The remaining potential for energy savings in UK households

Progress on improving energy efficiency of UK homes has stalled in recent years and the question arises how much more potential for further energy savings exist across the housing stock. Whilst there are some high-level estimates of the potential for buildings energy efficiency in the UK, a more granular assessment is needed to understand exactly where this potential lies and what form it takes. Our analysis fills this gap. It is based on the best available evidence on the remaining potential for energy efficiency improvements within UK residential buildings. Using UK government criteria for investment appraisal, we demonstrate that there is a significant resource of untapped energy-saving opportunities in UK homes. Specifically, our estimates suggest that: one quarter of the energy currently used in UK households could be cost effectively saved by 2035; and this could increase to one half if allowance is made for falling technology costs and the wider benefits of energy efficiency improvements. However, these estimates are sensitive to the assumptions made about capital, energy and carbon costs, and capturing this potential will require both significant policy change and large-scale investment.