Energy condition assessments

Inefficient homes are consuming significantly more energy than those with better values, increasing the strain on the national grid.

• Domestic Energy Consumption accounted for approximately 26% of energy consumption in the UK (ECUK) in 2024. In addition, 14% of total UK CO2 emissions were because of residential dwellings.
• According to the most recent UK housing survey datasets, just over 47% of homes in the UK meet the recommended EPC rating of C or above.*
• Average (median) fuel costs of A-C rated households are around three times less than those rated G.
• Smart energy system approach measures such as Solar PV can drastically reduce dependence on the national grid by supplying dwellings directly with ‘free’ energy.
• Renewable energy such as solar PV can drastically reduce dependence on the national grid by supplying dwellings with ‘free’ energy. However monetising some of the free energy is a clear opportunity for paying back investment. The EPC approach which focuses on cost does not currently differentiate whether residents receive the energy for free, or whether they have to pay for it.
• National Grid aims to be Net Zero across scope 1, 2 and 3 by 2050.

*Data from English Housing Survey Live Tables; Scottish House Condition Survey: 2022; Welsh Housing Conditions Survey; The Housing Executive, House Condition Survey.

SAP assessments are low-cost and accessible, yet give generic recommendations

• They’ve become the ‘standard’ for assessing retrofit suitability but have inadequate granularity to enable homeowners and landlords to take informed specific action.
• Assessments use outdated methodology and rely on visual inspections.
• Ratings are valid for 10 years and only dwellings that are newly constructed, sold, or let are required to have one, leading to a misrepresented and incomplete national dwelling database.
• National Retrofit Hub’s EPC Reform report states that 40% of homes do not have an EPC.

Listed buildings and those in conservation areas may be exempt.

• This is where meeting Minimum Energy Efficiency Standards (MEES) would result in unacceptable alterations to their historic character or appearance.
• Historic buildings might never meet A-ratings given the current methodology and restrictions regarding heritage building controls.

Reduced data Standard Assessment Procedure (RdSAP) is a more basic methodology used for older properties.

• Reduced data Standard Assessment Procedure (RdSAP) is a streamlined approach designed for existing or older properties where full data may not be available. It’s designed to be non-invasive and be carried out on buildings where the exact material properties in the building are unknown and based on construction data assumptions.
• Reduces time required to assess a property by making baseline assumptions.
• SAP calculations are much more detailed, and the precise performance of each ‘thermal element’ of the building (walls, floor, roof, etc.) is calculated using the manufacturers specifications for all the materials used in the build-up.
• Once a SAP rating runs out after 10 years, RdSAP methodology is used because the building is no longer classed as a new build.
• It is often found that a RdSAP EPC rating is lower than the original SAP EPC rating even if nothing has changed regarding building envelope or Energy Efficiency Measures (EEMs). This is due to the change in methodologies, from SAP to RdSAP.

Assessments are a critical tool for retrofit but EPCs are currently trying to fulfil multiple purposes for different audiences

• Assessments are critical for identifying dwellings suitable for retrofit, monitoring impact of government policies, and identifying opportunities for area-based and archetypal schemes to be applied.
• Yet EPCs are trying to fulfil multiple purposes for different audiences – for example, consumer information, government monitoring, eligibility -and lack a clear specific identity.

EPC values are publicly available but the data behind them is not.

• All dwellings with EPC values can be publicly viewed in a centralised UK database. This is based on dwelling address.
• Input data and output calculations are not currently publicly available on the database and so it is not possible to explore the assumptions made and adjust where necessary.

Scoring is based on a three-year rolling average price of the fuel used and the efficiency of the heating system.

• Property owners are incentivised to switch to or stay on the higher CO2 emitting cheaper fuels (gas fuel vs electricity conflict) MEES.
• Energy Efficiency Ratings (EER) are a measure of energy cost rather than efficiency as the score is calculated using the annual energy cost.
• EER is used to set policy targets rather than Energy Impact Rating (EIR), leading to reduction in carbon emissions not properly being prioritised.
• EPC ratings are therefore agnostic of whether fossil fuel or renewable energy is used, the objective of the rating is to assess the cost of heating the dwelling.
• Carbon emissions do not influence the headline EPC rating under the current system and are shown as supplementary information, despite the UK building stock accounting for 17% of CO2 emissions.

Variations and inconsistencies in surveyor dwelling ratings exist.

• This is a consequence of subjective judgement, building assumptions, and data interpretation and it’s estimated that 30% of properties in the UK are misclassified.
• Variations can be taken advantage of with some landlords being known to have manipulated or falsified EPC values to meet legal letting requirements.
• The SAP methodology, tailored for modern construction, fails to account for the characteristics of pre-1919 buildings, due to assumptions surrounding U-values, thermal bridging and construction techniques.

Assessments tend to focus individual measures in isolation.

• Rather than taking a systems approach, which explores the relationships between measures in order to maximise measure effectiveness, current assessments look at insulation, heating, smart homes technologies etc in isolation.
• This overlooks critical details such as moisture, ventilation and thermal bridging required for comprehensive retrofit.

Occupant behaviour and real energy use is not considered in energy condition assessments for calculation.

