Developing regulation of energy efficiency of private sector housing (REEPS): modelling improvements to the target stock - Main Research Report

4 Methodology For Modelling Improvements

4.1 In this section, we provide an overview on the identification of the potential measures that were selected for improving the energy performance of the 355 archetypes, and the evolution of the hierarchy for determining the basis for selecting which improvements were modelled to meet different SAP energy banding improvement targets. The modelling was completed using a SAP 2012 program, however, the approach used was developed to be consistent with RdSAP conventions so that the results could be replicated using a RdSAP 2012 program.

Improving the energy performance of the 355 selected archetypes

4.2 With the establishment of the typology and the identification of the 355 archetypes, the next stage of the project involved modelling the energy performance of each of the individual archetypes before improvement, identifying and modelling the range of measures to improve their respective energy performance, and evaluating the impact of the various improvements.

4.3 Prior to modelling each of the 355 archetypes, a preliminary analysis of two sample dwellings was carried out with the intention of:

• identifying the energy efficiency improvement measures to be modelled for the dwellings to be improved, both single measurements and packages of improvements;
• assessing the impact of these measures on improving the energy efficiency of the dwellings to be improved;
• evaluating the impact, cost and cost effectiveness of these measures for the dwellings to be improved.

4.4 This analysis was used to inform the basis of establishing a hierarchy for applying upgrades across the poorer energy performing parts of the Scottish dwelling stock. Various approaches to establishing this hierarchy were explored in this analysis, including impact of the improvement on energy ratings, lifetime cost savings, carbon dioxide emission reductions, and returns on investment. These are discussed in more detail below. As an important consideration would be the cost to the public of meeting any standard, the lowest indicative cost of achieving the agreed target standards became the basis of identifying the improvement packages for each archetype. The final decision on the hierarchy to be applied was taken by the REEPS Research Advisory Group (RAG).

Base data

4.5 The base data used in this energy modelling was extracted from the 2010 to 2012 SHCS data sets, for each dwelling. The SHCS has been designed to collect the necessary data to enable its analysis to emulate an RdSAP assessment of each property surveyed since the introduction of Energy Performance Certificates (EPCs) on the existing dwelling stock in 2009. A sample of the data extract is set out in Appendix 11.

4.6 At the time that this modelling was being carried out (i.e. during the latter half of 2014) it was known that the version of RdSAP being used in the production of EPCs in the UK would be changing from RdSAP 2009 v9.91 to RdSAP 2012 v9.92^[30] (see Appendix 6). No approved RdSAP 2012 v9.92 software was available at the time. Rather than carry out the analysis with RdSAP 2009 v9.91 software, and then attempt to convert it to version 9.92 later, it was agreed with the REEPS RAG to carry out the analysis using a full SAP 2012 v9.92 software program^[31].

4.7 The use of a full SAP program necessitated additional work to convert the SHCS data set for an archetype into a format that was compatible with the data entry requirements of the SAP program, which are different than those of an RdSAP program^[32]. The intention was to keep the SAP assessment as close to the RdSAP assessment as possible. As a cross check of this process, the first cohort of 12 modelled archetypes were also entered into both an approved full SAP 2009 v9.90 program and an approved RdSAP 2009 v9.91^[33] program, and the results from the two programs were within 1 SAP point in all 12 cases, which is within the accepted ±4 SAP point error bar applied to the SAP and RdSAP program approval process. Appendix 11 sets out this process in more detail.

Potential improvement measures

4.8 The list of potential improvement measures that were applied to the 355 archetypes was collated from a variety of sources, including:

• the Energy Efficiency Standard for Social Housing (EESSH)
• Appendix T of SAP (that is, the measures that appear within the energy advice report section of the EPC, and the conventions governing their inclusion)
• Appendix V of SAP (that is, the measures that are eligible through Green Deal financing)
• measures potentially included within Energy Company Obligation (ECO)
• measures eligible under the Renewable Heat Incentive
• the various strands of the Home Energy Efficiency Programme for Scotland (HEEPS).

4.9 Additionally, account was taken of suggestions from the REEPS RAG, and the measures assessed in another recent report^[34]. While there was a lot of overlap between the measures drawn from these various sources, there were also differences. The resultant list of potential 38 improvement measures encompassed insulation, ventilation, heating, hot water, space and water heating controls, renewables, and other energy saving improvement options.

4.10 By being cognisant of the measures included within the Green Deal, Energy Company Obligations and the Renewable Heat Incentive, there is potential that some of the proposed improvement to raise standards within the private sector dwelling stock may attract funding from these various schemes. However, the intention of this report is not to limit its exploration of improving the poorer energy performing dwellings to only those measures where grant funding is currently available, or presume that any grant funding will be available in the future.

4.11 The insulation measures included:

• loft insulation, including top-up loft insulation (M1)
• flat roof insulation (M2)
• room in the roof insulation (M3)
• cavity wall insulation (M4)
• solid wall insulation (M5)
• floor insulation , both beneath suspended timber floor insulation, and insulation on top of solid floors (M6)
• double glazing (M7)
• secondary glazing (M8)
• triple glazing (M9)
• insulated external doors (M10)
• hot water cylinder insulation jackets M11)

4.12 The ventilation measures included:

• draught proofing of windows, doors and loft hatch as necessary (M12)
• fit baffles / dampers to block open chimneys when not in use (M13)

4.13 The heating measures included:

• replacement / renewal of an existing gas, oil or LPG central heating boilers with condensing boilers (M14 and M15)
• new gas central heating system (where none before) (M16)
• new oil or LPG central heating system (where none before) (M17)
• biomass central heating system (M18)
• fan-assisted electric storage heaters (M19)
• high heat retention electric storage heaters (also referred to as Quantum storage heaters) (M20)
• direct electric heating appliances on an off-peak tariff (M21)
• electric thermal store (CPSU) wet central heating system (M37)
• air source heat pumps (both air-to-water and air-to-air systems) (M22 and M35)
• ground source heat pumps (M23)
• replacing the secondary heating with a more efficient / appropriate appliance (M36)

4.14 The space and water heating control measures included:

• fitting central heating controls such as room thermostats, programmers, and thermostatic radiator valves either individually, or as a package of controls (M24, M25, M26 and M27)
• fitting a cylinder thermostat on the hot water cylinder (M34)
• switching from manual charge control to automatic charge control for electric storage heating (M28)

4.15 The renewables or low carbon technology measures included:

• solar hot water (M29)
• photovoltaic panels (PVs) (M30)
• wind turbines on the roof top (M31)
• wind turbines on a stand-alone mast (M32)

4.16 The switching of electric storage heaters from a traditional off-peak tariff onto one of the 24-hour tariffs or electric radiator systems to an Economy 10 tariff were included as a measure (M38).

4.17 Switching to 100% low energy lighting within a dwelling was also included (M33).

4.18 Two measures that were considered (i.e. fitting shutters to single glazed windows, and the fitting of radiator panels) were not included in the final modelling as they do not have conventions within SAP or RdSAP on how they should be included within the models, or how their impacts would be modelled.

4.19 Not all of the 38 potential improvements were modelled for every dwelling type. In some instances the dwelling may already have the improvement installed. In others, the improvement may not be applicable (e.g. loft insulation in a ground floor flat or floor insulation in a top floor flat). Some of the measures are mutually exclusive, e.g. various new and replacement heating systems. In some instances, a potential improvement measure was not recommended, usually because it would have reduced the energy performance rating (i.e. the SAP score) of the dwelling. A more complete description of each of the 38 improvements is set out in Appendix 2, including descriptions of when the measures were recommended or not recommended.

4.20 Another issue to note here is that all of the above improvement measures are asset-based, that is, they relate to improving the energy performance of the dwelling as measured by the EPC energy efficiency rating (i.e. the SAP score). There is nothing included here for energy advice, which should be an integral feature of any improvement programme, or better information being made available to householders (for example, fitting smart meters). Again, neither SAP nor RdSAP include protocols for assessing the impact of energy advice.

4.21 Most of these technologies and the techniques for applying or installing these technologies, are well known within the heating and insulation industry, and have been installed in Scotland for many years. However, not all of these measures will be applicable to a particular dwelling, for example, due to its construction, or its location, or its particular circumstances^[35]. Improvement packages for listed buildings, and those in conservation areas, may need to deal with specific design issues if they are going to achieve the potential savings reaped elsewhere.

4.22 Whether a package is affordable, is cost effective, or is acceptable locally (because it may change the external façade of a dwelling) are different questions. These issues can be illustrated by the common use of the term 'hard to treat' dwellings with regard to upgrading a dwelling's wall insulation. The term is (mis)applied commonly to categorise various wall constructions of both traditional and non-traditional constructions, so that the term can apply equally to traditional solid brick and stone wall dwellings, as well as the wide variety of non-traditional metal-frame, timber frame, and concrete-built dwellings^[36]. However, most of these wall types are not 'hard to treat' per se. For example, wall insulation techniques have been used in Scotland for over 30 years to improve just these types of dwellings. There may be specific technical issues to ensure the design of the insulation is technically appropriate for specific dwellings or wall constructions, but they can be insulated. The real issue is usually that these dwellings are 'expensive to treat' when compared against the cost of installing cavity wall insulation in a dwelling. Certainly, there may be issues with regards to the aesthetics of changing the external facades of our dwelling stock, but these are social, planning or local issues, not technical issues.

4.23 Again, some of the improvements may be disruptive for the occupants. That was not a consideration in the modelling, but would certainly be a consideration for householders when contemplating improving the energy efficiency of their dwellings.

Establishing a hierarchy of measures

4.24 It would be relatively straightforward to establish a hierarchy of improvements if the impact on energy efficiency or the increase in the SAP energy efficiency rating was the only issue of concern. However, the various measures are very different in terms of their capital costs which are not necessarily reflected by their impact on the improvement in energy efficiency or the SAP rating. Further, other political priorities are also in play. There is an EU obligation to generate 20% of our energy from renewable resources. The government has an obligation to reduce fuel poverty by 2016 by as far as reasonably practicable. The Climate Change (Scotland) Act 2009 sets out the Scottish Government's target to reduce a basket of greenhouse gas emissions by 42% by 2020. Not all of the improvements set out in paragraphs 4.11 - 4.17 above affect fuel bills, greenhouse gas emissions and fuel bills in the same way. Installing a measure may positively impact on one improvement indicator but have a negative consequence on another.

4.25 It is possible to improve the SAP score without reducing CO_2e emissions (or even increase them), and conversely, significant reductions in CO_2e emissions can be achieved but with a SAP score reduction. For example, in an off-gas grid dwelling with a 90.8% efficient LPG condensing boiler, replacing it with an oil condensing combi boiler of the same efficiency would achieve a higher SAP score (by +19 points) and reduce the household fuel costs according to RdSAP analysis, but will result in increased CO_2e emissions (see Table 4.1). Oil is a more polluting fuel within the SAP and RdSAP process than LPG, but a fuel with lower unit fuel costs. By contrast, a biomass boiler is a significantly less polluting fuel. Replacing the LPG boiler with a considerably less efficient wood pellet boiler (using the default RdSAP efficiency of 63%) would significantly reduce CO_2e emissions, for about the same fuel costs as the LPG boiler, but achieve a much lower SAP score (by -10 points). The optimal strategy for this dwelling would be dependent upon whether you were prioritising the SAP score, the household fuel costs, or the CO_2e emissions.

Table 4.1: Comparing Ratings, Emissions and Fuel Costs by Heating and Fuel

Heating	Boiler efficiency	SAP Energy Efficiency rating	SAP Environmental Impact rating	RdSAP Fuel Costs £/year	RdSAP CO2e emissions tonnes/ year
LPG condensing boiler	90.8%	39	51	£1,549	4.38
Oil condensing boiler	90.8%	58	46	£1,073	4.89
Wood Pellet boiler	63%	29	88	£1,519	1.07

4.26 Adopting the environmental ethos - reduce ' reuse 'renew ' generate - has some merit, and is consistent with the Scottish Government's vision for its recently published heat generation strategy. Its heat hierarchy is illustrated in Figure 4.1 below.

Figure 4.1: Scottish Government's Heat Hierarchy^[38]

4.27 Installing insulation before heating has the benefit of reducing a dwelling's energy demand, and therefore avoids unnecessary over-sizing of the heating system, which may contribute to inefficiencies within the system: the less you need, the less you have to supply regardless of the heating system. It has the added benefits of reducing pressures on household fuel bills and reducing emissions associated with overall energy use in a dwelling. Reducing household fuel bills is a key factor in combatting fuel poverty in Scotland.

