CEP statement on Warm Homes Plan

Statement | Paulina Gonzalez-Martinez | Jan 2026

The Warm Homes Plan represents a significant and welcome intervention to address fuel poverty and improve the energy performance of the UK’s housing stock. It signals a clear shift towards treating energy efficiency and household vulnerability as core elements of the net zero transition, rather than as residual social policy concerns.

The Plan’s tax-funded programme to strengthen action on buildings and fuel poverty directly links to our research on how to pay for net zero, which shows that a tax approach is likely less regressive and less damaging to the economy than energy bills. Fully funded upgrades for low-income households at risk of being stranded on expensive gas networks, alongside a renewed Fuel Poverty Strategy for England, align with CEP’s longstanding emphasis on protecting vulnerable consumers during system transition. Our research also shows that to achieve these goals, support for domestic supply chains in manufacturing and installation will be essential. 

The focus on insulation, low-carbon heat, and complementary technologies such as solar and battery storage also represents a welcome rebalancing towards measures that permanently reduce energy demand. In addition, mandatory minimum standards for private landlords by 2030, and explicit recognition of the health impacts of cold, damp and mould on children, are in line with CEP’s concerns about equity, housing quality and public health in the private rented sector.

However, the Plan continues to raise important questions about coherence, delivery and cost efficiency. While it advances one critical dimension of fairness, it remains largely disconnected from wider decisions on energy pricing, markets and who ultimately pays. In particular, the absence of substantive measures on electricity pricing, including social tariffs, standing charges and electricity–gas price dependency, risks undermining the effectiveness of household upgrades in 2026 and beyond. CEP has consistently argued that energy efficiency and low carbon heating cannot be separated from market design, and that warm homes policy must be joined up with reforms to tariffs and retail protections if households are to fully benefit.

Uncertainty also remains around delivery. The early closure of the Energy Company Obligation (ECO) has heightened the need for clarity on the scale, scope and sequencing of the Warm Homes Plan. Although the headline budget and three-pillar structure now signal intent, key operational questions remain unresolved: how local authorities and communities will be resourced; how upgrades will be phased across tenures, regions and housing types; and how area-based schemes will manage labour constraints, supply-chain capacity and cost risk. Without long-term certainty, there is a continued risk of delivery continuity that undermines skills development and value for money.

Finally, CEP has emphasised the importance of robust institutional design, long-term policy certainty, independent scrutiny and granular distributional analysis. While the Plan references a new Warm Homes Agency, equality impact assessment and monitoring frameworks, further detail is needed on how impacts across different household types, regions and tenures will be tracked and addressed over time. Without this, there remains a risk that benefits accrue unevenly, that private renters and off-gas households experience slower progress, and that opportunities for learning and course correction are missed.

CEP’s Position in Summary

  • Warm homes are central to a fair energy transition, not an adjunct to net zero policy.
  • Investment-led, structural measures offer more durable protection than repeated bill subsidies.
  • Energy efficiency must be aligned with fair energy prices, including social tariffs and electricity market reform.
  • Delivery certainty matters: long-term funding, skills and supply-chain stability are essential to avoid policy churn.
  • Distributional impacts must be visible and monitored, with independent evaluation supporting accountability and learning.

The Warm Homes Plan is a meaningful step forward. To deliver a fully coherent, equitable and cost-effective transition, it must now be embedded within a broader reform agenda on energy prices, markets and governance –CEP has consistently argued that this is essential for households, communities and the wider energy system.

 

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