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  • Andrew Byrne

Government allocates £562m to help decarbonise 50,000 households

In an attempt to improve domestic energy efficiency, the government has announced that it will make £562m available to local authorities to allocate among 50,000 households across the UK. The funding will be used on measures including:

  • insulation for cavity walls, underfloor and lofts;

  • replacing gas boilers with low carbon alternatives such as heat pumps;

  • installation of solar panels.

The funding is being set aside for households where annual income is less than £30,000 with the hope that residents will be able to save up to about £450 a year. In addition, carbon emissions will be reduced by more than 70,000 tonnes annually which equates to the direct and indirect carbon footprint of about 9,000 households. It is estimated that the UK’s domestic building stock currently accounts for about 25% of all carbon emissions.

The funding will be provided by £500m from the Local Authority Fund – a component of the much-discussed Green Homes Grant scheme – and a further £62m from the Social Housing Decarbonisation Fund. The Green Homes Grant scheme was introduced in July 2020 setting aside £2bn to enable householders to apply for grants of up to £5,000 towards improving their energy efficiency.

Since then, the scheme has encountered problems and operational barriers with only a fraction of the fund being allocated prior to the end of the 2020/21 financial year. References to the Green Homes Grant scheme were conspicuous by their absence from Rishi Sunak’s budget speech in March fuelling further criticism. Now that £500m of the unspent fund has been redirected towards lower-income households, there may be some redemption for the government.

It may also lead to a rethink on the part of the government on how to administer any such schemes in the future. Announcing the new funding on March 23rd, Business and Energy Secretary Kwasi Kwarteng said: “We are ensuring households across the country enjoy warmer homes that are cheaper to heat and emit fewer emissions…while creating new work for local plumbers, builders and tradespeople”. Kwarteng went on to say that the government planned to invest over £9bn in eradicating fuel poverty.

A number of strands of advice is available to the government from sources granted a remit to provide just that. The Coalition for the Energy Efficiency of Buildings (CEEB) – an offshoot of the Green Finance Institute, an independent taskforce created by the government in 2017 – published a report in early March called Building Renovation Passports: Creating the pathway to zero carbon homes.

This report recommended creating a digital logbook about the operational performance of, and renovations carried out to, buildings. This would also contain a long-term renovation roadmap which identified potential future retrofit measures and links to available contractors and finance options. A reference in the report to “applying lessons from historic issues with [the] Green Homes Grant Scheme” is an encouraging indication of a willingness to learn quickly from previous projects.


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