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UK’s first mainstream zero carbon homes arrive – are they the future?

A government-backed modular housing ‘pioneer’ has unveiled the UK’s first mainstream zero carbon home, which it claims can cut energy bills to zero thanks to progress in manufacturing, materials and renewable energy.

ilke Homes says factory manufactured homes create less waste and are more ‘thermally efficient’ because many of the components come pre-assembled or are cut and manufactured using robots. Having already trialled zero carbon homes for five councils and housing associations, the Yorkshire-based company is now rolling out a mainstream zero carbon home to help investors go green.

And change is needed in property if the government is to meet its green targets. Housing is responsible for more than a quarter of the country’s carbon emissions – while, last year, only 1.6% of new-builds in the UK were built to the top standard of energy-efficiency, equivalent to just 3,457 homes.


Zero carbon homes, like electric vehicles (EVs) and most green technology, cost a bit more at present than standard fossil fuel-heated homes because of the cost of installing additional insulation, heat pumps and solar panels, ‘but also as incentives are perversely still provided to developers from gas network providers’.

Nevertheless, ilke Homes believes that the small cost premium will be eradicated totally by 2030 thanks to reductions in key component costs and advances in its manufacturing processes, robotics and AI-driven design.

This means investors and housing associations will not have to pay more for a zero carbon home, while it claims consumers living in an ilke ZERO house will pay nothing for energy, saving nearly £1,000 a year on bills.

A call for extra speed

The firm has now called on its partners, its supply chain and the wider construction industry, to work together to speed up delivery.

Collaboration between parts manufacturers and government incentives have significantly brought down the cost of materials with EVs and ensured more skilled engineers have been trained up, and the hope is to do the same with houses. 

In a similar way to a car chassis, with manufacturers like Audi, VW, SEAT and Skoda using the same chassis for different types of vehicle, modular homes can be specified for a range of price points using the same base, ilke says. This means that there is an opportunity ‘to find significant efficiencies’ through scaling up manufacturing.  

Incentives and policy levers helped wind, solar and EVs

Between 2010 and 2019, the cost of solar power, onshore wind and offshore wind fell by 47%, 40% and 29% respectively, thanks to feed-in tariffs - a policy mechanism that offers long-term contracts with cost-based compensation to renewable energy producers.

It’s estimated that by 2022, the extra cost of manufacturing battery powered cars versus fossil fuel equivalents will diminish to £1,470, with this reduction driven by government-backed grants that, since 2011, have shaved £5,000 off the cost of an electric vehicle for consumers. The grant has since been reduced to £2,500.

ilke says its ZERO homes can not only help tackle the climate crisis, but can also play a key role in reducing fuel poverty, with households potentially pay nothing for their energy. Fuel poverty is a major problem in England, with there being an estimated 3.18 million households in fuel poverty in 2019.

Meanwhile, the aggregate fuel poverty gap - the reduction in fuel costs needed for a household to not be in fuel poverty - was £687 million, or £216 a household, in 2019.

By contrast, ilke ZERO says it is able to achieve a zero carbon specification in the following ways.

  • Fabric: A home’s walls, floors and roofs are highly insulated, while all windows and doors are incredibly airtight. This helps ensure heat does not escape and stops draughts. Being manufactured in a factory - as opposed to a field - means everything can be done at higher quality.
  • Efficiency: Highly efficient LED lighting that use less than a quarter of the energy of a halogen bulb is incorporated into the design, as well efficient water fittings and ventilation systems
  • Renewable energy: Fossil-fuel gas boilers are replaced by low-carbon air source heat pumps that use a third of the energy. In addition, solar panels, that now cost less than traditional roof tiles, generate more electricity than a house requires, providing free energy for consumers and income from exported electricity.

Dave Sheridan, executive chairman at ilke Homes, said:

“Government is rightly pushing construction to drag itself into the 21st century and we need to replicate the successes seen with solar, wind and EVs where industry came together, drove down costs and drove up skills,” Dave Sheridan, ilke Homes’ executive chairman, commented. 

“We’ve spent years investing in our factory and this mainstream zero-carbon home is a great example of how the private sector can respond to politicians’ net zero pledges. There’s a huge opportunity here to tackle fuel poverty while helping investors meet their green targets. But we need our supply chain and our partners to work with us. Driving down the cost depends on scale and equally, we need to act now.”

He said that building zero-carbon homes now will pay off very quickly, ‘because very soon councils, housing associations and homeowners will face carbon taxes and stare down the barrel of huge retrofit costs which can all be avoided’.

“Low-carbon technologies are improving all the time but while some firms claim we don’t have enough of the right skills to build zero carbon homes en masse now, we believe that these are the very vested interests that have held back construction over the decades,” he added.

Laura Bujanauskiene, a resident of an ilke ZERO home in Greenwich, said: “My family and I love living in this home and I firmly believe that everyone else would. Although it’s not cheap to build these homes, I would certainly recommend making the move to zero-carbon living. Our bills are kept low and we can sleep well knowing our home habits are making minimum contributions to emissions. These are the homes of the future.”

Mark Farmer, the government’s champion for modern housebuilding, insisted that the government continues to be highly supportive of modern methods of construction (MMC). He said that, as efforts ramp up to meet the UK's net-zero carbon targets by 2050, it’s going to ‘be vitally important’ that the house building industry delivers more energy-efficient housing to avoid costly retrofitting programmes later down the line.

“Achieving this will require a greater focus on high quality factory-based production,” he said.

Mike De’Ath, partner at architecture firm HTA Design, agreed that manufacturing homes in factories is the only way we can decarbonise housing stock, at scale, and said ‘we have to do this if we’re to stand a chance of meeting our obligations’.

“Like the Model 3, ilke ZERO could be a Tesla moment as there’s significant demand for a mainstream, zero carbon home,” he explained.

“What’s critical now is that we have the right policies and incentives to encourage the right skills and technology to be developed so that all modular manufacturers and developers can benefit and work collaboratively to reduce the impact of housing on the environment.”

Nigel Banks, director of special projects at ilke Homes, concluded: “New building regulations mean that of the million or so homes that will be delivered between now and 2025, the majority will require retrofitting later down the line. Therefore, it’s crucial for the UK to be building homes to zero-carbon standards today.”

He added: “Not only will this help reduce housing’s large carbon footprint, but it will also avoid the need for costly retrofitting programmes later down the line.”

Poll: Will zero carbon homes soon be mainstream?


  • Andrew McCausland

    The ideal of MMC properties with a zero carbon footprint are definitely the future and many countries are ahead of UK in mass producing these. The price will no doubt come down as volumes increase and as a home buyer I would personally look for these over traditionally constructed properties.

    However, as a landlord and investor I can't get over the problem of the perverse incentive. The landlords buy the properties but the tenants get the advantages of lower utility bills. That is fine if the tenant then pays a substantially higher rent to cover my investment costs. But what do we do about those on lower incomes and in fuel poverty?

    Government needs to come up with a scheme to overcome this issue if they want investors to roll these units out to those who need them most - the people who can least afford high gas and electricity bills. Until there is a tax rebate or similar scheme to offset the capital costs of zero carbon homes it seems unlikely to penetrate in to the market where it is financially most needed, lower carbon emissions not withstanding.

    Algarve  Investor

    Great comment. Well said.

    While the government needs to intervene to make them more investor-friendly, I think there is no doubt that they are a good end goal to aim for, in the same way that homes without gas boilers are a good target. Or a world without petrol and diesel cars.

    The alternatives are not without their own issues and possible downsides, but still way better than the present.


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