Government commits extra funding for heat pumps and insulation in social homes
Energy Secretary Claire Coutinho said £75 million will support some of the lowest income households to warm their homes and save on energy bills.
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Your support makes all the difference.More than £75 million of taxpayers’ money will be used for free energy efficiency upgrades in thousands of social homes, the Government has announced.
Energy Secretary Claire Coutinho said the money, which will be spent on measures including heat pumps, double glazing and insulation, will support some of the lowest income households to warm their homes and save as much as £400 a year on energy bills.
The funding will be offered to 42 councils and housing associations across England to help them co-fund installations in up to 8,000 homes.
This funding today will help up to a further 8,800 households save around £400 a year on their energy bills
The Government said it will also support more than 1,300 jobs in the UK’s retrofit industry.
It comes as the latest round of awards from the Government’s Social Housing Decarbonisation Fund (SHDF), which has allocated more than £1 billion since 2019 to help upgrade around 100,000 households by September 2025.
North Yorkshire Council, Portsmouth City Council, Wandle Housing Association in London and Gentoo Group in Sunderland are among those receiving funding from this round, which is open to applicants who had not received SHDF money in the previous wave.
Councils and housing associations receiving a share of the funding are required to co-fund the projects, bringing the total for this wave to more than £200 million (£139 million of co-funding plus £75.5 million of Government funding).
Ms Coutinho said: “Our Social Housing Decarbonisation Fund is helping families to keep their homes warm and their bills down.
“We want to support hard-working families to make changes, rather than burdening them with unnecessary costs.
“This funding today will help up to a further 8,800 households save around £400 a year on their energy bills.”
Kate Henderson, chief executive of the National Housing Federation, said: “Housing associations play a crucial role in helping the country to meet its net zero targets and are already leading the way on energy efficiency, but funding is essential for maintaining this work.
“The funding announced today will give housing associations the certainty and confidence they need to plan and deliver more retrofit projects, tackle fuel poverty, and improve their residents’ homes.”
The fund is part of a wider package of support from the Government to improve the energy efficiency and low carbon heating of homes and businesses across the country, reducing reliance on fossil fuel heating and reducing household energy bills.
Around £20 billion has been allocated over the current Parliament and into the next.
This includes money going towards measures like the Boiler Upgrade Scheme, which helps households to make the switch from fossil fuel heating systems to cleaner low carbon alternatives.
The funding announced today will give housing associations the certainty and confidence they need to plan and deliver more retrofit projects, tackle fuel poverty, and improve their residents’ homes
Last week, the Government announced that rules requiring boiler companies to boost the number of heat pumps they sell – which prompted the firms to implement a so-called “boiler tax” – have been delayed by a year.
The clean heat market mechanism, which initially required boiler manufacturers to match, or substitute, 4% of their boiler sales with heat pumps or face a £3,000 fine for each missed installation, was due to be introduced on April 1.
Campaigners accused Ms Coutinho of giving in to big boiler manufacturers after she previously accused firms of “price gouging”.
Ministers also announced changes to the £7,500 heat pump grants the Government is offering, with households no longer having to install loft and cavity wall insulation in their homes to qualify for the funding.
The measures are part of a target to help phase out gas boilers and deliver 600,000 clean electric heat pump installations a year by 2028.