4.28 Reusing components of the existing heating system where appropriate, and the upgrading of existing heating controls to promote more efficient use of the existing system, avoids unnecessary capital costs.

4.29 Replacing inefficient and / or expensive to use heating systems and controls to improve system efficiencies or reduce household fuel costs where this makes economic sense, may be more economic than investing in on-site renewables or investing in national generating capacity. The impetus for the Scottish Government's consultation on a Heat Generation Policy is that investing in group heating where there is a sufficient heat demand will realise improvements in the efficiency of producing heat (compared with those achieved by individual boilers), reduce greenhouse gas emissions and lower fuel costs for households^[39].

4.30 Then there is a temporal dimension. Some technologies today may not tick all of the boxes in terms of improving energy efficiency, reducing emissions, and lowering fuel bills. For example, electric heating storage heating may be an issue because of its current poor fuel price comparison with mains gas. The higher associated emissions because of the current electricity generation mix, means it also compares poorly in terms of CO_2e emission reductions. Yet, when you couple higher thermal capacity and electric storage heaters with increasing world gas prices, more volatile world gas supply chains, and the increasing decarbonisation of the grid, electricity may become the fuel of choice in the future. Storage heaters also provide at least a partial solution to dealing with the issue of variability in availability associated with some renewable technologies.

4.31 There is no single solution. These issues were explored further by modelling the impact of various improvements on two sample dwellings.

Costing the modelled improvement measures

4.32 The REEPS RAG took the decision to use the Product Characteristics Database File (PCDF) costs for improvement measures that were modelled in the absence of a robust, comprehensive, nationally recognised, evidence based, alternative. RAG was not willing to base the research modelling on prices quoted by a small number of contractors. RAG was also mindful of ensuring research results were consistent with EPC reports, which are based on PCDF costs. In addition, RAG took the decision to use mean PCDF costs, as corresponding unit costs were not available. It was recognised by RAG that this will lead to some over/under estimation of costs for individual archetypes, depending on their size and other characteristics. However, the use of mean costs would result in the best central estimates for the aggregated results from the research.

4.33 SAP, RdSAP, and Green Deal assessments use the PCDF as the basis of assessing the indicative cost of the improvement measures. For most measures in the PCDF, both an indicative low and a high cost figure are given (see the Low Cost Range A and High Cost Range A columns in Table 4.2 below), though there are some measures with variable costs in the Low Cost B and High Cost B columns^[40] (e.g. low energy lighting, storage heaters, and insulated doors, where the number of each present in the dwelling is multiplied by this variable cost to get the total cost of the improvement measure). For this modelling exercise, the REEPS RAG took the decision to use mean PCDF cost of the measure when calculating the cost of the improvements. The calculated mean cost is also set out in Table 4.2

4.34 The PCDF improvement costs do not cover all of the 38 improvements included in this analysis, and were supplemented with costs from other sources where necessary. These supplementary costs and their source are set out in Table 4.2a.

4.35 Alternative costs were investigated as part of this research project (see Appendix 3 of this report), and discussed in the meetings of the REEPS RAG.

Modelling two sample dwellings

4.36 Two of the poorest scoring dwellings in terms of their SAP score within the SHCS data were identified and modelled with a full SAP 2012 program^[41] : a detached bungalow and a top floor gable end flat. These dwellings were selected specifically because they rated so poorly on their SAP score - the worst scoring house and the worst scoring flat. One possible improvement target that was discussed with the REEPS RAG was raising the SAP score to at least Band D (that is, a SAP score of 55 or better) across all of the Scottish dwelling stock. If these two sample dwellings could be improved to achieve at least a SAP Band D score then the view was that it should be possible to achieve SAP Band D across all of the stock.

4.37 Both of the sample dwellings would be considered 'hard to treat': the bungalow has solid stone walls, and the top floor flat has a solid brick gable and rear wall and sandstone front wall. Both had no insulation added to the walls, the floors or the roof spaces. The flat did benefit from double-glazing. Heating in both cases was via room heaters: a solid fuel open fire in grate supplemented by electric heaters in the bungalow, and direct acting electric heating in the flat. The bungalow relied on instant electric water heater, while the flat had an electric immersion heater within a poorly insulated hot water cylinder. The bungalow achieved a SAP 2012 score of '1'^[42] ; the flat scored '5' on the SAP 2012 scale.

4.38 Various improvements were applied to both dwellings, taking account of their prevailing situation and location - so installing floor insulation, a ground source heat pump, and a standalone wind turbine were assessed with the detached bungalow but not with the top floor flat. The detached bungalow was off the gas grid, so various non-gas fuel options were assessed; the flat had a mains gas meter present so mains gas heating was included and the potential improvements assessed.

Table 4.2: Cost of Improvement Measures used in Modelling^[43]

Improvement Measure	Low cost range A	Low cost B	High cost range A	High cost B	Mean cost
Loft insulation	100		350		225[44]
Cavity wall insulation	500		1,500		1,000
Hot water cylinder insulation	15		30		22.5
Draught proofing	80		120		100
Low energy lights	0	5			5
Cylinder thermostat	200		400		300
Heating controls for wet central heating system	350		450		400
Heating controls for warm air system	350		450		400
Upgrade boiler, same fuel	2,200		3,000		2,600
Biomass boiler	7,000		13,000		10,000
Biomass room heater with boiler	7,000		13,000		10,000
New or replacement storage heaters	0	300	0	400	350
New or replacement quantum storage heaters					700[45]
Replacement warm-air unit	1,250		2,500		1,875
Solar water heating	4,000		6,000		5,000
Double glazing	3,300		6,500		4,900
Secondary glazing	1,000		1,500		1,250
Solid wall insulation	4,000		14,000		9,000
Solid wall insulation	4,000		14,000		9,000
Condensing oil boiler	3,000		7,000		5,000
Change heating to gas condensing boiler	3,000		7,000		5,000
Photovoltaics	9,000		14,000		11,500
Wind turbine on roof	1,500		4,000		2,750
Flat roof insulation	850		1,500		1,175
Roof room insulation	1,500		2,700		2,100
Flue gas heat recovery	900				450
Floor insulation	800		12,00		1,000
Insulated doors	0	500			500
Waste water heat recovery	585		725		655
Biomass boiler	7,000		13,000		10,000
Solid wall insulation	4,500		15,500		10,000
ASHP with radiators	6,000		10,000		8,000
ASHP with underfloor	6,000		10,000		8,000
Micro CHP	5,500				5,500
GSHP with radiators	9,000		17,000		13,000
GSHP with underfloor	9,000		17,000		13,000
Triple glazing	5,000		10,000		7,500
Wind turbine separate mast	15,000		25,000		20,000

Table 4.2a: Supplementary Improvement Measure Costs used in Modelling

Improvement Measure	Unit Cost	source
Fit baffle / damper to open fire	£50	Parity Projects report[46]
New hot water cylinder with 50mm spray foam	£750	Parity Projects report
Electricity Meter change	£200	Discussion with electricity utility
Electric wet system (flow / CPSU / thermal store)	4,000	Parity Projects report
Solid fuel ‘cassette’ insert into open fire	£450	Internet search

Improving the Detached Bungalow

4.39 This detached bungalow has solid stone walls approximately 600mm thick, a pitched roof and suspended timber floors, with no insulation added to the walls, the floors or the roof spaces. Heating is by a solid fuel open fire in one room supplemented by portable electric heaters in other rooms. Hot water is via an instant electric water heater; i.e. no hot water cylinder. The property is single glazed, and the windows and doors are not draught proofed. The only energy saving feature in the property is that all light fittings have low energy lamps. The property is well off the gas grid. The publicly quoted SAP 2012 rating for this property is '1', i.e. a property at the bottom of SAP G banding.

4.40 Table 4.3 sets out the various improvement measures assessed for this dwelling. The improvements comprise a variety of single insulation, ventilation, heating, hot water, and renewable measures, plus combinations of insulation with various heating systems and renewables. This table is rank ordered by their resultant SAP rating after the improvement. Both the reported SAP score and the one actually calculated within the SAP program are shown. The calculated SAP score (i.e.' -24'^[47] ) was used here as the starting point, otherwise where the increase in the SAP rating was less than 25 points for a particular improvement option in this particular dwelling, the publically reported SAP score of '1' would show no change despite the improvement. In an RdSAP assessment of this dwelling, a number of recommended improvements would show no increase in the SAP score.

4.41 What emerged from this assessment is that no single improvement, regardless of whether it was a heating, insulation or renewable measure, was sufficient on its own to raise this dwelling above SAP Band G. Even when measures were combined, their impact was not always sufficient to improve the SAP banding. It was only with combining both heating and insulation measures that a SAP banding of F (i.e. a SAP score of 21 or better) was achieved. Getting to SAP Band E (i.e. a SAP score of 39 or better) required packages of comprehensive insulation, high performance double glazing, and heating measures. The impact of some of these packages was sufficient to achieve a SAP Band D rating (i.e. a SAP score of 55 or better) in this property.

Table 4.3: Detached Bungalow Improvement Options - Rank ordered by SAP Rating and Estimated Fuel Costs (smallest to largest increase in SAP points)

Improvement Option	SAP rating	SAP EPC Band	kg CO2e per year	SAP fuel costs £ per year
Base case - as surveyed	1 [-24]	G	33,091	£3,427
Solar hot water panels (4m2)	1 [-23]	G	32,711	£3,387
Fit baffle / damper on open fire (damper)	1 [-23]	G	32,589	£3,377
Insulated doors (2 doors)	1 [-23]	G	32,429	£3,361
Draught proof windows and doors (DP)	1 [-22]	G	32,237	£3,341
Damper + DP	1 [-22]	G	31,756	£3,293
Wind turbine on roof (2m diameter)	1 [-22]	G	32,737	£3,337
Photovoltaics (2 kWp) (PVs)	1 [-21]	G	32,374	£3,245
Floor insulation (U-value 0.25) (FI)	1 [-20]	G	30,946	£3,212
Low-E Double Glazing (U-value 2.1) (DG)	1 [-20]	G	30,836	£3,201
Low-E + Argon filled Double Glazing (U-value 1.8) (DGA)	1 [-20]	G	30,775	£3,195
Electric wet central heating (flow boiler) on E10 tariff + new hot water cylinder (HWC)	1 [-12]	G	14,643	£2,762
Electric wet central heating (flow boiler )on E10 tariff + new HWC + damper	1 [-11]	G	12,825	£2,716
Wind turbine on stand-alone mast (5m diameter)	1 [-11]	G	30,192	£2,690
Loft insulation (U-value 0.13) (LI)	1 [-10]	G	25,468	£2,662
LI + DP	1 [-9]	G	24,600	£2,575
Electric room heater system on E10 tariff + new HWC	1 [-8]	G	14,940	£2,542
Solid Wall insulation (U-value 0.3) (SWI)	1 [-8]	G	24,177	£2,533
Electric room heater system on E10 tariff + new HWC+ damper	1 [-7]	G	11,785	£2,493
LI + DP + FI	1 [-4]	G	22,409	£2,355
Solid Fuel (SF) range boiler 67.5% + new HWC	2	G	18,813	£2,107
Air Source Heat Pump (ASHP) + radiators + new HWC	3	G	8,158	£2,073
Electric wet central heating - CPSU on E18 tariff	4	G	14,787	£2,030
Electric fan storage heating (auto charge control) + panel heaters + new HWC + damper	6	G	14,890	£1,964
Electric wet central heating CPSU + damper	7	G	13,013	£1,915
Electric fan storage heating (auto charge control) + new HWC	7	G	17,308	£1,914
Ground Source Heat Pump + new HWC	12	G	6,826	£1,735
Oil condensing combi 90.1%	13	G	10,608	£1,690
Electric Wet thermal store on E18 off peak tariff	14	G	15,678	£1,671
Oil condensing range 90% + new HWC	14	G	10,503	£1,670
LI + DP + SWI	14	G	15,528	£1,665
Wood log boiler 80% + new HWC	16	G	3,769	£1,606
Quantum storage heaters + new HWC	17	G	14,492	£1,566
Electric fan storage heating (auto charge control) + new HWC + LI	19	G	13,428	£1,514
Electric Wet thermal store on E18 off peak tariff + damper	20	G	13,743	£1,504
Electric fan storage heating (auto charge control) + new HWC + LI + DP	21	F	12,987	£1,468
Insulation package (LI + SWI + FI + DP)	22	F	13,339	£1,445
Oil condensing combi 90.1% + LI	25	F	8,469	£1,365
Oil condensing combi 90.1% + LI + DP	26	F	8,223	£1,327
Insulation package + DGA	28	F	11,628	£1,273
Quantum storage heaters + new HWC + LI	29	F	11,487	£1,256
Oil condensing combi 90.1% + LI + DGA + DP	29	F	7,759	£1,254
Insulation package + DGA + Solar hot water	30	F	11,221	£1,230
Quantum storage heaters + new HWC + LI + DP	31	F	11,143	£1,220
Electric Wet (thermal store) + damper + LI	32	F	10,792	£1,192
Insulation package + DGA + Wind turbine on roof (2m diameter)	32	F	11,274	£1,183
Electric Wet (thermal store) + damper + LI + DP	33	F	10,463	£1,157
Oil condensing combi 90.1% + LI + DGA + DP + FI	34	F	7,120	£1,155
Quantum storage heaters + new HWC + LI + DGA + DP	34	F	10,502	£1,154
Insulation package + DGA + PVs	36	F	10,911	£1,091
Electric Wet (thermal store) + damper + LI + DGA + DP	37	F	9,806	£1,087
Electric Wet (thermal store) + damper + LI + DP + FI	38	F	9,604	£1,066
Quantum storage heaters + new HWC + LI + DGA + DP + FI	38	F	9,616	£1,062
Electric Wet (thermal store) + damper + LI + DGA + DP + FI	41	E	8,936	£995
Insulation package + DGA + ASHP + new HWC	48	E	3,478	£884
Insulation package + DGA + Electric Storage Heating + new HWC	50	E	6,238	£843
Insulation package + DGA + SF range 67.5% + new HWC	51	E	7,378	£829
Insulation package + DGA + Electric Storage Heating + electric panel heaters + new HWC	53	E	5,606	£800
Insulation package + DGA + Ground Source Heat Pump	55	D	3,006	£764
Insulation package + DGA + oil condensing combi 90.1%	55	D	4,781	£762
Insulation package + DGA + oil condensing range 90% + new HWC	58	D	4,524	£714
Insulation package + Electric Wet (thermal store) + damper	59	D	6,004	£684
Insulation package + DGA + wood log boiler 80% + new HWC	60	D	2,398	£676
Insulation package + DGA + Quantum storage heaters + new HWC	60	D	5,842	£673
Insulation package + DGA + Electric Wet (thermal store) + damper	64	D	5,308	£611
Insulation package + DGA + Wind turbine on mast (5m diameter)	68	D	8,729	£537

