Heating up: Towards a new generation of warm home schemes

The government’s upcoming Warm Homes Plan can open the door for the UK’s many exciting innovators in clean heat and home energy efficiency to deliver real improvements to low income and vulnerable households.

Building on the lessons of previous Energy Company Obligation (ECO) schemes, we propose that the next generation of retrofit funding schemes should be centred around consumers’ needs, delivered through area-based partnerships, and have a specific focus on the health and social outcomes associated with affordable clean heat.

Our insights build upon a wide range of work at the Catapult including domestic heat policy analysis and design, trials with consumers delivering Warm Home Prescription® and retrofit services, and business model analysis. Following our trial delivering Warm Home Prescription® through ECO with ScottishPower, we engaged industry stakeholders and held a workshop to generate and validate our recommendations.

Recommendations in this report include:

• National retrofit policy should be locally delivered through area-based partnerships. Area-based retrofit should tie in with other local plans where possible, such as Local Area Energy Plans (LAEPs).
• Future schemes must improve consumer trust and ensure high-quality installs. Households should have a digital building logbook that records the improvements made to improve secure data sharing, and a live Energy Performance Certificate to provide a single source of truth on the low carbon technologies that have been installed.
• The new retrofit scheme should be designed to maximise the health and social outcomes. Prioritise low income and vulnerable households most at risk of acute health problems from living in a cold home and equip health authorities with the resource and remit to identify and refer health vulnerable households to energy efficiency schemes.

Kat Young, Practice Manager – Heat Policy, Energy Systems Catapult, said:

“Evidence from a recent trial we ran with Scottish Power helping those with health problems living in cold homes showed that the current design of government’s ECO energy efficiency scheme makes it difficult for many of those most at risk accessing the help they need. With the latest phase of ECO ending in March 2026 there is a huge opportunity to redesign it so it better addresses the needs of low income and vulnerable households. The next version of ECO needs a long-term, 10-year programme focused on building local supply chains, improving health and social outcomes, and using local knowledge to deliver interventions that match local priorities.”

This report draws on research and experience from a range of Energy Systems Catapult projects and programmes. For information on our Fair Futures work is available here.

To find out more about our Fair Futures work, or to discuss collaborating on future work, contact: fairfutures@es.catapult.org.uk