Up to 300,000 households will benefit from home upgrades in the next year, as the government announces new steps to help households take up measures that can help save money on their bills and deliver cleaner heating.
This includes boosting the budget for the Boiler Upgrade Scheme to support more households switch to a heat pump – which can save families around £100 a year compared to a gas boiler by using a smart tariff effectively, and insulating more homes across the country – potentially saving homeowners around £200 per year.
The wide-ranging package is another step in delivering the Warm Homes Plan, supporting:
- Homeowners in England and Wales to get a £7,500 heat pump grant through the Boiler Upgrade Scheme, which had the highest number of applications ever in October according to Ofgem.
- Households install an air source heat pump without needing to submit a planning application in England – removing the 1m rule 1 metre from the boundary), with figures from Octopus showing 34% of those who order a heat pump are discouraged or drop out for reasons attributed to planning permission.
- Social housing residents, lower income householders and renters to receive funded energy efficiency upgrades – including insulation and low-carbon heating – through the Warm Homes: Social Housing Fund and Warm Homes: Local Grant respectively.
Minister for Energy Consumers Miatta Fahnbulleh said, “For too long, far too many people who have been left with draughty homes and sky-high bills. That is why we are taking immediate action today to make cleaner heating available to more households.
“This follows our plan to lift over one million households out of fuel poverty by consulting on boosting minimum energy efficiency standards for all renters by 2030, delivering warmer homes and cheaper bills.”
Households have paid the price in recent years of the energy bill crisis, following Putin’s illegal invasion of Ukraine, which exposed years of overreliance on international gas markets.
Support thousands more households with home upgrades
- Helping more families to get £7,500 off the cost of a heat pump, with an extra £30 million for the Boiler Upgrade Scheme this financial year, while almost doubling the budget to £295 million for the next financial year.
- Overseeing around £3.2 billion of investment in warmer homes across 2025/26 from government, social housing providers and supplier obligations, delivering measures to help lower bills and support cleaner heating to up to 300,000 households.
Deliver new regulations to back consumers and encourage innovation
- Consulting on plans to increase energy efficiency standards for new boilers and heat pumps, saving households with a new gas boiler £30 a year on running costs.
- Allowing more households in England to install an air source heat pump without the need to submit a planning application from early next year, by removing the rule requiring them to be installed at least one metre from a property’s boundary. This will provide greater flexibility, with rules still in place around listed buildings.
Back British manufacturers
- Introducing a reformed Clean Heat Market Mechanism on 1 April 2025, with new changes to make sure manufacturers have the time they need to scale up supply chains, making heat pumps an even more attractive choice for households and boosting sales without penalising those buying a new gas boiler. There will also be government support available for every heat pump installation that is required under the mechanism in 2025-26.
- Supporting industry by investing over £5 million in Ideal Heating as the first award from the Heat Pump Investment Accelerator competition, kickstarting a homegrown heat pump industry to boost the UK’s energy security and support hundreds of low-carbon jobs.
- Working with trade unions to ensure good jobs throughout the supply chain, backing Britain’s world class traders.
This follows an announcement from the National Wealth Fund, whose financial guarantees enabled up to £1 billion of funding from Barclays UK Corporate Bank and Lloyds Banking Group to help housing associations provide warmer, more energy efficient homes to tenants across the country.
