Low awareness of property EPC ratings costing homeowners thousands

• New research from Atom bank has found over half of homeowners don’t know their property’s Energy Performance Certificate (EPC) rating despite many believing it can reduce bills and boost property value
• The majority of homeowners believe improving their home’s EPC would cost them over £25,000
• In reality, moving from EPC D to EPC C could cost homeowners as little as £1,500 while saving them £550 a year on energy bills
• Atom has partnered with Kamma to launch the Retrofit Explorer tool, helping households to improve energy efficiency and cut costs

Atom bank, the UK’s highest rated bank on Trustpilot, has today released new research which highlights a significant knowledge gap among UK homeowners when it comes to Energy Performance Certificates (EPCs) and the cost of retrofitting.

The data reveals that over half (53%) of homeowners are unaware of their home’s EPC rating, and three fifths (62%) admitted to having a low or no understanding of the system¹. Despite this, the majority (68%) of homeowners still think improving EPC ratings is a worthwhile investment, recognising the potential to save on energy bills and improve the value of their property.

An EPC states how energy efficient a property is, and you must have one when you’re selling, renting or building a property. The certification is valid for 10 years and contains information about a property’s energy use and typical energy costs, as well as steps to improve a property’s energy efficiency and save money.

Lower rated buildings are less energy efficient, leading to higher heating demand, increased energy usage, and elevated costs. The majority of homes in the UK are rated EPC D, with annual energy bills averaging £2,471, £723 more per year compared to EPC C rated homes².

Why retrofit?

Retrofitting - the process of updating a building with new features or technology to improve its energy efficiency and sustainability - can boost property values by an average of 12%³. This means homeowners benefit not only from lower energy bills, but also long-term increases in property value.

However, despite the potential cost savings, Atom’s research found that less than half (44%) of homeowners have undertaken or plan to undertake retrofitting, citing the upfront cost as a major barrier. This is no surprise, given the majority of homeowners (63%) believe that making improvements to their home through retrofitting would cost over £25,000. The Government has already recognised this issue as it considers plans to subsidise the cost of fitting solar panels and batteries for millions of homeowners, as part of its ‘Warm Homes Plan’.

While 29 million British homes need retrofitting by 2050, homeowners struggle to find clear information about their EPC rating and improvement options. This lack of accessible information often leads to an assumption of high costs, hindering retrofitting efforts. For example, for the many homeowners in the UK who may be looking to move from an EPC D to a C, Atom’s retrofit tool indicated that this could actually be done for as little as £1,500, a 94% reduction from the £25,000 many assume it might cost.

Introducing the Atom bank Retrofit Explorer

To address the challenges and misconceptions around EPC ratings, Atom has partnered with data firm Kamma to launch a Retrofit Explorer tool. The tool helps homeowners to better understand their current EPC rating and offers a tailored plan for how it can be improved through retrofitting or other means. Once the plan has been generated, the tool then suggests local tradesmen who can carry out the work. Atom’s research shows that a large number (44%) of homeowners would be more likely to retrofit their home if provided with a tailored plan and supplier suggestions, highlighting the need for better resources and guidance.

Unlike standard EPC information, the tool generates personalised retrofitting recommendations based on individual property needs. Homeowners can easily adjust their plan based on their budget, allowing them to lower the costs of the retrofitting work by as much as 67% when compared to standard suggested EPC certificate improvements alone⁴. It also provides estimates of energy savings achievable through recommended upgrades so homeowners can weigh up the benefit of the upgrades.

Edward Twiddy, Director of ESG at Atom bank, comments: “Millions of homes could benefit from retrofitting, yet EPC ratings and the associated costs are widely misunderstood by homeowners. Part of the issue is that there is a current lack of information and guidance available on how to make improvements, which promotes inertia. As many of us face sub-zero temperatures, January is the perfect time for homeowners to consider how retrofitting can help them keep their homes warm while cutting energy costs.

“The launch of our new Retrofit Explorer tool makes it easy for homeowners to put together a tailored plan and for a relatively small amount of money they could save themselves hundreds of pounds a year in energy costs. Given that retrofitting homes to improve efficiency is a key part of the Government’s plan to achieve the UK’s net-zero goals, we think tools like this will have an important role to play in helping homeowners on this journey.”

Atom reduces operational carbon emissions

As part of its ongoing commitment to sustainability, which coincides with the launch of the Retrofit Explorer tool, Atom has also published its 2023/2024 Carbon Report. Publishing the Report for the third year, Atom has announced a 12% reduction year on year for CO2 equivalent per full time employee (FTE) for all of the bank’s 504 employees. For the first time this year, Atom has also reported on its funded emissions, covering both residential and commercial mortgages, and set its ambitious target to be climate positive by 2035.

ENDS

Notes to editors

¹ Research conducted 19 November 2024 by Atom bank among 500 homeowners in the UK

² Rightmove Monthly Energy Tracker, data published on price cap October 1st 2024

³ Kamma meta analysis of 12 separate studies into the impact on energy efficiency on asset value

⁴ Kamma analysis of property improvement

For Lansons

Sorcha Hornett, sorchah@lansons.com 07712 805191

For Atom

Robbie Steel, robbie.steel@atombank.co.uk 07538 775 701

About Atom bank

Atom bank is the UK’s first app-based bank, on a mission to make the experience of borrowing and saving faster, simpler and better value than anyone else.

The bank launched operations in April 2016, and offers award-winning mortgages and savings through its app, alongside secured business lending for small and medium-sized enterprises.

Based in the North East of England with a team of over 500 people, Atom is here to ​​change banking for the good, for the better, and for everyone. This means focusing on customers’ needs, delivering better value than the incumbents, providing an exceptional app-based experience and offering award-winning customer support via phone, chat, email and social channels. The bank has some of the best customer service credentials in the UK, having achieved 5-star ratings on both the iOS and Android App Stores, and on Trustpilot, whilst consistently delivering Net Promoter Scores (NPS) in the high 80s.

Based in Durham, Atom is an engaged and active member of the North East Community. In 2022 Atom signed a five-year Memorandum of Understanding with Durham University to progress key research and diversity initiatives. The region has one of the highest levels of youth unemployment in the UK and Atom is passionate about addressing the critical digital skills gap and helping develop young people and other groups that are under-represented within the industry.

As of November 2021, all employees enjoy a four-day working week, after Atom became the largest company - and only bank - in Britain to introduce the policy for all employees, with no reduction in salary.

The Atom executive team are highly experienced, having built and run some of the most well-respected banks in the UK. CEO Mark Mullen has 30 years’ experience in the sector and was previously CEO at the multi-award-winning telephone and internet bank First Direct. The team is supported by a strong non-exec board, chaired by Lee Rochford.