The Welsh Government has added £8 million to the Optimised Retrofit Programme, bringing its total budget to £106.75 million in the current financial year, the Cabinet Minister for Local Government, Housing and Planning, Siân Gwenllian MS, said in a written statement on 16 July 20261. The increase is part of a wider £17 million injection into housing retrofit schemes, funded from existing budget within the minister's portfolio1.
The statement sets out how the £17 million is divided. Alongside the £8 million for the Optimised Retrofit Programme, £5 million goes to the Nest scheme, taking total funding for that demand-led scheme to £37 million this financial year, and £4 million is made available for alternative and novel delivery models with local partners across Wales1. The minister said the Optimised Retrofit Programme is in its last year, and that insights from it will inform future policy and interventions1.
"An additional £8 million to the Optimised Retrofit Programme brings its total budget to £106.75 million this financial year, to continue the momentum to improve our social housing stock."
| Allocation | Amount | Resulting total this financial year |
|---|---|---|
| Optimised Retrofit Programme | £8 million | £106.75 million |
| Nest scheme | £5 million | £37 million |
| Alternative and novel delivery models | £4 million | Not stated |
The statement also covers Tai Clyd Caerdydd, a pilot area-based project in the Splott, Adamsdown and Fairwater areas of Cardiff, delivered with Cardiff Council. The previous government committed £3 million to the project, which will explore a neighbourhood level approach to cross-tenure retrofit1. The minister confirmed it will open for applications in September, when eligible residents will be contacted with further details1. Details of the alternative delivery models have not yet been set out1.
Why it matters for households
The Optimised Retrofit Programme is directed at social housing stock, so the additional £8 million affects tenants in social homes rather than owner-occupiers or private renters1. The Nest scheme, which receives £5 million of the package, is described in the statement as a lifeline for many low-income households living in cold, damp homes1. For households in Wales, the practical reach of this funding depends on which scheme covers their tenure: social tenants fall under the Optimised Retrofit Programme, while lower-income households in cold homes may be served by Nest. The statement does not set out eligibility criteria for either scheme, and no detail has been reported on how the £4 million for alternative delivery models will be allocated or which areas it will cover1.
What happens next
The Tai Clyd Caerdydd project opens for applications in September 2026, with eligible residents to be contacted directly1. The Welsh Government says it will review evidence on cost-effectiveness, including where to target funding and wider policies, to inform the next emissions reduction plan, and will look at maximising the benefit to Wales of UK Government funding streams1. Details of the alternative and novel delivery models will be set out in due course1. The Optimised Retrofit Programme ends after this financial year1.
Households looking at the wider landscape of grants and schemes can find guidance by audience, including the Boiler Upgrade Scheme eligibility rules, the closed Green Homes Grant and Home Upgrade Grant schemes, the comparison of the Warm Homes: Local Grant and the Great British Insulation Scheme, delivery through YES Energy Solutions, and Nest and the Warm Homes Programme in Wales.