The Warm Homes Plan has finally been released, but will it deliver? 

By Tom Gosschalk – Senior Account Director

The Warm Homes Plan lands at a pivotal moment. After years of policy churn, cost of living pressures and stalled progress on retrofit, the UK finally has a package that could make clean, affordable heating a reality for millions. But ambitions on paper have never been the issue, delivery has.

A fabric first approach?

The Plan marks a subtle change in approach. Ministers are clear that while insulating Britain’s housing stock remains a key pillar in making our homes warmer and cheaper to heat, the Government is prioritising rooftop solar, clean heating and batteries as the fastest route to bring down energy bills.

This shift reflects a political challenge – retrofitting properties can be highly disruptive, insulation quality can vary and Ministers will want to distance themselves from recent headlines about previous retrofit schemes that left homes with damp and mould. By contrast, installing solar panels isn’t overly invasive and households can easily see how much they are saving if they are exporting electricity back to the grid.

However, electrifying cold, leaky homes has the potential to push up bills if they can’t keep the heat in, as well as putting additional pressures on the grid as homes draw more electricity for their heat pumps.

More carrot than stick

Before they took office, Labour said they wouldn’t ban gas boilers. And they’ve kept their promise, opting for the carrot rather than the stick as they look to move homes off gas boilers and onto heat pumps. Boiler bans have proved to be politically toxic, with Rishi Sunak repealing previous bans in a bid to claw-back votes towards the end of his premiership.

As part of this approach the Warm Homes Plan has recognised that the upfront costs of installing a heat pump aren’t the only obstacle people face, with measures to improve timeframes for installation, supply chain skills and generally improve customer satisfaction.

But the plan doesn’t outline further measures to bring down the relative price of electricity compared to gas outside measures announced by the Chancellor in the Autumn, which are expected to be wiped out by new grid costs and funding the development of Sizewell C. As pointed out by Bill Esterson, the Chair of the Energy Security & Net Zero Committee, without a further reduction in the price of electricity, households won’t fully benefit from the measures that have been set out.

A starting gun

In setting out the roadmap for future heating policy, the Warm Homes Plan has brought with it a plethora of future policy commitments and consultations. With further announcements expected on the much-delayed Future Homes Standard and eligibility criteria for its package of low-cost financing and loans, this is just the beginning of the Government’s plans to decarbonise home heating.

The Warm Homes Plan is absolutely central to the Government’s mission of bringing down the cost of living, but it can take around 10-years to recoup the cost of a heat pump. So, while this package is the right thing to do for the long-term, it’s unlikely the majority of voters will feel the benefit before the next election – doing little to help Labour out of the popularity slump it finds itself in.