Steven Heath, Technical Director at Knauf Insulation Northern Europe, looks at the goals of the Warm Homes Plan and how we might just make a success of it.
Let’s deal with the first bit: ‘Why it won’t work’. Media headlines have attacked the government’s plan for warmer homes as not certain to save households money nor deliver warmer homes. Essentially, a ‘green plan’ dressed in ‘cost of living’ clothing.
It’s not a hard case to make. The foundation of the plan is a shift to low-carbon heat – heat pumps can be 4x as efficient as gas boilers. A magic trick negated by the 4x higher unit cost of electricity than gas. So, for a £7,500 heat pump grant and likely equivalent cost for a householder the home is no: warmer, more Comfortable or Affordable than before. But it is Lower Carbon… (the CAPITALs will be explained).
The Warm Homes Plan (WHP) attempts to counter this failing with additional tech… “an offer for everyone: with grants and loans to make it easier than ever for homeowners to install heat pumps, solar panels and batteries”. So direct subsidy, or subsidised loans, for generation and storage too.
The Treasury is asked to take a big hit per home for what outcome? For those householders benefitting from this full package the home is still no more Comfortable, but is likely to be, but not guaranteed to be, more Affordable and Lower Carbon.
Why not ‘guaranteed to be’? First up, the 4x efficiency of heat pumps is an ideal outcome. The technology is capable of this (see HeatpumpMonitor.org), but the complexity of install, commissioning & poor accuracy of heat loss assessment tools has seen large scale studies showing homes falling well short of this 400% efficiency level.
Advocates such as Octopus Energy point to Time of Use tariffs as a route to ensure lower bills. Households with the trio of tech can be flexible, adapting their time to heat to when electricity is cheap or the battery is available. However, Energy System Catapult’s Electric Vehicle overnight demand peak paper outlines herding behaviour which challenges the presumption there will always be a cheap time to heat.
So, what risks might the Warm Homes Plan leave with householders?
· Heat pumps falling well short of target efficiency levels = higher bills or colder homes.
· No cheap time to heat as electric vehicles penetrate the market leaving home heating having to compete with EV charging = higher bills or colder homes.
· Failure to drive basic energy efficiency measures to lower heat demand especially at peak winter periods (attacking this peak should be a national priority) = higher bills and higher network costs = still higher bills
· High net zero network upgrade costs loaded onto electricity bills = higher bills
· Very high replacement cost for technologies like Heat Pumps at end of life = high-cost technology lock in.
Clear counter arguments for staying on gas are real: climate change, wholesale gas price spikes as seen in recent energy crisis. So, the need to act is there. Why the WHP will fail is because many wanting to address the very real risks of continuing to heat our homes with fossil fuels have drunk the Kool-Aid. They have chosen to believe those claiming the above risks to householders of a large-scale heat transition aren’t real.
My view is born out of repeat experience of previous retrofit schemes that have had their successes (e.g. 30% reduction in median domestic gas demand between 2005-2013) but are too often defined by their failures. One or more of the dangers identified will sink the plan under the weight of negative headlines. In short, there is little in the Warm Homes Plan that will manage the highlighted risks. BUT there is not ‘nothing’.
Why…might the WHP work?
Firstly: What are we trying to achieve? Comfortable, Affordable, Low Carbon homes that can be shown to be that. CALC is an acronym born out of my boss refusing to accept as acronyms go it is a bit rubbish. But it gets to the heart of what the WHP must focus on. The plan needs to build the faith with householders that their:
1. heat pump can operate at high efficiencies.
2. home fabric is as efficient as promised after insulation install.
3. indoor comfort is not compromised, and is ideally improved, by the above.
Evidence the above outcomes are delivered all the time, every time, might even persuade households that can afford it to use their own money to pay for upgrades. Only when this is true, will the political space to transition from subsidy to regulation exist.
How can these outcomes be demonstrated?
