Cheap loans for families to install solar panels, heat pumps and batteries

Homeowners will be able to access low and zero interest loans to install solar panels, heat pumps and batteries under a flagship energy upgrades scheme.

And low income households and fuel poor families struggling to pay energy bills will receive free upgrades for insulation and clean tech backed by £5 billion of public investment, officials said.

The measures form part of the Government’s “warm homes plan”, a £15 billion programme to deliver energy efficiency and technology upgrades to British homes, in a bid to cut bills and reliance on fossil fuels, reduce carbon emissions and lift people out of fuel poverty.

Environmental and anti-fuel poverty campaigners welcomed the plan but called for more action and funding to end the “scandal” of people living in cold, damp homes and struggling to pay energy bills.

In addition to the £5 billion for low-income schemes, some £2 billion is earmarked for consumer loans, £2.7 billion for the “boiler upgrade scheme” for heat pump grants and £2.7 billion in innovative finance through a new “warm homes fund” investment facility for home upgrades.

There is also £1.1 billion for heat networks and £1.5 billion for other funding including the devolved administrations.

The plans also include upgrading protections for renters, along with support for landlords to make energy efficiency improvements, the Department for Energy Security and Net Zero (Desnz) said.

The programme aims to roll out upgrades to up to five million homes, saving families hundreds of pounds on their energy bills, and lift up to a million households out of fuel poverty by 2030.

Sir Keir Starmer said the plans showed the Government was “bearing down on the cost-of-living crisis”.

The measures come after moves in last year’s budget to take an average of £150 off energy bills from April, as well as £150 warm homes discount for around six million households, with the Government saying energy upgrades would bring down bills for good.

The Prime Minister said: ““A warm home shouldn’t be a privilege, it should be a basic guarantee for every family in Britain.

“Today’s plan marks a turning point. It will help to slash energy costs and lift up to a million people out of fuel poverty.”

‘Scandal’

Energy Secretary Ed Miliband said: “It is a scandal that millions of people in our country do not have the security of a home that is warm, affordable and safe.

“With this investment, we embark on a national project to turn the tide – waging war on fuel poverty and taking another step forward in tackling the affordability crisis for families throughout Britain.”

The warm homes plan includes direct support for low income families to receive a free-of-charge package of energy saving measures ranging from insulation to technology such as solar panels and a battery worth thousands of pounds, depending what suits an individual property.

There could also be upgrades to entire streets of social housing, officials said.

Government-backed zero and low interest loans will be available to homeowners to install solar panels on their roofs, alongside new rules in the Future Homes Standard that will make solar on new homes standard.

The loans will also be available for batteries and heat pumps, to allow greater take up of clean technologies, and are in addition to the £7,500 grant for replacing boilers with heat pumps.

The Government has repeatedly ruled out boiler bans, and instead hopes the new plan will enable consumers to choose ever more popular clean tech for their homes.

A Labour source said: “We believe in empowering consumers to make choices about what works for them, not banning one technology or another.

“Demand is growing for clean tech and we want to lean into it by making these products the cheaper choice.”

Warm homes agency

A new Warm Homes Agency will support energy efficiency upgrades, local mayors will be in the “driving seat” for rolling out improvement programmes in their local areas and there will be a new aim to ensure that at least 70% of heat pumps installed in the UK are built here.

The £15 billion scheme includes allocations for devolved governments in Scotland, Wales and Northern Ireland.

The plan was welcomed by anti fuel poverty campaigners, but they warned further reforms would be needed and “now the hard work begins”.

Simon Francis, coordinator of the End Fuel Poverty Coalition, said: “The lifeblood of the Warm Homes Plan amounts to a rescue mission for the coldest, dampest homes in Britain – and this must be the priority.

“Combined with long-overdue improvements to conditions in the private rented sector, it could save lives, cut NHS costs and permanently slash energy bills for those in fuel poverty.”

But he called for further reforms to bring down the cost of electricity and provide financial support for households while they wait for improvements to be installed.

“Above all, any use of public funds must come with a warm homes guarantee, built around quality advice on the right installations to deliver, enhanced consumer protections and a promise that every upgraded home will see bills come down.”

‘Soaring energy bills’

Rick Parfett, WWF’s head of climate said: “In an unstable world, depending on fossil fuels risks soaring energy bills.

“That’s why today’s announcement matters – if fully funded and delivered, this plan will create warmer homes and lower bills for households through insulation and harnessing the UK’s abundant clean energy.”

Friends of the Earth’s head of policy, Mike Childs, said: “The warm homes plan is a welcome step forward, with tougher standards for rental homes and £5 billion to help councils and social landlords install insulation and clean energy like solar panels.

“But without more investment it will fall far short of what’s needed to protect people’s health and end the scandal of families forced to live in cold, damp homes.”