4.42 In Table 4.4 the indicative capital cost of the improvement options are set alongside impact of the various measures in terms of the changes in the SAP scores, the reduction in CO_2e emissions, and the reduction in fuel bills. The last three columns of Table 4.4 set out the respective relative cost of a single point increase in the SAP rating, the cost of reducing CO_2e emissions by 1 kg per year, and the payback period of the assessed measures. These relative costs vary considerably.

4.43 What emerges from Table 4.4 is that the capital cost of the improvements are not correlated with their respective impacts on the SAP ratings, the reduction in CO_2e emissions, or fall in fuel costs^[48].

Table 4.4: Impact and Cost of Improvements - Detached Bungalow

Improvement Option	Capital cost £	increase in sap points	CO2e emissions saving (kg CO2e / year)	Fuel bill saving (£/year)	Cost / SAP point increase (£)	Cost / kg CO2e per year saved (£)	payback (years)
Solar hot water panels (4m2)	£5,000	1	380	£40	£4,250	£11.18	106.3
Fit baffle / damper on open fire (damper)	£50	1	502	£50	£50	£0.10	1.0
Insulated doors (2 doors)	£1,000	1	662	£66	£1,400	£2.12	21.2
Draught proof windows and doors (DP)	£100	2	854	£86	£96	£0.23	2.2
Damper + DP	£150	2	1335	£134	£121	£0.18	1.8
Wind turbine on roof (2m diameter)	£2,750	2	354	£90	£1,375	£7.77	30.6
Photovoltaics (2 kWp) (PVs)	£11,500	3	717	£182	£2,467	£10.32	40.7
Floor insulation (U-value 0.25) (FI)	£1,000	4	2145	£215	£209	£0.39	3.9
Low-E Double Glazing (U-value 2.1) (DG)	£4,900	4	2255	£226	£1,225	£2.17	21.7
Low-E + Argon filled Double Glazing (U-value 1.8) (DGA)	£4,900	4	2316	£232	£1,225	£2.12	21.1
Electric wet central heating (flow boiler) on E10 tariff + new hot water cylinder (HWC)	£4,000	12	18448	£665	£333.3	£0.22	6.0
Electric wet central heating (flow boiler )on E10 tariff + new HWC + damper	£4,050	13	20,266	£711	£311.5	£0.20	5.7
Wind turbine on stand-alone mast (5m diameter)	£20,000	13	2,899	£737	£1538.5	£6.90	27.1
Loft insulation (U-value 0.13) (LI)	£350	14	7,623	£765	£27.4	£0.05	0.5
LI + DP	£450	15	8,491	£852	£38.3	£0.07	0.7
Electric room heater system on E10 tariff+ new HWC	£2,150	16	18,151	£885	£134.4	£0.12	2.4
Solid Wall insulation (U-value 0.3) (SWI)	£9,000	16	8,914	£894	£752.9	£1.35	13.5
Electric room heater system on E10 tariff + new HWC + damper	£2,200	17	21,306	£934	£129.4	£0.10	2.4
LI + DP + FI	£1,450	20	10,682	£1,072	£70.6	£0.13	1.3
Solid Fuel (SF) range boiler 67.5% + new HWC	£8,500	26	14,278	£1,320	£355.8	£0.65	7.0
Air Source Heat Pump (ASHP) + radiators + new HWC	£8,000	27	24,933	£1,354	£314.8	£0.34	6.3
Electric wet central heating - CPSU on E18 tariff	£4,000	28	18,304	£1,397	£142.9	£0.22	2.9
Electric fan storage heating (auto charge control) + panel heaters + new HWC + damper	£2,500	30	18,201	£1,463	£80	£0.13	1.6
Electric wet central heating CPSU + damper	£4,050	31	20,078	£1,512	£130.6	£0.20	2.7
Electric fan storage heating (auto charge control) + new HWC	£2,150	31	15,783	£1,513	£69.4	£0.14	1.4
Ground Source Heat Pump + new HWC	£13,000	36	26,265	£1,692	£354.2	£0.49	7.5
Oil condensing combi 90.1%	£5,000	37	22,483	£1,737	£145.9	£0.24	3.1
Electric Wet - water storage boiler (thermal store) on off peak tariff	£4,000	38	17,413	£1,756	£105.3	£0.23	2.3
Oil condensing range 90% + new HWC	£5,750	38	22,588	£1,757	£161.8	£0.27	3.5
LI+ DP + SWI	£9,450	38	17,563	£1,762	£341.6	£0.74	7.4
Wood log boiler 80% + new HWC	£8,750	40	29,322	£1,821	£231.3	£0.32	5.1
Quantum storage heaters + new HWC	£3,550	41	18,599	£1,861	£86.6	£0.19	1.9
Electric fan storage heating (auto charge control) + new HWC + LI	£2,500	43	19,663	£1,913	£58.9	£0.13	1.3
Electric Wet - water storage boiler (thermal store) on off peak tariff + damper	£4,050	44	19,348	£1,923	£92.0	£0.21	2.1
Electric fan storage heating (auto charge control) + new HWC + LI + DP	£2,600	45	20,104	£1,959	£60.6	£0.14	1.4
Insulation package (LI + SWI + FI + DP)	£10,450	46	19,752	£1,982	£292.6	£0.68	6.8
Oil condensing combi 90.1% + LI	£5,350	49	24,622	£2,062	£118	£0.24	2.8
Oil condensing combi 90.1% + LI + DP	£5,450	50	24,868	£2,100	£119.5	£0.24	2.8
Insulation package + DGA	£15,100	52	21,463	£2,154	£347.5	£0.84	8.4
Quantum storage heaters + new HWC + LI	£3,900	53	21,604	£2,171	£74.2	£0.18	1.8
Oil condensing combi 90.1% + LI + DGA + DP	£10,050	53	25,332	£2,173	£198.8	£0.42	4.8
Insulation package + DGA + Solar hot water	£20,100	54	21,870	£2,197	£412.4	£1.02	10.1
Quantum storage heaters + new HWC + LI + DP	£4,000	55	21,948	£2,207	£75	£0.19	1.9
Electric Wet (thermal store) + damper + LI	£4,400	56	22,299	£2,235	£79.2	£0.20	2.0
Insulation package + DGA + Wind turbine on roof (2m diameter)	£17,850	56	21,817	£2,244	£370.8	£0.95	9.3
Electric Wet (thermal store) + damper + LI + DP	£4,450	57	22,628	£2,270	£82	£0.21	2.1
Oil condensing combi 90.1% + LI + DGA + DP + FI	£10,100	58	25,971	£2,272	£172.8	£0.39	4.4
Quantum storage heaters + damper+ new HWC + LI + DGA + DP	£8,650	58	22,589	£2,273	£126.5	£0.33	3.2
Insulation package + DGA + PVs	£26,600	60	22,180	£2,336	£416.1	£1.13	10.7
Electric Wet (thermal store) + damper + LI + DGA + DP	£9,150	61	23,285	£2,340	£152.2	£0.40	4.0
Electric Wet (thermal store) + damper + LI + DP + FI	£5,450	62	23,487	£2,361	£88.9	£0.24	2.3
Quantum storage heaters + solid fuel open fire + new HWC + LI + DGA + DP + FI	£9,650	62	23,475	£2,365	£153.6	£0.41	4.0
Electric Wet (thermal store) + damper + LI + DGA + DP + FI	£10,150	65	24,155	£2,432	£154.2	£0.42	4.1
Insulation package + DGA + ASHP + new HWC	£23,850	72	29,613	£2,543	£362	£0.88	10.3
Insulation package + DGA + Electric Storage Heating + solid fuel open fire + new HWC	£17,250	74	26,853	£2,584	£272.5	£0.75	7.8
Insulation package + DGA + SF range 67.5% + new HWC	£24,350	75	25,713	£2,598	£363.6	£1.06	10.5
Insulation package + DGA + Electric Storage Heating + electric panel heaters + new HWC	£17,650	77	27,485	£2,627	£265.2	£0.74	7.8
Insulation package + DGA + Ground Source Heat Pump	£28,100	79	30,085	£2,663	£389.5	£1.02	11.6
Insulation package + DGA + oil condensing combi 90.1%	£20,100	79	28,310	£2,665	£296.4	£0.83	8.8
Insulation package + DGA + oil condensing range 90% + new HWC	£20,850	82	28,567	£2,713	£294.7	£0.85	8.9
Insulation Package + Electric Wet (thermal store) + damper	£19,150	83	27,087	£2,743	£210.9	£0.65	6.4
Insulation package + DGA + wood log boiler 80% + new HWC	£25,550	84	30,693	£2,751	£317.1	£0.87	9.7
Insulation Package + DGA + Quantum storage heaters + new HWC	£18,650	84	27,249	£2,754	£256.8	£0.79	7.8
Insulation Package + DGA + Electric Wet (thermal store) + damper	£19,150	88	27,783	£2,816	£250.8	£0.79	7.8
Insulation package + DGA + Wind turbine on mast (5m diameter)	£35,100	92	24,362	£2,890	£413.2	£1.56	13.2

4.44 For example, loft insulation and draught proofing, despite their low capital cost, show a bigger impact on the SAP score of this dwelling than some of the more expensive options assessed. While solar hot water is considerably more expensive than either of these two improvement measures, it has very little impact on the SAP rating, and certainly less of an impact than insulating the loft and draught proofing the windows and doors in this property.

4.45 The rank ordering of the improvement options will vary depending on whether they are organised by their indicative capital cost, their impact on the SAP score, their impact on CO_2e emissions, or their impact on fuel bills.

4.46 From the examination of the rank ordering of the improvements, the outcomes (e.g. achieving a given SAP score, reducing CO_2e emissions, or reducing household fuel costs) cannot be predicted simply from the capital cost of the improvement.

4.47 The last column of Table 4.4 sets out the payback period for the improvements in this dwelling, based on the indicative capital cost of the improvement divided by the estimated annual fuel bill saving. For this dwelling, the improvement payback periods ranged between 0.5 years for loft insulation to over 106 years for the solar panel hot water system.

