Decarbonising housing associations’ homes to cost £36bn, according to National Housing Federation

19 October 2021

The National Housing Federation (NHF), which represents housing associations in England, has today revealed that the costs of decarbonising its existing housing stock will cost at least £36bn.

The research, done by Savills, comes alongside the launch of the NHF’s vision for how its sector can reach net zero by 2050 in its new report, Decarbonisation: a guide for housing associations.

With emissions from housing association homes contributing the equivalent amount of carbon as the annual use of 1.8m cars, the sector has a vital role to play in helping the government achieve its net zero ambitions. The guide sets out a suggested pathway for housing associations to meet the challenge, making their existing homes not only greener, but also more comfortable and cheaper to heat for residents.

While housing association homes are already the most energy efficient in the country, the guide sets out ambitious plans to go further. It prioritises a “fabric first” approach, which will increase energy efficiency as well as futureproofing the homes for clean heat installation. The guide demonstrates that this approach will also have the immediate benefits of bringing down energy bills for residents and reducing carbon emissions.

The £36bn would cover the costs of bringing the 39% of housing association homes which need to be brought up to EPC C, as well as installing heat pumps and other clean heat technologies in all 2.7 million homes.

Kate Henderson, Chief Executive of the National Housing Federation, said: “It’s clear that urgent action to tackle the climate crisis must be taken, and that the decarbonisation of our homes must be at the heart of our efforts. Our members own and manage almost three million homes, and with this they are uniquely placed to help the country reach this critical net zero target by retrofitting homes at scale and pace. This work will also provide a once-in-a-generation opportunity to invest and level up communities across the country, and ensure homes are warmer and more affordable for residents.

“But we can’t do it alone. While housing associations are already planning to invest £70bn in futureproofing their homes, our new estimates demonstrate that full decarbonisation by 2050 will cost an additional £36bn.  The NHF is committed to working with the government and industry to come up with a strategy to ensure that the full costs of net zero can be met long-term. For now, the government could help us make significant progress by delivering on its manifesto pledge and bringing forward the £3.8bn Social Housing Decarbonisation Fund in the upcoming Spending Review. 

“It’s not all about investment, either. Housing associations need direction from government on everything from what fabric standards will be necessary to support clean heat, how we can accurately measure decarbonisation, and crucially reform of electricity pricing to ensure new heating systems don’t lead to higher bills. Without policy change to bring down the costs of electricity, we would need a much higher standard of insulation to keep fuel bills affordable.”

John Kiely, Director in the Savills Affordable Housing Team, said: “These costs are an early estimate and the range we have provided highlights the uncertainties we face between now and 2050. The £36bn cost of the base scenario relies on technology improvements and policy changes to avoid increasing fuel poverty. If these improvements don’t materialise then we would expect costs could be much higher. The challenge between now and 2050 will be getting the right balance between appropriate measures, cost benefits and investing in the right stock.”


For further information please contact: 

Jess Reid, PR Officer, National Housing Federation, 0207 067 1064 / 07881 860 198

(out of hours 07786 916 877)   

Notes for Editors:

The National Housing Federation is the voice of affordable housing in England. We believe that everyone should have the home they need at a price they can afford. That’s why we represent the work of housing associations and campaign for better housing.

Our members provide over two and a half million homes for six million people. And each year they invest in a diverse range of neighbourhood projects that help create strong, vibrant communities.

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