Question to the Department for Energy Security & Net Zero:

To ask the Secretary of State for Energy Security and Net Zero, what the proposed timeline is for the implementation of the Warm Homes Plan, and what steps are being taken to ensure collaboration with local authorities, industry stakeholders, and consumer groups in its delivery.

Answered by Martin McCluskey - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)

The government remains committed to delivering the Warm Homes Plan which will be published soon. At the Autumn Budget 2024 the Chancellor announced an additional £1.5 billion of funding for the Warm Homes Plan, bringing total capital investment to almost £15 billion. This exceeds the manifesto commitment of £13.2 billion.

As part of the development of the Plan, this department has engaged with a broad range of stakeholders through a variety of different fora to ensure a wide range of views are considered.

This includes working with local authorities and social housing providers, who in March last year were allocated £1.8 billion to install energy saving measures across the country through the Warm Homes: Social Housing Fund and Local Grant.

Question to the Department for Energy Security & Net Zero:

To ask the Secretary of State for Energy Security and Net Zero, if he will set out the detailed allocation plan for the additional £1.5 billion funding for the Energy Company Obligation, including the timeline for disbursement and the criteria for prioritising households.

Answered by Martin McCluskey - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)

ECO4 has played a part in delivering clean heat technologies; however, issues identified by the NAO and PAC support a shift to a more direct, publicly-funded approach focused on technologies that cut bills and accelerate the transition to clean heat such as heat pumps, solar PV and batteries. The government is providing an additional £1.5 billion—taking planned capital investment to almost £15 billion—to upgrade low‑income homes and scale clean home‑energy technologies. Deployment will be further supported through wider policies and details of this will be set out soon in the Warm Homes Plan.

Question to the Department for Energy Security & Net Zero:

To ask the Secretary of State for Energy Security and Net Zero, what measures are being introduced to protect and support small and medium-sized enterprises in the retrofit supply chain under the Energy Company Obligation and related schemes.

Answered by Martin McCluskey - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)

ECO4 has played a part in delivering clean heat technologies; however, issues identified by the NAO and PAC support a shift to a more direct, publicly-funded approach focused on technologies that cut bills and accelerate the transition to clean heat such as heat pumps, solar PV and batteries. The government is providing an additional £1.5 billion—taking planned capital investment to almost £15 billion—to upgrade low‑income homes and scale clean home‑energy technologies. Deployment will be further supported through wider policies and details of this will be set out soon in the Warm Homes Plan.

Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment she had made of the potential implications for her policies that heat batteries do not qualify for VAT relief through the Energy Saving Materials framework, while being MCS-certified and eligible for support under the Boiler Upgrade Scheme in the same way as heat pumps.

Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)

Installations of qualifying energy-saving materials (ESMs) in residential accommodation and buildings used solely for a charitable purpose benefit from a temporary VAT zero rate until March 2027, after which they will revert to the reduced rate of VAT at five per cent. The list of qualifying ESMs, which includes but is not limited to heat pumps, can be found here: https://www.gov.uk/guidance/vat-on-energy-saving-materials-and-heating-equipment-notice-7086.

The Government assesses whether to add ESMs to this relief by evaluating them against the following tests: the primary purpose of the technology must be to improve energy efficiency and reduce carbon emissions; relieving the technology of VAT must be a cost effective lever for encouraging installations; and it must be practical for business to operate and for HMRC to administer.

Question to the HM Treasury:

To ask the Chancellor of the Exchequer, whether she has considered adding heat batteries to the list of Energy Saving Materials.

Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)

Installations of qualifying energy-saving materials (ESMs) in residential accommodation and buildings used solely for a charitable purpose benefit from a temporary VAT zero rate until March 2027, after which they will revert to the reduced rate of VAT at five per cent. The list of qualifying ESMs, which includes but is not limited to heat pumps, can be found here: https://www.gov.uk/guidance/vat-on-energy-saving-materials-and-heating-equipment-notice-7086.

The Government assesses whether to add ESMs to this relief by evaluating them against the following tests: the primary purpose of the technology must be to improve energy efficiency and reduce carbon emissions; relieving the technology of VAT must be a cost effective lever for encouraging installations; and it must be practical for business to operate and for HMRC to administer.