In a major push to tackle energy bills and reach net zero emissions, the UK government has unveiled a £6 billion investment package as energy efficiency support for homes and businesses across the country.
This significant funding aims to make around a million homes warmer and assist hundreds of businesses in reducing their energy consumption, ultimately saving money for the public.
A key feature of the plan is targeted support for 200,000 low-income, cold, and social homes. This aligns with the government’s commitment to helping families achieve net zero while saving on energy costs.
Heat pumps, a low-carbon alternative to traditional gas boilers, are a central focus of this energy efficiency support program. The successful £7,500 uplift in heat pump grants has already seen applications soar by 57%. Building on this momentum, an additional £1.5 billion will be allocated to the Boiler Upgrade Scheme, making it easier for homes and businesses to transition to these modern heating systems.
Energy Secretary Claire Coutinho emphasised the importance of reducing energy bills, stating that today’s funding prioritises those most in need and keeping families warm during winter. She highlighted the progress made, with nearly half of properties in England now boasting a good Energy Performance Certificate (EPC) rating.
Chancellor Jeremy Hunt stressed the importance of energy efficiency support alongside energy security, underlining its role in reducing reliance on volatile international gas prices, a significant driver of inflation. He emphasised that the investment will empower households and businesses to make environmentally friendly choices without placing an additional burden on working people.
Industry leaders welcomed the announcement. Greg Jackson, CEO of Octopus Energy, pointed to the rapid decrease in heat pump costs and installation times, solidifying their position as the future of home heating. Mike Thornton, Chief Executive at Energy Saving Trust, emphasised the crucial role of improved home energy efficiency support initiative and widespread heat pump adoption in reducing reliance on imported fossil fuels and achieving net zero targets.
The plans extend beyond existing homes. From 2025, all new homes and buildings will be required to be zero-carbon-ready. This eliminates additional future costs for families purchasing new homes, ensuring they are future-proofed for clean heating technologies.
For existing homes, the government is exceeding its initial manifesto commitment of £9.2 billion for energy efficiency by 2030. Today’s announcement confirms a total spend of £12.6 billion by 2028. This significant investment will be distributed across various schemes, including:
- Boiler upgrade scheme: Receives an additional £1.5 billion to support the transition from gas boilers to heat pumps.
- New £400 million energy efficiency grant: Launching in 2025, this grant will support home improvements like larger radiators or better insulation.
- Local authority retrofit scheme: Allocated £500 million to target low-income and cold homes, including those off the gas grid, with measures like insulation.
Social housing will benefit from a £1.25 billion Social Housing Decarbonisation Fund to improve energy performance and lower bills in up to 140,000 homes. Additionally, the Green Heat Network Fund receives £485 million to connect up to 60,000 homes and buildings to low-carbon heating networks. Businesses are not left out, with the Industrial Energy Transformation Fund receiving £225 million to support their transition to a low-carbon future.
This £6 billion investment by the UK government signifies a comprehensive approach to tackling energy efficiency support in homes and businesses. It prioritises low-income households, promotes heat pumps, and establishes stricter standards for new buildings. This multi-pronged strategy aims to achieve a future with lower energy bills, reduced reliance on fossil fuels, and a significant step towards achieving net zero emissions.
