Making healthy homes? A pilot study of the return on investment from an external wall insulation intervention
Brown et al. BMC Res Notes
Making healthy homes? A pilot study of the return on investment from an external wall insulation intervention
Heather Brown 0
Gulnar Fattakhova 0
Clare Bambra 0
Paul Taylor 1
0 Newcastle University, Institute of Health and Society , Newcastle upon Tyne NE2 4AA , UK
1 Principal Environmental Officer, Economic Growth & Development, Stockton on Tees Borough Council , Municipal Buildings, Church Road, Stockton TS18 LTD , UK
Objectives: External Wall Insulation (EWI) insulates and protect homes against damp. The Energy Company Obligation (ECO) scheme incentivised large energy providers in the UK delivering energy efficiency measures such as EWI to fuel impoverished households. Return on Investment (ROI) analysis is utilised to determine if EWI is a cost-effective procedure in terms of improving health related quality of life (HRQOL) measured using the EQ-5D-3L™, reducing health care expenditure, and fuel costs. Data comes from Stockton-On-Tees council, health care costs data, and information collected from households in the most socially deprived areas in Stockton-on-Tees. Results: The total cost of installation across all 2252 that received EWI was £10,222,954 in 2016 GBP. Annual total benefits were extrapolated across all 3265 households that received EWI. Total benefits were differences between the control and treatment groups in fuel costs, health care costs, and HRQOL multiplied by the National Institute for Health and Care Excellence Quality Adjusted Life Year threshold (£20,000). Total benefits for all households that received EWI were £1,519,045. The ROI of EWI is − 41%. 7.9 years are needed to recoup the costs of the initial investment.
External wall insulation; Fuel poverty; Health related quality of life; Return on investment analysis; UK; Pilot study
Poor housing has a detrimental effect on health costing
the National Health Service (NHS) at least £600 million
per year [
]. Housing related hazards that increase the
risk of illness stem from damp, mould, and excess cold
]. External Wall Insulation (EWI) is a thermally
insulated exterior wall cladding procedure that can be used
to insulate homes and protect against damp. EWI is the
most cost efficient way to insulate solid wall homes.
More than 45% of all fuel poor households live in solid
wall properties and approximately 20% of all households
living in solid wall housing are living in fuel poverty. [
Wider benefits of EWI in terms of improved respiratory
and cardiovascular health and subsequently reduced
costs of treating these conditions, area level
regeneration, aesthetic improvements, and social capital have
been identified. [
] There is no evidence investigating
whether EWI may provide wider health benefits related
to mental and physical health. In 2012, The Energy
Company Obligation (ECO) scheme was designed to
incentivise large energy providers in the UK to fund and install
energy efficiency measures such as EWI to the most fuel
impoverished households [
]. Understanding how the
installation of EWI through the ECO scheme will benefit
the most deprived households is important for reducing
inequalities and improving health.
In this study we report on a pilot study to evaluate the
ECO scheme in Stockton-on-Tees an area level
installation of EWI of 3265 homes in eight of the most socially
deprived lower super output areas (LSOAs)1 with high
incidence of fuel poor and fuel poverty households in
1 The smallest geographical area for which census estimates are provided.
Stockton-On-Tees, UK. We perform a Social Return on
Investment Analysis (ROI) to evaluate if EWI is
costeffective in terms of the return to health related quality of
life (HRQOL) measured using the EQ-5D-3L™2 [
health care expenditure, and fuel spending.
The primary source of data for this project came from
a cross-sectional postal survey containing questions
on HRQOL on the day of the survey, measured using
a standardised EQ-5D-3L™ tool [
] healthcare usage,
fuel spending, and demographic information such as
household income, age, and gender. Additional file 1
is the questionnaire sent to households. Sample sizes
were determined by the number of properties that
had received EWI in the most deprived areas of
Stockton and the control group were houses that would have
been eligible for EWI if the Eco Scheme had continued
and had similar socioeconomic status, a similar
housing stock, and were located within similar lower layer
super output area (LSOA). Questionnaires were posted
to a total of 3256 household consisting of 1149
households that received EWI in 2012 (early cladders) and 1103
households that received EWI in 2014–2015 (late
cladders), and a control group of 1004 households that had
not received EWI but had similar socioeconomic and
housing characteristics to the intervention groups. The
response rate to the questionnaire was approximately
7% (n = 232). From intervention group 1 (early cladders)
n = 91, n = 78 respondents from intervention group 2
(late cladders) and n = 63 from the control group.
