The high cost of energy puts significant strain on household budgets and the the impact is particularly felt by low-income families who are sometimes faced with the stark choice between heating and eating. Fortunately, there is some help available with free grants for low-income families towards the cost of installing new energy-efficient measures that will help reduce energy costs.
Read on to learn more about relevant low income family grants that will not only help eligible households get energy-efficient home improvements installed for free, but also allow them to reduce their annual energy bills and the pressures on their household budgets.
Great British Insulation Scheme
Under the Great British Insulation Scheme (GBIS), funding is available to help those on the lowest incomes and with the least energy efficient homes in lower council tax bands. The Great British Insulation Scheme (formerly known as ECO+) is due to run from April 2023 to March 2026 and is complementary to ECO4.
Grants for insulation are provided by the main energy companies who are obligated to provide this funding to low income and vulnerable households, and applies to those living in a property with an Energy Performance Certificate (EPC) rating of D or below, and those in properties in council tax bands A-D in England, A-E in Scotland and Wales.
Funding will, in many cases, cover the cost of adding loft insulation or cavity wall insulation to a property. With other insulation measures, such as internal or external wall insulation, where the costs are generally more expensive, the funding may only partially cover the costs. This could mean that the household would have to make a contribution towards the insulation installation where necessary.
GBIS will offer insulation grants to households who haven’t previously received any funding help to improve the energy efficiency of their home.
The Energy Company Obligation (ECO) scheme
The ECO scheme was launched by the government with the aim of helping fuel-poor domestic households lower their energy bills, become more energy efficient, and reduce their carbon emissions in order for us as a country to reach our target of net-zero carbon emissions by 2050 to ultimately try and limit our impact on climate change. This is one of the biggest schemes that focus on awarding a grant to low-income UK families as a protective measure against poverty.
ECO works by giving the responsibility of providing free grants for low-income families in the UK to the large energy companies, who then provide funding grants for the installation of heat-retaining measures at zero cost to the resident.
Since its launch in 2013, the ECO scheme has allowed over 2.4 million homes to get free energy-efficient home improvements fitted and save hundreds of pounds a year on heating bills according to the latest government figures released in May 2023. The fourth and final phase of the scheme (ECO4) is due to run until March 2026.
Who is eligible for ECO4 funding?
There are some key changes with ECO4, in relation to the qualifying criteria for grants. The government made these changes to ensure more low-income homes that truly need this funding for energy-efficient home improvements can easily access it.
This means that if you are a homeowner or privately renting tenant, your combined household income is less than £31,000, you or someone in your household is claiming an eligible benefit, or you have an inefficient heating system in your house that has resulted in a low Energy Performance Certificate (EPC) rating, you are highly likely to be accepted for funding through the ECO4 scheme.
In terms of the qualifying benefits, specifically related to low-income families, they are listed below for you to see if you’re entitled to funding.
- Income Support (IS)
- Child Benefits (depending on the income threshold)
- Child Tax Credits
- Income-based Jobseekers Allowance (JSA)
- Income-related Employment and Support Allowance (ESA)
- Universal Credit (UC)
- Warm Home Scheme Discount Rebate (currently closed but reopening in October 2024)
- Housing Benefit
Boiler Upgrade Scheme (BUS)
The Boiler Upgrade Scheme provides grants up to £7,500 for households who are looking to replace their fossil fuel heating system with an energy efficient alternative. Since many low-income households are likely to be in properties with older inefficient heating systems that use gas, oil, or electric to run them, this sort of funding could help them shift to a renewable energy alternative such as a heat pump.
Grants of up to £7,500 are available for both air source heat pump and ground source heat pump installations, while a £5,000 grant could be available to households shifting their heating method to a biomass boiler. Even if you’ve already had funding to make your property more energy efficient, such as through insulation grants, you could still be eligible for BUS grants.
Previous Grants Available To Low-Income Families
Some grants have since been discontinued, but had you applied prior to their closure, their delivery may still be ongoing in some cases.
The Green Homes Grant
The Green Homes Grant scheme was another funding option introduced by the government as an incentive to install energy-efficient heating measures in fuel-poor households. It allowed homeowners and landlords to apply for vouchers that would contribute towards the cost of fitting low-carbon and energy-efficient home improvements, meaning these homes could then save up to £600 a year on their energy bills.
The scheme is currently closed to new applications but if a successful application was submitted prior to 31st March 2021, the government provided a voucher that would subsidise two-thirds of the cost of installing the new measures.
In the majority of cases, the maximum amount the voucher could cover was £5,000. However, there was potential for low-income families to get a higher level of funding if you were a homeowner and you or someone in their home was receiving a qualifying benefit. This would often take care of the full cost of installation as the maximum value of these vouchers was £10,000. It is important to note that if you did successfully apply and receive a voucher, make sure you redeem it and get your new insulation installed before the expiry date. Landlords could not apply for this higher level of funding, only homeowners.
