Cuts to a program aimed at providing insulation and heat pumps for low-income households have raised concerns among experts, who warn that many homes may become damp, draughty, and unsafe as winter approaches. Housing representatives are advocating for a one-year extension of the current scheme to maintain operations and support small retrofit businesses, which have reported a withdrawal of funding for solar panels and insulation.
In a recent budget announcement, Treasury officials disclosed a reduction of £150 from the average energy bill. This decision is partly attributed to the elimination of the £1.3 billion energy company obligation (ECO) scheme that supported upgrades for households earning under £31,000. The ECO scheme is scheduled to conclude in March, with a new “warm homes plan” intended to replace it, although this initiative has encountered delays.
Experts estimate that the cuts will impact approximately 222,000 forthcoming retrofit projects designed to lower energy costs for low-income households. While the ECO scheme faced scrutiny due to some faulty external wall insulation installations, it has retrofitted over 15 million homes since 2013, reportedly saving £110 billion on energy bills.
Concerns about job security have arisen, with thinktank E3G estimating that the cuts could result in the loss of around 10,000 skilled jobs, including many apprenticeships. Anna Moore, co-founder of a retrofit company, has reached out to the Energy Secretary, urging for the allocation of funding specifically for low-income households in the upcoming plan and calling for a one-year scheme extension.
Small businesses, such as Net Zero Renewables and Eco Approach, are seeking clarity about the future of funding to support their ongoing projects. They express urgency for a transitional plan to avoid leaving families in fuel poverty.
A spokesperson from the Department for Energy Security and Net Zero stated that the previous schemes were not yielding sufficient value for money and emphasized that investments would be redirected into the warm homes plan.
Source: https://www.theguardian.com/society/2025/nov/29/insulation-scheme-cuts-winter-warning-retrofit-firms