Warm homes heat boost

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 important step in delivering the Warm Homes Plan and reaches across all households, 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, 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

Working alongside the government’s mission to make Britain a clean energy superpower, the Warm Homes Plan will ensure millions more households benefit from homegrown energy delivered by every new turbine, solar panel or pylon built on the path to energy independence.

Minister for Energy Consumers Miatta Fahnbulleh said:  “The idea at the heart of our Warm Homes Plan is a simple one – all families deserve the security of a home they can afford to heat.

“But for too long, that has been out of reach for 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.

“The government is now overturning this legacy by investing in homegrown, cleaner energy free from the control of dictators.”

The plan will help:

Support thousands more households with home upgrades

• Helping thousands 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 to 2026 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

• Lifting over one million households out of fuel poverty under plans to consult on increasing minimum energy efficiency standards for all rented homes by 2030
• 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 each and every heat pump installation that is required under the mechanism in 2025 to 2026
• Supporting industry by investing over £5 million in Ideal Heating as the very-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 a landmark 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.

By charting a bold new approach to delivering warmer homes and taking immediate action to speed up the rollout of cleaner heating, the government will cut energy bills, tackle fuel poverty and create new opportunities for jobs and skills right across the country.

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