Additional data on the costs of installing EWI was
provided by Stockton-On-Tees Borough Council, UK.
To quantify any observed differences in health
expenditure between those who had received EWI and the
control group, Information on cost of health care usage was
taken from the Unit Costs of Health and Social Care 2015
] and National Schedule of Reference Costs 2014–2015
(Additional file 1). [
] Costs for prescriptions was taken
from the British National Formulary 2016. [
] All costs
were presented in 2016 Great British Pounds (GBP).
Data was analysed using the statistical software
package, STATA v.14. [
] To conduct the ROI, we needed to
estimate the total costs to compare with the total
benefits of EWI to recipients. Total costs were estimated as
the mean cost of EWI per household multiplied by the
number of households which received EWI. There were
2 EQ-5D-3L is an assessment tool for measuring HRQOL and is a paper
based questionnaire asking respondents about five dimensions of their
health: (1) mobility; (2) self-care; (3) usual activities; (4) pain/discomfort;
and (5) anxiety/depression. Each dimension has three levels: (1) no
problems; (2) some problems; and (3) extreme problems.
no maintenance costs of EWI in the first 4 years after
installation. The company that installed EWI provided a
25 year warranty of works and materials and therefore
there is no cost to the household of the insulation during
this period. To estimate total benefits, firstly we estimated
mean differences in fuel spending, HRQOL measured as
mean difference in total EQ-5D-3L score, and mean
difference in health care expenditure between the control
group and the early cladder group. These models were
estimated using Ordinary Least Squares (OLS) and
controlled for age, gender, and household income which may
impact on our benefit outcomes of interest. Next, to
provide meaningful values for the ROI, the adjusted mean
differences were further manipulated. Mean adjusted
fuel expenditure was multiplying by 12 (to estimate costs
over a whole year) and then multiplying again by the
total number of households. Mean adjusted HRQOL
was multiplied by £20,000—the maximum value that
the National Institute of Health and Clinical Excellence
(NICE) (which makes recommendations on services and
treatments which should be funded by the NHS) will
pay for a quality adjusted life year [
] and multiplied by
the total number of households. Health care costs were
estimated as adjusted difference between early cladders
and control group multiplied by number of
individuals requiring health care treatment multiplied by cost of
treatment/medicine. These amounts were summed to
provide annual total benefits and benefits over a 4 year
period (the time that had elapsed since early cladders
received EWI). Finally, we estimated the ROI model over
the 4 year period since the early cladders received EWI
which was calculated by Eq. (1):
ROI = (Total Benefits − Total Costs)
The Research plan is shown in Fig. 1. Table 1 shows the
total costs and benefits of EWI which were used to
estimate the ROI. In column 1, we can see the costs of
installing EWI. The average cost of delivering the intervention
per household is £4539.50 in 2016 GBP. The total cost of
delivering the intervention to the 2252 households which
received EWI is £10,222,954 measured in 2016 GBP.
Annual total benefits which were comprised of adjusted
differences in fuel expenditure, HRQOL, and health
expenditure between the early cladders and control group
were £1,519,045 measured in 2016 GBP. This amount is
extrapolated across all households and includes reductions
in fuel expenditure, health care costs, and improvements
in health related quality of life multiplied by the quality
adjusted life year (QALY) threshold which is £20,000 for
the UK compared to the control group. Benefits over the
4 year period since the first set of household received EWI
•Develop ques onnaires
•Iden fy early cladder, late cladder, and control households
•Post ques onnaires to early cladders, late cladders, and control
•OLS models to es mate differences between control and early cladders in fuel spending, health
care u lisa on, and HRQOL. Models controlled for age, gender, marital status, age group,
educa onal a ainment, household size, number of dependent children
•Conduct ROL analysis using total benefits from OLS models above and cost data provided by
Stockton on Tees Local Authority.
Develop ques onnaire
Data collec on
ture is − 41%. This suggests it will take 7.9 years to recoup
the costs of the initial investment (Table 1).
