Education gap on energy efficiency still exists, says Santander

Borrowers have little knowledge of EPCs

There is still a lack of understanding among homeowners of what Energy Performance Certificate (EPC) ratings are, according to financial services provider Santander UK.

Its Buying into the Green Homes Revolution report has found that only two in five (42%) homeowners knew what their EPC rating is, suggesting an education gap on energy efficiency.

Over half (53%) of the surveyed homeowners also said they could not afford the average £10,000 needed to retrofit their home, leading to inaction that made the government’s target of getting the UK’s housing stock to an EPC rating of ‘C’ or above by 2035 more challenging.

Meanwhile, only 6% of UK mortgage brokers reported encountering clients who regularly asked about energy efficiency, while over half (58%) of them said that clients never ever mentioned it.

However, homeowner awareness and engagement was growing, with seven in 10 (70%) saying that in the past 12 months, they had become more alert to the importance of energy efficiency, due to soaring energy costs.

This was where mortgage brokers were primed to help, Santander said, as 99% of mortgage brokers knew what EPC stood for, compared to only 42% of homeowners, illustrating brokers were more informed on energy efficiency and better able to guide and educate homeowners through their retrofitting plans. Six in 10 (61%) brokers also said they were clued up on current green products and future regulatory changes.

The Santander reports also showed that three-quarters (77%) of brokers were highly supportive of an increase in grants for households which could not afford to make necessary improvements. In addition, seven in ten (70%) brokers pointed to tax incentives, such as a stamp duty discount on energy efficiency homes, which might act as a useful driver of activity.

Brokers were also keen to see the government provide more education to the public, with almost three in five (58%) believing this would encourage more action among homeowners.

Graham Sellar, head of business development for mortgages at Santander, commented that with 21% of the UK’s carbon emissions coming from housing, the government and the housing industry needed to work together on the crucial challenge of retrofitting homes, if the UK is to achieve its net zero gas emissions target by 2050.

“Brokers will play an important role in the industry’s ability to rise to this challenge: from educating homeowners on the benefits of improved energy efficiency, to supporting them with funding their home’s retrofitting journey,” Sellar said.

“As the costs of living pressures continue to hit many homeowners, a high energy efficient property can bring savings of up to 52% on energy costs a year, so ensuring those looking to buy or remortgage understand EPC ratings and how they can improve their energy efficiency can potentially provide real cost savings to homeowners.”


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