4.48 An alternative assessment of cost effectiveness examined the financial return on the investments over the lifetime of the respective measures. Using the lifetimes and associated 'in-use factors' of various energy efficiency improvements within the Energy Company Obligation (ECO): Measures Table v1.5^[49] , the annual fuel bill reduction for each measure was first multiplied by the lifetime of the measure, and then by the in-use factor to effectively discount some of the savings. While individual measures have different lifetimes and different in-use factors, calculating the net lifetime fuel bill reductions is straightforward. It is not straightforward for packages when measures included in the package have different lifetimes and in-use factors. For packages, the additional reductions attributed to each measure were calculated separately^[50] and then aggregated (see Table 4.5).

4.49 The net in-use lifetime cost savings of the assessed measures ranged between -£0.84 for every £1 invested (for the solar thermal hot water system) and £58.67 for loft insulation. Several negative values appear in the last column of this table (highlighted in orange): even over the assessed life time of these measures, they do not pay for themselves in terms of financial savings on the estimated fuel cost savings. By contrast, loft insulation here would return £58.67 for every pound invested in installing the measure.

Table 4.5: Net In-use Lifetime Fuel Cost Saving - Detached Bungalow (rank ordered by smallest to largest cost saving)

Improvement Option	SAP rating	Capital cost £	SAP fuel costs £ per year	Saving £ / year	Lifetime	In-use factor	Net in-use lifetime cost saving per £ cost
Solar hot water panels (4m2)	-23	£5000	£3387	£40	20	0	-£0.84
Wind turbine on roof (2m diameter)	-22	£2750	£3337	£90	10	0	-£0.67
Wind turbine on stand-alone mast (5m diameter)	-11	£20000	£2690	£737	10	0	-£0.63
Photovoltaics (2 kWp) (PVs)	-21	£11500	£3245	£182	25	0	-£0.60
Low-E Double Glazing (U-value 2.1) (DG)	-20	£4900	£3201	£226	20	0.15	-£0.08
Low-E + Argon filled Double Glazing (U-value 1.8)	-20	4900	£3195	£232	20	0.15	-£0.05
Insulated doors (2 doors)	-23	£1000	£3361	£66	20	0.15	£0.12
Solid Fuel (SF) range boiler 67.5% + new HWC	2	£8500	£2107	£1320	12	0	£0.86
Electric wet central heating (flow boiler) on E10 tariff + new hot water cylinder (HWC)	-12	£4000	£2762	£665	12	0	£1.00
Electric wet central heating (flow boiler) on E10 tariff + new HWC + damper	-11	£4050	£2716	£711	12	0	£1.11
Insulation package + DGA + PVs	36	£26600	£1091	£2336	combined	combined	£1.31
Insulation package + DGA + Ground Source Heat Pump	55	£28100	£764	£2663	combined	combined	£1.52
Air Source Heat Pump (ASHP) + radiators + new HWC	3	£8000	£2073	£1354	15	0	£1.54
Insulation package + DGA + SF range 67.5% + new HWC	51	£24350	£829	£2598	combined	combined	£1.56
Ground Source Heat Pump + new HWC	12	£13000	£1735	£1692	20	0	£1.60
Insulation package + DGA + ASHP + new HWC	48	£23850	£884	£2543	combined	combined	£1.63
Solid Wall insulation (U-value 0.3) (SWI)	-8	£9000	£2533	£894	36	0.25	£1.68
Insulation package + DGA + wood log boiler 80% + new HWC	60	£25550	£676	£2751	combined	combined	£1.70
Insulation package + DGA + Solar hot water	30	£20100	£1230	£2197	combined	combined	£1.88
Insulation package + DGA + oil condensing range 90% + new HWC	58	£20850	£714	£2713	combined	combined	£2.05
Insulation Package + DGA + Quantum storage heaters + new HWC	60	£18650	£673	£2754	combined	combined	£2.13
Insulation package + DGA + oil condensing combi 90.1%	55	£20100	£762	£2665	combined	combined	£2.14
Insulation package + DGA + Wind turbine on roof (2m diameter)	32	£17850	£1183	£2244	combined	combined	£2.24
Insulation Package + Electric Wet (thermal store) + damper	59	£19150	£684	£2743	combined	combined	£2.30
Insulation Package + DGA + Electric Wet (thermal store) + damper	64	£19150	£611	£2816	combined	combined	£2.39
Insulation package + DGA + Wind turbine on mast (5m diameter)	68	£35100	£537	£2890	combined	combined	£2.59
Oil condensing range 90% + new HWC	14	£5750	£1670	£1757	12	0	£2.67
Insulation package + DGA + Electric Storage Heating + electric panel heaters + new HWC	53	£17650	£800	£2627	combined	combined	£2.76
Oil condensing combi 90.1% + LI + DGA + DP	29	£10050	£1254	£2173	combined	combined	£2.77
Insulation package + DGA + Electric Storage Heating + new HWC	50	£17250	£843	£2584	combined	combined	£2.80
Insulation package + DGA	28	£15100	£1273	£2154	combined	combined	£3.08
Oil conden combi 90.1% + LI + DGA + DP + FI	34	£10100	£1155	£2272	combined	combined	£3.10
Wood log boiler 80% + new HWC	16	£8750	£1606	£1821	20	0	£3.16
Oil condensing combi 90.1%	13	£5000	£1690	£1737	12	0	£3.17
Electric wet central heating - CPSU on E18 tariff	4	£4000	£2030	£1397	12	0	£3.19
Electric Wet (thermal store) + damper + LI + DGA + DP + FI	41	£10150	£995	£2432	combined	combined	£3.25
Elect Wet (therm store) + damper + LI +DGA+DP	37	£9150	£1087	£2340	combined	combined	£3.35
Electric wet central heating CPSU + damper	7	£4050	£1915	£1512	12	0	£3.48
LI+ DP + SWI	14	£9450	£1665	£1762	combined	combined	£3.89
Quantum storage heaters + new HWC + LI + DGA + DP + FI	38	£9650	£1062	£2365	combined	combined	£3.95
Quantum storage heaters + damper+ new HWC + LI + DGA + DP	34	£8650	£1154	£2273	combined	combined	£4.14
Electric Wet - water storage boiler (thermal store) on off peak tariff	14	£4000	£1671	£1756	12	0	£4.27
Electric Wet - water storage boiler (thermal store) on off peak tariff + damper	20	£4050	£1504	£1923	12	0	£4.70
Insulation package (LI + SWI + FI + DP)	22	£10450	£1445	£1982	combined	combined	£4.79
Oil condensing combi 90.1% + LI + DP	26	£5450	£1327	£2100	combined	combined	£5.72
Oil condensing combi 90.1% + LI	25	£5350	£1365	£2062	combined	combined	£5.81
Draught proof windows and doors (DP)	-22	£100	£3341	£86	10	0.15	£6.31
Floor insulation (U-value 0.25) (FI)	-20	£1000	£3212	£215	42	0.15	£6.68
Elec Wet (thermal store) + damper + LI + DP + FI	38	£5450	£1066	£2361	combined	combined	£6.69
Elec room heater system on E10 tariff+ new HWC	-8	£2150	£2542	£885	20	0	£7.23
Quantum storage heaters + new HWC	17	£3550	£1566	£1861	20	0.2	£7.39
Electric room heater system on E10 tariff + new HWC + damper	-7	£2200	£2493	£934	20	0	£7.49
Electric Wet (thermal store) + damper + LI + DP	33	£4450	£1157	£2270	combined	combined	£7.68
Electric Wet (thermal store) + damper + LI	32	£4400	£1192	£2235	combined	combined	£7.76
Quantum storage heaters + new HWC + LI + DP	31	£4000	£1220	£2207	combined	combined	£9.92
Quantum storage heaters + new HWC + LI	29	£3900	£1256	£2171	combined	combined	£10.12
Electric fan storage heating (auto charge control) + new HWC + LI	19	£2500	£1514	£1913	combined	combined	£10.55
Electric fan storage heating (auto charge control) + panel heaters + new HWC + damper	6	£2500	£1964	£1463	20	0	£10.70
Electric fan storage heating (auto charge control) + solid fuel open fire + new HWC + LI + DP	21	£2600	£1468	£1959	combined	Combined	£10.75
Electric fan storage heating (auto charge control) + new HWC	7	£2150	£1914	£1513	20	0	£13.07
Damper + DP	-22	£150	£3293	£134	combined	combined	£15.66
LI + DP + FI	-4	£1450	£2355	£1072	combined	combined	£19.33
Fit baffle / damper on open fire (damper)	-23	£50	£3377	£50	42	0.15	£34.70
LI + DP	-9	£450	£2575	£852	combined	combined	£47.05
Loft insulation (U-value 0.13) (LI)	-10	£350	£2662	£765	42	0.35	£58.67

4.50 What emerges from Table 4.5 is that all of the renewable technologies perform badly on the return on the cost of their investment i.e. the net in-use lifetime cost savings are all negative despite their potential not being reduced by an in-use factor (i.e. the in-use factor is 0 for these measures). Double glazing also performs badly on this criterion. None of these measures would improve the publically quoted SAP score (i.e. the resultant SAP score is still a negative number so would be rounded to 1 on the EPC). However, even the improvements displaying the best returns on the cost of the investment for this dwelling (i.e. the five best packages all have a net lifetime return of over £15 for each £ invested) are associated with improvements that would not shift the publically quoted SAP score of the dwelling from '1', and their returns would be even higher without the application of the in-use factor.

4.51 To increase the SAP banding of this dwelling, will involve packages of improvement measures with a high return on the investment, and higher cost measures with a lower return. It is possible to achieve a SAP Band D score (i.e. SAP score 55 or better) for an indicative capital cost of between £18,650 and £35,100, with a positive net lifetime return on the investment of between £1.52 and £2.59 per £ invested.

4.52 A similar analysis was performed to assess the calculated lifetime CO_2e emissions reductions associated with the different improvement options assessed. Again, using the ECO lifetimes and 'in-use factors' associated with various energy efficiency improvements the annual CO_2e reduction for each measure was first multiplied by the lifetime of the measure, and then by the in-use factor applied to effectively discount some of the savings. For packages, the additional reductions attributed to each measure were calculated separately and then aggregated. The net lifetime CO_2e emission reductions are set out in the second last column of Table 4.6. By dividing the capital cost of the improvement by the tonnes of CO_2e reduction for each assessed measure and package, the respective cost per tonne of carbon saved can be calculated (see the last column of Table 4.6). These costs range from £1.68 for loft insulation up to £776.84 for a stand-alone wind turbine for this dwelling.

4.53 By way of comparison, the traded price for a tCO_2e is approximately £3.60 per tonne of CO_2e; non-traded price of carbon is approximately £60 per tonne of CO_2e. Reductions in energy consumption, and therefore the associated CO_2e emissions, in this dwelling would fall in both the traded and non-traded sectors: reductions in electricity consumption are attributable to the traded sector, while gas and other fuels are attributable to the non-traded sector^[51].

