Renovation
Energy upgrade grants for London homeowners in 2026: what is available, and the deadlines that matter
With winter approaching, London boroughs and the Mayor are writing to households about free energy upgrades, and the government's Warm Homes Plan is reshaping the support on offer. Here is what a London homeowner can apply for now, who qualifies, and which dates to plan around.
The government published its Warm Homes Plan on 20 January 2026, describing it as £15 billion of public investment to upgrade up to 5 million homes by 2030. It combines grants for lower-income households, a universal heat pump grant, a new government-backed loan scheme, and the closure of the older supplier-funded schemes. For anyone planning a renovation in London, the result is a different set of options from even a year ago. This guide summarises what is open now, based on official GOV.UK, Greater London Authority and council sources. It is general information, not financial advice.
Free upgrades for lower-income households: the Warm Homes: Local Grant
The Warm Homes: Local Grant pays for energy-saving improvements to privately owned homes in England, including those let by private landlords. If you are eligible and your council has funding, it arranges a home survey and then organises and pays for the agreed work. GOV.UK lists wall, loft and underfloor insulation, air source heat pumps, smart controls and solar panels as typical measures. Where a landlord owns the home, they may need to contribute.
Who qualifies
- The home must be in England, privately owned and have an Energy Performance Certificate (EPC) rating of D, E, F or G.
- Household income must usually be £36,000 a year or less. Households above that may still qualify if they live in an eligible postcode area or someone in the household receives certain benefits.
- The Mayor of London's Warmer Homes pages add that household savings must be less than £25,000.
In London the grant is delivered through the Mayor's Warmer Homes London programme, launched with London Councils in February 2025, across 31 boroughs. The GLA lists ventilation and damp-prevention measures among the improvements. Under the government's July 2026 policy guidance, £500 million was allocated to the scheme for delivery from April 2025 to March 2028.
Some boroughs are now contacting likely households directly. On 1 October 2026 Hackney Council announced that more than 3,000 households would receive letters from the GLA inviting them to apply, sent in batches of around 500 over the coming months, and said residents who do not receive a letter can still apply. If you think you qualify, you can check your eligibility and apply through GOV.UK. Your council will usually be in touch within 10 working days to arrange a survey.
Heat pumps for any homeowner: the Boiler Upgrade Scheme
The Boiler Upgrade Scheme (BUS) is not means-tested and is open in England and Wales to replace fossil fuel heating, including gas. Current grants, one per property, are:
- £7,500 towards an air source (air-to-water) or ground source heat pump;
- £2,500 towards an air-to-air heat pump, a newer option the Warm Homes Plan highlights for smaller properties;
- £5,000 towards a biomass boiler, subject to strict conditions.
An extra £1,500 is available until March 2027 for homes heated by oil or LPG with no mains gas connection, which applies to few London properties. Hybrid systems that combine a gas boiler with a heat pump are not eligible. In practice you do not apply yourself: you get quotes from MCS-certified installers, agree one, and the installer applies to Ofgem on your behalf, with the grant deducted from your quote and invoice (GOV.UK: how to apply).
Planning permission for a heat pump in London
Most houses can install an air source heat pump as permitted development. According to the Warm Homes Plan, the permitted development right in England was relaxed in May 2025: units can now sit within 1 metre of the property boundary, the size limit for houses has risen from 0.6 to 1.5 cubic metres, detached houses can have two units, and air-to-air units that also cool are now covered. The government says it will consult in 2026 on further changes. A minority of homes, such as listed buildings, still need an application. Many streets in boroughs such as Camden, Islington and Kensington & Chelsea fall within conservation areas, so check your council's guidance on where a unit can go before you commit. Our guide to permitted development in London explains how the wider system works.
Borrowing for upgrades: the Warm Homes Loan Scheme
For households that can borrow, the government has set up the Warm Homes Loan Scheme. Participating lenders receive a government grant that must be passed on as a lower interest rate on loans for low-carbon measures such as heat pumps, solar panels and batteries. The scheme is aimed mainly at owner-occupiers and private landlords and has no income threshold: lenders make their usual affordability and credit checks. Products can include personal loans, finance arranged through an installer, and borrowing secured on your home.
