Energy News

Warm Front insulation grants to be phased out

Thursday 21 October 2010

By Dominic Welling - dominic.welling@consumerchoices.co.uk

Warm Front, the government’s scheme to provide needy households with insulation and heating grants, is to be phased out by 2014.

Funding for the Warm Front scheme is to be cut to £110million over 2011/12 and then to £100million in 2012/13, according to the Spending Review announced yesterday.

The scheme will then be funded through the government’s Green Deal, said the Department for Energy and Climate Change (DECC).

The Review said: “Households will be able to improve the energy efficiency of their homes at no upfront cost, repaying through the savings they make on their energy bills, through a Green Deal.”

Extra support to reduce energy bills and improve heating and insulation will also be provided by energy companies to combat fuel poverty, the review confirmed.

This will allow the Warm Front scheme to be phased out over time, saving £345million by 2013-14, according to the review.

Winter energy bills

Meanwhile, the popular Winter Fuel Allowance will be protected but will be slightly lowered.

The Winter Fuel Allowance was introduced in 1997 as an annual one-off payment of £20. It has risen since then to £250 for people over 60 and £400 for the over-80s.

This will drop to £200 for people over 60 and to £350 for people over 80 years old, under the Spending Review.

Cold weather payments - which are paid to pensioners when the temperature drops below freezing for seven consecutive days - will also stay the same at £25 despite earlier government threats to cut this to £8.50.

The government also confirmed yesterday that the Renewable Heat Incentive (RHI) will go ahead next year, and tariffs will start to be paid from April 2011.

With the RHI, participants will earn a fixed income for every kilowatt hour of heat they produce using renewable sources, like solar thermal panels.

Although the energy produced is likely to be used in the participant’s own property, if they are also connected to a heat network they could get an additional payment for exporting surplus heat onto the grid.

This is similar to the Feed-In Tariffs system, which works in the same way for the electricity generated by solar panels, or by other renewable methods. Feed-In Tariffs were not altered by yesterday’s Spending Review.