Table 4.6: Net In-use Lifetime Cost per tonne of CO_2e saved - Detached Bungalow (rank ordered by smallest to largest cost per tonne)

Improvement Option	increase in sap	capital cost £	emissions kg CO2 per year	lifetime	in-use factor	net in-use lifetime kg CO2 saved	£ per net lifetime tonne CO2 saved
Loft insulation (U-value 0.13) (LI)	14	£350	25,468	42	0.35	208,108	1.68
LI + DP	15	£450	24,600	combined	combined	215,486	2.09
Fit baffle / damper on open fire (damper)	1	£50	32,589	42	0.15	17,921	2.79
LI + DP + FI	20	£1,450	22,409	combined	combined	293,705	4.94
Electric room heater system on E10 tariff + new HWC + damper	17	£2,200	11,785	20	0	426,120	£5.16
Electric room heater system on E10 tariff+ new HWC	16	£2,150	14,940	20	0	363,020	£5.92
Damper + DP	2	£150	31,756	combined	combined	25,002	£6.00
Electric fan storage heating (auto charge control) + new HWC	31	£2,150	17,308	20	0	315,660	£6.81
Electric fan storage heating (auto charge control) + panel heaters + new HWC + damper	30	£2,500	14,890	20	0	364,020	£6.87
Electric fan storage heating (auto charge control) + solid fuel open fire + new HWC + LI + DP	45	£2,600	12,987	combined	combined	301,906	£8.61
Electric fan storage heating (auto charge control) + new HWC + LI	43	£2,500	13,428	combined	combined	285,708	£8.75
Quantum storage heaters + new HWC + LI	53	£3,900	11,487	combined	combined	431,804	£9.03
Quantum storage heaters + new HWC + LI + DP	55	£4,000	11,143	combined	combined	434,728	£9.20
Electric Wet (thermal store) + damper + LI	56	£4,400	10,792	combined	combined	384,220	£11.45
Electric Wet (thermal store) + damper + LI + DP	57	£4,450	10,463	combined	combined	385,130	£11.55
Quantum storage heaters + new HWC	41	£3,550	14,492	20	0.2	297,584	£11.93
Oil condensing combi 90.1% + LI	49	£5,350	8,469	combined	combined	412,096	£12.98
Floor insulation (U-value 0.25) (FI)	4	£1,000	30,946	42	0.15	76,576	£13.06
Electric Wet (thermal store) + damper + LI + DP + FI	62	£5,450	9,604	combined	combined	415,796	£13.11
Oil condensing combi 90.1% + LI + DP	50	£5,450	8,223	combined	combined	412,010	£13.23
Draughtproof windows and doors (DP)	2	£100	32,237	10	0.15	7,259	£13.78
Wood log boiler 80% + new HWC	40	£8,750	3,769	20	0	586,440	£14.92
Electric wet central heating (flow boiler) on E10 tariff + new HWC + damper	13	£4,050	12,825	12	0	243,192	£16.65
Electric wet central heating CPSU + damper	31	£4,050	13,013	12	0	240,936	£16.81
Electric Wet - water storage boiler (thermal store) on off peak tariff + damper	44	£4,050	13,743	12	0	232,176	£17.44
Electric wet central heating (flow boiler) on E10 tariff + new hot water cylinder (HWC)	12	£4,000	14,643	12	0	221,376	£18.07
Electric wet central heating - CPSU on E18 tariff	28	£4,000	14,787	12	0	219,648	£18.21
Oil condensing combi 90.1%	37	£5,000	10,608	12	0	269,796	£18.53
Insulation package (LI + SWI + FI + DP)	46	£10,450	13,339	combined	combined	556,282	£18.79
Electric Wet - water storage boiler (thermal store) on off peak tariff	38	£4,000	15,678	12	0	208,956	£19.14
Quantum storage heaters + damper+ new HWC + LI + DGA + DP	58	£8,650	10,502	combined	combined	444,511	£19.46
Quantum storage heaters + new HWC + LI + DGA + DP + FI	62	£9,650	9,616	combined	combined	476,142	£20.27
LI+ DP + SWI	38	£9,450	15,528	combined	combined	460,430	£20.52
Oil condensing range 90% + new HWC	38	£5,750	10,503	12	0	271,056	£21.21
Air Source Heat Pump (ASHP) + radiators + new HWC	27	£8,000	8,158	15	0	373,995	£21.39
Oil condensing combi 90.1% + LI + DGA + DP + FI	58	£10,100	7,120	combined	combined	442,710	£22.81
Electric Wet (thermal store) + damper + LI + DGA + DP	61	£9,150	9,806	combined	combined	396,299	£23.09
Electric Wet (thermal store) + damper + LI + DGA + DP + FI	65	£10,150	8,936	combined	combined	427,358	£23.75
Oil condensing combi 90.1% + LI + DGA + DP	53	£10,050	7,759	combined	combined	419,898	£23.93
Ground Source Heat Pump + new HWC	36	£13,000	6,826	20	0	525,300	£24.75
Insulation package + DGA + Electric Storage Heating + new HWC	74	£17,250	6,238	combined	combined	693,169	£24.89
Insulation package + DGA + Electric Storage Heating + electric panel heaters + new HWC	77	£17,650	5,606	combined	combined	705,809	£25.01
Insulation package + DGA	52	£15,100	11,628	combined	combined	585,369	£25.80
Insulation Package + DGA + Electric Wet (thermal store) + damper	88	£19,150	5,308	combined	combined	661,209	£28.96
Insulation Package + Electric Wet (thermal store) + damper	83	£19,150	6,004	combined	combined	644,302	£29.72
Insulation package + DGA + oil condensing combi 90.1%	79	£20,100	4,781	combined	combined	667,533	£30.11
Insulation package + DGA + Wind turbine on roof (2m diameter)	56	£17,850	11,274	combined	combined	588,909	£30.31
Insulation package + DGA + oil condensing range 90% + new HWC	82	£20,850	4,524	combined	combined	670,617	£31.09
Insulation Package + DGA + Quantum storage heaters + new HWC	84	£18,650	5,842	combined	combined	578,040	£32.26
Insulation package + DGA + wood log boiler 80% + new HWC	84	£25,550	2,398	combined	combined	769,969	£33.18
Insulation package + DGA + ASHP + new HWC	72	£23,850	3,478	combined	combined	707,619	£33.70
Insulation package + DGA + Solar hot water	54	£20,100	11,221	combined	combined	593,509	£33.87
Insulation package + DGA + Ground Source Heat Pump	79	£28,100	3,006	combined	combined	757,809	£37.08
Solid Wall insulation (U-value 0.3) (SWI)	16	£9,000	24,177	36	0.25	240,678	£37.39
Insulation package + DGA + SF range 67.5% + new HWC	75	£24,350	7,378	combined	combined	636,369	£38.26
Insulation package + DGA + PVs	60	£26,600	10,911	combined	combined	603,294	£44.09
Solid Fuel (SF) range boiler 67.5% + new HWC	26	£8,500	18,813	12	0	171,336	£49.61
Insulation package + DGA + Wind turbine on mast (5m diameter)	92	£35,100	8,729	combined	combined	614,359	£57.13
Insulated doors (2 doors)	1	£1,000	32,429	20	0.15	11,254	£88.86
Low-E + Argon filled Double Glazing (U-value 1.8) (DGA)	4	£4,900	30,775	20	0.15	39,372	£124.45
Low-E Double Glazing (U-value 2.1) (DG)	4	£4,900	30,836	20	0.15	38,335	£127.82
Photovoltaics (2 kWp) (PVs)	3	£11,500	32,374	25	0	17,925	£641.56
Solar hot water panels (4m2)	1	£5,000	32,711	20	0	7,600	£657.89
Wind turbine on stand-alone mast (5m diameter)	13	£20,000	30,192	10	0	28,990	£689.89
Wind turbine on roof (2m diameter)	2	£2,750	32,737	10	0	3,540	£776.84

Improving Energy Efficiency in the Detached Bungalow

4.54 For this dwelling, 65 different single improvement measures or combinations of measures were assessed.

4.55 The increases in the SAP score, the reductions in kg of CO_2e emissions, and the reductions in SAP fuel bills are plotted against the mean capital cost of the various improvement measures in Figures 4.2, 4.3 and 4.4 respectively. The capital costs are along the x-axis, and the respective impact on the SAP rating, CO_2e emissions and fuel bills on the y-axis. The axes of the graphs take their intersection to be the median of cost of the improvements assessed for this dwelling (i.e. £5,450) and the median change in the respective SAP score (i.e. 43 SAP points), the reduction in Kg of CO_2e per year (i.e. 21,604 kg^[52] of CO_2e), and the reduction in £ per year on the SAP fuel costs (i.e. £1,913). This effectively quarters the graph into low cost - low impact, low cost - high impact, high cost - low impact, and high cost - high impact sections. The further left on the x-axis and further up the y-axis, the bigger the impact on the energy performance of the dwelling for the money spent. Additionally, Figure 4.2 displays threshold lines showing the increase in SAP points to raise this dwelling into a higher SAP banding.

SAP rating: Low cost - High impact improvements in the Detached Bungalow

4.56 Ten improvements comprise in the low cost - high impact sector of the graph in Figure 4.2: mostly heating with loft insulation or loft insulation and draught proofing combinations (see Table 4.7). The cost of increasing the SAP rating by 1 point ranges between £59 and £110 per point amongst this group of measures. Two of the improvements here do not raise the dwelling out of the SAP Band G; with the rest, the dwelling would achieve SAP Band F.

Table 4.7: SAP rating: Low cost - High impact improvements in the Detached Bungalow

Improvement(s) assessed	SAP	SAP Band	Capital cost	SAP increase	Saving kg CO2e / year	Cost per SAP point increase
Electric fan storage heating (auto) + new HWC + LI	19	G	£2,500	43	19,663	£58
Electric wet thermal store on off peak E18 tariff + damper	20	G	£4,050	44	19,348	£92
Electric fan storage heating (auto charge control) + new HWC + LI + DP	21	F	£2,600	45	20,104	£58
Oil condensing combi 90.1% + LI	25	F	£5,350	49	24,622	£109
Oil condensing combi 90.1% + LI + DP	26	F	£5,450	50	24,868	£109
Oil condensing combi 90.1% + LI + DGA + DP doors	29	F	£3,900	53	25,332	£74
Quantum storage heaters + new HWC + LI + DP	31	F	£4,000	55	21,948	£73
Insulation package + DGA + Wind turbine on roof (2m diameter)	32	F	£4,400	56	21,817	£79
Electric wet thermal store + LI + DP	33	F	£4,450	57	22,628	£78
Quantum storage heaters + new HWC + LI + DGA + DP doors + FI	38	F	£5,450	62	23,475	£88

Figure 4.2 Cost of Measure versus Increase in SAP rating

Figure 4.3 Cost of Measure versus Reductions in CO_2e emissions

Figure 4.4 Cost of Measure versus Reductions in Estimated Fuel Costs

CO_2e emissions: Low cost - High impact improvements in Detached Bungalow

4.57 When examined in terms of the impact on reducing carbon emissions, the Low cost - High impact sector is comprised of heating improvement options (see Table 4.8). Changing from burning house coal in open fires reduces the CO_2e emissions from this dwelling. The oil boiler, quantum storage heater, and electric wet thermal store improvements of the Low cost - High impact measures per SAP point again feature amongst the Low cost - High impact sector when costs are assessed against the CO_2e emission reductions (see Table 4.8 below). While the new high heat retention electric storage heaters (i.e. Quantum storage heaters) still feature here, the more usual form of storage heating (i.e. the modern slimline storage heaters) drop out of the Low cost - High impact emissions sector. The oil boilers in this section are joined by the condensing combi boiler without any additional insulation being included within the improvement measure. No insulation only package comes within this sector. The mean cost of reducing CO_2e by 1 kg per year here ranges between 18p per kg of CO_2e up to 24p per kg of CO_2e saved.

Table 4.8: CO_2e emissions: Low cost - High impact improvements in the Detached Bungalow

Improvement(s) assessed	SAP	SAP Band	Capital cost	Saving kg CO2e / year	Cost per kg CO2e reduced
Oil condensing combi 90.1%	13	G	£5,000	22,483	£0.22
Oil condensing combi 90.1% + LI	25	F	£5,350	24,622	£0.22
Oil condensing combi 90.1% + LI + DP	26	F	£5,450	24,868	£0.22
Oil condensing combi 90.1% + LI + DGA + DP doors	29	F	£3,900	25,332	£0.15
Quantum storage heaters + new HWC + LI + DP	31	F	£4,000	21,948	£0.18
Insulation package + DGA + Wind turbine on roof (2m diameter)	32	F	£4,400	21,817	£0.20
Electric wet thermal store + LI + DP	33	F	£4,450	22,628	£0.20
Quantum storage heaters + new HWC + LI + DGA + DP doors + FI	38	F	£5,450	23,475	£0.23

Fuel bill reductions: Low cost - High impact improvements in Detached Bungalow

4.58 As already discussed the SAP scores and SAP fuel bills are directly related, so it is not surprising that the improvement measures comprising Low cost - High impact when examining the reductions in fuel bills are identical to those seen when discussing the impact of the improvements on increasing the SAP scores in paragraph 4.51.

4.59 The Low cost - High impact sector of the Figure 4.4 is comprised of various changes in the heating system usually coupled with loft insulation or loft insulation and draught proofing. The payback periods range between 1.3 and 2.8 years (see Table 4.9). Two of the improvements do not raise the dwelling beyond SAP Band G. The rest of the options assessed raise the dwelling into SAP Band F. The payback periods range between 1.3 and 2.6 years.

Table 4.9: Reduced Fuel Bills: Low cost - High impact improvements in the Detached Bungalow

Improvement(s) assessed	SAP	SAP Band	Capital cost	SAP increase	saving £/year	payback (years)
Electric fan storage heating (auto) + new HWC + LI	19	G	£2,500	43	£1,913	1.3
Electric wet thermal store on off peak E18 tariff + damper	20	G	£4,050	44	£1,923	2.1
Electric fan storage heating (auto charge control) + new HWC + LI + DP	21	F	£2,600	45	£1,959	1.3
Oil condensing combi 90.1% + LI	25	F	£5,350	49	£2,062	2.6
Oil condensing combi 90.1% + LI + DP	26	F	£5,450	50	£2,100	2.6
Oil condensing combi 90.1% + LI + DGA + DP doors	29	F	£3,900	53	£2,173	1.8
Quantum storage heaters + new HWC + LI + DP	31	F	£4,000	55	£2,207	1.8
Insulation package + DGA + Wind turbine on roof (2m diameter)	32	F	£4,400	56	£2,244	2
Electric wet thermal store + LI + DP	33	F	£4,450	57	£2,270	2
Quantum storage heaters + new HWC + LI + DGA + DP doors + FI	38	F	£5,450	62	£2,365	2.3

4.60 All of the other improvement measures assessed for this detached bungalow fall within the Low cost - Low impact; High cost - Low impact; and High cost - High impact sections of the respective graphs. An extended analysis is set out in Appendix 9.

