When we first heard about the Home Energy Model (HEM), it immediately piqued our interest.

At Energy Digest, we spend a lot of time dealing with SAP, and while it’s served as the backbone of our residential services, it’s fair to say it’s not without its limitations. Whether that is SAP 2012 or 10, they have always not quite hit the spot of satisfaction for us as assessors or our clients, a penny short of a pound.

HEM, on the other hand, will bring something new to the table – something more dynamic, granular, and, dare we say, ambitious.

We’ve waited a while to post about this. Firstly, with changes, there is normally a flurry of content about it then it goes quiet, so we wanted to give you something to read nearly a year on as a reminder that this is still happening (fingers crossed). Also, we wanted to read through the documents and pick out what we believe are the most interesting aspects.

We won’t cover the consultation in its entirety, but we will highlight what we think are the useful parts and what you will enjoy reading about. And leave all the technical bits for the boffins of our industry, who we do of course love, honour and respect.

The bits of the consultation we think are cool are:

• What the hell are wrappers?
• Impact on self-builders and SMEs
• Sheer level of extra data required
• EcaaS (another acronym for you)

What the Hell are Wrappers?

Okay, bear with us on this. If you re-read it a couple of times it will make sense!

Firstly, let’s look at the etymology of the word ‘wrapper’.

It comes from the word wrappen: “to wind, cover, or swaddle” something. It’s probably derived from ‘wer’ which means “to turn or bend”.

Wrappers in HEM function as components that bend and adapt the core calculation to meet specific policy or assessment needs. The core is the foundational engine, modelling heat transfer, energy demand, and system performance. Wrappers add pre-processing steps, like standardising inputs for occupancy or assumptions – and post-processing steps, such as applying emissions and primary energy factors, to tailor the calculations for different uses.

For instance, while the core calculation works independently, it requires detailed and extensive input data, which might not be practical for every assessment. Wrappers simplify this by transforming simpler input datasets into the detailed formats required by the core. They may also adjust, expand, or overwrite data to align with policy needs, like those for an EPC or the Future Homes Standard. Essentially, wrappers act as bridges, enabling the same core calculation to serve multiple purposes without needing to be fundamentally altered.

This is particularly exciting as it suggests that the software will be inherently multi-disciplinary. While the full extent of its flexibility is not yet fully detailed, the possibilities for future assessments appear virtually limitless. If the core methodology remains the foundation, the ability to integrate various inputs and outputs means that new functionalities can be developed and tailored to meet evolving needs and deliver specific outcomes.

We are fixated on the idea that there could be a calculation process created for virtually all development types that interact with Approved Document L in some capacity.

Impact on Self-Builders and SMEs

The sweeping changes and additional regulations introduced in 2022 revealed just how unprepared much of the industry was, including government agencies, architects, compliance professionals, and especially accreditation bodies. While it felt like chaos at the time, it served as a much-needed wake-up call. The sudden push for Continuing Professional Development (CPD), additional training, and more active community discussions around regulations raised the bar significantly. The hope now is that the industry doesn’t regress into complacency, risking a repeat of the same unpreparedness.

This time, however, the shift is even more dramatic. In 2022, it was primarily an update to the calculation methodology. Now, we’re looking at a complete overhaul of the system. These changes will undoubtedly challenge professionals whose businesses rely on providing compliance calculations and clients who must navigate the new requirements.

It’s worth considering how these changes will disproportionately affect self-builders and small-to-medium enterprises (SMEs). These groups often lack the in-house expertise of larger firms and face higher costs to access professional advice. Services come at a premium because SMEs and self-builders can’t benefit from the economies of scale that larger developers enjoy.

Take thermal bridging as an example. In smaller projects, there’s often more variation in construction design – different materials, methods, and innovations that create truly unique homes. These are the homes that make people stop and say, “Wow, that’s beautiful,” rather than dismissing them as another “cookie-cutter” development. But that creativity comes at a cost. Each unique design may require tailored thermal bridging calculations, which can quickly add up. A single PSI-value calculation to measure heat loss at building junctions can start at £100, and with multiple junctions in a project, this will eat away at margins. This is looking at one aspect of one regulation, roll this philosophy out across all additions to regulatory requirements and you not left with a lot of meat on the bone.

Contrast this with a major developer like Taylor Wimpey, which rolls out national house types, constructed with standardised materials and specifications. The company can invest in thermal bridging calculations once and apply the results across thousands of homes and flats. The economies of scale here are vast, and they can spread the cost of compliance across a large portfolio, something SMEs simply can’t do.

Regulatory reform is undeniably important. It drives progress, improves standards, and brings us closer to net-zero goals. But reform only achieves its intended positive outcomes if stakeholders can genuinely understand and adapt to the changes. Overcomplicating the system risks alienating users, undermining trust, and creating barriers for smaller players in the market. Consumer comprehension is paramount, because when users and clients are left confused, the system falters.

This brings us to an essential question: what does the sheer volume of additional data required for calculations under the Home Energy Model (HEM) mean for service providers and their clients? How will this level of complexity impact costs, timelines, and, most critically, user understanding? Let’s explore this in more detail.

Sheer Level Of Extra Data Required

The transition from SAP to the Home Energy Model (HEM) marks a significant shift in how data is collected, interpreted, and utilised for compliance calculations. With HEM, the level of granularity required for inputs surpasses anything assessors have dealt with under SAP. It feels like PHPP. Unlike SAP, which allows for broader assumptions in areas like system efficiency and thermal performance, HEM insists on specifics.

