The UK government has ambitious targets for new homes over this Parliament, and we still await the publication of the Future Homes Standard (FHS). But as 2026 gets under way, here’s a sobering statistic for those involved in the housebuilding sector: 29 million UK homes will need retrofitting before 2050.
The Future Homes Standard (FHS) will be introduced in England in line with upcoming regulations. Its aim is to considerably enhance the energy efficiency of new homes and reduce carbon emissions, supporting the UK’s broader strategy to achieve net zero by 2050.
Under the FHS, new homes built after 2025 must produce 75-80% fewer carbon emissions compared to those constructed under previous regulations. Homes must also be ‘zero-carbon ready’ and designed in a way that won’t need updating in the transition to electrified heating. The use of fossil fuel systems, such as gas and oil boilers, won’t be allowed in new homes, with heating now provided by low-carbon technologies such as heat networks and heat pumps.
In October 2025, UK domestic retrofit was once again put into the national spotlight, with the publication of the recent National news, with the headline finding that 98% of external wall insulation installed under ECO4 (the 4th iteration of the Energy Company Obligation) and GBIS (Great British Insulation Scheme) need remediation.
COUNTING THE COSTS
With an estimated remediation cost of between £250 and £18,000 per property, the total cost to correct the Audit Office (NAO) ‘Value for Money’ report on energy efficiency installations under the Energy Company Obligation. The report made national work could be more than £300 million (calculated based on 23,000 external wall insulation (EWI) installs, 13,000 internal wall insulation (IWI) installs, at an assumed average cost of £9,000).
Add to this the major issues identified by similar schemes and the bill could potentially be £400 million.
"A National Audit Office report has found that 98% of external wall insulation installed under ECO4 may need remediation works.
The Social Housing Decarbonisation Fund and Home Upgrade Grant, which also funded domestic retrofit schemes, have much lower levels of projects with major issues, but the NAO report still identified a further 6,500 homes under these schemes needing remediation.
TESTING TIMES FOR RETROFIT
But things aren’t quite that simple. At present, more than 50% of UK homes have uninsulated walls. The £400 million cost should be covered by guarantees, but the process to get payment will not be simple. Also, the current skills shortage within the construction industry means that the pool of workers will be busy working on remediation, not the remainder of existing stock.
With householder confidence in retrofitting measures low, and the increasing costs of insulation, combined with the remediation costs identified by the NAO, the case for building performance testing has never been stronger.
At BSRIA, we’re working on a white paper that analyses the issues in depth and recommends actionable pathways for regulators, practitioners, and clients to ensure domestic retrofit delivers its full energy, carbon, and socioeconomic potential.
There are some initial takeaways from our report. At the design stage, testing helps the designer better understand the work needed, facilitating evidence-based decision making, rather than working off assumptions. It will also help build confidence in householders of where heat is lost and that the disruption will be worthwhile.
Upon completion, testing holds the installer to account and means defects are identified quickly. Knowing there will be thermal imaging, airtightness and ventilation testing as a minimum will prevent installers cutting corners in the rush to finish jobs quickly.
Physical testing is a vital part of successfully retrofitting homes and should be given increased prominence in the process. Rather than being seen as an avoidable cost, it should be seen as a risk mitigation measure that can improve outcomes, speed-up design and reduce time on site. Not every property needs extensive testing, but a considered approach in the wider retrofit programme will be beneficial, whatever level of detail is used.
Testing shouldn’t be seen as a replacement for an effective PAS 2035-compliant process. Instead it should support the process, improve accuracy, reduce the risk of noncompliance and prevent poor work.
The BSRIA Retrofitting Report can be downloaded at: www.bsria.com/uk/market-intelligence/reports