What is the LAD Scheme?

The government £2 billion Green Homes Grant was introduced in 2020 to upgrade properties across the UK through energy efficient improvements with the intention that it would save households money on their energy bills and lower carbon emissions. Part of this grant is the Local Authority Delivery scheme which was initially assigned £500 million of the funding for Phase 1 & 2 of LAD, with an additional £287 million for Phase 3.

This scheme, which has now ended, allowed councils and local authorities to apply for grants to generate energy efficient retrofit schemes to provide specific improvements including:

Home Insulation

Renewable heat

Air source heat pumps
Ground source heat pumps
Solar heating

The LAD scheme was available to homeowners and private tenants to cover the full cost of installing the new measures. Landlords needed to provide one-third of the costs of the installation.

What did the different phases of LAD involve?

The LAD scheme was divided into multiple phases.

Phase 1A – £74m of funding delivered to over 50 Local Authority projects in 2020.
Phase 1B – £126m of funding given to 81 projects in January 2021.
Phase 2 – £300m of funding spread across five Local Energy Hubs to cover 2021/22.
Phase 3 – £287m is intended to be made available for new projects.

Phase 1

During this phase, local authorities (either individually or as part of a group bid with other local authorities) could submit bids for funding through LAD to improve the energy efficiency of eligible homes in their respective areas. Some important eligibility information to keep in mind is:

Households need a combined income of £30,000 or less.
Homes should have an EPC rating of E, F, or G before the installation of the energy efficient measures.
A 100% subsidy option for owner-occupiers (up to a max of £10,000).
Potential subsidy of around two-thirds for landlords (up to a max of £5,000).

Funding bids were permitted to include proposals that had been developed before or use pre-existing delivery mechanisms or new proposals that can meet the aims of the scheme.

Phase 2

As previously mentioned, phase 2 saw the LAD scheme get £300m of extra funding. Of this additional funding, 15% could be put towards work to assist with the delivery such as fulfilling EPC improvement requirements, essential repairs and maintenance to prepare homes for energy efficiency upgrades, and other help required for low-income households.

Phase 3

An additional £287 million of funding was made available to local authorities under Phase 3 and this saw the scheme combined with the Home Upgrade Grant (Phase 1) as part of the Sustainable Warmth Competition.

Home Upgrade Grant (HUG) Funding

Complementary to the LAD scheme was HUG which targeted homes that were specifically off the gas grid. A total of £220 million was allocated under HUG Phase 1 running between 2022-23 and saw 4,000 homes upgraded. HUG Phase 2 saw an additional 11,500 homes upgraded by the funding. HUG scheme officially closed in March 2025, but some measures were still to be completed/

Was cross-funding allowed with the LAD scheme?

Households should not have been getting the LAD and Green Homes Grant funding (it was the responsibility of local authorities to make sure cross-funding does not occur)
LAD funding could not be used in conjunction with any other government schemes such as RHI or ECO to make the same improvement (e.g., insulation). However, installations of new energy efficient home improvements could be carried out with different funding for different measures. For example, if a contractor was completing work in a property and has been provided with funding through LAD to fit insulation they would have been able to get separate funding through ECO to install a different measure.
Grants through LAD could be put together with third-party finance or Local Authority budgets to provide additional support to communities (e.g., adding to the total subsidy to a measure or package of measures).

What were the reporting requirements for Local Authority Delivery?

To keep track of all the key details and factors of the LAD scheme, monthly reporting was required on:

Applications and measures installed
Costs involved
EPC improvement records
Savings in terms of energy, emissions, and bill savings
Risks/ issues and mitigation

How many people were assisted by the LAD scheme?

Key stats relating to the LAD and HUG schemes:

Over 58,500 homes upgraded via 77,800 energy efficiency measures under LAD (Phases 1-3)
Over 15,500 homes upgraded via 27,500 energy efficiency measures under HUG (Phases 1 & 2)
LAD Phase 1 (2020-2022) saw 18,500 homes upgrades with 23,800 measures installed
LAD Phase 2 (2021-2022) saw 20,500 homes upgrades with 27,000 measures installed
LAD Phase 3 (2022-2023) saw 19,500 homes upgrades with 27,00 measures installed

While both schemes are now closed, there are other funding avenues worth exploring. Get in touch with our team today to find out if you’re eligible for free insulation funding.

*Article updated July 2025 to reflect the scheme is closed to applications and outline how many people have been helped according to official government data as of May 2025.

Oliver Creevy

Ollie has been writing content in the home improvement sector for over 3 years and over the last 18 months has really specialised in Government grants, researching the different funding available to UK citizens. Ollie is well placed to provide households with access to the right advice when it comes to improving the energy efficiency of your home. With knowledge of the various grant schemes past and present, including Boiler Upgrade Scheme, ECO4, LAD Scheme, Green Homes Grant and more, his knowledge will be invaluable to those looking for ways to reduce their energy bills and reduce their carbon footprint through eco home improvement measures such as solar panels, insulation & heat pumps.