Warm Homes Plan 2025: What the New Government Grant Scheme Means for Homeowners

What the Warm Homes Plan Is

The Warm Homes Plan is the Labour government's comprehensive programme to improve the energy efficiency of homes across Great Britain, announced as part of the 2024 manifesto and subsequently detailed in the Autumn Budget 2024 and the Clean Power Action Plan. The government has committed £13.2 billion over the parliament (to 2029) across related programmes.

The plan encompasses several distinct funding streams, not a single unified scheme. Understanding which stream applies to your situation requires knowing your property's EPC rating, tenure, and income level.

The Great British Insulation Scheme (GBIS)

Launched in 2023 under the previous government and continuing under the Warm Homes Plan framework, the Great British Insulation Scheme provides insulation measures (loft, cavity wall, solid wall, underfloor) to households meeting one of two eligibility routes:

**Group A (means-tested):** Households receiving qualifying benefits (Universal Credit, Pension Credit, Working Tax Credit, Child Tax Credit at certain thresholds) are eligible regardless of EPC rating.

**Group B (EPC and council tax):** Households with a property in EPC band D, E, F, or G AND in council tax bands A–D in England (A–E in Scotland, A–C in Wales) are eligible without means-testing.

Measures are delivered by energy companies under their obligation and by government-funded schemes. Eligible households can apply via the GOV.UK Simple Energy Advice service or directly through their energy supplier.

The Energy Company Obligation (ECO4)

ECO4, running to March 2026, targets the least energy-efficient homes in the private and social rented sectors and for owner-occupiers receiving qualifying benefits. It funds insulation, heating upgrades, and low-carbon heating technologies (including heat pumps) for eligible households.

The successor to ECO4 (expected to be ECO5 or an equivalent obligation) is expected to continue under the Warm Homes Plan framework from 2026, with an expanded focus on low-carbon heating.

The Boiler Upgrade Scheme (BUS)

The BUS, administered by Ofgem, provides upfront grants for heat pumps and biomass boilers:

• Air source heat pump: £7,500
• Ground source heat pump: £7,500
• Biomass boiler: £5,000

The BUS was initially funded to March 2025 and has been extended and uprated (the original air source grant was £5,000; it was increased to £7,500 in October 2023). Under the Warm Homes Plan, the BUS or equivalent funding is expected to continue through the parliament, though specific terms may evolve.

Applications are made by MCS-certified installers on behalf of eligible households. A property must have a current EPC with no outstanding recommendations for loft or cavity wall insulation to qualify. Check your EPC on Property Passport UK before applying.

Warm Homes Local Grant (Formerly LADS)

The Local Authority Delivery Scheme (LADS) has been succeeded by the Warm Homes Local Grant, which channels funding through local authorities to owner-occupiers and private landlords with low-income tenants in low-EPC properties. The scheme targets properties in EPC bands E, F, and G.

Local authority delivery means availability and application processes vary by area. Contact your local council or check the GOV.UK guidance for your local authority's current scheme availability.

The Warm Homes Discount

The Warm Homes Discount is a £150 annual reduction on electricity bills for qualifying low-income households. It is separate from the capital grant schemes above and applies automatically to qualifying benefit recipients whose energy supplier participates in the scheme. Around 3 million households benefit annually.

What Is Not Yet Fully Confirmed

The Warm Homes Plan as described by the government includes ambitions around:

• A new green grants and loans scheme for middle-income homeowners not covered by ECO4 or GBIS (the "green homes finance" stream)
• Integration with mortgage lenders to incentivise retrofit lending
• Expansion of heat pump installation at scale through workforce development

As of early 2026, the detailed policy frameworks and application mechanisms for some of these elements are still being developed. Monitoring the Simple Energy Advice website (simpleenergyadvice.org.uk) provides the most current information on what schemes are open and accepting applications.

What Homeowners Should Do Now

If your property is EPC band D or below, check your eligibility for current schemes without delay — waiting for the next iteration of a scheme means waiting months or years. Commission an up-to-date EPC if your existing certificate is expired or predates significant improvements. Use Property Passport UK to retrieve your current EPC data, then explore eligibility for GBIS, ECO4, or the BUS based on your property rating and household income.