Helping you make the most out of your money
Helping you make the most out of your money
Households could be eligible for grants to cover energy-saving renovations like loft insulation to make their homes more efficient
Households across the UK have been hit by rising energy costs, and for many, eye-watering bills are putting pressure on already-stretched budgets.
The government’s energy price guarantee has been extended and will now run until April 2024. But while bills have been frozen at an annual £2,500 for the average household until 31 March this year, the threshold is set to increase again after that, meaning the average annual bill will go up to £3,000 for the following 12 months.
Making energy-efficient upgrades to your home can help slash bills as oil and gas prices have soared in response to Russia’s invasion of Ukraine. Prices in the wholesale market have been on the way down recently but remain high by historical standards – the average annual bill for households was £1,360 in 2019 – and so consumers are feeling the pinch.
In response to UK energy bill inflation the government is offering green energy grants to some households to help pay for renovations like loft insulation and cavity wall insulation. We take a look at:
The UK’s housing stock is among the oldest and leakiest in Europe, which makes properties very expensive to heat. This is why improvements are needed.
But many of these energy-efficient changes can come with a hefty price tag, so it’s important to know what help is available to help you meet the cost.
Renewable energy grants, or green energy grants, as they are also known, can subsidise the cost of installing energy-efficient features in your home.
While there are lots of grants on offer now to households in the UK, eligibility criteria apply.
Here we took a look at how the different schemes work, and whether you qualify for them.
Making your home more efficient will make it cheaper to run over time. And the changes you implement can help make it feel cosier, too.
According to the Energy Saving Trust, getting loft insulation put in could cost between £300. Based on a three-bed semi, this would save you around £180 a year.
Cavity-wall insulation would cost the same home around £450, and save between £140 a year.
Here are some estimated household savings based on a gas-heated, three-bedroom semi-detached home:
As well as the schemes below, some lenders also offer green mortgages, which come with preferential rates for homes with improved insulation.
This can mean lower interest rates or cashback for properties that have better energy-efficiency ratings, or where eco-friendly improvements are planned. Read more about green mortgages and who qualifies.
Most of the UK’s energy firms are part of the government’s ECO4 scheme, designed to help cut carbon emissions and reduce fuel poverty.
Suppliers are required to improve the energy efficiency of properties occupied by low-income and vulnerable households through grants for measures such as roof, loft and cavity wall insulation, as well as boiler replacements or repairs.
There are thousands of pounds of grants available, but strict criteria need to be met, and it can be quite tricky to work out if you can get funding.
You must be in receipt of certain benefits to qualify for ECO4. These are:
It’s important to note that different companies provide different amounts of support and will fund different energy-efficiency improvements. Even if you are eligible, the energy supplier doesn’t have to fund one of these measures.
To qualify, you must also own your own home, or – if renting, whether as a private or social housing tenant – get permission from your landlord.
There are several factors that make it more likely you will qualify:
To find out if you are eligible and how much you could get, contact your local council or your energy provider.
The latest government scheme, ECO+, is set to run from April this year and is aimed at helping middle earners in the least energy-efficient homes to insulate their properties, with grants of up to £15,000.
This will run in tandem with ECO4 and is part of a wider move by the government to reduce the UK’s energy use by 15% by 2030, while helping people save on their bills.
The new package, worth £1 billion, will expand support to those living in lower council tax bands (from A to D in England).
The focus is on helping those who do not currently benefit from any other government support to upgrade their homes.
The scheme will run for three years, and about 70,000 homes are expected to benefit.
According to government estimates, households will be able to make savings of about £310 a year through changes such as loft and cavity-wall insulation or smart heating controls.
Unlike the now-defunct Green Homes Grant (see below), the funding of ECO+ will be administered by energy suppliers.
All gas and electricity providers with more than 150,000 customers are required to deliver ECO energy-efficiency improvements. (You don’t have to approach your existing energy company; you can opt for the supplier that best suits your needs.)
The Green Homes Grant was launched in autumn 2020, and offered households government funding of up to £5,000 (rising to £10,000 for those on certain benefits) to pay for eco-friendly installations, such as insulation or low-carbon heating.
