Everything you need to know about retrofit funding options and support

This elemental guide covers everything housing providers need to know about current options for retrofit funding and support.

The UK’s Climate Change Committee (CCC) has set ambitious targets for retrofit rates, aiming to increase to 500,000 homes per year by 2025 and one million per year by 2030. To support this, a number of funding schemes were opened to local authorities and housing providers, including the Social Housing Decarbonisation Fund (later known as the Warm Homes Social Housing Fund), as well as programmes in the devolved nations, such as Wales’ Optimised Retrofit Programme and Scotland’s Social Housing Net Zero Heat Fund.

However, with applications now closed for these key schemes – and no word yet on similar funding for the future – opportunities for financial support for retrofit have been significantly restricted. But there are still key avenues to pursue.

Current funding schemes for retrofit

UK: Retrofit Funding Scheme

The Housing Finance Corporation (THFC) and The National Wealth Fund (NWF) have joined forces to provide low-cost unsecured funding to retrofit social housing, aiming to reduce carbon emissions, lower tenant expenses, and enhance overall social housing quality in the UK. The fund – which now totals £1 billion – provides flexible and competitively priced loans for a range of measures, including insulation, small-scale renewable energy, efficient lighting and ventilation.

Registered social housing providers are invited to contact THFC in the first instance at info@thfcorp.com. Find out more about the scheme here.

UK: Energy Company Obligation (ECO)

The ECO places an obligation on large energy providers to allocate funding for a range of energy efficiency home improvements for low-income households. Currently in its ECO4 stage (superseding ECO3 in April 2022), the scheme offers funding for a range of measures – including insulation and heat pumps – depending on a property’s EPC rating and tenant eligibility. Tenants must be in receipt of specific benefits, such as Universal Credit or Pension Credit. Both private and social landlords are eligible for the scheme, providing their properties meet these criteria.

One of the key features of the ECO4 scheme is the ECO4 Flex option, which allows landlords to choose which energy efficiency measures to install in their properties. The scheme is worth a total of £4 billion, with grant funding ranging from £7,000 to £20,000. Landlords must apply through a registered installer. Find out more here.

UK: Retrofit Credits

Developed by the Housing Association’s Charitable Trust (HACT) and PNZ Carbon, Retrofit Credits is a verified carbon credits programme that enables housing providers to unlock retrofit funding by verifying the emission reductions of their retrofit projects. It’s the only project in the world originating carbon credits for the decarbonisation of housing stock, and incorporates social value to measure the positive impact that retrofit has on residents’ lives.

The scheme is in its early stages, but its successful pilot phase yielded projections of more than £7 million across the lifetime of the project, with Luton Borough Council, Saffron Housing Trust and Believe Housing some of the first on board. Find out more here.

Wales: The Principality Building Society Retrofit for the Future Fund

This is a Wales-wide fund set up in partnership with Principality Building Society with the aim of improving the environment in Wales. The fund supports organisations across Wales to improve their energy efficiency by retrofitting buildings through measures including insulation, solar panels, battery storage and energy efficient lighting. Grants of up to £25,000 are available.

Applicants must be one of the following: a constituted group; a registered charity or charitable incorporated organisation; a company limited by guarantee; a community interest group (CIC); or a social enterprise. Applications can be made online here.

Getting support with retrofit projects

There’s a variety of supportive resources available for local authorities and housing providers embarking on retrofit projects. Chief among them is RISE, which stands for ‘retrofit information, support and expertise’. This was formally known as The Social Housing Retrofit Accelerator and Home Upgrade Hub

RISE is a free support service funded by the Department for Energy Security and Net Zero (DESNZ), which provides training, guidance and support to help social housing providers, local authorities and their supply chains across England plan and deliver successful domestic retrofit programmes.

Elsewhere, the UK Green Building Council (UK GBC) has a wealth of resources on offer for organisations looking at retrofit, including ‘The Retrofit Playbook’ and a Getting Started Toolkit. UK GBC also runs the Local Authority Retrofit Forum (LARF), designed to support local authorities taking the lead on retrofit projects. In addition, the National Retrofit Hub offers a range of resources around retrofit best practices.