Government launches £2bn Green Homes Grant scheme

The government has launched its Green Homes Grant scheme, which aims to help homeowners upgrade the energy efficiency of their homes.
The government has launched its £2 billion Green Homes Grant scheme. Credit: Pixabay

The government has today launched its £2 billion Green Homes Grant scheme, which aims to help homeowners upgrade the energy efficiency of their homes.

The Green Homes Grant scheme, announced as part of the Chancellor Rishi Sunak’s summer economic update, will see the government fund up to two-thirds of the cost of green home improvements such as low-carbon heating installation and wall insulation, up to a maximum of £5,000.

Meanwhile, homeowners with low incomes will be eligible for grants covering up to 100% of the cost of works up to £10,000.

The government says the scheme will help cut energy bills and carbon emissions, supporting over 100,000 green jobs in construction while improving the energy efficiency of over 600,000 homes across the country.

Announcing the launch of the Green Homes Grant scheme, Sunak said: “We promised to support jobs and protect the environment – and the Green Homes Grant delivers on this.

“We’re giving homeowners, landlords and local authorities the funding they need to hire local tradespeople and make our homes more energy efficient. By supporting the green van men and women, we’ll save money, save jobs and save the planet.”

Grants offered by the scheme, which will employ Tradesmark-registered installers, will cover home improvements ranging from the insulation of walls, floors and roofs, to double or triple glazing installation and low-carbon heating like heat pumps.

£1.5 billion of the Green Homes Grant scheme will be handed out through vouchers, while the remaining £500 million has been assigned for local authorities to provide such improvements for households with incomes below £30,000. Improvements must be completed by March 2021.

Opening the Green Homes Grant website for voucher applications today, the government also announced further measures to raise the energy efficiency standard of homes in the private rental sector.

Landlords must now ensure their homes reach Energy Performance Certificate (EPC) Band C requirements and will be able to access the Green Homes Grant in order to fund the necessary improvements. Costs will be capped at £10,000.

The rules will come into force for new tenancies from 10 April 2025 and for all tenancies by 1 April 2028. The measures are expected to improve the energy efficiency of over 3 million homes.

The government additionally confirmed details of its £50 million pilot for the Social Housing Decarbonisation Fund (SHDF), which will see grants supplied to improve the energy efficiency of over 2000 of the worst-performing social homes.

The UK-wide pilot will upgrade around 2,200 poor energy performing social homes (homes with an EPC rating D or below), using a ‘whole house’ retrofit approach. Grant applications will be open to local authorities for work on their own housing stock or homes owned by housing associations and will be awarded later this year.

Ben Beadle, chief executive of the National Residential Landlords Association commented on the announcements: “Improving the energy efficiency of rental housing is good news for tenants, landlords and local economies.

“We encourage all landlords to make use of this as it will mean housing standards are improved, tenants will save money and it will reduce carbon emissions across the whole sector.”

The announcements form part of the government’s efforts to ensure that the UK has a ‘green’ recovery from the COVID-19 pandemic and meets its legally binding target to reach net zero carbon emissions by 2050.

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