How Does the £5,000 Government Green Homes Grant Work?

What is the £5,000 Green Homes Grant and how does it work? Read an up-to-date account of what home improvements are covered and who is eligible to apply.

Smart Thermostat

Making homes more energy efficient

The £2 billion Green Homes Grant was announced in July 2020 as a way to help homeowners in England make their homes more energy-efficient. As well as cutting household bills and reducing carbon emissions, the grant aims to help kick start the economy.

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Once launched, the grant will pay for two thirds of the cost of home improvements for eligible homeowners, up to the value of £5,000. The grant goes up to £10,000 for low income households. Not all energy-saving improvements are included though, and there are questions about the scheme that still need to be answered.

This grant only applies to England. Scotland, Wales and Northern Ireland will not benefit. More updates will be available soon but here’s what we know so far – including what home improvements are covered, what the restrictions are, and who can apply.

When does the grant begin?

The Green Homes Grant is set to launch in September 2020 for homeowners in England. Currently, there is no official start date, but once live there will be an application process to obtain vouchers. This will likely be an online portal, but how long the approval process will take is not clear at this time.

How will the Green Homes Grant work?

This energy grant for homeowners will provide vouchers to cover the cost of energy-efficient home improvements. However, restrictions will be in place and homeowners who had hoped to spend the money on renovations of their choice may be disappointed.

Right now, we know that these improvements are divided into two categories – “primary” measures and “secondary” measures.

In order to qualify for secondary measures, applicants must carry out one of the primary measures first.

For those who are eligible, the good news is the vouchers can actually cover most of the cost. In some cases, the vouchers cover all of the cost.

Primary and secondary improvements explained

To take advantage of the Green Homes Grant, you must use the scheme for at least one of the primary measures listed below.

Primary home improvements:

  • Home insulation (cavity wall, solid wall, underfloor or roof insulation)
  • Low-carbon heating systems (air source heat pumps, ground source heat pumps or solar thermal)
  • Only after you have completed one or more primary measures can you then use the scheme for secondary improvements.
  • Secondary home improvements:
  • Draught proofing
  • Double or triple glazing
  • Thermostats or smart heating controls
  • Energy-efficient doors
  • Hot water tank insulation

Additionally, the voucher for secondary measures will be capped at the amount claimed for primary improvements. For instance, if you use a £1,000 voucher for roof insulation, your voucher for double glazing will be capped at £1,000 also.

Does the grant cover upgrades as well as new installation?

This is an energy grant for homeowners who don’t already have energy-saving measures in their home. Further details may be revealed later, but as far as we know vouchers don’t cover upgrades.

If you have single glazing, you will be able to apply for a voucher for double glazing. If you already have double glazing, you won’t be able to use the grant for another double glazing product (even if it is more energy efficient).

How much money can I save?

For those who are eligible, this could be one of the most useful home improvement grants for homeowners in England. Not only will you benefit from highly subsidised green home solutions, but you will make substantial savings on your energy bills.

Initial savings:

The vouchers will cover around two thirds of the cost of listed improvements. The maximum amount a household can claim is £5,000 (or £10,000 for low income households).

An example provided by the Treasury is a saving of £2,680 on cavity wall and floor insulation costing £4,000. The homeowner would only pay £1,320, with the Government contributing the rest.

Ongoing savings:

The biggest cost benefit of getting energy-efficient solutions installed is reduced bills. Chancellor Rishi Sunak predicts that the scheme could save families as much as £600 a year on energy costs.

Who can apply for the vouchers?

At the moment, over 600,000 homes are said to qualify for the scheme. Those eligible include owner-occupiers, long-leaseholders and shared ownership mortgage holders, as well as social/private landlords and park home owners.

The £10,000 vouchers for low income families will only be obtainable if they are in owner-occupied properties or park homes.

Properties that don’t qualify are new build homes and any non-domestic properties. However, the definition of what qualifies as a “new build” has still not been confirmed.

How will the application process work?

While we don’t know the exact format for approval, we do know that income will play a part. The boosted £10,000 vouchers will be for those receiving benefits, such as an income or disability benefit.

The qualifying benefits include:

  • Jobseekers allowance (JSA)
  • Employment & Support Allowance (ESA)
  • Income support
  • Housing support
  • Pension guarantee credit
  • Working tax credit
  • Child tax credits
  • Universal credit
  • Disability allowance
  • Personal independence payment (PIP)
  • Attendance allowance
  • Carer’s allowance
  • Severe disablement allowance
  • Industrial injuries benefits

Can anyone carry out the work?

The Government plans to draw up a list of accredited suppliers in each area or region. All accredited tradespeople must register for TrustMark or Microgeneration Certification Scheme (MCS) accreditation.

Simple Energy Advice has also been announced as the recommended service for home assessment. However, this is not a mandatory step and assessments are optional for those who wish to seek advice.

Should I wait until September to get work done on my house?

If you were already planning on eco home improvements, it could be worth hanging on until September. Energy efficiency grants like this not only promote green living and cut costs, but they also create thousands of jobs for people in the green construction industry.

Will the scheme open up in Scotland, Wales or Northern Ireland?

Currently, this initiative is only open to homeowners in England. However, other government grants for homeowners are available. These include the Warmer Homes Scotland scheme, the Nest scheme in Wales, and the Boiler Replacement Scheme in Northern Ireland.

We will continue to update information on the Green Homes Grant as it is announced.

Chris Salmon, Director

About the author

Chris Salmon is a co-founder and Director of Quittance Legal Services. Chris has played key roles in the shaping and scaling of a number of legal services brands and is a regular commentator in the legal press.

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