Check eligibility for the Home Upgrade Grant (HUG2) in 2025/26. Free insulation, heat pumps and low-carbon heating for off-gas-grid homes in England.
The Home Upgrade Grant Phase 2 (HUG2) is a £1.7 billion England-only programme funded by central government and delivered through local authorities. It specifically targets the most energy-inefficient off-gas-grid homes, which typically have the highest fuel bills and the most carbon-intensive heating (oil, LPG, solid fuel).
HUG2 differs from ECO4 (which is supplier-funded and available on-gas or off-gas) by having larger individual grant values and greater flexibility for whole-house retrofit. A single HUG2 package can fund both insulation improvements and a full heat pump replacement in properties currently on oil heating, potentially reducing heating bills by 30–60%.
| Measure | Typical Grant Value | Key Requirement |
|---|---|---|
| Loft insulation | £1,500–£3,000 | Uninsulated or under-insulated roof space |
| Cavity wall insulation | £2,000–£4,000 | Cavity wall construction post-1920 |
| Solid wall insulation (EWI) | £8,000–£15,000 | Solid brick/stone pre-1920 construction |
| Air source heat pump | £10,000–£15,000 | Suitable property + existing radiator/UFH system |
| Ground source heat pump | £15,000–£25,000 | Suitable land, pre-assessment required |
| Solar PV panels | £5,000–£8,000 | Suitable south-facing roof, structural survey |
Three main schemes apply to improving heating and insulation in off-gas-grid homes in England in 2025/26:
Households that are off-gas-grid and on qualifying benefits should explore HUG2 first, as grant values are typically higher than the BUS. Those above the income threshold who want a heat pump should consider the Boiler Upgrade Scheme, which remains open throughout 2025/26.
The Home Upgrade Grant (HUG) is an England-only government programme that funds energy-efficiency improvements and low-carbon heating systems in homes that are off the gas grid. HUG Phase 2 (HUG2) runs from April 2023 to March 2025, with delivery into 2025/26 for some local authority areas. It is delivered through local authorities using central government funding from DESNZ.
HUG2 targets owner-occupiers and private renters (with landlord permission) in England with homes that are: (1) off the gas grid — i.e., using oil, LPG, solid fuel, or electric storage heaters as primary heating; (2) with an EPC rating of D, E, F, or G; and (3) either in receipt of a qualifying means-tested benefit OR with a household income below £36,000. Some local authorities prioritise the most fuel-poor households using additional vulnerability criteria.
HUG2 covers a range of energy-efficiency and low-carbon heating measures including: air source heat pumps, ground source heat pumps, solar PV panels, solid wall insulation (internal or external), cavity wall insulation, loft insulation, underfloor insulation, flat roof insulation, electric storage heaters, low-carbon ready heating systems, and draught-proofing. Measures are offered as a package tailored to each property's needs.
HUG2 grant values depend on measures needed and property characteristics. Typical values range from £5,000–£10,000 for insulation-only packages to £15,000–£30,000 for full heat pump replacement and fabric improvement packages. The government allocated £1.7 billion to HUG2 nationally, with each local authority having a specific budget allocation. Most eligible households can expect £10,000–£15,000 of works funded.
Yes. HUG2 is specifically designed for homes not connected to the gas mains network. On-gas-grid homes that are low-income or fuel-poor should instead apply through ECO4 (for benefits-eligible households) or the Great British Insulation Scheme. The off-gas-grid focus reflects the higher energy costs faced by rural households on oil, LPG, or electric heating.
HUG2 is administered at local authority level, not through a central portal. To apply: (1) Check if your local authority is participating (most in England are). (2) Contact your LA housing or energy team directly or use their HUG referral form. (3) You may also be referred by your energy supplier, NHS, or housing association. (4) A home assessor will visit to determine eligibility and recommend measures. Applications through local authority HUG pages or the Simple Energy Advice website (simpleenergyadvice.org.uk) are recommended.
All local authorities in England were allocated HUG2 funding, though delivery timelines and application processes vary. Areas with high concentrations of off-gas-grid housing (rural counties, coastal areas, older housing stock) typically have higher per-capita allocations. Check your local council website for HUG2 information or search for 'Home Upgrade Grant [your council name]'. Devon, Cornwall, Lincolnshire, Norfolk, and many Northern counties have been particularly active in HUG2 delivery.
ECO4 is a supplier obligation scheme targeting any fuel-poor household (on-gas or off-gas), funded by energy companies. HUG2 is a government grant programme specifically for off-gas-grid homes in England, delivered through local authorities. ECO4 is available UK-wide; HUG2 is England-only. Both can fund similar measures (insulation, heat pumps), but HUG2 is generally better funded for off-gas-grid properties and may cover higher grant values for heat pump installations. Some households can access both schemes.
HUG2 funds the full range of home insulation measures appropriate to the property type: loft/roof insulation (including flat and room-in-roof variations), cavity wall insulation where present, external wall insulation (EWI) for solid-wall properties, internal wall insulation (IWI), underfloor insulation for suspended timber floors, and park home insulation for mobile homes. The specific measures offered depend on your property's construction type, current EPC, and the cost-effectiveness assessment.
Yes. HUG2 is primarily aimed at owner-occupiers who are off the gas grid and have a low income or low EPC rating. Owner-occupiers are typically the primary beneficiary group. Private renters can also qualify with landlord consent. However, if a property is rented, the landlord must agree to the measures being installed, and the landlord may be subject to cost sharing in some circumstances (particularly where improvements primarily benefit the landlord's asset value).
HUG2 funds low-carbon and energy-efficient heating replacements including: air source heat pumps (ASHP), ground source heat pumps (GSHP), solar thermal hot water systems, infrared heating panels, electric storage heaters (high heat retention), biomass boilers in some rural areas, and hybrid systems pairing heat pumps with existing infrastructure. Heat pumps are the priority measure in most HUG2 delivery programmes given their carbon reduction potential.
HUG2 Phase 2 officially runs to March 2025 for grant commitments, with delivery extending into 2025/26 for works already approved. The government is expected to announce successor schemes through the Warm Homes Plan, which will continue supporting off-gas-grid retrofit beyond HUG2. If you are considering applying, doing so as soon as possible is advisable given limited remaining funding. Check your local authority's HUG page for current availability.