Government ramps up Climate Action with Warm Homes and Retrofit Funding

Welcome to Net Zero News, your daily briefing on the UK’s transition to a low‑carbon future.

The latest developments in UK climate action and policy show a renewed, tangible commitment to retrofitting homes, decarbonising heating systems, and embedding climate risk transparency across government operations.

First, the Department for Energy Security and Net Zero has unlocked a substantial boost to the Warm Homes Plan. From the £3.4 billion initially pledged in the Autumn Budget, £1 billion has now been allocated for 2025‑26. Of this, £374 million is earmarked for the Social Housing Fund—formerly the Social Housing Decarbonisation Fund to help raise social housing to EPC Band C. In addition, councils will receive £88 million through the Local Grant to deliver energy‑efficiency and low‑carbon heating upgrades to low‑income homes in England. The Boiler Upgrade Scheme has also received an extra £30 million in funding this year, with its total budget for 2025‑26 increased to £295 million. Overall, with contributions from social landlords, suppliers and core funding, the government expects to support up to 300,000 households through improvements in 2025‑26.

This plan has been welcomed by the National Housing Federation as a vital step to address fuel poverty, scale supply chains, and lower the cost of future energy‑efficient heating systems. The NHF has also signalled its readiness to collaborate on the design of the broader Warm Homes Plan ahead of the spring 2025 Spending Review.

Meanwhile, the Climate Change Committee (CCC) has underlined the scale of ambition needed to meet net‑zero targets. Its Seventh Carbon Budget calls for around half of UK homes to be heated by heat pumps by 2040 up from only around 1 percent in 2023. To meet this goal, installations must rise from approximately 60,000 a year in 2023 to nearly 450,000 by 2030 and reach approximately 1.5 million annually by 2035. The CCC also recommended that from 2026, no new homes should be connected to the gas grid, and that all new and replacement heating systems become low‑carbon after 2035 to ensure a fully decarbonised housing stock by 2050.

Complementing these moves, the Carbon Trust has highlighted that central UK government departments and select public bodies are now required to apply the Task Force on Climate‑related Financial Disclosures (TCFD) framework in their annual reports and accounts. This mandates structured reporting on climate‑related risks and opportunities including governance, strategy, risk management, and metrics and targets starting in 2024. Such transparency aims to embed climate considerations throughout public sector decision‑making.

What this means:
These coordinated measures signal stronger alignment between policy ambition and delivery. The expanded Warm Homes funding directly targets retrofit actions in both social and low‑income housing, delivering immediate improvements to energy efficiency and helping to reduce fuel poverty. The CCC’s roadmap for heat pump adoption reframes home heating as a central pillar of net‑zero strategy and sets clear trajectories for electrification. And the introduction of TCFD‑aligned disclosures across government institutions will enhance transparency, risk awareness, and accountability in climate governance. Together, these represent a significant move from planning to implementation in the UK’s low‑carbon transition.

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