Overall Comment on the Improvements Assessed for the Detached Dwelling

4.61 On their own, many of the single measures and many of the insulation-only packages are insufficient to raise the SAP rating of this dwelling out of SAP Band G. With regard to insulation, only the comprehensive insulation package of loft, wall and floor insulation coupled with draught proofing of the windows and doors, just achieves a SAP Band F rating. Achieving even higher SAP bandings would require comprehensive insulation and heating improvement packages. That said, there are a variety of heating options, once coupled with insulation packages that can be selected from, including various options to achieve a SAP rating of '55' or better.

4.62 The indicative cost to achieve a SAP Banding of F ranged between £2,600 (just to reach it) to £26,600; by way of comparison, to achieve a SAP Banding of E, ranged between £10,150 and £23,550; and to achieve a SAP Banding of D ranged between £19,150 and £35,100. Conversely, given the range of measures assessed here, it is possible to spend more than £20,000 and still be a SAP Band G dwelling. Alternatively, if you chose to spend up to £19,150 on this property, you could achieve a SAP rating in Band D. The ranges of indicative costs to achieve the different SAP bandings in this dwelling are illustrated in Figure 4.5.

Figure 4.5: Detached Dwelling: Range of Costs to Achieve a SAP Band Rating

4.63 Importantly, this dwelling would be considered one of the most problematic to improve. It is a detached bungalow, and therefore comprises a relatively high amount of exposed heat loss surface area for its floor area and volume, and was noted to be problematic within the EESSH modelling works^[53]. It is comprised of walls that would need expensive insulation to improve their energy efficiency performance. The dwelling is well-off the gas grid. If a SAP D band rating can be achieved here, it should be easier and cheaper elsewhere in the stock.

Improving the Top Floor Flat

4.64 A similar analysis was performed on a 1920's solid wall tenemental gable end flat within an urban area of Scotland. This dwelling has brick walls to the gable and rear, and sandstone walls to the front. It does have double glazing. It has no loft insulation. It is heated via direct acting electric heaters, and its hot water is provided via a single electric immersion heater in a poorly insulated hot water cylinder. There are no low energy light bulbs in the dwelling. The windows are draught proofed; the door is not. The flat does have a mains gas meter supply point. The starting point of this dwelling is a SAP rating of '4'. The improvements assessed for this dwelling are set out in Table 4.10.

4.65 What emerges immediately is that compared to the detached bungalow, the presence of a gas supply in this dwelling completely changes the dynamics of the improvements. For example, simply fitting a gas condensing combi boiler as a single measure increases the SAP score from '4' to '55', and in itself raise the SAP rating from Band G to Band D. Two of the improvement packages assessed raise the SAP rating into Band C.

Table 4.10: Top Floor Flat Improvement Options - Rank ordered by SAP score

Improvement assessed	SAP	EPC Band	Capital cost	CO2e /year	Fuel Bill (£ / year)
Base case	4	G		6,544	£1,663
Low energy light bulbs (LELs)	5	G	£25	6,486	£1,648
Draught proofing door (DPd)	5	G	£100	6,532	£1,660
Insulated door (U-value 1.0)	5	G	£500	6,443	£1,637
Hot water tank jacket 80mm (HWTJ)	5	G	£23	6,327	£1,608
Wind turbine on roof (2m diameter)	5	G	£2,750	6,431	£1,634
Low-e + Argon-filled DG (U-value 1.8) (DGA)	6	G	£4,900	6,419	£1,631
Solar hot water (4m2)	9	G	£5,000	5,978	£1,519
Photovoltaics (2 kWp)	11	G	£11,500	5,827	£1,481
Solid Wall insulation (U-value 0.3) (SWI)	18	G	£9,000	5,072	£1,289
Electric storage heating system auto control on E7 (ESH E7)	20	G	£1,400	7,808	£1,247
Loft insulation (U-value 0.13) (LI)	22	F	£350	4,652	£1,182
LI + DPd	22	F	£450	4,640	£1,179
ESH E7 + HWTJ	22	F	£1,423	7,268	£1,182
LI + DPd + HWTJ	25	F	£478	4,427	£1,125
LI + DPd + HWTJ + CFLs	26	F	£498	4,371	£1,111
Electric storage heating system auto control on E24 (ESH E24)	29	F	£1,600	7,415	£1,034
ESH E24 + HWTJ	30	F	£1,623	7,273	£1,014
Quantum storage heaters	31	F	£2,800	6,354	£1,004
Air source heat pump (ASHP) + new Hot water cylinder	34	F	£8,500	3,758	£955
Quantum storage heater + HWTJ	35	F	£2,823	6,137	£934
ESH E7 + LI	36	F	£1,750	5,258	£904
ESH E7 + LI + DPd	37	F	£1,850	5,242	£902
ESH E7 + LI + DPd + HWTJ	40	E	£1,878	5,058	£837
ESH E7 + LI + DPd + HWTJ + CFLs	42	E	£1,898	5,014	£818
Quantum storage heaters + LI	45	E	£3,150	4,508	£774
Quantum storage heaters + LI + DPd	45	E	£3,250	4,497	£772
ESH E24 + LI	47	E	£1,950	5,066	£739
ESH E24 + LI + DPd	47	E	£2,050	5,052	£737
Insulation package (LI SWI DPd LELs HWTJ)	49	E	£9,498	2,804	£712
ESH E24 + LI + DPd + HWTJ	49	E	£2,073	4,859	£712
Quantum storage heaters + LI + DPd + HWTJ	50	E	£3,273	4,282	£702
ESH E24 + LI + DPd + HWTJ + CFLs	50	E	£2,098	4,811	£695
ASHP + LI	50	E	£8,850	2,736	£695
ASHP + LI + DPd	50	E	£8,950	2,729	£694
Insulation package + Wind turbine on roof (2m diameter)	51	E	£12,248	2,690	£684
Quantum storage heaters + LI + DPd + HWTJ + CFLs	51	E	££3,298	4,227	£682
ASHP + LI + DPd + CFLs	52	E	£8,975	2,657	£675
Gas condensing combi 88% (GCC)	55	D	£5,000	3,041	£626
Insulation package + Solar hot water	55	D	£14,498	2,456	£624
GCC + Flue Gas Heat Recovery System (FGHRS)	56	D	£5,450	2,921	£612
Insulation package + ESH E7	61	D	£10,898	3,031	£552
Insulation package + PVs	62	D	£20,998	2,087	£530
GCC + LI	65	D	£5,350	2,193	£494
GCC + LI + DPd	65	D	£5,450	2,188	£493
Insulation package + Quantum storage heaters	65	D	£12,298	2,717	£493
GCC + LI + DPd + CFLs	66	D	£5,475	2,112	£473
Insulation package + ASHP	67	D	£11,798	1,806	£459
Insulation package + ESH E24	67	D	£11,098	2,960	£459
Insulation package + GCC	74	C	£14,498	1,407	£359
Insulation package + GCC + FGHRS	75	C	£14,498	1,335	£347

4.66 In Table 4.11, the indicative capital cost of the improvement options are set out alongside the changes in the SAP ratings, the reduction in CO_2e emissions and the reductions in fuel bills for each improvement option. In the last three columns of Table 4.11 below, the relative cost of a single point increase in the SAP rating, the cost of reducing CO_2e emissions by 1 kg per year, and the payback of the measures are set out as well. These relative costs vary considerably.

Table 4.11: Impact and Cost of Improvements - Top Floor Flat

Improvement assessed	Capital cost (£)	Increase in SAP score	Saving kg CO2e / year	Saving in fuel bill £/year	Cost per SAP point increase (£)	Cost per Kg CO2e saved per year (£)	Payback (years)
Base case
Low energy light bulbs (LELs)	£25	1	58	£15	£25	£0.43	1.7
Draught proofing door (DPd)	£100	1	12	£3	£100	£8.33	33.3
Insulated door (U-value 1.0)	£500	1	101	£26	£500	£4.95	19.2
Hot water tank jacket 80mm (HWTJ)	£23	1	217	£55	£23	£0.11	0.4
Wind turbine on roof (2m diameter)	£2,750	1	113	£29	£2,750	£24.34	94.8
Low-e + Argon-filled DG (U-value 1.8) (DGA)	£4,900	2	125	£32	£2,325	£37.20	145.3
Solar hot water (4m2)	£5,000	5	566	£144	£1,000	£8.83	34.7
Photovoltaics (2 kWp)	£11,500	7	717	£182	£1,642	£16.04	63.2
Solid Wall insulation (U-value 0.3) (SWI)	£9,000	14	1,472	£374	£642	£6.11	24.1
Electric storage heating system auto control on E7 (ESH E7)	£1,400	16	-1,264	£416	£87	-£1.11	3.4
Loft insulation (U-value 0.13) (LI)	£350	18	1,892	£481	£19	£0.18	0.7
LI + DPd	£450	18	1,904	£484	£25	£0.24	0.9
ESH E7 + HWTJ	£1,423	18	-724	£481	£79	-£1.97	3
LI + DPd + HWTJ	£478	21	2,117	£538	£23	£0.23	0.9
LI + DPd + HWTJ + CFLs	£498	22	2,173	£552	£23	£0.23	0.9
Electric storage heating system auto control on E24 (ESH E24)	£1,600	25	-871	£629	£64	-£1.84	2.5
ESH E24 + HWTJ	£1,623	26	-729	£649	£62	-£2.23	2.5
Quantum storage heaters	£2,800	27	190	£659	£104	£14.74	4.2
Air source heat pump (ASHP) + new Hot water cylinder	£8,500	30	2,786	£708	£283	£3.05	12
Quantum storage heater + HWTJ	£2,823	31	407	£729	£91	£6.94	3.9
ESH E7 + LI	£1,750	32	1,286	£759	£55	£1.36	2.3
ESH E7 + LI + DPd	£1,850	33	1,302	£761	£56	£1.42	2.4
ESH E7 + LI + DPd + HWTJ	£1,878	36	1,486	£826	£52	£1.26	2.3
ESH E7 + LI + DPd + HWTJ + CFLs	£1,898	38	1,530	£845	£50	£1.24	2.2
Quantum storage heaters + LI	£3,150	41	2,036	£889	£77	£1.55	3.5
Quantum storage heaters + LI + DPd	£3,250	41	2,047	£891	£79	£1.59	3.6
ESH E24 + LI	£1,950	43	1,478	£924	£45	£1.32	2.1
ESH E24 + LI + DPd	£2,050	43	1,492	£926	£48	£1.37	2.2
Insulation package (LI SWI DPd LELs HWTJ)	£9,498	45	3,740	£951	£211	£2.54	10
ESH E24 + LI + DPd + HWTJ	£2,073	45	1,685	£951	£46	£1.23	2.2
Quantum storage heaters + LI + DPd + HWTJ	£3,273	46	2,262	£961	£71	£1.45	3.4
ESH E24 + LI + DPd + HWTJ + CFLs	£2,098	46	1,733	£968	£46	£1.21	2.2
ASHP + LI	£8,850	46	3,808	£968	£192	£2.32	9.1
ASHP + LI + DPd	£8,950	46	3,815	£969	£195	£2.35	9.2
Insulation package + Wind turbine on roof (2m diameter)	£12,248	47	3,854	£979	£261	£3.18	12.5
Quantum storage heaters + LI + DPd + HWTJ + CFLs	£3,298	47	2,317	£981	£70	£1.42	3.4
ASHP + LI + DPd + CFLs	£8,975	48	3,887	£988	£187	£2.31	9.1
Gas condensing combi 88% (GCC)	£5,000	51	3,503	£1,037	£98	£1.43	4.8
Insulation package + Solar hot water	£14,498	51	4,088	£1,039	£284	£3.55	14
GCC + Flue Gas Heat Recovery System (FGHRS)	£5,450	52	3,623	£1,051	£105	£1.50	5.2
Insulation package + ESH E7	£10,898	57	3,513	£1,111	£191	£3.10	9.8
Insulation package + PVs	£20,998	58	4,457	£1,133	£362	£4.71	18.5
GCC + LI	£5,350	61	4,351	£1,169	£88	£1.23	4.6
GCC + LI + DPd	£5,450	61	4,356	£1,170	£89	£1.25	4.7
Insulation package + Quantum storage heaters	£12,298	61	3,827	£1,170	£202	£3.21	10.5
GCC + LI + DPd + CFLs	£5,475	62	4,432	£1,190	£88	£1.24	4.6
Insulation package + ASHP	£11,798	63	4,738	£1,204	£187	£2.49	9.8
Insulation package + ESH E24	£11,098	63	3,584	£1,204	£176	£3.10	9.2
Insulation package + GCC	£14,498	70	5,137	£1,304	£207	£2.82	11.1
Insulation package + GCC + FGHRS	£14,498	71	5,209	£1,316	£204	£2.78	11

4.67 Another occurrence seen within Table 4.11, not seen in the analysis of the detached dwelling, is the appearance of negative CO_2e emission values, that is, CO_2e emissions are increasing when compared against the base case top floor flat. This increase occurs because of the change from direct electric heating in the base case, and the modelling of the impact of electric storage heating. Although both types of heating are deemed 100% efficient at end-use in the home, storage heaters are considered an unresponsive heating system, while direct electric heaters are considered responsive in SAP. Unresponsive heating systems are penalised within SAP and RdSAP by increasing the energy consumption associated with heating the dwelling, when compared to responsive heaters. However, this extra consumption is charged on the lower, off-peak electricity tariff rate within SAP and RdSAP so replacing direct electric on-peak heaters with electric storage off-peak heaters results in a fuel cost saving and a better SAP rating despite the increase in energy consumption and the increase in the associated CO_2e emissions.

