The Social Housing Decarbonisation Fund will provide 8,800 homes with free efficiency upgrades, saving households £400 a year on their energy bills on average
Up to 8,800 social homes will benefit from free upgrades to make them more energy efficient and cheaper to run
over £75 million will be allocated to councils and housing associations to install insulation, heat pumps and double glazing
funding from the Social Housing Decarbonisation Fund will help save tenants around £400 a year on their energy bills on average, while supporting 1,300 jobs
Social housing tenants could save as much as £400 a year on their energy bills, as part of upgrades to their homes backed by millions of pounds of government funding.
Secretary of State for Energy Security Claire Coutinho today (Monday 18 March) announced the award of over £75 million from the Social Housing Decarbonisation Fund to offer free upgrades to tenants’ homes including insulation, double glazing and the installation of heat pumps. The scheme is already working to reach around 100,000 households.
Funding will be available to 42 councils and housing associations across England to install energy saving measures in social homes, while supporting 1,300 jobs in the UK’s retrofit industry.
This funding will help some of the lowest income households by delivering warm and energy efficient homes, lifting people out of fuel poverty and improving the comfort and wellbeing of social housing tenants.
Almost half of all homes in England are now rated Energy Performance Certificate (EPC) Band C or above, up from 14% in 2010.
Secretary of State for Energy Security Claire Coutinho said:
Our Social Housing Decarbonisation Fund is helping families to keep their homes warm and their bills down. We want to support hard-working families to make changes, rather than burdening them with unnecessary costs. This funding today will help up to a further 8,800 households save around £400 a year on their energy bills.
Minister for Energy Efficiency and Green Finance Lord Callanan said:
Already working to deliver free home upgrades to around 100,000 social homes, the Social Housing Decarbonisation Fund is helping low-income families have cheaper bills and a warmer home. We’re now going even further to cut energy bills for more social tenants, all while supporting an additional 1,300 jobs in the UK’s retrofit industry.
Open to applicants who had not received funding in the previous wave – which is also expected to save tenants around up to £400 on their energy bills – this funding will bring many new social housing landlords into the Social Housing Decarbonisation Fund for the first time, helping to ensure the programme reaches as many social homes as possible.
The Social Housing Decarbonisation Fund has already allocated over £1 billion since 2019, with projects including:
Durham County Council, which previously received over £5 million to upgrade around 1,300 homes. This includes Colin Barnes, a local social housing tenant from Karbon Homes who described the positive impact of the changes on his home as: “You put the heating on for 20-30 minutes and it heats up even quicker – it holds the heat for ages.”
Manchester City Council and One Manchester, which was previously awarded around £3 million to help install external wall insulation and air-source heat pumps. Asked if the new measures had made a difference to her energy bills, One Manchester tenant Vicky Connor said: “Yeah, it works out. If you’re looking at it, if you’re watching it works out as being good. Works out at about £7 a day.”
The government is allocating around £20 billion over this Parliament and next to improve the energy efficiency and low carbon heating of homes and businesses, reducing reliance on fossil fuel heating and reducing household energy bills.
This includes the Boiler Upgrade Scheme, which is helping households make the switch from fossil fuel heating systems to cleaner low carbon alternatives.
Having increased the grant by 50% to £7,500 – making it one of the most generous schemes of its kind in Europe – applications are on a sustained surge, with the average monthly number of applications from November 2023 to January this year 39% higher than the monthly average before the uplift.
The government also recently announced that homeowners will have more choice in how they improve their home and will no longer have to install cavity wall or loft insulation to use the Boiler Upgrade Scheme.
Chief Executive of the National Housing Federation Kate Henderson said:
Housing associations play a crucial role in helping the country to meet its net zero targets and are already leading the way on energy efficiency, but funding is essential for maintaining this work. The sector is committed to providing energy efficient and comfortable homes for their residents that are affordable to heat, and the Social Housing Decarbonisation Fund is key to enabling them to do so; I’ve seen first-hand the difference it has made. The funding announced today will give housing associations the certainty and confidence they need to plan and deliver more retrofit projects, tackle fuel poverty, and improve their residents’ homes.
Chief Executive of the Northern Housing Consortium Tracy Harrison said:
I’m delighted to see continued government support for SHDF, with Wave 2.2 helping to support a number of smaller housing associations. This is vital funding to complement the investment our members are making to deliver more green home upgrades, to help residents with lower bills and warmer homes.
Reaction from Previous Social Housing Decarbonisation Fund Winners
Head of Planning and Housing at Durham Country Council Michael Kelleher said:
We have ambitious targets to reduce County Durham’s carbon footprint and we continue to work with partners to achieve this aim. The energy efficiency retrofit works carried out through the Social Housing Decarbonisation Fund have made a significant difference to households. Not only has it benefitted the environment by reducing the carbon emissions of the houses involved, but the more efficient energy use has also helped reduce heating and electricity costs for tenants.
Chief Executive of Karbon Homes Paul Fiddaman said:
With a diverse range of homes, across rural and urban communities and everything in between, this vital funding is enabling us, and other registered providers across the North East, to make real progress in retrofitting and decarbonising our homes. Not only has this programme helped us lower the carbon footprint of these homes, but it’s also helped us provided our customers with warmer, more comfortable homes. As the cost of living crisis continues to have an impact, and we look for more ways to help customers financially, this work has never been more important.
Notes to Editors
A total of £75.5 million from Wave 2.2 of the Social Housing Decarbonisation Fund (SHDF) will be offered to 42 local authorities, housing associations, registered providers of social housing and charities across England, subject to grant funding agreements being signed.
Applicants to the Social Housing Decarbonisation Fund are required to co-fund their projects, with the total value of co-funding from Wave 2.2 being £139 million.
Wave 2.2 builds on the success of earlier waves of the SHDF and was announced in October 2023. It is a top up to the £778 million funding for Wave 2.1 announced in March 2023, which is currently in delivery.
The SHDF was allocated a further £1.25 billion in December 2023 for the period 2025-2026 - 2027-2028.