The climate think tank E3G published a briefing on 19 May 2025 setting out the economic case for the £13.2bn Warm Homes Plan pledged in the Labour manifesto. E3G said the programme would represent "one of the most competitive infrastructure investments available to the UK government"1.
The briefing models three spending scenarios: a low ambition £6bn pathway, the £13.2bn manifesto plan, and a £26.4bn pathway meeting the Committee on Climate Change's recommendations1. E3G found the £13.2bn plan would boost GDP by 0.08 per cent, against a 0.17 per cent increase over 20 years under the CCC-aligned investment. It compared the returns to the £19bn Elizabeth Line, which it said is projected to deliver similar GDP growth over a significantly longer timescale1.
On delivery, E3G said £13.2bn would support the installation of 1.2 million heat pumps, 1 million solar arrays and insulation upgrades for 2.7 million roofs and walls, and create 9,000 additional skilled jobs annually across the UK, particularly in regions with higher deprivation1. It put average annual energy bill savings at £220 for 3 million households, targeted at those most in need, alongside £8.7bn in health and wellbeing gains1.
On energy security, E3G said heating and cooking account for 34 per cent of the UK's total gas demand, a greater share than gas used in power generation. Fully delivering the plan would cut domestic gas use by 13 per cent by 2035, saving households and the economy nearly £10bn in gas import costs over the next decade1.
"Delivering the full £13.2bn Warm Homes Plan, as pledged in the Labour manifesto, would represent one of the most competitive infrastructure investments available to the UK government."
| Scenario | Investment | Modelled GDP effect |
|---|---|---|
| Low ambition | £6bn | Not reported |
| Warm Homes Plan | £13.2bn | 0.08 per cent boost |
| CCC-aligned | £26.4bn | 0.17 per cent over 20 years |
Why it matters for households
The briefing frames home energy efficiency as a question of national finances as much as household comfort. Its central claim is that money spent on insulation, heat pumps and solar reduces what households send to energy suppliers, and that this released spending supports growth elsewhere in the economy1. For a household, the practical link between energy independence and the measures described is direct: a home that needs less gas to heat and cook is less exposed to gas import costs and price shocks, which E3G identifies as the security case for the plan1.
The bill savings E3G models are targeted rather than universal. The £220 average annual saving applies to 3 million households, described as those most in need of support, not to all homes1. The briefing does not set out eligibility rules, delivery bodies or a timetable for individual measures, and none of these have been reported in the material published alongside it. Households looking at what support currently exists can find the current landscape of public funding through the site's grants and schemes pages.
What happens next
E3G said the government should deliver its manifesto commitment as a minimum, to drive economic growth, support emissions reductions and meet statutory fuel poverty targets1. No implementation dates, funding allocations or delivery milestones are given in the briefing. The full analysis and a methodology annex are published alongside it1.