Energy Efficiency Grants in 2024: What’s Coming in 2025 with the Labour Government?

In 2024, the UK government has continued to support energy efficiency through various grants aimed at reducing energy consumption, lowering costs, and cutting carbon emissions. These grants are part of the wider effort to decarbonise the country and meet net-zero goals. With the new Labour government now in place, 2025 promises to introduce even more ambitious policies and funding to accelerate these efforts.

Current Energy Efficiency Grants (2024)

A variety of grants are already in place to help households and businesses in the UK improve energy efficiency. Below is an overview of the most important schemes in operation as of 2024:

1. Energy Company Obligation (ECO4): Running until 2026, the ECO4 scheme helps low-income households by funding essential energy efficiency measures, such as insulation and heating system upgrades. The goal is to target homes that are particularly vulnerable to fuel poverty and help reduce overall energy consumption.
2. Boiler Upgrade Scheme: This scheme offers homeowners in England and Wales up to £6,000 to replace traditional gas boilers with low-carbon alternatives like heat pumps or biomass boilers. It’s part of the UK’s broader mission to phase out gas heating and encourage the adoption of more sustainable systems.
3. Home Upgrade Grant: The Home Upgrade Grant provides financial assistance to low-income households with an annual income of less than £31,000 and energy-inefficient homes (with EPC ratings of D to G). The grant helps fund insulation, energy-efficient heating systems, and other upgrades arranged through local councils.
4. Scotland’s Warmer Homes Scheme: In Scotland, eligible households can access up to £10,000 through the Warmer Homes Scheme for improvements like insulation and energy-efficient heating. The focus is on reducing heating costs and improving comfort in homes with poor energy performance.
5. Wales’ Nest Scheme: In Wales, the Nest Scheme helps residents by offering free energy-saving measures like solar panels, heat pumps, and insulation. The initiative is designed to tackle fuel poverty and reduce energy bills, particularly in low-income homes.

These grants are part of a wider governmental push to improve energy efficiency across the UK. As energy prices continue to rise and the need for sustainable living grows, these schemes provide much-needed support for individuals and businesses looking to upgrade their properties.

New Policies in 2025

The Labour government, elected in 2024, is expected to introduce major new policies in 2025 to build on the existing energy efficiency initiatives. One of the headline promises is the “Warm Homes Plan,” which will see an investment of £6.6 billion to upgrade five million homes across the UK.

This ambitious plan aims to provide grants and low-interest loans to households to install insulation, solar panels, batteries, and low-carbon heating systems like heat pumps.

By increasing the energy efficiency of these homes, the Warm Homes Plan hopes to lower energy bills for millions of residents while contributing to the country’s broader decarbonisation goals.

Great British Energy and Renewable Investments

In addition to direct support for homes, Labour has also announced the creation of Great British Energy. This public energy company will co-invest in large-scale renewable energy projects, including offshore wind, onshore wind, and green hydrogen. Labour’s decision to remove planning barriers for onshore wind projects is expected to accelerate growth in renewable energy, boosting the UK’s energy independence and reducing its reliance on fossil fuels.

This initiative is part of a broader strategy to decarbonise the UK’s energy grid while creating jobs and driving investment in clean technologies. The introduction of Great British Energy is expected to be a game-changer in terms of how the UK manages and invests in renewable energy projects.

October Budget

The upcoming budget on October 30th is highly anticipated, with expectations that it will outline specific funding allocations for these new energy initiatives. While full details are not yet available, there are key areas that will likely be covered:

• Additional grants for energy efficiency upgrades in homes and businesses.
• Increased investment in clean energy infrastructure, including improvements to the national grid to support the increased use of renewables.
• Further green finance initiatives aimed at providing affordable loans and support for both individuals and businesses looking to invest in energy-efficient technologies.

Labour’s focus on net-zero targets will make energy efficiency and renewable energy top priorities in the budget. This should provide homeowners and businesses with more opportunities to access funding for energy-saving improvements and renewable energy projects.

Conclusion

The future of energy efficiency in the UK is set for major transformation in 2025, with new policies and grants expected to be announced by the Labour government. From the Warm Homes Plan to the establishment of Great British Energy, the government’s focus is on driving investment in energy-efficient homes and renewable energy projects.

For those looking to improve their homes or businesses, these new initiatives will offer significant support. As the October 6th budget approaches, it’s a great time to start planning energy efficiency upgrades to take advantage of the upcoming schemes.

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