Create positive energy

Rising utility prices are the ideal incentive to boost your home's green credentials, says Graham Norwood

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There has been much discussion of "eco-towns" and of green new homes, but in so many ways this tinkers with the issue; there are 26 million older homes which need to improve their green credentials.

Research by British Gas suggests that while improving building regulations to make new homes more eco-friendly will reduce CO2 emissions by 7 per cent by 2020, simple work on existing properties can achieve far greater emissions savings.

For example, more than nine million homes have uninsulated cavity walls – and this contributes to a frightening statistic by British Gas suggesting that £1 in every £3 spent on heating is lost as a result of poor insulation.

Constructing, maintaining and living in our homes accounts for 28 per cent of UK carbon dioxide emissions says the Government. The average "old" house loses about 35 per cent of its heat through the walls, 25 per cent through the roof, 25 per cent via doors and windows and 15 per cent through the floor, so there is huge scope for improvement.

In the past, it has not always been cost-effective to retro-fit green features to older homes. When utilities were relatively cheap it would take many years to pay back the cost of installing these devices. But the surge in energy costs has changed all that.

Improved insulation could consist of a 150mm jacket on the hot water tank and loft insulation at least 250mm thick, with wall cavities filled with fibre.

The cost will vary according to house size and labour costs but the Energy Saving Trust, a body that promotes greener lifestyles at home, says £1,800 should be enough to have all this installed in most homes. Energy bills could subsequently drop by up to 15 per cent annually, so "pay back" is about seven years.

There is also the Ground Source Heat Pump (GSHP), a series of pipes filled with water and anti-freeze buried in a trench outside a home. Natural heat from the ground is absorbed by the fluid-filled pipes and is then pumped into the home, where it heats water and the property. A GSHP can cost £6,000 to £12,000 for installation in a typical family home. A typical London resident now spends £720 on heating fuel every year – a lot more in large houses – and a 40 per cent rise is predicted by late 2009. So it could be as little as five years before a GSHP pays back its installation costs in savings.

"Most customers don't want them [GSHPs] purely because of their environmental credentials. Instead, they've worked out the comparative costs, and a pump works out cheaper than an oil-fired home," says Robert Meeks of Ice Energy, one of Britain's largest suppliers and installers of GSHPs.

Then of course there are solar panels, located on south-facing roofs, gathering energy from the sun and turning it into heat. This is piped into the domestic water system to complement heating provided by a boiler. On a sunny summer day, solar energy can provide all the hot water required by a typical household. The cost to a typical home would be £1,000 to £8,000, but many existing homes qualify for a grant for up to 50 per cent of this price. With enough panels, a home can save half the year-round average cost of heating water. This still means it could take a decade for panels to save enough to cover their cost.

British Gas is conducting an experiment to see how energy-saving devices can be retro-fitted to older houses. It has chosen eight properties across the country – each in a road called Green Street – and presented the owners with £30,000 of equipment, from energy-efficient light bulbs to heat pumps.

The streets will compete on how much energy they can save annually with the winners receiving £50,000 to spend on energy-saving equipment for their local community.

Owners of more unusual homes have more exotic opportunities to go green.

For example, there are thousands of old water mills now used as homes. A green group in Cornwall – the Renewable Energy Office – says these are often perfectly positioned to have turbines fitted. The REO says that for an investment of £100,000, a water-driven turbine could earn a householder as much as £34,000 a year by generating the household's electrical needs and selling the rest to the National Grid.

Gage Williams, director of the REO for Cornwall, says: "There are over 200 mills in Cornwall alone, and we've identified 500 potential hydro sites. If you live in a disused millhouse, look at what drove the mill in the past, and see if you have a head of water. It might be that you have a revenue-generating resource flowing right past your house."

There are further, wider benefits to retrofitting homes with green technology.

A report by the Federation of Master Builders says eco-upgrades on existing housing stock could create an industry worth £3.5bn to £6.5bn annually. Gavin Killip from Oxford University, the author of the report, says: "Bringing British homes up to standard is possible. Making low-carbon housing mainstream will reduce emissions, be good for business and good for jobs."

10 ways to make your home greener

*Fit compact fluorescent bulbs: they use up to 80 per cent less energy and last longer

*Turn your thermostat down by 1C and save on heating costs

*Switch off TVs, PCs and monitors when not in use

*Seal leaky doors and windows

*Use a brick or "flush saver" in your toilet cistern to reduce water usage

*Fit condensing-type boilers and set the thermostat to 60C

*Buy water butts to store rainwater and use bath water in the garden

*Solar panels or photovoltaic tiles can store energy to heat water

*Double- or triple-glazing cuts heat loss through windows by 50 per cent

*Increase loft insulation to 20cm or more and install cavity wall insulation

'The system pays for itself in five years'

David Berkeley may own an unusually large listed property in a beautiful part of Devon, but this has not stopped him going green. He is fitting a Ground Source Heat Pump (GSHP) which extracts heat from the soil in his grounds, and pumps it inside.

"Because I rely on oil for almost all of my heating, it costs £4,000 to £5,000 a year – and that's at last winter's prices, before the oil price surge. I've had a quote for the installation of a [GSHP] system at around £20,000 including materials," explains Berkeley, who works for the Stacks Search & Acquisition buying agency.

"The system will provide almost all of my heating. So even if oil prices stay steady and don't go up, it'll pay for itself in four to five years at most."