- Today, the UK government published its Warm Homes Plan, setting out plans to lower consumer energy bills and reduce carbon emissions from home heating.
- Key announcements in the plan include improved rental sector building standards, which could save renters £300 per year. It also includes a new programme of low-interest loans for home improvements, and free solar panels and heat pumps for low-income households.
- High UK energy bills are a result of dependence on fossil gas. Solar panels, cleaner heating systems and better home insulation are the best ways to reduce household energy bills and keep them permanently low.
- E3G welcomes the new plan, which sets a clear direction of travel towards a future which both lowers consumer bills and delivers carbon emission reductions.
Ed Matthew, UK Programme Director at E3G, said:
“The UK needs to get off the gas price rollercoaster and ramp up the installation of clean energy technologies. The Warm Homes Plan sets a clear direction for British homes – warmer, cheaper to run, and less dependent on foreign imports of fossil fuels. This is a major opportunity for UK households to take back control of their energy. Government should follow this up by removing more taxes from electricity bills, ensuring consumers can feel the benefits of clean energy.”
Minimum energy efficiency standards for rental properties
The Plan confirmed the Labour government will implement its manifesto commitment to raise minimum energy efficiency standards for the rental sector. This means the vast majority of private rental properties will need to meet Energy Performance Certificate level C by 2030.
- This is expected to benefit over 1.5m rental households.
- On average, benefitting renters can expect a £300 reduction in energy bills, as well as reduced prevalence of mould and damp.
- The plan also outlines measures to support landlords to comply with the new standards and exemptions for “low-value properties”.
Chris Galpin, Senior Policy Advisor at E3G, said:
“Stronger building regulations will be life-changing for many renters – slashing their bills by hundreds of pounds a year, as well as keeping their homes drier and healthier. But more still needs to be done to protect households with electric heating, who are twice as likely to face fuel poverty as other households.”
Low-interest loans for all consumers
The Warm Homes Plan pledges nearly £2bn in funding to enable new low-interest consumer loans.
This policy will make energy-bill reducing measures like solar, batteries and heat pumps more affordable to ordinary households.
The Department for Energy Security and Net Zero (DESNZ) will set out further details of the scheme’s eligibility later this year, with the scheme then expected to roll out in phases.
- Recent polling found that over 35% of people couldn’t afford the upfront cost of upgrading their homes’ energy efficiency – an affordable loan scheme will help with this.
- The number of green loans available in the UK market, supporting households to finance energy efficiency upgrades such as solar PV, battery storage and heat pumps, has tripled over the past three years. Today’s loan announcement shows that this government is tapping into our strong and growing green finance sector to supercharge investment and efficiency outcomes for homeowners.
- These new loans can, in the case of heat pumps, be linked to the Boiler Upgrade Scheme, providing a winning ‘grant + loan’ model which has been successfully deployed in other countries, including France.
Leo Vincent, Senior Policy Advisor at E3G, said:
“An affordable, government-backed loan scheme is an excellent way of supporting more families to upgrade their homes while creating skilled jobs and apprenticeships. This investment shows that reducing our carbon emissions and making real savings on energy bills go hand in hand.”
Fully-funded solar and heat pumps for low-income consumers
Low-income households will be able to get these bill-reducing technologies completely free, backed by £5bn in grants. From 2027/28 onwards, DESNZ intends to combine the Warm Homes Social Housing Fund and the Warm Homes Local Grant into a single scheme aimed at supporting low-income households with a more area-based delivery approach.
- According to the government’s own reporting, there were an estimated 2.73 million households (11.0% of homes) in fuel poverty in England in 2024.
- Over 1.5 million homes across the UK are fitted with solar panels, saving a typical household an average of £350 a year on energy bills.
- E3G analysis suggests heat pumps could halve heating bills compared to a gas boiler, assuming further action is taken to cut taxes on electricity. When combined with solar panels, the results could be financially life-changing for low-income households.
Leo Vincent, Senior Policy Advisor at E3G, said:
“With millions of low-income British people living in damp, cold, mouldy homes, this policy of delivering cutting edge energy technology to those most in need will deliver transformational change to people’s lives, create jobs and grow the economy.”
Available for comment
Ed Matthew, UK Programme Director for E3G: Tel: 07827 157906 / ed.matthew@e3g.org
Ellie Mae O’Hagan, UK Energy Team Programme Leader: Tel: 07732 891599 / elliemae.ohagan@e3g.org
Chris Galpin, Senior Policy Advisor: Tel 07825 894188 / chris.galpin@e3g.org
Notes to editors
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