The government is consulting on a £5bn Warm Homes Fund. Rather than fund measures via grants it hopes to supply finance to schemes that deliver a return on investment. CSE’s message to government is, do a few things well and learn from what’s failed before. The Green Deal collapsed under its own complexity and because the interest rates were too high. This fund has three years to show results before a general election. Spreading it too thin would be a serious mistake.

At CSE, we have long argued for low-cost finance that supports the ‘middle majority’ – households struggling with the cost of living but not eligible for grant support and unable to afford the upfront cost of retrofit or low carbon heating. For many owner occupiers, cost remains a major barrier even where there is willingness to invest.

It’s a concern therefore that the call for evidence is so unfocused, with seventy questions across a vast range of topics. It appears to offer something for almost everyone: loans for owner occupiers and landlords, for households already in energy debt, for energy suppliers, local authorities, heat network expansion, community energy, the supply chain …

But time is short. The next general election will be no later than July 2029. That’s only three years for any loan scheme to be designed, launched, show results and build public support, before potentially being cancelled by the next government. Our advice is to learn from what’s failed before and concentrate on doing a few things well, prioritising homeowners and landlords and focussing on these sectors:

Homeowners

The Green Deal failed in part because interest rates were too high and the process was too complex. The Warm Homes Fund should avoid repeating those mistakes. If it is to drive take-up, finance for owner occupiers will need to be simple, accessible and offered at below-market rates. And it seems unfair and unwise to encourage people already in fuel poverty to take on further financial commitments. People in fuel poverty need grant-funded measures.

Landlords

Minimum energy efficiency standards in the private rented sector are tightening. Finance could help landlords meet those requirements and improve tenants’ lives.

Loans for councils and combined authorities

Loans for councils and combined authorities to run area-based programmes – we’ve seen how locally led, place‑based projects can deliver investable plans which deliver climate, social and economic benefits rooted in community priorities.

The consultation is open until 1 June 2026 and can be found here. Please get in touch if you would like to align responses.