‘Lost interest’ means lost opportunity for greener homes

New analysis from Ecology Building Society shows UK savers could pay for a range of energy efficient home improvements from lost interest alone, simply by switching savings accounts. 

The UK has more than 365,000 UK accounts with balances of over £100,000 earning 1.5% interest or less. An account holding £100,000 could earn £2750 more interest in one year, when compared to the rate of interest offered by Ecology’s Single Access Saver, which pays a monthly variable interest rate of 4.25% AER /4.17% gross until 31 October 2027.

The value of this additional interest could fund important energy efficient home improvements, from cavity wall insulation within a year, solar panels within three, and an air-source heat pump within five – without touching the savings themselves. 

Year 1 - £2750 extra interest Enough to exceed the typical £2200 cost of cavity wall insulation

Year 3 - £8250 extra interest Enough to exceed the £7600 average cost of solar panels 

Year 5 - £13,750 extra interestEnough to exceed the typical £12,000 cost of an air source heat pump

This lost opportunity comes against the backdrop of England having some of the oldest building stock in Europe, making them less energy efficient than newer dwellings.

Separately, to illustrate the potential environmental benefits, if 365,000 more UK homes installed solar panels, the number of houses generating their own solar power would rise by more than 20%. Based on Energy Saving Trust estimates, those installations could collectively save around 365,000 tonnes of CO₂ annually – equivalent to the emissions of driving more than 1.3 billion miles.  

Gareth Griffiths, chief executive officer at Ecology Building Society, said: ‘If you have worked hard to build up significant savings, you should expect that money to work hard for you too. Our analysis shows that a competitive rate isn’t just a percentage on a statement. It could mean thousands of pounds towards making your home warmer, better for the planet, and cheaper to run, without touching the savings you have worked so hard to build. 

‘But there is another side to making your money work harder: what happens to it while it is sitting in your savings account. Choosing where to save is also choosing what your money helps to support. 

‘At Ecology, we use savers’ deposits to finance energy efficient homes, and projects that benefit people and communities. Across the UK, £327 billion is held in low interest savings accounts – the equivalent of one million property projects at our average mortgage advance of £310,000. 

‘That is an extraordinary amount of financial potential. Imagine what could be achieved if more of it was directed towards making Britain’s homes more sustainable and energy efficient.’