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A £1.8bn energy efficiency and insulation boost for homes and buildings across England

The government has announced today that £1.8bn is to be distributed through the Social Housing Decarbonisation Fund, Home Upgrade Grant and Public Sector Decarbonisation Scheme to upgrade social homes and public buildings and make them more energy efficient.

New Insulation

The vast majority of the money, £1.4bn, is coming via phase two of the Home Upgrade Grant (£630m) and the Social Housing Decarbonisation fund (£778m). This money will go directly to local authorities who will be tasked with upgrading homes through a number of measures, including:

  • Loft insulation
  • New window installation
  • Exterior wall insulation
  • Cavity wall insulation
  • Draft proofing measures
  • Heat pump and solar panel installation

The government hope that these measures will save the targeted households up to £400 a year on energy bills.

In total, around 115,000 homes in England will benefit from this funding with local authorities also pumping in £1.1bn to increase the scope of beneficiaries and to bring the total amount of funding for homes to £2.5bn.

The focus of this funding will be on vulnerable households and off-gas grid homes with an EPC rating of D or below. The people in these types of households pay significantly more than the rest of the country on energy bills but through this funding, they should be able to bring their bills down by at least £30 per month.

On top of the households which will directly benefit from the funding, others could benefit through the number of jobs that it will create. The government are estimating that around 20,000 jobs will be created in the construction and home retrofit sectors due to the scale of the work needed.

The funding will be rolled out from April 2023, will last for two years and will form part of the government’s commitment to reduce energy demand in the UK by 15% by 2030.

A boost for public buildings

While a large portion of the funding is going towards housing, 144 public sector organisations are also set to benefit. Over £400m has been dished out to reduce carbon emissions in the following public buildings:

  • Schools
  • Hospitals
  • Museums
  • Universities
  • Leisure centres.

The entirety of this funding is being delivered through the Public Sector Decarbonisation Scheme. This scheme was launched in 2020 to support the UK’s economic recovery from the pandemic and has already pledged more than £2bn.

The fund has provided grants to public sector organisations to fund energy-saving measures such as low-carbon eating and solar panel insulation. The overall aim of the scheme is to help with the government’s commitment to reduce emissions from public sector buildings by 75% compared to 2017 levels.

This ambitious plan was set out in the 2021 Heat and Buildings strategy and the government says significant progress is already being made. According to the official government website, the UK has already cut emissions across the board by 48% between 1990 and 2021 which is faster than any other G7 country.

They are now estimating that by 2037, energy efficiency measures will save the public sector around £650 a year.

Key reaction

Within the announcement, Secretary of State for Energy Security and Net Zero Grant Shapps said that the funding is a “huge boost for job creation and economic growth”. He added:

“We know this is a difficult time for families, which is why the government is covering around half a typical household’s energy bill this winter. This is a huge investment that will help households save hundreds on energy bills and see them heat their homes for less, and stay warm for longer.

This funding will open also open up new and exciting opportunities across the UK’s ever-expanding green sector.”

“The UK truly is a world leader when it comes to reducing carbon emissions and the progress we’ve made over the last decade has been remarkable. But we can’t rest on our laurels and must continue to drive forward progress, setting a standard for other countries to follow.

Reaching net zero means considerable action from the public sector as well as the private sector. Through the Public Sector Decarbonisation Scheme funding allocation announced today, we are empowering public bodies to save the taxpayer hundreds of millions while packing a punch on our ambitious and necessary climate goals.”

Lord Callanan – the Minister for Energy Efficiency and Green Finance

Final thought

With many households facing short-term pain over their energy bills in the coming months as the government’s support scheme comes to an end, this funding may at least provide some of the most vulnerable with hope for the future.

Beyond that, making homes and buildings across England more energy efficient can only help with the government’s commitment to going net zero by 2050. In addition to the funding today, they recently dished out £19m to 37 green British companies in further evidence that they are serious about reaching their targets.

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