Retrofitting Homes Could Save NHS England £1.4 Billion, New Report Finds

Improving the energy efficiency of homes in England, while accelerating the transition to electric cooking and heating systems, could deliver significant public health benefits and save the NHS nearly £1.4 billion by 2050. These findings come from a group of researchers commissioned by the UK Government to explore how decarbonising homes could impact public health.

The study focused exclusively on England, since housing and energy policies are devolved matters across the UK. Researchers examined the outcomes of two major shifts: improving energy efficiency and transitioning away from fossil fuel-based appliances, such as gas boilers and cookers.

The numbers are striking. Swapping gas cookers for electric alternatives in 14 million homes could save the NHS around £170 million over the next quarter-century. A broader rollout of electric heat pumps could add another £300 million to £900 million in savings. That’s partly because heat pumps help keep indoor temperatures slightly warmer, by about one degree Celsius, on colder days.

One of the key advantages of this transition is the impact on indoor air quality. Gas appliances contribute to indoor pollution, including delicate particulate matter known as PM 2.5. By switching to electric cooking, the researchers estimate a 25% reduction in exposure to these harmful particles.

Better Buildings, Better Health

Upgrading the physical fabric of homes is also crucial. Complete retrofits — such as adding wall insulation, loft insulation, double glazing and ventilation — could save the NHS another £300 million by helping to maintain healthier living environments.

While the analysis did not assign a value to adapting homes to extreme heat — such as using shutters or creating shaded urban spaces through better planning — researchers believe the total savings could still range between £770 million and £1.37 billion.

Where Policy Is Falling Short

Despite the potential benefits, progress remains slow. According to the Climate Change Committee, as of 2024, only about 1% of UK homes had installed a heat pump, placing the country near the bottom of the European rankings.

Efforts to improve energy efficiency have also been inconsistent. Stop-start policies, unclear responsibilities, and shifting government priorities have hampered momentum. The Climate Change Committee reports that, as things stand, the UK only has credible plans to achieve 38 per cent of the emissions cuts it is legally required to meet by 2030.

A new Warm Homes Plan is expected from the government later this year. Backed by £13.2 billion in funding, the plan will include grants for retrofitting social housing and low-income households. It is also expected to expand support for heat pump installations by covering a portion of the upfront cost.

However, the Committee argues that more profound structural changes are necessary. One proposal involves shifting legacy policy costs from electricity bills to either gas bills or general taxation. This move could reduce the price ratio between electricity and gas from around four to one to something closer to two or three to one, aligning the UK with countries like Ireland and France.

A more balanced energy pricing model would not only encourage the adoption of electric heating and cooking, but it could also support the uptake of electric vehicles.

Finally, the Committee is urging an update to the Future Homes Standard to prevent new housing developments from being connected to the gas grid. That change alone could eliminate the need for costly retrofitting in the years ahead.