• Instead, an assumptions-based model derived from standard occupancy trends, heating patterns and building use is used. This distorts the actual energy performance of a home or other building.

There is often a gap between as-designed vs as-built thermal performance. 

• This is known as the ‘building performance gap‘ and is a fundamental challenge to achieving net-zero targets.
• Measured performance can therefore refine EPCs and make them significantly more relevant and accurate. This is one of Energiesprong UK’s key recommendations for EPC reform.

In this section, we outline key ideas, approaches, measures and policies for shifting towards a thriving retrofit eco-system that can deliver home energy upgrades at speed and scale. All points are drawn from project research and consortium partners’ experience.

An ideal future state for energy condition assessments may include:

Improved standards including BS 40104

This is an upcoming standard that will aim to provide a comprehensive guide to assessing homes before retrofit in the UK. It will be a major evolution in how energy condition assessments are conducted, taking a whole house focus by including:

• Occupancy analysis
• Climate resilience
• Ventilation
• Condition
• Building context (dwelling archetype, suitability, constraints, location etc)

Focusing on data-driven decisions

• By equipping homes with more digital tools such as smart sensors or thermal imaging, we could enable gathering of actual dwelling specific performance measurement data – improving accuracy of ratings and improving energy-efficiency measure solution matching.

Improve the recommendation section on EPCs

• Recommendation section on EPCs could include a much wider range of measures, more accurate costs and more realistic estimated outcomes based on specific dwelling and occupant characteristics.
• All costs associated in the retrofit should be fully accounted for and detailed, for example in-depth surveys, planning applications and other associated costs for interventions to upgrade EPC rating.
• Assessments provide homeowners with recommendations on how to lower their emissions.

EPC ratings to assess occupant behaviour and their impact on energy performance

• The priority should however always be the dwelling, as a tenancy might be short term with a high turnover of residents. Retrofits must take a generalised approach in these instances to avoid tailored approaches which quickly become outdated.

Home Energy Modelling (HEM) is due to replace SAP methodology in 2025 to demonstrate that new dwellings comply with the Future Homes Standard.

• HEM delivers a half-hourly dynamic simulation of home’s energy use, carbon emissions and running costs.
• It ensures that assessments better reflect real-world performance and emerging low-carbon technologies.
• 2026 will see full rollout of HEM-based EPCs across England, Wales and Northern Ireland.

Energy condition assessments should contain bespoke energy-efficiency measures and site-specific considerations

• Each dwelling’s assessment could include specific information for that home rather than generic universal advice – for example, accounting for exposure, topography, climate risks etc.

Adoption of post-retrofit completion evaluations

• This will help verify the effectiveness of EEM and building performance to help refine assessment tools and improve future retrofit planning.
• Period that EPCs are valid shortened from 10 to 5 years to make it easier for them to be updated and reflect recent renovations and degradation in building performance, plus investigate issues surrounding maintenance of systems.
• Address the skills gap in the energy modelling of dwellings with improved quality assurance and skills training – ensuring workmanship/installation errors are addressed and the ‘performance gap’ is minimised.

Overhaul the centralised assessment database to support local authority’s planning

• Adding detailed data to facilitate the development of area-based retrofit strategies with targeted funding streams.
• Ensuring each dwelling has its own Digital Passport for general product and material data.
• Allowing data captured from various sources, such as Energy Condition Assessments, to be accessible to the public.

Widespread adoption of Heat Transfer Coefficient (HTC) assessments 

• In-situ testing in the form of widespread Heat Transfer Coefficient (HTC) assessments can measure the heat loss from dwellings to understand real-world performance.
• HTC provides actual performance that can be used to challenge or validate existing modelled assumptions. It is especially useful for challenging assumptions in non-standard homes or pre-1919 dwellings.

Change to a Fabric Rating that measures space heat demand intensity in kWh/m2/yr

• This can discourage low cost/high carbon energy and reflect true building efficiency.

Incorporate a carbon metric 

• Homes with the same EPC rating can have very different carbon footprints. Incorporating a carbon metric could highlight the importance of dwelling CO2 emissions and accelerate UK housing decarbonisation.

Enablers

• Development of national training programmes for retrofit assessors and coordinators to address the shortage in skilled surveyors and increase the quality of assessments.   

• Adoption and mandating of BS 40104 Assessment of dwellings for retrofit to standardise and future-proof the retrofit assessment process, aligning it with the UK’s NZ2050 ambitions. 

• Public access to input data and output worksheets would enable portfolio level analysis and help improve retrofit planning. 

Key insights

• EPCs currently have massive implications on mortgages and the ability to let a property. People can find themselves paying tens of thousands of pounds based on an EPC assessment that is simply wrong. 

Rules

• Must consider transition from SAP to adopting HEM 

Questions

• How can we increase engagement and understanding of energy condition assessments to homeowners within the UK? 

• What needs to be put into place to address the energy performance limitations in historical and dwellings in conserved areas in which EMM’s cannot readily be applied to? 
• How is this measured at a portfolio level? 
• Can there be an occupant strategy for social housing to pair tenants with appropriate dwellings based on their occupant behaviour?