£15 Billion Warm Homes Plan: What it means for households, social housing and the UK's retrofit market

The Government has unveiled a £15 billion Warm Homes Plan, setting out one of the most significant commitments to domestic energy efficiency and retrofit in over a decade. The plan aims to upgrade 5 million homes by 2030, lift 1 million households out of fuel poverty, and fundamentally shift the UK’s housing stock toward low-carbon, low-bill living.

At its core, the Warm Homes Plan marks a decisive move away from piecemeal grant schemes and toward a system-wide electrification and retrofit strategy, closely aligned with the forthcoming Future Homes Standard for new build properties.

The Headline Ambition

The Warm Homes Plan focuses on deploying solar PV, batteries, heat pumps and insulation at scale to reduce household energy bills and cut emissions. The emphasis is not simply on carbon reduction, but on cost-effective electrification, resilience to volatile gas prices, and long-term affordability.

Key objectives include:

• Retrofitting 5 million homes by 2030

• Removing 1 million households from fuel poverty

• Driving down energy bills through electrification and on-site generation

• Creating a more consistent national framework for retrofit delivery

A New Direction for Retrofit Funding

One of the most notable aspects of the plan is a clear strategic shift in how retrofit is funded. Rather than relying heavily on competitive, short-term grant programmes, the Government is signalling a move toward longer-term, structured funding and finance, particularly for electrification technologies.

The £15 billion programme sits alongside:

• The Future Homes Standard, which will electrify all new homes

• Reforms to Energy Performance Certificates (EPCs) via the new Home Energy Model (HEM)

Together, these changes aim to align how homes are built, assessed and upgraded, something the sector has long called for.

How the Funding Is Split

Devolved Nations

• £1.5billion allocated to Scotland, Wales and Northern Ireland

• Delivery mechanisms will be determined by devolved administrations

England: £13.5bn Breakdown

£5bn - Fully Funded Upgrades for Low-Income Households

• Targeted at fuel-poor and vulnerable households

• Fully funded packages tailored to the property, including combinations of:

  • Insulation

  • Solar PV

  • Batteries

  • Heat pumps

• Particularly significant for social housing providers, who will be able to upgrade homes without relying solely on limited capital budgets

£2.7 billion - Universal Heat Pump Grant

• A £7,500 grant available to any household

• Includes air-to-air heat pumps, which can also provide cooling

• Designed to normalise heat pump adoption beyond early adopters

£2 billion - Zero and Low-Interest Loans

• Government-backed finance for:

  • Solar panels

  • Batteries

  • Heat pumps

• Intended to remove upfront cost barriers entirely

• Marks a shift from grant dependency to affordable finance at scale

£2.7 billion - Innovative Finance and Green Mortgages

• Support for products such as:

  • Green mortgages

  • Lower interest rates linked to energy performance

• Builds on emerging models like “zero bills” homes

• Aims to crowd in private capital rather than displace it

£1.1 billion - Heat Networks

• Continued investment in district heating

• Important for urban areas and higher-density housing, including social housing estates

Some elements of this funding are already in place, but the plan consolidates and expands them under a single strategic framework.

Implications for Social Housing

The Warm Homes Plan has major implications for social landlords:

• Fully funded retrofit packages reduce pressure on Housing Revenue Accounts

• Supports compliance with tighter Minimum Energy Efficiency Standards (MEES)

• Enables estate-wide, fabric-first retrofit rather than one-off interventions

• Opens the door to combining public funding with low-cost finance

From 2030, landlords will be required to ensure rental properties meet EPC C, up from the current EPC E. Crucially:

• This will be assessed using a new EPC methodology, based on the Home Energy Model

• There is expected to be a spending cap for hard-to-treat homes, where EPC C cannot be met cost-effectively

This provides some protection for landlords managing older or complex stock, though full details are still awaited.

A New Warm Homes Agency

The plan introduces a new Warm Homes Agency, designed to replace the fragmented landscape of current delivery bodies.

Its role will include:

• Providing trusted advice to households

• Ensuring quality installations

• Supporting delivery from initial assessment through to completion

This is intended to address long-standing issues around consumer confidence, installer quality and scheme complexity.

Local and Mayoral Leadership

The Government has stated that local mayors will be “in the driving seat” for delivering home upgrades in their areas. This signals:

• A stronger role for combined authorities

• Place-based delivery aligned with local housing, health and climate priorities

• Potential for better coordination across social housing, private rental and owner-occupied homes

However, success will depend on whether mayors are given sufficient powers, certainty and long-term funding to plan at scale.

Reforming EPCs: The Home Energy Model

Later this year, the Government will publish reforms to EPCs, moving to the Home Energy Model (HEM). The new system is expected to assess homes against four metrics:

1. Energy bills

2. Space heating demand

3. Carbon emissions

4. Smart readiness

To score well across all four, homes are likely to need:

• Strong insulation

• Heat pumps

• Solar PV

This represents a shift away from a narrow efficiency score toward a whole-home performance assessment.

The Future Homes Standard: Completing the Picture

The Future Homes Standard (FHS) is expected to be introduced in early 2026, with a transition period of 18–24 months.

Key features include:

• Low-carbon heating as standard (effectively banning gas boilers)

• Solar PV required on most new homes

• Higher on-site generation expectations, with exemptions where roofs are unsuitable

• Short-term compliance via SAP 10.3, transitioning to the Home Energy Model

From late 2027 / early 2028, new plots not substantially complete will need to comply.

Conclusion: A Structural Shift, Not Just Another Scheme

The Warm Homes Plan represents a fundamental reset in how the UK approaches domestic retrofit. Its success will depend less on headline funding numbers and more on:

• How well public funding is blended with private finance

• Whether local leaders are truly empowered to deliver at scale

• How quickly new EPC and building standards provide certainty to the market

For social housing providers, the plan offers a long-awaited opportunity to move from incremental upgrades to strategic, whole-stock decarbonisation, provided the delivery framework lives up to the ambition.

If implemented well, this could mark the moment retrofit finally moves from pilot projects to national infrastructure priority.