The aim was to help more than 600,000 households in England save up to £600 on their energy bills. However, this £1.5 billion initiative was axed after just six months, having reached just a fraction of that number of homes.
Many homeowners complained of issues with the application process and felt it just wasn’t worth the hassle.
No new applications were accepted after March 31, 2021.
One of the scheme’s predecessors, the Green Deal, suffered a similar fate. Launched in 2013, and once hailed a “flagship scheme to insulate homes”, this was scrapped two and a half years later because take-up was too low.
According to Theecoexperts.co.uk, £300 million of the funding originally intended for the Green Homes Grant was handed to local councils to help low-income households install insulation.
But the programme also covered double and triple glazing, energy-efficient doors, heat controls, draught proofing, and solar thermal panels. There is no direct replacement for these measures.
If you are on a low income, you may be able to apply for an energy-efficiency grant through your local council.
Those who qualify could get up to £10,000 to pay for measures such as insulation, double glazing or solar panels. The support you receive will depend on where you live and your personal circumstances.
As a guide, your home must have an EPC rating from D to G. You will also need to have a combined household income below £30,000, or someone in your home must be in receipt of a means-tested benefit.
To find out what is available in your area – and whether you are eligible – contact your local authority.
For more information on this, visit the gov.uk website.
Getting solar panels fitted does not come cheap. According to Energyhelpline, to have a 4kW system installed (one of the most common options), you would have to fork out about £6,000.
Many people find this initial expense offputting.
That said, once you have made this investment, your electricity costs will be reduced. You can find out how much you could potentially save with the Energy Saving Trust’s solar energy calculator.
In the 2022 spring budget, when Rishi Sunak was chancellor, he announced that VAT on solar panels would be scrapped. According to Sunak, a family having solar panels installed could potentially see tax savings of about £1,000, and annual savings of about £300 on their energy bill.
Energyhelpline figures suggest a slightly more modest saving of £270 a year with a 4kW solar panel system.
Based on Energy Saving Trust estimates, a typical household with a 4.2kW-peak system could knock between £210 and £514 per year off bills at the current price-cap rates.
In the past, it was possible to get a grant for having solar panels installed. These are no longer available – except for low-income households (as mentioned above).
The Feed-in-Tariff (FiT) was introduced by the government in April 2010. Under this initiative, homeowners could get payments for every kWh of solar energy they generated. They could also get money for any energy they sold back to the grid. But this closed to new applicants in April 2019.
Energy suppliers are now doing their own version through the smart export guarantee (SEG), established in January 2020. Under this government-backed initiative, all energy firms with 150,000 customers or more must provide at least one SEG tariff to households in England, Scotland and Wales. These tariffs pay a set rate for each kWh of excess electricity you generate from solar panels (but don’t use yourself).
The big electricity firms set their own rate, and most pay just a few pence, making it a lot less lucrative than the FiT. Rates can range up to 7.5p per kWh, but many suppliers are offering SEG tariffs at 3-4p, and some homeowners are being paid as little as 1p per kWh.
According to the Energy Saving Trust, a typical household could make between £80 and £110 a year (based on a rate of 3.99p kWh).
Robert Bolohan is keen to find out whether he might be eligible for any grants to help with the cost of getting solar panels installed on his home.
The 28-year-old lives in London with his wife, Mariona, 26. Together they are the co-founders of translation agency Lotuly.com.
Robert says: “We recently added a 600-watt solar panel system to our campervan, saving us a lot of money on energy costs as it’s all electric. We did look around for grants, but they aren’t available for vans.
“We are now planning to add solar panels to our house this spring, and would love to find a grant to help cover the cost of installation, as there’s a lot to pay at the outset.”
Once the panels are installed, the couple hope this will mean that during the summer months, they hardly need to buy any electricity from the grid.
“We hope to be able to make significant savings on our bills by generating our own electricity,” says Robert.
“Based on current energy bills, we’d expect to save a minimum of £3,500 a year, as we don’t use gas – so we wouldn’t be paying either gas or electricity bills.”
A host of schemes and grants are available to help with your energy bills and the cost of living. See what energy support you are entitled to in our guide.
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