ECO4 is ending in December 2026. There is no ECO5. But there is a replacement — and it works completely differently.
The government's Warm Homes Plan, published on 21 January 2026, replaces the old supplier obligation model with a government-funded framework. Instead of energy companies being legally required to fund home upgrades, support now flows through government grants, local authority delivery, and new finance products. For landlords, this changes who you apply to, what your tenants need to qualify, and critically — how much you can claim for a portfolio of properties.
This article is the practical update to our ECO4 ending guide. It explains what's available from 2027 onwards, what the 50% portfolio rule means, and how the transition affects your 2030 EPC C compliance strategy.
This article provides general guidance only. Eligibility criteria are set locally and may vary. Always verify scheme details directly with your local council or the relevant government body.
ECO4 Is Ending — and There Is No ECO5
ECO4 was extended to 31 December 2026 in January 2026 — but only to allow suppliers to complete existing targets and remediate non-compliant installations. No new delivery targets were added. The government has confirmed there will be no new energy company obligation — no ECO5, no direct successor scheme in the same format.
If your tenant currently qualifies for ECO4 (typically via Universal Credit, Pension Credit, or other means-tested benefits), this is still the most powerful grant route available. Installers are booking up fast. If ECO4 applies to your property, the time to act is now — not in the autumn.
See our ECO4 ending article for full eligibility rules, qualifying benefits, and how the consent process works.
What Is the Warm Homes Plan?
The Warm Homes Plan is the government's successor framework for home energy upgrades. Published 21 January 2026, it commits £15 billion over five years with a goal of upgrading up to 5 million homes by 2030.
This is not a rebrand of ECO4. The key structural difference:
- ECO4: Energy companies funded upgrades as a legal obligation imposed by government. You applied via an energy supplier.
- Warm Homes Plan: Government funds upgrades directly through grants and loans. You apply via local authorities or government-administered schemes.
For private landlords, the relevant components are:
- Warm Homes: Local Grant — available now, for low-income tenants
- Boiler Upgrade Scheme (BUS) — continues for all landlords, no income requirement
- Warm Homes Fund loans — coming, not yet finalised
The same announcement also confirmed the 2030 EPC C deadline and the updated £10,000 cost cap, and set out a statutory instrument (SI) to be laid in 2026 to update the PRS Regulations with a target in-force date of 2027.
Warm Homes: Local Grant — The Main Replacement Route
For landlords whose tenants qualify, the Warm Homes: Local Grant is the primary post-ECO4 funding route.
Key facts:
- Who delivers it: Local authorities in England — not energy suppliers
- Budget: £500 million (April 2025 – March 2028)
- Property criteria: EPC D–G (generally required)
- Tenant criteria: Income-based (thresholds set locally)
- Maximum grant: Up to £30,000 per property
- Coverage: 74 projects involving 271 local authorities — covering over 97% of eligible English councils by February 2026
Measures covered: loft insulation, cavity wall insulation, solid wall insulation, air source heat pumps, ground source heat pumps, solar PV, battery storage, smart heating controls, windows, doors, draught-proofing.
⚠️ This is NOT the same application route as ECO4. You do not contact an energy supplier. You — or your tenant — contact your local council directly. Check your council's website or the government's Warm Homes: Local Grant page.
The 50% Portfolio Rule — What It Means for Landlords
This is the single most important difference for landlords with multiple properties, and it is widely underreported.
Under the Warm Homes: Local Grant:
- Your first eligible property: Fully funded (100%) by the grant — no contribution required from you as landlord.
- Any additional eligible properties in the same scheme: 50% funded — you pay the other half.
A landlord with five qualifying properties cannot get five full grants. The first upgrade is free; everything after that is matched funding. This is a deliberate policy condition: MoneySavingExpert has confirmed this arrangement, and it differs from ECO4 which had no portfolio restrictions of this kind.
Why this matters for your strategy: Don't leave the first (fully-funded) property application until last. If you have multiple qualifying properties, prioritise the one with the highest upgrade cost for the 100% slot — typically a solid-wall property requiring external wall insulation or a heat pump. The 50% contribution properties are still excellent value but require capital planning.
For the full eligibility guide and how to check whether your area is covered, see our Warm Homes Local Grant article.
The Boiler Upgrade Scheme — Available for All Landlords
The Boiler Upgrade Scheme (BUS) is separate from the Warm Homes Plan and operates independently. It continues to run until 2028.
