Home Upgrade Grant (HUG2) — 2026 Guide
The Home Upgrade Grant (HUG2) is a government-funded scheme that provides free low-carbon heating and energy-efficiency upgrades to low-income, energy-inefficient homes in England that are not connected to the gas grid. Administered by local councils using funding from the Department for Energy Security and Net Zero (DESNZ), HUG2 can cover the full cost of measures like heat pumps, solar panels, insulation and hot water cylinders — with no up-front cost to the homeowner.
- Max grant per home
- Up to £15,000+
- Where
- England (off-gas-grid)
- Administered by
- Local councils
- Income test?
- Yes — low income or benefits
Who is eligible?
To qualify for HUG2, your home must meet all of the following:
- Located in England and not connected to the mains gas grid
- EPC rating of D, E, F or G (homes A–C are excluded)
- Household income below £36,000 per year (or you receive certain means-tested benefits)
- You are the owner-occupier or a private/social renter with landlord consent
Local councils have some discretion in how they target their funding — some prioritise the lowest EPC bands or the lowest incomes first. Contact your local council or check the gov.uk HUG2 eligibility checker to confirm whether you qualify.
What does HUG2 cover?
HUG2 can fund a wide range of measures, often in combination (called a 'whole-house' approach):
- Air-source and ground-source heat pumps
- Solar PV panels
- Solar thermal hot water
- Battery storage systems
- Loft, wall and floor insulation
- Hot water cylinders and heating controls
- Double glazing (in some cases, as part of a wider package)
Unlike the Boiler Upgrade Scheme, which is a fixed-amount voucher, HUG2 can cover the full assessed cost of the works up to the scheme cap. For rural, hard-to-heat homes, this can often exceed £15,000 per property.
How to apply
- 1Check your local council's website — HUG2 is administered regionally. Search '[your county] HUG2' or 'Home Upgrade Grant [council name]'.
- 2Complete a referral or eligibility check form. Your council may also accept referrals via energy suppliers or housing associations.
- 3A council-approved assessor visits your home to carry out an energy survey and confirm the measures needed.
- 4Works are carried out by an approved contractor at no cost to you.
- 5The council or its delivery partner handles all admin, procurement and installation management.
HUG2 in 2026
The HUG2 programme runs until March 2026, with some councils still accepting applications depending on remaining budget allocations. A successor scheme (sometimes referred to as HUG3 or a Warm Homes Local Grant) is expected to follow under the Warm Homes Plan. Check your local council's website for the most current status — availability varies significantly by region as councils exhaust their individual allocations.
Common questions about Home Upgrade Grant
Is HUG2 the same as the Warm Homes Discount?
No. The Warm Homes Discount is a rebate on your electricity bill (currently £150) for low-income households. HUG2 (Home Upgrade Grant) funds physical improvements to your home — insulation, heat pumps, solar panels — at no cost to the homeowner. They are separate schemes with different eligibility criteria.
Can I apply for HUG2 if I'm on the gas grid?
No. HUG2 specifically targets off-gas-grid homes (properties heated by oil, LPG, electric storage heaters or solid fuel). Homes connected to the mains gas network are not eligible. If you are on the gas grid and want a heat pump, look at the Boiler Upgrade Scheme instead.
What happens if my council has no HUG2 budget left?
If your local council has exhausted its HUG2 allocation, you may need to wait for a successor scheme. In the meantime, you may qualify for ECO4 (administered via energy suppliers) or the Great British Insulation Scheme, which have broader eligibility and different funding routes.
Does HUG2 cover properties in Scotland and Wales?
No. HUG2 is an England-only scheme administered by DESNZ. Scotland has its own equivalent schemes (Home Energy Scotland grant and loan, and Warmer Homes Scotland for the most vulnerable households). Wales has the Warm Homes Programme.
Do I need an EPC before applying for HUG2?
An existing EPC showing D–G is helpful for the eligibility check, but if you don't have one your council's assessor can arrange one as part of the HUG2 process. You don't need to pay for an EPC separately before making an initial enquiry.
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