The answer is every home needs access to a CALCulator. A tool that measures how Comfortable, Affordable and Low Carbon their home is…especially after insulation or a heat pump is installed. Providing the means for households to know where their home sits on the red and green boxes in our ‘Affordability Equation’ (see title image), is to genuinely manage risk on occupants’ behalf.
Pretending you can ignore the size of the red box, fail to measure the green box and hope the blue box will do all the heavy lifting to lower bills is beyond naive. Yet one leading heat pump installer would not allow me to install a heat meter at my cost – an action that would at least tell me my green box rating if not the red box. Their policy it seems is to keep people in the dark and perhaps cold.
The responsible action: measure the red box, & commit to lower heat demand through well-installed insulation where possible and offer measurement of the green box too. Even better, guarantee outcomes linked to each box. Then you have a home very well-placed to exploit time-of-use tariffs.
Do CALCulators exist? Government calls them SMETERs (another questionable acronym). SMETERs, or at least Knauf Energy Solutions’ (KES) SMETER, will tell you where your home – new or retrofitted with heat pump or insulation – lands in our affordability equation. KES’ sensor & AI driven dashboard will tell households where their home sits in the red box, and the green box… it will offer a mould risk analysis too (based on where genuine risks are rather than just a single sensor in a hallway). In short it will offer up a CALC, a robust view of your home’s Comfort, Affordability and Low Carbon rating.
Could SMETERs be the key?
So much, so advertorial (KES are yet to be convinced of my CALCulator branding). Why might these tools save the Warm Homes Plan? Deep in the plan and accompanying EPC Reform feedback is a role for SMETERs:
‘Smart Meter Enabled Thermal Efficiency Ratings (SMETERs)… can make the real thermal performance of homes visible in ways that have not before been possible. They can be used to help tailor fabric and clean heat retrofit measures installed in homes, identify hidden defects for remediation and drive installation quality.’
‘The government would work with interested parties to develop detailed processes whereby a SMETER HTC estimate could be included within the Energy Performance Certificate system. This includes work to assure the accuracy of measurements.’
So far, so positive:
- DESNZ are setting up a SMETER ‘validation facility’.
- DESNZ will assess accuracy of existing SMETERs through that facility.
- EPC Reform will allow any landlord or householder to request a measured HTC from an accredited SMETER.
- DESNZ will build a mechanism to store that measured HTC in the EPC system.
- DESNZ will work with the HEM team to allow that measured in-use HTCs to be plugged in to create an in-use EPC.
What is not yet clear is whether that SMETER measured HTC will be required, regulated, subsidised or incentivised through the Warm Homes Plan and linked retrofit schemes.
The Warm Homes Plan believes low carbon heat is the platform on which our homes will be transformed with success defined by heat pump install rates. If install rate is the focus – with no reference to how well they are performing – the plan will fail. Brought down by the weight of higher-than-expected bills, or an energy crisis meaning cheap time-of-use tariffs are pulled from the market (as Ovo’s recently was), or perhaps a price inflation war waged between heating and car-charging won by those with the deepest pockets.
Where the plan might just succeed is if the platform for the transition is built on verified outcomes, or CALCulations, that manage the risk of a rubbish outcome on occupants’ behalf. Yes, allow occupants to access grants and subsidised loans for the technologies that can attack both the red and green boxes like heat pumps and insulation but also drive access for the CALCulators that show retrofit performance. Then rather than focus solely on the number of technologies installed, let policy set the required endpoint in terms of CALCulation efficiency required of each install. Outcome-based policy rather than picking technology winners and crossing fingers they work.
In the next 6-9 months we will see if our CALCulator and other SMETERs are offered the opportunity to de-risk retrofit. In Government’s own words this technology ‘can make the real thermal performance of homes visible in ways that have not before been possible’. For the first time, government has a chance to get ahead of the criticism; to proactively measure, evaluate, and improve outcomes. What will their CALCulation be?
To hear the latest on the Warm Homes Plan, join thousands of construction professionals at InstallerSHOW 23-25 June at the NEC. Register here: forms.reg.buzz/installer-show-2026
