London boroughs call for £194m funding to retrofit 20,000 homes

Two million homes, over half the capital’s housing stock, require energy efficiency upgrades within this decade.

Under the councils’ plan, retrofit would be carried out on a neighbourhood-by-neighbourhood basis, regardless of whether residents are social renters, private renters or homeowners.

The programme would deliver multiple measures at once, reducing disruption for residents. This would enable retrofit projects to be delivered more efficiently and draw in investment from the private sector.

To deliver the programme, London would need £194m of additional capital funding from the government for the five-year period. This would be combined with £224m of existing grant funding.

The model would ensure “zero upfront costs” for residents, with investment repaid “primarily through energy bill savings”. Inside Housing asked London Councils whether this means residents would be charged for the upgrades after installation and, if so, how they would be charged.

Without adopting the programme, London Councils said, only two scenarios remain: the government fully subsidising the retrofits with around £605m on top of existing grant schemes, or a “business as usual” approach that would continue to deliver low levels of retrofit.

The proposal was developed by London Councils with 11 London boroughs including Hounslow, Lambeth, Camden, Islington, Newham, Greenwich, Westminster, Brent, Lewisham, Barnet and Kensington and Chelsea.

It follows on from a concept published in 2023 by the Cities Commission for Climate Investment and pilot programmes in areas including the West Midlands.

Brenda Dacres, executive member for transport and environment at London Councils, said: “Too many people are struggling in cold, expensive-to-heat homes, while the threat posed by the climate crisis continues to grow.

“Through the net zero neighbourhood programme, boroughs are showing a clear path to retrofit that is fair, affordable and delivered in partnership with our communities – with no upfront cost to residents.

“With suitable backing from the government, alongside private investment, we can ensure the current system works better for all Londoners and delivers good-quality homes which are cheaper and greener to heat.”

The Ministry of Housing, Communities and Local Government was approached for comment.

Earlier this month, a report found that UK councils have made progress on climate action in the past two years, but are not moving fast enough to meet their net zero targets.