The scheme rules, last updated in August 2026, set out an initial lender application window from June 2026 and an initial consumer launch phase from September 2026, with a further lender window from late 2026. Not every lender will take part, so if you are offered finance, ask whether it is supported under the Warm Homes Loan Scheme, and compare the full cost of borrowing before signing. Borrowing secured on your home puts it at risk if you cannot keep up repayments.
Zero-rate VAT until 31 March 2027
Under HMRC VAT Notice 708/6, installing qualifying energy-saving materials in a home is currently zero-rated for VAT. Qualifying materials include insulation, draught stripping, central heating and hot water controls, solar panels, batteries, and air, ground and water source heat pumps. The zero rate covers installations made up to 31 March 2027. From 1 April 2027 these supplies revert to the reduced rate of 5%. If you are planning insulation or a heat pump as part of a wider renovation, ask your builder or installer to show qualifying work separately on the quote.
Supplier schemes are closing: ECO4 ends on 31 December 2026
The Great British Insulation Scheme closed to new installations on 31 March 2026. The Energy Company Obligation (ECO4) was extended by nine months and now ends on 31 December 2026, mainly to give suppliers time to meet existing targets and put right non-compliant work. There will be no successor obligation. The Warm Homes Plan says ECO was the source of the majority of poor-quality installations. If you had external wall insulation fitted under ECO4 or GBIS, the government's guidance on poor-quality wall insulation says you will be offered a home check, and that you should not be asked to pay for any repair. Be cautious of anyone cold-calling about ECO funding in its final months, and check offers with your council or energy supplier.
Getting the work done properly
Grants change who pays, not the rules the work must meet. Energy measures under government schemes must be installed by firms certified to PAS 2030 and registered with TrustMark, and heat pumps and solar panels need an MCS-certified installer. Outside government schemes these are not legal requirements, but the Warm Homes Plan recommends them. Building Regulations apply either way. GOV.UK lists installing or replacing a heating system and replacing windows among the jobs that may need approval, unless a competent person scheme installer certifies the work. Keep every certificate: our guide to building regulations sign-off explains why they matter when you sell.
If an energy upgrade is part of a larger project, such as an extension in Ealing or a full refurbishment in Lambeth, plan the insulation, ventilation and heating together rather than as separate jobs. For indicative 2026 London construction ranges, see our house extension cost guide, and read our guide to choosing a builder before you sign anything. When you are ready to compare builders, you can request quotes. Home Builders does not carry out building work: we ask advertisers to provide proof of insurance, and any contract is between you and the builder you choose.
Sources: DESNZ: Warm Homes Plan (updated 18 March 2026); GOV.UK press release, 20 January 2026; GOV.UK: Apply for the Warm Homes: Local Grant; Warm Homes: Local Grant policy guidance, July 2026; Mayor of London: Warmer Homes; Hackney Council news, 1 October 2026; GOV.UK: Apply for the Boiler Upgrade Scheme; DESNZ: Warm Homes Loan Scheme, Scheme Rules; HMRC: VAT Notice 708/6; DESNZ: Extending the ECO4 end date, government response; DESNZ and Ofgem: What to do if you have poor quality wall insulation; GOV.UK: Building regulations approval. Scheme rules and funding change; confirm eligibility with your council, installer or lender before committing.
Frequently asked questions
Can London homeowners get free insulation or a heat pump in 2026?
Possibly, through the Warm Homes: Local Grant, if the home is privately owned with an EPC rating of D to G and the household meets the income, postcode or benefits criteria. In London the Mayor's Warmer Homes pages also require household savings under £25,000. The council arranges and pays for the agreed work.
How much is the Boiler Upgrade Scheme grant?
£7,500 towards an air source or ground source heat pump, £2,500 towards an air-to-air heat pump and £5,000 towards a biomass boiler, with one grant per property. It is not means-tested, and your MCS-certified installer applies on your behalf.
Do I need planning permission for an air source heat pump in London?
Most houses can install one as permitted development, and the rules were relaxed in May 2025, including allowing units within 1 metre of the boundary. Listed buildings need an application, and conservation areas can bring extra limits, so check with your borough first.
When does zero-rate VAT on insulation and heat pumps end?
HMRC's VAT Notice 708/6 applies the zero rate to qualifying installations up to 31 March 2027. From 1 April 2027 they revert to the reduced rate of 5%.
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