The Renewable Heat Incentive (RHI)
The domestic RHI scheme is now closed to new applications with the last day being 31st March 2022. The Renewable Heat Incentive began in 2014 with the aim of incentivising more people to install renewable heating systems like heat pumps with quarterly payments made over a seven-year time frame. The exact amount each member of the scheme received was dependent on multiple factors such as the type of system they elected to have, the tariffs that were available at the time of their application, and in certain cases, metering.
Are There Any Other Government Grants For Low-Income Families In The UK?
In short, yes. If you are struggling financially with your housing costs, you might be able to get some additional financial support. There are a number of options including the following:
Household Support Fund
The Household Support Fund is a government scheme that helps vulnerable people and families with priority household costs like food and energy and water bills over winter. It is separate to the Cost of Living Payments currently administered by the Department for Work and Pensions. This fund is, instead, delivered by local councils to a low income household to support them during extreme financial hardship.
The Fund will help parents with children, older people, and those on low incomes, so if your household receives free school meals, pension credit, or council tax support then you will qualify for the payments.
Discretionary Housing Payment
A discretionary housing payment (DHP) is designed to support low income households with the cost of rent or housing costs. If you receive Housing Benefit or the housing element of Universal Credit then you can qualify. DHP only applies to England and Wales. To apply you must do so through your local council as each council has their own application process and funds to allocate.
Local Council Support Schemes
Local authorities have a responsibility to provide help to its residents who may be in need of additional support. Circumstances such as a families’ health being at risk, not being able to afford food, or needing support after coming out of care, hospital or prison can all be considered emergency situations where local authority support may be available. However, the available support is not a given and will vary from local council to council. They may be able to help with these emergency expenses to help you and your family get back on your feet, but you’ll need to check what’s available locally. Some councils choose to use this money to support local projects such as food banks and homeless charities to improve their area, rather than giving funding directly to households, although they largely achieve the same thing: supporting low-income families.
Budgeting Loans And Advances
A budgeting loan or budgeting advance makes interest-free loans available to those on certain income-based benefits to help them on occasions where they are unable to afford items considered essential, such as clothing or furnishings. Applications can be made at the Jobcentre or online at Gov.uk. You can minimally borrow £100 or apply for the maximum amount of:
- £348 if you’re single
- £464 if you have a partner
- £812 if you or your partner claim Child Benefit
The amount you could get it determined by whether you can pay back the loan, have savings of more than £1,000, or are paying back an existing loan.
Grants For Low Income Families With Children
Low income households with children may be eligible for additional grants. These include:
Sure Start Maternity Grants
If you or your partner receive certain benefits (universal credit, income support, income-based JSA, income-based ESA, tax credits, pension credit) and have recently had your first child or are pregnant with your first child (or already have children and are expecting a multi-birth), you could be eligible for £500 to help buy clothes and equipment. You should apply between 11 weeks before and 6 months after the birth. You do not have to pay the grant back and it will not affect your other benefits or tax credits.
School Support Grants
If you are on means-tested benefits and have kids at primary or secondary school, you could be able to get help with free school meals, school uniform grants and transport costs. The funding is intended to help boost the educational and employment ambitions of otherwise disadvantaged children. These close and reopen at certain times, so it’s best to check online to see if a support grant is currently able to offer welfare assistance in this case.
Childcare Help
Working parents could claim up to £2,000+ per child in tax-free childcare broken down in to £500 payment every 3 months, depending on the number of children they have to help with the often crippling costs of childcare.
Disabled Child Help
Families with a disabled child under-17 (including both physical and learning disabilities) living at home who receive certain benefits, such as income support or universal credit, could be able to get grant assistance from the Family Fund – offering support in England, Scotland, Wales, and Northern Ireland. You don’t need to be in receipt of benefits to qualify, but you must be on a low income.
Grants From Energy Suppliers To Help Pay Off Energy Debts
If you have built up debts to your energy supplier, you might be able to get some grant support to help you pay it off and return to being debt free. A number of energy suppliers offer grants for those struggling to pay for their gas and electricity, including:
- British Gas Energy Support Fund
- Scottish Power Hardship Fund
- Ovo Energy Fund
- E.ON Energy Fund
- EDF Energy Customer Support Fund
- Bulb Energy Fund
- Octopus ‘Octo Assist Fund’
- Shell Energy Support Fund
In exceptional circumstances, it is possible that funding for other priority household costs might be provided from these various energy supplier funds.
Need More Free Grant Advice And Help With Essential Costs?
Contact us today to check your eligibility for a range of UK-wide grants for low-income families. We can put you in touch with energy and funding professionals that will handle everything for you from applying for free funding to arranging the installation of your new insulation or other energy efficiency measures. We can also give you advice regarding some of the other sources of funding, including the energy companies and your local council. Feel the benefits of free insulation and other funding grants for your home today.