Improving the Energy Efficiency in the Top Floor Flat

4.68 The increases in the SAP score, the reductions in kg of CO_2e emissions, and the reductions in SAP fuel bills are plotted against the indicative capital cost^[54] of the various improvement options assessed for this top floor tenemental flat in Figures 4.6, 4.7 and 4.8 respectively. The capital costs are along the x-axis, and the respective impact on the SAP rating, CO_2e emissions, and fuel costs are on the y-axis. The axes of the graphs take their intersection to be the median cost of the improvement options assessed for this top floor flat (i.e. £3262) and the median change in the respective SAP score (i.e. 41 SAP points), the reduction in kg of CO_2e per year (i.e. 1970 kg of CO_2e), and the reduction in £ per year on the SAP fuel costs (i.e. £890), quartering the graph into Low cost - Low impact, Low cost - High impact, High cost - Low impact, and High cost - High impact sections. The further left on the x-axis and further up the y-axis, the bigger the impact on the energy performance of the dwelling for the money spent.

4.69 Additionally in Figure 4.6, threshold lines are included showing the increases in SAP points to move this dwelling into the higher SAP Bands.

Figure 4.6: Cost of Measure versus Increase in SAP rating - Top Floor Flat

Figure 4.7: Cost of Measure versus Change in CO_2e emissions - Top Floor Flat

Figure 4.8 Cost of Measure versus Reductions in Fuel Costs - Top Floor Flat

Low cost - High impact improvements in Top Floor Flat

4.70 Only one measure falls within the Low cost - High impact section of the graph for improving the SAP rating, reducing CO_2e emissions and cutting household fuel costs - the fitting of the new high thermal capacity (Quantum) electric storage heaters in conjunction with loft insulation and draught proofing the door of the flat (see Tables 4.12 - 4.14 below). A modern electric storage heating system on a 24-hour tariff, coupled with loft insulation, draught proofing the front door, and fitting a new hot water cylinder jacket, show up well on improving the SAP score and reducing the fuel bill, but are not so good on reducing CO_2e emissions because of the higher CO_2e conversion co-efficient with electric heating than gas.

Table 4.12: SAP rating: Low cost - High impact improvements Top Floor Flat

Improvement assessed	SAP	SAP EPC Band	Capital cost (£)	Increase in SAP score	Cost per SAP point increase (£)
Quantum storage heaters + LI	45	E	£3,150	41	£77
Quantum storage heaters + LI + DPd	45	E	£3,250	41	£79
ESH E24 + LI	47	E	£1,950	43	£45
ESH E24 + LI + DPd	47	E	£2,050	43	£48
ESH E24 + LI + DPd + HWTJ	49	E	£2,073	45	£46
ESH E24 + LI + DPd + HWTJ + CFLs	50	E	£2,098	46	£46

Table 4.13: CO_2e emissions: Low cost - High impact improvements Top Floor Flat

Improvement assessed	SAP	SAP EPC Band	Capital cost (£)	Saving kg CO2e / year	Cost per Kg CO2e saved per year (£)
LI + DPd + HWTJ	25	F	£478	2,117	£0.23
LI + DPd + HWTJ + CFLs	26	F	£498	2,173	£0.23
Quantum storage heaters + LI	45	E	£3,150	2,036	£1.55
Quantum storage heaters + LI + DPd	45	E	£3,250	2,047	£1.59

Table 4.14: Fuel Cost Savings: Low cost - High impact improvements Top Floor Flat

Improvement assessed	SAP	SAP EPC Band	Capital cost (£)	Saving in fuel cost (£/year)	Payback (years)
Quantum storage heaters + LI + DPd	45	E	£3,250	£891	3.6
ESH E24 + LI	47	E	£1,950	£924	2.1
ESH E24 + LI + DPd	47	E	£2,050	£926	2.2
ESH E24 + LI + DPd + HWTJ	49	E	£2,073	£951	2.2
ESH E24 + LI + DPd + HWTJ + CFLs	50	E	£2,098	£968	2.2

4.71 All of the other improvement measure assessed for this top floor flat fall within the Low cost - Low impact, High cost - Low impact and High cost - High impact sections of the three graphs Low cost - High impact sections of the respective graphs. An extended analysis is set out in Appendix 9.

Overall Comment on the Improvements Assessed for the Top Floor Flat

4.72 The presence of a mains gas supply changes the fundamental nature of the improvement package compared to the assessment of the detached bungalow that was off the gas grid. Installing a condensing boiler as a single measure would achieve a SAP D Band rating, and in combination with insulation measures could achieve a C rating.

4.73 In the top floor tenemental flat, the cost to achieve a SAP Banding of F ranged between £350 to almost £8,500; by way of comparison, to achieve a SAP Banding of E, ranged between £1,878 and £12,248; to achieve a SAP Banding of D ranged between £5,350 and £20,998, and to reach a SAP C rating, between £14,458 and £14,998 (see Figure 4.9). Conversely, given the range of measures assessed here, it is possible to spend upwards of £11,500 and still be a SAP Band G dwelling. Alternatively, if you chose to spend up to £8,500 on this property, you could achieve a SAP rating in Band G, Band F, Band E or Band D.

Figure 4.9: Detached Dwelling: Range of Costs to Achieve a SAP Band Rating

4.74 On its own, loft insulation would be sufficient to raise the SAP rating of this flat to Band F. Wall insulation does not quite achieve a SAP F Band rating on its own here because it was assumed that the close wall would not be insulated.

4.75 While replacing the heating with a gas condensing boiler has the biggest single impact on the energy performance of this dwelling, there were other heating options that had significant impacts on improving the SAP rating, reducing CO_2e and lowering fuel bills. Interestingly, switching from the direct electric heaters to electric storage heating (without any complementary insulation) resulted in increased CO_2e emissions although the option improved the SAP rating and lowered fuel bills.

4.76 There is a general consistency with the measures emerging from the assessment falling into the respective Low cost - High impact, Low cost - Low impact, High Cost - High impact, and High cost - Low impact groupings for this property.

4.77 There is also consistency within this dwelling that some measures are extremely cost effective but do not have a huge impact in terms of raising the overall SAP rating. There is also a consistency in measures that are very expensive and do not make a sizeable big impact on the rating, or the reductions in CO_2e emissions, and have a long payback period.

Establishing a hierarchy for modelling improvements

4.78 The lessons emerging from the analysis of the improvement options assessed for the detached bungalow and the top floor tenemental flat are:

• that the prevailing situation in terms of the installed heating, insulation, ventilation and presence of other energy saving equipment within the dwelling, the location of the dwelling (whether on or off the gas grid) were important variables in determining the applicability of potential improvement measures, and how effective they will be at improving the SAP rating, reducing the CO_2e emissions and lowering the fuel costs;
• that certain measures may be very cost effective but will have only a small impact on the overall improvement of the SAP rating
• that certain measures are very expensive, not cost effective and will only have a very small impact on the SAP rating
• that for a particular dwelling there is a great consistency amongst the measures that can be categorised as Low cost - High impact, Low cost - Low impact, High Cost - High impact, and High cost - Low impact.
• that it is likely that a package of measures to raise the SAP rating to achieve a SAP Band D rating would be possible in most dwellings, as well as the lower bandings.

4.79 While the quadrant-based analysis was very useful for highlighting these issues, it was deemed too subjective overall on the basis of defining the overall hierarchy of improvements. The intersections of the improvement in SAP scores and the indicative capital costs axes would change with each archetype modelled and depend on the range of improvements modelled.

4.80 The results from the modelling of the two sample dwellings highlighted that there was a high degree of variability with regard to the impact of different improvements. While the intention of the hierarchy of improvements was to include measures that were 'cost effective', the issue for this project became one of 'what is cost effective'? As can be seen from the above discussions, there are no shortage of ways to measure or define cost-effectiveness:

• increase in SAP points
• SAP points increase per £
• increase in Environmental Impact rating
• reduction in CO_2e emissions
• tonnes of CO_2e reduction per £
• reductions in fuel costs
• minimum payback periods

4.81 Alternatives to some measure of cost effectiveness were discussed, for example;

• maximum cap on the capital cost of improvements
• minimum standards to be met

4.82 Alternative monetary approaches assessed included calculating the fuel cost savings over the lifetime of the improvement and comparing it with the cost of the improvement either directly, or by discounting the fuel cost savings (e.g. using the Ofgem 'in-use' factors^[55] ). The net return on the investment over the lifetime of the investment was modelled. The complicating issue here is that different measures have different lifetimes and different in-use factors. This means that a combined lifetime has to be calculated, with the savings associated with each improvement within a package being affected by the order in which the improvement measures are assessed.

4.83 In addition to examining the monetary return, another approach calculated the cost of a net lifetime tonne of CO_2e saved by the various improvement measures and package. This approach again took into account the lifetime of the measure and its 'in-use' factor. This cost could be compared with the shadow price of carbon figures that are published by the government.

4.84 That said, in assessing a measure, a view with regards to not closing off future options will be applied. For example, the Scottish Government not only has a greenhouse gas emissions reduction target for 2020, but also a more onerous one for the year 2050. Thus, for example, if it were necessary to propose external wall insulation to achieve a target SAP score (regardless of the banding), it would be inappropriate to improve the wall U-value by the minimum necessary just to achieve that banding. Trying to then further improve the U-value at a later date to achieve the next target would incur duplication of effort, extra costs and be less cost effective. Similarly, the same could be said for any insulation measure. So where insulation is to be proposed, the proposal would be to achieve at least the minimum standard in keeping with the current Scottish building regulations.

4.85 This issue is less of a concern with heating. The lifetime of heating systems is less than that of fabric insulation^[56], so going for a short term system such as gas would be to reap the short term gains in terms of improvements in energy efficiency, reductions in CO_2e emissions, and the fall in fuel bills, knowing that in the medium term future they are going to be replaced anyway. If gas is still a low cost, low carbon fuel in 2030, then nothing is lost. If the de-carbonisation of electricity supply means the future is electric, then when these heating systems are in need of replacement, new heating can be installed.

4.86 Installing wet central heating systems, certainly within urban areas, would be in keeping with the proposed establishment of heat generation networks in Scotland. These networks will take time to establish, and ultimately switching the heat source from an individual boiler to a connection to a community heat network would not be disadvantaged by the presence of a wet distribution network (radiators and pipework) already within the dwelling.

4.87 Lastly, in keeping with the principles set out within the proposed Scottish Heat Generation Strategy, even where a single heating measure would be sufficient to achieve the target SAP banding set for REEPS, the dwelling should be brought up to a minimum insulation standard. Reducing the demand for heat, by reducing the heat loss from our dwellings would reduce the pressure of rising fuel bills on households.