Take heating systems. Under HEM, assessors must provide precise details about radiator sizes, pipe lengths, and configurations of hot water outlets. This contrasts sharply with SAP, where these elements are often generalised. HEM’s inclusion of hourly weather data also brings an entirely new dimension to calculations. Gone are the monthly averages of SAP – now, assessors need to account for how building performance shifts over half-hour intervals, capturing nuances that SAP methodologies overlook.

Solar PV assessments also expand under HEM, moving beyond generation capacity to include self-consumption patterns and energy storage. Battery storage, load shifting, and even integration with smart technologies become part of the equation. These advancements mean that renewable installations are assessed not just on theoretical efficiency but on their interaction with the building’s overall energy profile.

For assessors, the requirement to deliver this depth of data means more than just ticking additional boxes. It demands a collaborative approach with designers, engineers, and contractors early in the project to ensure all necessary information is available. This change pushes the onus onto the industry to rethink workflows and timelines, especially for custom or one-off builds.

Cost and Time Implications

With increased data demands come inevitable cost and time implications. The upfront costs for developers and self-builders are expected to rise due to the need for more detailed modelling and extended consultancy input. Smaller firms or projects may struggle disproportionately, as they often lack the in-house resources to handle such complex requirements. For them, sourcing and interpreting highly specific inputs could add significant strain.

For larger developers, the shift to HEM will likely mean expanded budgets for compliance teams and additional training for staff. Projects with intricate designs, such as mixed-use developments or unique architectural builds, will face even steeper costs and longer lead times due to the added layers of modelling complexity.

However, cost isn’t the only concern. Time pressures are equally significant. Meeting deadlines with the increased workload of data gathering and processing could lead to delays, especially for firms that have yet to invest in streamlined workflows or advanced software.

The Impact on the Industry

The energy compliance industry has already experienced the fallout of regulatory changes. The introduction of SAP 10 and overheating assessments saw some professionals leave the sector, unwilling to retrain for increasingly demanding roles. HEM represents an even greater leap in complexity. The steep learning curve could exacerbate this trend.

This raises questions about how the professional landscape might shift in response. Will smaller consultancies survive under the weight of additional requirements, or will larger firms dominate? Could this lead to consolidation within the industry, with smaller players merging or disappearing altogether? Or do the smaller consultancies that stay become invaluable?

This brings us to a fundamental question: can the industry absorb the costs, time, and complexity of HEM without alienating professionals and clients? And if not, what strategies can be employed to ensure HEM delivers its intended benefits without creating undue burdens? These are the conversations the industry must have as it steps into this new era.

EcaaS (another acronym for you)

Calculations as a Service (ECaaS). This system centralises the calculation engine on a government-hosted cloud platform, allowing software providers to develop user interfaces that interact directly with this core engine. 

Potential Benefits:

• Consistent Results: By using a single calculation engine, ECaaS aims to eliminate discrepancies between different software applications, ensuring uniform compliance outcomes across the industry.
• Resource Allocation: Software providers can focus more on enhancing user interfaces and user experience, as they no longer need to develop and maintain individual calculation engines.

Potential Challenges:

• Downtime Management: Any maintenance or downtime of the centralised service could halt assessors' ability to generate compliance results, potentially causing delays.
• Reduced Peer Review: With the calculation engine managed centrally, there may be fewer opportunities for industry-wide peer review, which could impact the robustness of the methodology.
• Calculation Speed: Initial versions of the HEM tool experienced lengthy processing times, sometimes up to 10 minutes per calculation. While improvements are expected, achieving the near-instant results familiar with current SAP applications remains a concern.

The first implementation of ECaaS is planned for the Future Homes Standard assessments in 2025, with potential expansion to Energy Performance Certificate (EPC) calculations for both new and existing homes thereafter. Access to ECaaS will be limited to approved energy assessor accreditation schemes.

Breeding Competition or Creating Chaos?

The open-source nature of ECaaS could encourage competition, but it’s not without its challenges. Building a user interface is no small feat, and smaller companies may lack the resources to compete with the established players. Additionally, while more competition might mean better options for assessors, it could also lead to a chaotic landscape where too many interfaces flood the market, and quality control becomes an issue.

The Final Say

The Home Energy Model (HEM) and its supporting innovations, like ECaaS, represent a bold leap forward for energy compliance calculations in the UK. While these changes bring exciting opportunities for more accurate, nuanced assessments and the potential for increased competition in the software market, they are not without their challenges. The sheer volume of additional data required, coupled with the complexity of adapting to entirely new methodologies, will place significant demands on both professionals and clients.

For self-builders and SMEs, the added costs and time pressures could be daunting, potentially exacerbating existing disparities in the industry. Meanwhile, for energy professionals, HEM’s complexity raises questions about retention, training, and the future shape of the sector. Will it drive innovation and progress, or will it create barriers that discourage participation and stifle smaller players?

These are questions we don’t have all the answers to yet, but one thing is clear: the industry must work together to ensure this transition is as smooth and inclusive as possible. By embracing the opportunities for collaboration and innovation that HEM and ECaaS offer, we have a chance to not only meet compliance goals but also redefine how we think about energy performance and sustainability in the built environment. At Energy Digest, we’ll continue to dissect the changes, advocate for practical solutions, and support our clients in navigating this brave new world of energy compliance. The next few years will undoubtedly be challenging, but they also have the potential to be transformative. Let’s make it count.