The government has announced the Warm Homes Plan, which will invest £15b to upgrade up to 5 million homes, aiming to reduce energy costs and address fuel poverty.
Existing measures announced at the Budget include an average reduction of £150 on energy bills from April, with around six million households receiving a £150 Warm Home Discount, bringing total support to £300.
The Plan includes measures to increase access to home clean energy products such as solar panels, heat pumps, and batteries, including government-backed low- and zero-interest loans. Low-income households and those in fuel poverty may receive support to cover the full cost of installations. New rules will require landlords to invest in energy efficiency improvements for rented and social housing.
The government will publish a separate information sheet with details of the scheme.
Prime minister Sir Keir Starmer said: “A warm home shouldn’t be a privilege, it should be a basic guarantee for every family in Britain.
“Today’s plan marks a turning point. It will help to slash energy costs and lift up to a million people out of fuel poverty.
“This is a government bearing down on the cost-of-living crisis. By driving bills down for good and upgrading millions of homes, we’re giving people the security and the fair shot they need to get on in life.
Energy Secretary Ed Miliband commented: “It is a scandal that millions of people in our country do not have the security of a home that is warm, affordable and safe.
“With this investment, we embark on a national project to turn the tide – waging war on fuel poverty and taking another step forward in tackling the affordability crisis for families throughout Britain.”
The government’s clean power plan includes £15bn of investment, with allocations for devolved governments in Scotland, Wales and Northern Ireland to support home energy upgrades nationwide.
The plan also introduces measures to ensure new homes are cheaper to run, including the installation of solar panels as standard, with the Future Homes Standard due to be implemented in early 2026.
It responds to changes in building standards over the past decade, including the cancellation of the Zero Carbon Homes standard, which affected the energy efficiency of more than a million homes.
Reactions:
Chris Norbury, CEO, E.ON UK: “We welcome the government’s action through the Warm Homes Plan and its clear focus on practical measures that will help households bring their energy bills down.
“We know from working with our own customers that the most effective way to cut bills is to enable people to generate and store their own energy and combine this with flexible time-of-use tariffs that reward smarter energy use. This approach puts control in customers’ hands, pounds in their pocket and turns the energy system into something that works for people, not the other way around.
“By taking strong action to make sure new energy works for everyone by combining access to innovative solutions with significant funding support, the Government is helping unlock real, everyday benefits. It means lower bills, simpler choices and a positive energy transition that people can feel directly in their homes and communities.”
Adam Scorer, Chief Executive at National Energy Action: People struggling in fuel poverty desperately need the Warm Homes Plan. Cheaper energy costs, efficient heat systems and homes that keep the warmth in are all essential for the plan to succeed. There is a lot of work to be done, but today’s publication and commitment to lift a million households out of fuel poverty is a welcome, landmark occasion.
Charlie Nunn, CEO of Lloyds Banking Group: “At Lloyds Banking Group, we are committed to helping ensure that homes across the UK are warm, affordable and energy efficient. This will require sustained collaboration between government, industry and civil society, and I look forward to working together to mobilise the finance, innovation and partnerships needed to support more resilient and energy efficient homes.”
Kirsty Britz, head of group sustainability at NatWest Group: “We welcome the government’s announcement of the Warm Homes Plan, at a critical time for the UK’s transition. Higher energy bills have made it difficult for people to keep themselves and their homes safe and warm. This investment will help unlock more finance and provide much needed support. We look forward to continuing our support for the UK’s mission to adapt and grow in a changing world alongside the government.”
Ben Twomey, chief executive of Generation Rent: “Homes are the foundations of our lives but high energy bills and rents force many of us to make heart wrenching choices between heating and eating, while millions of us are living with shocking levels of mould and damp.
“That’s why it’s so important, both for renters and the climate, that the government is raising the basic insulation and heating standards for rented homes. We look forward to working with the Department on giving renters who are eligible for support to improve their home the assurance they need to apply for it.”
Dhara Vyas, Chief Executive of Energy UK: “Supporting better access to clean heat systems, solar panels, batteries and other low-carbon technologies will help millions of households across the UK bring down their energy bills.
“£15bn is a substantial commitment, and it’s great to see the plan has an offer for all households with substantial grants for clean heat solutions and affordable finance options for various low-carbon technologies, as well as fully funded measures for fuel poor and low-income homes.
“The Warm Homes Plan also provides certainty to investors and businesses in the energy market, and will drive growth, supporting the creation of thousands of good jobs across the country.”
Tania Kumar, energy transition director, CBI: “The Warm Homes Plan signals a significant commitment to upgrading homes across the country. By making millions of homes energy efficient, supporting those most in need in society and unleashing consumer demand for heat pumps and solar panels, households and businesses alike will benefit from these investments in the clean energy economy.
“Businesses stand ready to support the government to turn this ambition into delivery, including through low and zero interest loans. Improving the energy efficiency of Britain’s homes is essential for tackling the cost‑of‑living pressures households continue to face. To ensure these benefits are felt by all households, a continued and unwavering focus on driving down the overall cost of energy remains essential.”
David Postings, CEO of UK Finance: “Upgrading the UK’s housing stock is essential to meeting our net zero goals, and boosting consumer demand is critical to unlocking private finance at scale. The new Warm Homes Plan is a welcome step forward, offering a package of support to help homeowners meet retrofit costs. The financial services sector will work with government, alongside other industries, to accelerate the growth of the green home finance market and help ensure households across the country can share in the benefits of the net zero transition.”
Jonathan Brearley, Chief Executive Officer of Ofgem: “The government’s Warm Homes Plan is an important step towards the UK realising its goals in improving energy efficiency in our nation’s buildings. Creating warmer, more energy efficient homes is in all our interests. Ofgem will continue to play a key part in supporting this.
“The creation of a Warm Homes Agency will see existing Ofgem experts transfer over to the new organisation, to deliver energy efficiency schemes for homes and other buildings. By bringing together schemes currently split across government, Ofgem and elsewhere, households and scheme users will benefit from a clearer, more efficient system.”
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