4.88 Within all of this discussion, what has become apparent is that all of the energy performanc¬e indicators do not always move in the same way. Sometimes they do: the improvement measure reduces fuel costs, reduces energy consumption and reduces CO_2e emissions, while improving the energy performance rating of the dwelling. In other instances, for example, you can achieve improved SAP ratings and reductions in fuel costs, but at the cost of higher energy consumption or higher CO_2e emissions. Alternatively, you can achieve lower CO_2e emissions and reduce the dwelling's SAP score. Most insulation improvement measures, regardless of their cost effectiveness, have a limited impact on increasing the SAP score when pursued as single measures. Large improvements in SAP ratings can be achieved by focussing on heating related improvements, but such an emphasis would result in higher energy consumption if not pursued in tandem with insulation improvements. For any given amount of capital expenditure, the impact on the dwelling's energy performance will be dependent on the actual improvements selected; a large capital expenditure is no guarantee that a large improvement in the SAP rating will result.

4.89 The RAG decided that the issue that would engender the most public concern and be the focus of the public debate, if REEPS became a mandatory standard, related to the capital cost of the improvements. That is, the public would be concerned with "how much is this going to cost me?" The decision taken by the REEPS RAG was for the modelling of the 355 individual archetypes to identify the cheapest selection of improvement measures to take each dwelling into the successive SAP bandings, from SAP Band G to Band F, from SAP Band F to Band E, and from SAP Band E to Band D. If REEPS becomes a mandatory standard, the current policy intention is for the public to have flexibility in deciding how to meet the standard.

4.90 On this basis, a 5-page report was prepared for each of the 355 archetypes. An example of the 5-page report is included below for archetype 1320130. Each report follows the same format, and contains:

• a description of the archetype: Archetype 1320130 presented represents the group of pre-1919 mid terrace / terrace with passage / enclosed end dwelling with sandstone walls and a mains gas boiler and achieved a Band F rating (as set out in the title). This group represents 1684 dwellings (i.e. 0.42%) of the target stock. Specifically, the actual dwelling modelled was a mid-terrace bungalow with rooms in the roof and an extension. All of the dimensional details used in the modelling and U-values are set out on the description page, along with information on the space heating, hot water and controls in the dwelling, and other energy-related characteristics of the dwelling when surveyed by the SHCS. This dwelling has an assessed SAP 2012 score of 30, so falls into SAP Band F.
• the list of the specific improvements modelled for the archetype: On the second page of the report, the resultant SAP and Environmental Impact scores and bandings, as well as the SAP fuel costs, CO_2e emissions and delivered energy consumption figures broken down by energy end use in the home for each of the improvements modelled for the respective archetype. The improvements modelled were specific to this dwelling in this archetype, and were drawn from the overall list of 38 improvements measures set out earlier in this report (see para 4.11 - 4.17, and described in more detail in Appendix 2). For this dwelling, 19 improvement measures were modelled as individual improvements, and ordered according to their impact on the SAP score. The impact of two of the improvements are sufficient enough in their own right to increase the SAP score by at least SAP 9 points, which would move the dwelling from SAP Band F into Band E. None of the other improvements assessed increase the SAP score by as many as 9 points.
• the list of the improvements not assessed and the reason: the third page of the report sets out the reasons why specific improvements were not modelled for this archetype. Some improvements were not applicable to archetype 1320130: for example, flat roof insulation was not assessed because this archetype did not have a flat roof. Some improvements were not recommended: for example, switching to any of the electric heating options would have resulted in a lower SAP score. Some improvements were not needed as they were already present within the dwelling: for example, the existing heating system had a programmer and TRVs already.
• the impact of the individual improvements on the annual and lifetime SAP fuel costs, CO_2e emissions and delivered energy: The fourth page of the report sets out in Table 3 the calculated annual and lifetime reductions in SAP fuel costs, CO_2e emissions and delivered energy for each if the individual improvements. Importantly, these impacts are ordered by the indicative capital cost of the improvement. For archetype 1320130, the improvement measures modelled ranged from £23 for fitting a new hot water cylinder jacket to £20,000 for installing a stand-alone, 5 meter diameter wind turbine. The table also includes the calculated net lifetime return on the investment and its simple payback period. The paybacks vary from 1.1 years to over 350 years: some of the improvements show a positive return on their indicative capital investment cost, while some measures do not recoup the cost of their investment through reductions in SAP fuel costs over the assessed lifetime of the improvement (which are highlighted in orange in Table 3).
• the cheapest improvement or packages of improvements to raise the SAP banding respectively to SAP Band F, to SAP Band E and to SAP Band D as necessary: For archetype 1320130, its initial SAP score achieved a SAP Banding of F. Two measures were sufficient on their own to achieve Band E, i.e. loft insulation and a room in the roof insulation package, with loft insulation having a much lower indicative capital cost than the room in the roof insulation package. Loft insulation as a single measure was also less expensive than any combination of other measures to achieve SAP Band E, so loft insulation, with an indicative capital cost of £350, is presented in Table 4a below least costly way to achieve SAP Band E. However, to raise the SAP rating by 25 points, to move it from Band F to Band D needed a combination of improvements. No single measure assessed on its own for archetype 1320130 was sufficient to achieve the 25 point increase in the SAP score necessary to achieve SAP Band D. Many different permutations of improvements could be packaged to achieve a SAP Band D score of at least 55 here. For archetype 1320130 the package with the least indicative cost included room in the roof insulation, a replacement gas condensing boiler, and a hot water tank jacket. The indicative capital cost for the package was £4723, with a net lifetime return of over £4 for each pound invested, and a simple payback of 7 years.

4.91 Appendix 11 of this report sets out the complete process of taking the initial SHCS data for archetype 1320130 through to the production of its archetype template. All 355 archetype reports are available on-line.

Table 1: Modelled SIngle Improvements: EPC Band, SAP Score, Environmental Impact Band, Enviromental Impact Score, SAP Annual Fuel Costs, SAP CO2 emissions, and SAP Delivered Energy Consumption (Ordered by impact on the SAP score (lowest to highest))

EPC = EPC band / SAP = SAP 2012 score / EI = Environmental Impact band / EIs = Environmental Impact score
MH = main heating / SecH secondary heating / HW = hot water / L = lighting and other costs (e.g. fans and pumps) / ren = impact of renewable generation / tot = total of category

The starting point for this dwelling (i.e. as existing) is a Band F SAP score of 30, that is, 9 points short of Band E, and 25 points below Band D.

For this dwelling, 19 improvement measures were assessed. Those that were not assessed, and the reasons, are set out in Table 2.

Table 1 above is ordered in terms of the smallest impact on the increase in the SAP score to the highest. Five measures do not have an impact on the SAP score:

M12	draughtproof windows and doors
M7	double glazing to 1.8
M8	secondary glazing to 2.4
M11	hot water tank jacket 80mm
M31	2m diameter wind turbine on roof

While these 5 measures do improve the dwelling's overall energy efficiency, the improvements are not sufficient in themselves to increase the SAP score by 1 full SAP point.

Two measures on their own (highlighted in yellow in Table 1 above) would raise the SAP rating into the Band E category. Neither of these measures are mutually exclusive.

No assessed measure on its own would raise the SAP rating into Band D or higher.

Note: In SAP and RdSAP, the estimated delivered energy (which is assumed to be electricity) generated from a installed photovoltaic system (PVs) and / or a wind turbine is converted to a monetary value, a carbon dioxide emission equivalent value, and a primary energy value using conversion factors from Table 12 of the SAP manual. These amounts are then subtracted from the respective estimated delivered energy, SAP fuel cost, carbon dioxide emission equivalent, and primary energy totals of the dwelling without the PVs and / or wind turbine. The impact of the installation of photovoltaics and / or wind turbines appears in the 'ren' columns in above table as a negative number.

Table 2: Reasons for Measures Not Assessed in this Property

code	Improvement Description	Improvement Modelled?
M2	flat roof insulation	not applicable
M15	replace oil boiler with condensing boiler 90%	not applicable
M16	full gas central heating system inc controls	not recommended
M17	full oil central heating system inc controls	not recommended
M18	full biomass central heating system inc controls	not recommended
M19	fan electric storage heaters with auto charge control	not recommended
M20	quantum storage heaters	not recommended
M21	full electric radiator system inc controls - off peak tariff	not recommended
M22	air source heat pump	not recommended
M23	ground source heat pump	not recommended
M25	programmer for heating system	already present
M26	TRVs	already present
M27	full controls package (r/stat, programmer and TRVs)	not recommended
M28	Auto charge control	not applicable
M34	Cylinder stat for hot water cylinder	not applicable
M35	Air to Air heat pump	not recommended
M36	replace secondary heating with one more efficient	not recommended
M37	electric CPSU with raidtors and controls on E18 tariff	not recommended
M38	switch to E24 tariff	not applicable

A number of the improvement measures were not assessed with regard to this dwelling. Appendix 2 of the Final Report sets out the methodology associated with modelling the 38 improvements, including why measures were not recommended, or not applicable.

Table 3: Impact of Single Improvements on Annual and Lifetime SAP Fuel Costs, CO2 emmissions, Delivered Energy Consumption - ordered by Capital Costs (lowest to highest)

Table 3 sets out the resultant EPC and Environmental Impact (EI) banding for each of the individual improvement measures assessed for this dwelling, along with the changes in the respective SAP and EI scores. It then displays the impact on the respective SAP-calculated annual fuel bill, CO2 emissions and delivered energy consumption for the dwelling (the pink columns in Table 3 above). Multipling the annual change in the calculated SAP fuel costs, CO2 emissions, and delivered energy consumption for this property, by the respective lifetime of each of the measures assessed, produces the lifetime change for each measure (see the blue columns in Table 3 above). This allows us to compare the capital costs against both the cost of the saving on the fuel bill on an annual basis (i.e. the payback), and over the lifetime of the measure (i.e. the net lifetime £ saving / capital cost). The net lifetime £ saving / capital cost subtracts the capital cost of the measure from the calculated lifetime SAP £ reduction. In this column, a value greater than 0 here means the calculated lifetime fuel bill savings are greater than the capital cost of installing the measure. Where the net lifetime saving is a negative number, that is, it has a cost effectiveness of less than 0 (and highlighted in orange in Table 3), the measure will not return the cost of the original investment through savings in the fuel bills alone.

Table 3 is ordered from the lowest capital cost for the improvement measure assessed to the highest. The capital costs of the individual measures ranged from £23 for a hot water tank jacket, up to £20,000 for the stand-alone wind turbine. A low capital cost does not necessarily equate to a good return on an investment or short payback period; similarly, a high capital cost does not necessarily mean a poor return on the cost of the investment or a long payback. In terms of cost effectiveness, the two measures with the shortest payback for this archetype are installing low energy lighting throughout the dwelling, and loft inulation, both with a payback of 1.1 years. Installing loft insulation has a longer payback period, but provides the largest lifetime return on the cost of the improvement, with a return of £36.74 for every pound invested over the lifetime of the measure.

Ten of the measures have a cost effectiveness of less than 0 (highlighted in orange in Table 3) and will not return the cost of the original investment through savings in the fuel bills alone. However, the eligibility for other incentive schemes (e.g. Feed in Tariffs for fitting PV systems and wind turbines, and the Renewable Heat Incentive for fitting solar thermal systems) are likely to have a significant impact on the financial return associated with these measures. The financial benefits associated with these incentive schemes are not included in the calculations here, because of their constantly changing returns.

From the characteristics of this archetype, the starting point for this dwelling was assessed to be a RdSAP 2012 Band F SAP score of 30. Two separate packages were assessed for this archetype: the cheapest package of measures to raise the SAP score so that it achieved a SAP Band E score of at least 39; and, the cheapest package of measures to raise the SAP score so that it achieved a SAP Band D score of at least 55. While some measures may be common to all of the packages, each package was assessed independently of one another, so that the separate packages for this dwelling may have no components in common.

Table 4a Cheapest Package of improvement Measures to Increase the SAP EPC Band to SAP Band E

Installing loft insulation in this property was assessed as the cheapest way to move the SAP rating for this property into Band E (see Table 4a). The indicative cost was estimated at £350.

Table 4b: Cheapest Package of improvement Measures to Increase the SAP EPC Band to SAP Band D

No single measure was assessed to achieve the Band D for this dwelling, therefore a package of measures was assessed. Installing room in the roof insulation in conjunction with insulating the rest of the loft space, replacing the existing boiler with a more efficient condensing model with an efficiency of at least 88%, and fitting an additional jacket on the hot water cylinder in this property was assessed as the cheapest way to move the SAP rating for this property into Band D (see Table 4b). The total indicative cost of this package was estimated at approximately £4,723.