Future Homes Standards Consultation – What Does This Mean for Tendering?

First opened for consultation three years ago, the Future Homes Standards means all new homes will require heat pumps and on-site renewable energy generation, such as solar PV, among other significant changes.

The outcome of the consultation was published last month following amendments from the consultation. With regulations due to come into force from 2028, meaning this will actively shape future public sector contracts going through the tender process.

Explaining the Future Homes Standards

The Future Homes Standards will be embedded into UK Building Regulations – meaning it applies universally to private residential development, local authorities and housing associations. Rather than an optional sustainability initiative, it is a mandatory baseline for housing standards and delivery, with a heavy focus on reduced emissions.

Mandatory changes introduced by the Future Homes Standard include:

• Challenging energy performance targets, with new build homes producing 75–80% less emissions in comparison to previous standards issued in 2013
• Low carbon heating systems (e.g. ASHP, GSHP) fitted into all new homes as a standard requirement
• Solar PV installed as a default where appropriate, comprising 40% of the property’s floor area if possible
• Enhanced fabric standards for insulation and air tightness, providing more stable internal temperatures and reducing excessive heating and cooling demands.

With private homes comprising 14% of UK carbon emissions, decarbonising existing housing stock is a crucial component of reaching the government’s net zero by 2050 target. Higher risk buildings as classified under the Building Safety Act 2022 will be granted longer transition times to meet requirements.

Future Homes Standards impacts on public sector tenders

Understandably, implementation of the Future Homes Standards will result in additional tender opportunities. Changes to the tender process may also include:

• Heat pumps and renewable energy embedded into employer’s requirements and contract specifications, rather than optional value engineering or variations
• Greater scrutiny on design for tender submissions containing this element, effectively demonstrating how installed assets can meet required standards stemming from changes to Part L regulations
• Increased performance accountability, potentially through reports and information provided to contracting authorities over the contract term.

Ultimately, this marks a shift from compliance-led bidding – for instance, stating works will be delivered in compliance with PAS 2030 and 2035 – to demonstrating credible, tangible, performance-led outcomes.

How the Future Homes Standards complements current tender opportunities

Over the past few years, the decarbonisation and retrofit sector has expanded significantly, with older housing stock being updated to meet a minimum EPC rating of C. Typically, this involves whole-house works with multi measure retrofit workstreams, including:

• Installation of internal, external and loft insulation to existing properties, following a ‘fabric first’ approach
• Upgrading heating and energy systems to renewable systems, such as solar PV, air source heat pumps and ground source heat pumps
• Installing energy-efficient assets, such as cookers and hot water/heat distribution systems
• Replacing windows and doors for more energy-efficient models, increasing air tightness within the property.

Currently, contractors delivering works must adhere to PAS 2030 and PAS 2035 standards. Similar to PAS requirements, it is likely that Future Homes Standards will require transparent reporting, increased evidence-based solutions, and demonstrate accurate, measurable outcomes.

What should bidder organisations do to prepare?

With the Future Homes Standards not coming into force until 2028, current and prospective suppliers have sufficient time to prepare in advance of the changes. Executive Compass recommends all bidders:

• Undertake a skills gap analysis: due to the requirements, certain elements such as gas boilers and heating systems, will be phased out entirely for new build homes. Now is the time to earmark training budget to upskill staff – for instance, gaining MCS accreditation – ensuring they are qualified and capable to deliver against requirements.
• Monitor updates to guidance: be vigilant in monitoring Ministry of Housing, Communities & Local Government press releases for future guidance and updates. Additionally, the Cabinet Office and Government Commercial Agency may issue further guidance on how the standards will affect tenders, such as through a new policy procurement note.
• Consider collating evidence and previous experience: contract examples and case studies are critical to public sector bidding. Building credibility by referencing previous projects will allow you to actively persuade the evaluator of your competency and capability. Begin to gather case studies and evidence of previous delivery to be used as part of bid content for future submissions.

Executive Compass will continue to monitor updates and how this will impact public sector procurement and UK tenders.

Support with decarbonisation and retrofit tenders

Executive Compass’s expert bid and tender writers have extensive experience in completing decarbonisation and retrofit tenders in both domestic and commercial environments. With successful submissions bidding into contracting authorities such as Pagabo, Prosper and LHC among others, we are ideally positioned to support your organisation with the strongest possible submission.

Book a free 30-minute bid consultation to discuss the bid services we provide, including bid writing, bid review and comprehensive bid management support.