External wall insulation grant: solid walls, terraces and the Warm Homes Local Grant

Why solid walls matter to this scheme

The Warm Homes: Local Grant was designed for “low-income households living in the worst quality, privately owned homes in England”. Many of the worst-rated homes have solid walls: no cavity to fill, so heat escapes through the brick or stone. Insulating them means wrapping the outside of the wall (external wall insulation, EWI) or lining the inside (internal wall insulation, IWI).

Both are on the guidance’s list of eligible energy performance measures, paid from the energy performance pot of £16,600 per home, averaged across the council’s project.

The terrace problem, and the infill rule

External wall insulation on one house in the middle of a terrace is awkward: the insulation should run continuously across the row, and neighbouring walls, eaves and pipes all connect. The guidance encourages area-based upgrades for economies of scale and value for money, and it deals directly with the household in the row that does not qualify.

Under the infill rule, a council can include connected homes that are not income eligible on their own when:

• the average gross household income across the block of flats, houses or maisonettes is below £36,000 a year, or
• at least 75% of the households have a combined average income of no more than £36,000 a year

The homes must be physically connected, not simply on the same street or in the same area. Social housing can be included as infill too, up to 10% of the homes a project treats, with the social landlord paying at least 50%. Infill in more detail.

The price limit

External wall insulation is one of five measures with a price limit: the others are internal wall insulation, double or triple glazing, park home insulation and solar thermal. DESNZ set these because value for money on these measures is particularly sensitive to installation price. Councils must meet each limit on average across the project by closure, so a council can pay more on one home if others cost less. The figures are commercially sensitive and shared with councils only under a non-disclosure agreement.

In practice this means the retrofit coordinator will weigh EWI against other options. The guidance tells councils to plan an alternative package of fabric and smart measures in case a quote comes in too high, so the household is not left with nothing.

How it fits the whole-house approach

Solid wall insulation changes how a building handles moisture and air, which is why the scheme requires the PAS 2035:2023 whole-house process. A retrofit assessor records the home, a coordinator designs a package that works together, and installers certified to PAS 2030 for the measure do the work, with a guarantee in place before they start. Everything is lodged with TrustMark. What the assessment involves.

Who qualifies

• A low-income household: an eligible postcode, a listed benefit, or a gross income of £36,000 or less (or under the after-housing-costs limit)
• A home in England, privately owned or rented, already lived in, rated EPC D to G
• Owner occupiers and tenants pay nothing; landlords pay 50% from their second home

External wall insulation alongside other schemes

A home can use more than one scheme, but never for the same measure. The guidance gives exactly this example: a household could receive a heat pump under the Warm Homes: Local Grant “alongside funding to install solid wall insulation under ECO”. ECO4 ends on 31 December 2026, and any ECO4 work must be completed wholly before or wholly after the Warm Homes: Local Grant work.

Paying for it yourself

If you do not qualify, installation of insulation in a home is zero-rated for VAT until 31 March 2027, then 5%. External wall insulation can need planning checks depending on the building and location, so ask the installer and your council’s planning team before committing.