From ambition to action: Making the most of the Warm Homes Plan
4 min read 13 April 2026
The Warm Homes Plan announced on 21 January 2026 is the most ambitious intervention the UK has ever made in home energy upgrades. If it lives up to its promises, it will be transformational for households, the supply chain, and domestic decarbonisation at scale. If we get it wrong, we risk another stop-start cycle that erodes confidence, capability, and investment.
So how can the ecosystem collaborate together and with government to capitalise on this opportunity and overcome barriers to success?
That was the starting point of debate at our tenth Green Buildings and Transport Forum on the 18 March 2026.
What’s different about the Warm Homes Plan?
The Warm Homes Plan marks a shift from previous approaches, with a clearer move away towards a more coordinated, area-based programme delivered locally. While still early in its rollout, the intent signals broader ambitions than past schemes. Our discussion homed in on three emerging shifts in policy direction:
- Scale and intent: The Warm Homes Plan is explicitly framed around mass-market retrofit, not a series of pilots. Language has shifted from schemes to outcomes: homes upgraded, bills reduced, and carbon cut.
- Broad delivery ecosystem: Compared with previous strategies, delivery shifts more strongly towards local authorities as orchestrators, with suppliers, installers, and finance providers working with them in a much more coordinated way. There’s a clearer expectation that private capital must play a role, especially for ‘able to pay’ segments.
- Narrative shift: Warmth, affordability, and resilience are front and centre – messages that resonate more strongly with households than previous framing around net zero.
What’s missing from the Warm Homes Plan?
In reality, grant and finance journeys still aren’t well stitched together for households. Customers don’t care where the grant ends and finance begins, they just want a simple, trusted journey.
Four gaps stood out for our forum attendees:
- A credible ramp-up plan: The ecosystem still lacks a clear, shared view of how quickly volume can realistically scale and what good looks like in one and two years, not just five. Delegates expressed uncertainty about the next steps for delivering in the immediate short term.
- Onus on new build to drive demand and change perceptions: The focus on retrofit is welcome and needed, but new build still has a key role to play in the transition. As one delegate said, “We’re still trying to fix the problem without stopping the leak. We need to build better homes now, or we create more retrofit problems down the line.” The Future Homes Standard has now been formally published and will require new homes to be built with low carbon heating and onsite renewables by default. However, its real world impact will be slow. The regulations come into force in March 2027, with a year long transition, meaning full compliance will not be in effect until March 2028. Even then, new build rates mean change will be marginal relative to the existing stock. For context, around 45% of homes built last year were still delivered to 2013 Building Regulations, underlining how long policy change takes to translate into meaningful systemwide outcomes.
- End-to-end customer journey ownership: The Warm Homes Plan focuses on funding and eligibility but isn’t clear on who owns customer acquisition, who holds risk when things go wrong, and how dropout will be reduced at scale.
Customers need a clear, streamlined, and simple journey to drive conversions. Emma Sinclair, Sustainability Team Lead at Lloyds Banking Group, addressed this challenge when describing a recent pilot for fully-funded heat pump installations. “Demand was very low even though we were effectively giving heat pumps away, which says something about mass-market readiness. We saw lots of interest at the top of the funnel which dropped off by the time we got to installation. Key concerns were about post-installation running costs and redress processes. It was also clear that we need to make better use of data across the ecosystem to drive a more personalised approach that joins up finance, delivery, tariff, and aftercare.”
- Stronger integration with finance: The market lacks clarity on how the new funding aligns with private finance. Will we reach a point where we can treat low-carbon technology like UK infrastructure with a lower cost of capital, instead of treating it as consumer finance?
What stands in the way of achieving Warm Homes Plan aspirations?
The Warm Homes Plan has four lofty aims:
- Lift up to one million households out of fuel poverty by 2030
- Retrofit up to five million homes with energy efficiency measures
- Massively accelerate low carbon heating and solar deployment
- Create a stable, long term market that can attract skills, installers, and private capital
However, amid the positive signals, there was concern that many plan elements are more aspirational than achievable. Our discussion highlighted four key risks:
- Delivery will be uneven because local authority capacity varies: Some are sophisticated delivery bodies with established supply chains, whereas others struggle to stand up programmes and others are yet to install a single measure under existing local grant schemes.
- The supply chain is fragile: Installer numbers have contracted significantly over the past two ECO cycles, and cancelling ECO has had a major impact. Some suppliers have cut their workforces by up to 60% and won’t be able to ramp up by the time demand kicks in. Plus, there’s uncertainty as to whether that demand will actually materialise despite the big policy ambitions. Therefore skills shortages remain acute, particularly for heat pumps and whole house retrofit.
- Administration will create additional friction: The shift from supplier-led to local authority-administered delivery introduces new governance layers, which may slow down mobilisation and increase short-term transaction costs. Although the intent is right, the system isn’t yet ‘match fit’ for the implied pace.
- People are at risk of getting left behind: Having cancelled ECO, the government risks introducing further inequalities into the energy transition. We need to ensure that, within the new funding architectures and delivery models, low-income and vulnerable people get the support they need to benefit from decarbonisation.
Chris Carberry, Strategic Development Director at ScottishPower, summed up this challenge: “Each day, we speak to customers struggling with their energy bills. Trying to get them to engage with decarbonisation in that context is difficult. Before, ECO was a lever to support them – because upgrades would reduce energy bills. Now we can’t do that, and there’s no simple bridge to the new local authority-led funding today. We’re left with a big gap that affects the most vulnerable customers.”
How do we manage delivery risks?
To unlock progress, we must look at where risk sits within delivery models so it no longer stalls the flow of capital into installations at scale.
The Warm Homes Agency established in the Plan could potentially act as the connective tissue between devolved funding, private finance, and delivery partners to ensure a unified, scalable rollout across entire streets and towns. However, it introduces new interfaces and dependencies that need careful oversight.
Delegates agreed that we need a shift towards models that manage risk at portfolio level rather than per individual dwelling. Collaboration between institutional investors and local authorities creates opportunities to develop standardised, blended finance blueprints that make social housing more attractive to private capital. Aligning finance with delivery up front will then help prevent projects from stalling.
We also need strategic coordination to go from pilots to scalable models. There has been lots of recent discussion across the SSMC, WHP and recent consultations about leveraging Distribution Network Operators (DNOs) and their Regulatory Asset Value (RAV) funding to accelerate LCT roll-out. However, questions remain about what the extent of this ‘strategic co-ordinator' role could be, and new challenges would be unlocked around managing consumer engagement or coordinating tech installations.
Avoiding another stop-start cycle
While the Warm Homes Plan sets a clear ambition, success now hinges on whether the system can move in lockstep. Aligning finance, delivery capability and customer proposition at scale is critical if we are to avoid another stop-start cycle. Policy certainty matters, but it cannot be a pause button. Too often, uncertainty in regulation is used as a reason to delay action, when in reality much of what is needed to build demand, simplify journeys and deārisk delivery sits firmly within industry control.
Customer engagement remains the biggest constraint, and those closest to households have an important role to help to solve it. That requires deeper collaboration across suppliers, manufacturers, installers, finance and local delivery bodies to design offers that are simple, trusted and scalable, even as policy continues to evolve. If the sector waits for perfect conditions, momentum will stall again. Progress depends on collective leadership now, not just regulatory signals later.
Continue the discussion with us at our next Green Buildings and Transport Forum, which will be in the summer. To hear about future Baringa events, look out for updates in Energy Insights, our Energy and Natural Resources newsletter.
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