Up to £1.5bn is being made available through the Social Housing Decarbonisation Fund and Home Upgrade Grant schemes, allowing social housing providers and local authorities to submit bids for funding to upgrade the properties of around 130,000 low-income and social households.

The government hopes this work will help those households across England see bills reduce by around £400 to £700 a year.

The funding will see the installation of measures such as external wall and loft insulation, energy efficient doors and windows, heat pumps and solar panels.

Local authorities and social housing providers will be able to submit bids for funding and will deliver upgrades from early next year until March 2025.

The schemes could together support “19,000 green energy sector jobs”.

Social housing with an Energy Performance Certificate (EPC) rating of D or lower will be eligible to receive Social Housing Decarbonisation Fund (SHDF) upgrades, while the Home Upgrade Grant (HUG) funding will help people who are most vulnerable to fuel poverty, living in privately-owned – both rented and owner-occupied – off gas-grid homes and on low incomes.

The HUG funding will see up to £700m available for local authorities to install energy efficiency measures in around 30,000 properties.

Up to £800m SHDF wave 2 grant funding will see around 100,000 social homes receiving energy efficiency upgrades. The grant funding provided by the government will have to be matched by those applying, doubling the investment being made under the SHDF scheme to around £1.6bn.

Minister for Business and Energy Lord Callanan said: “The cheapest form of energy is the energy we do not use. Our Help to Heat schemes are already bringing real benefits to tens of thousands of low-income households across the country by improving the energy performance of their homes and saving them hundreds of pounds on their bills.

“Together with the unprecedented support government is putting in place to help households and businesses with rising energy costs, this latest funding will extend that assistance even further, targeting help to those who need it most by making their homes warmer and cheaper to run.”

Business and Energy Secretary Jacob Rees-Mogg said: “Putin’s illegal war in Ukraine, would have had dire consequences on the energy bills of both households and businesses this winter, without the government’s decisive action. Today I am cutting costs even further for the most vulnerable households for years to come.

“By making homes warmer and cheaper to live in, we are not only transforming the lives of households across England, we are creating huge growth in the economy, backing the green energy sector and supporting thousands of high-skilled jobs.”

Kate Henderson, Chief Executive of the National Housing Federation, said: “The launch of the second wave of the Social Housing Decarbonisation Fund is hugely welcome. This vital funding will enable housing associations across the country to make significant progress in retrofitting and decarbonising their homes – work that not only cuts carbon emissions but saves residents money on their heating bills.

“We know that England’s homes produce more carbon each year than the average annual use of the country’s cars, so decarbonising social homes has a pivotal role to play to meeting the country’s net zero target.

“The National Housing Federation and our members look forward to continuing to work with BEIS to demonstrate the benefits that decarbonising homes has on residents’ lives.”

Tracy Harrison, Chief Executive, Northern Housing Consortium said: “We welcome the opening of this important funding, which gives the North the opportunity to scale-up social housing retrofit programmes, creating good, skilled, green jobs and helping to tackle fuel poverty in our communities.

“The North is ambitious for this Wave – some significant collaborations are under way and councils and housing associations are looking forward to working with BEIS to build on the momentum we’ve already established together.”