New UK housing has insulation standards that do not come close to matching the best northern European levels. Individual homeowners and ethical investors have built single 'eco-homes' but a small new development in Bladon, Oxfordshire is among the first to be speculatively built by a mainstream housebuilder. The new houses are not 'zero-carbon' and do not use the Passiv Haus technologies pioneered for low-emissions housing in Germany. But they are a substantial improvement on most mass-produced homes. Will they make the builder more money? No, says the company, but the experience it has gained will enable it to build eco-homes at a more competitive price in the future. These nine houses each cost over £40,000 more than their draughty Persimmon equivalents. The builder expects the price premium to be slightly less.

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At the edge of the Blenheim estate, nine new houses are almost completed. Clad in stone to fit in with the style of local buildings, these eco-homes are now being actively marketed by Kingerlee, a family-owned building company in Oxford. The homes are terraced two- and three-bedroom houses, typically 1,200 square feet, or about 50% larger than today's average new build property. (A smallish detached house might be about 2,000 sq ft.)

The site is a difficult one and access has not been easy. But Bladon is an attractive place to live and there would have been substantial competition for the land. The decision to risk building really well-insulated and robustly constructed housing was a brave one when demand was unknown.

The homes have six major improvements intended to guarantee better insulation and lowered utility bills:

The walls are constructed from Ziegel blocks rather than the brick, air cavity and aircrete blocks construction typical of UK homes. Ziegel blocks are made from clay with insulation being provided by the air passages inside the block. The blocks glue together, and there is no mortar course. This means much lower heat loss.
The second major insulation improvement is in the loft, with Pavatex wood-based insulation boards and Warmcel, an insulator made from recycled newspapers.
Ground floor thermal insulation is provided by 150mm of urethane.
Far more focus on air tightness than most new builds
Solar thermal panels for hot water
Argon-filled double glazing

In addition, the ground floor has a wood-burning stove that is big enough to provide most of the heat needed on a cold day. Other house features will reduce water consumption and low-energy lightbulb fittings are standard.

The best measure of a house's likely energy consumption is its SAP rating. The Bladon houses average 86 (out of a maximum 100) compared to 75 or so for a conventional home built properly to today's building regulations. This may seem a relatively small improvement, but the builder thinks that the house will probably consume about 40% less gas than the average new build of the same size.

The company gave me some figures for construction costs. It estimates that the total bill, including all preparatory fees such as architects' bills, comes to about £170 per square foot, about 25% more than would be expected for an ordinary set of houses. Typically, therefore, the construction costs of the houses will be something over £200,000, perhaps £45,000 more than a standard unit.

Kingerlee says it expects this 25% premium to fall to about 15% or less. This is the first time construction sub-contractors have worked on properties of this type, and trades such as bricklayers had charged a substantial premium, even though laying Ziegel blocks is no more difficult than the UK's standard aircrete ('breeze blocks').

The houses are priced at about £400,000 each. According to the company, the premium over conventional homes of otherwise the same quality will be less than the £45,000 necessary to cover the incremental building cost. More optimistically, it thinks the lessons and experience gained in Bladon will enable future developments to cost less than the potential price premium it can attain.

It is important to note that the price premium will not be driven by a rational assessment of the capitalised value of the house's lower utility bill. If the Bladon houses consume 40% less gas, 10% less electricity and 15% less water than a comparable dwelling, the saving will be perhaps £500-600 a year. At today's mortgage rates, it certainly doesn't make sense to pay much more than £10,000 for this benefit.

Kingerlee thought that the buyers would be 'silver-haired'. The purchasers would be buying the house because it was extremely well-constructed with low maintenance costs and reduced utility bills. The good energy rating would make it easy to sell in the future. Kingerlee mentioned that the new Home Information Packs would give housebuyers written evidence of the energy efficiency of these homes.

These houses are strikingly attractive buildings and they are amongst the most energy-efficient homes built speculatively by a builder in the UK. Other developments, such as BedZed (Zero Emission Development) in SW London and the Ecos buildings in the south-west of England were not constructed with profit-maximising risk capital. Nevertheless, Kingerlee admits that the buildings do not come close to having a zero-carbon footprint. If it takes a 25% cost increment to make the progress we see at Bladon it may take another 25% to get to zero carbon. The government's generous plan to reduce stamp duty on new homes with no emissions looks like an offer that few will take up.