We employed a ROI to provide some preliminary
evidence if EWI may be a cost-effective measure to improve
HRQOL, reduce health expenditure, as well as reducing
fuel poverty measured by fuel expenditure in
socioeconomically disadvantaged areas with poor housing stock.
Living in a consistently under-heated home poses
significant health risks through increased incidence of damp
and mould [
]. The cost reductions of EWI on
cardiovascular and respiratory illness, conditions typically
associated with living in cold and damp conditions [
been estimated at £183 million per annum [
]. If there are
wider health benefits in terms of improving HRQOL and
reductions in health expenditure, as our results suggest,
this would imply that the health benefits to the NHS may
be even greater. Our finding of a reduction in monthly
fuel expenditure of £40 is similar to larger evaluations of
the benefits of EWI [
]. This boost in household income
will be important for socially deprived households. Our
results from a small sample from Stockton-On-Tees
provides support for future research investigating how EWI
may improve health and provide wider benefits than
those which have traditionally been focused upon.
Tackling fuel poverty and inadequate housing requires
a multidisciplinary approach. This research drew upon
expertise in public health, geography, health economics,
and local government. Accessing data from households
with similar characteristics that have received EWI to
a control group which has not received EWI but would
have been eligible for EWI if the Eco Scheme had
continued has allowed us to provide preliminary evidence if
EWI may be cost-effective in relation to health and fuel
The Scheme in Stockton-on-Tees funded via ECO to
provide EWI to households in the most deprived LSOAs
has been found to reduce fuel expenditure and provided
preliminary support for improving HRQOL. A long
term outlook is required for making informed decisions
regarding all the potential public health benefits of EWI.
This will be used to inform future work in this area.
The response rate for our questionnaire was low (7%).
Financial resources constrained us to a postal survey
which may partially explain the low response rate.
Evidence from the UK suggests that low response rates to
postal questionnaires in socially deprived areas such as
Stockton-On-Tees, stems from disengagement, low
literacy rates, and poor contact information [
shows that civic participation does not differ by
socioeconomic status or ethnicity in the UK [
]. The low
participation rate may have biased our findings. Nevertheless,
our results are important for informing the direction of
future research in the area to collaborate these findings.
For a further evaluation, we plan to utilise alternative
methods such as door to door or telephone
questionnaires to improve the response rate for this hard to reach
group. In addition, the study is confined to one city in the
North East of England; thus, it is possible that climate
may affect the generalisability of these findings to other
Additional file 1. Health care usage.
GF conducted the statistical analysis. GF and HB drafted the manuscript. HB,
CB, and PT developed the research idea. All authors read and approved the
The authors wish to thank ASK FUSE for facilitating this research project and all
the people in Stockton on Tees who filled in the questionnaire.
Paul Taylor was part of the team that commissioned the research in his
capacity as an employee of Stockton on Tees Borough Council but has no financial
stake in the research outcomes.
Availability of data and materials
The data used in this paper is not available for use by other researchers. The
consent form provided to participants stipulated that the data would only be
used for the specified project and is therefore not available for future analysis.
Consent for publication
Ethics approval and consent to participate
Written informed consent was obtained from the participant for the
publication of this report and any accompanying images.
Heather Brown, Gulnar Fattakhova, and Clare Bambra are members of Fuse,
the Centre for Translational Research in Public Health (http://www.fuse.ac.uk).
Fuse is a UK Clinical Research Collaboration (UKCRC) Public Health Research
Centre of Excellence. Funding for Fuse from the British Heart Foundation,
Cancer Research UK, Economic and Social Research Council, Medical Research
Council, the National Institute for Health Research, under the auspices of the
UKCRC, is gratefully acknowledged. Grant reference number is MR/K02325X/1.
The views expressed in this paper do not necessarily represent those of the
funders or UKCRC. The funders had no role in study design, data collection
and analysis, decision to publish, or preparation of the manuscript.
This work was funded by Stockton on Tees Borough Council with support
from Eon through the Ask Fuse programme. The project was co-designed with
Stockton on Tees Borough Council.
Springer Nature remains neutral with regard to jurisdictional claims in
published maps and institutional affiliations.
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