Unlike ECO4 and the Warm Homes: Local Grant, BUS has no income requirement. Any private landlord can apply regardless of tenant circumstances.
| ECO4 | Warm Homes Local Grant | BUS | |
|---|---|---|---|
| Tenant income required? | Yes (benefits) | Yes (income threshold) | ❌ No |
| Maximum amount | Varies | Up to £30,000 | £7,500 per property |
| Measures covered | Multiple | Multiple | Heat pump only |
| Portfolio limit | None | 50% for 2nd+ property | Per property (unlimited) |
| Runs until | 31 Dec 2026 | March 2028 | 2028 |
The BUS pays £7,500 per property for air source or ground source heat pump installation. For a portfolio of five properties, that is up to £37,500 in grants — one application per property.
This matters particularly under the incoming Home Energy Model. Heat pumps are the primary mechanism for achieving EPC C under the new Heating System metric. Landlords who install heat pumps now — especially before October 2029 — lock in EPC C compliance under current grandfathering protections.
See our heat pump grant guide for the full BUS eligibility rules, how to find an MCS-certified installer, and how heat pump installation affects your EPC.
What About Loans? The Warm Homes Fund
The Warm Homes Plan also includes a government-backed finance component — low or zero-interest loans for home energy improvements.
The detail is not finalised. The government launched a "call for evidence" to determine where the Warm Homes Fund can deliver greatest impact. That call for evidence explicitly considers extending loans to private landlords. The law firm Travers Smith's analysis of the Warm Homes Plan confirms: "this will consider extending loans to both private and social landlords."
⚠️ This is not confirmed. Loan products for private landlords have not been announced. This article will be updated when details emerge — expected spring/summer 2026.
If you fund EPC improvements from your own resources in the meantime, those costs may be eligible as an allowable expense for tax purposes. See our EPC tax relief guide for how HMRC treats EPC improvement costs and the capital vs revenue distinction.
ECO4 vs Warm Homes Plan — Summary Comparison
| ECO4 | Warm Homes Plan (from 2027) | |
|---|---|---|
| Funding model | Energy company obligation | Government-funded |
| Who delivers | Energy suppliers | Local authorities / gov schemes |
| Application route | Via supplier / broker | Via local council / BUS portal |
| Tenant income required? | Yes (benefits-based) | Yes (income threshold, set locally) |
| Portfolio rule | No limit | Full grant for 1st; 50% for 2nd+ |
| Available for heat pumps | ✅ | ✅ (BUS continues separately) |
| Available for non-income tenants | ❌ | ❌ (BUS only) |
| Ends | 31 Dec 2026 | WH:LG to March 2028; BUS to 2028 |
What Should You Do Now?
If your tenant is on qualifying benefits (ECO4 route): Apply for ECO4 immediately. Installers are already booking into late 2026. This is the most generous scheme available and it closes permanently in December. See our ECO4 guide for the consent form process.
If your tenant is low-income but not on ECO4-qualifying benefits: Contact your local council to check Warm Homes: Local Grant availability in your area. Income thresholds are set locally and may include working households with modest incomes, not only those on benefits.
If your tenant doesn't qualify for income-based schemes: The BUS remains fully open to you. If the property needs a heating upgrade — particularly one aligned with heat pump installation — this is the cleanest route. No income checks, no local authority involvement.
If you have a portfolio: Plan the order of applications carefully. Your first Warm Homes: Local Grant application is fully funded; subsequent properties cost you 50%. Prioritise the highest-cost upgrade for the first application slot. Use BUS for heat pump installations across all properties in parallel — no portfolio restriction applies.
Frequently Asked Questions
Is there an ECO5? No. The government has confirmed there will be no new energy company supplier obligation after ECO4 ends in December 2026. The Warm Homes Plan replaces the ECO model entirely with a government-funded approach.
Can I use Warm Homes: Local Grant if my tenant earns too much for ECO4? Possibly. Warm Homes: Local Grant uses income thresholds set locally by councils — they are not identical to ECO4 benefit requirements. Some councils include working households with lower incomes who wouldn't qualify for ECO4. Check with your specific local authority.
Does the Warm Homes Plan help with the 2030 EPC C deadline? Yes — the same government response that confirmed the Warm Homes Plan also confirmed the 2030 EPC C deadline, the £10,000 cost cap, and the new HEM methodology. The grants and the compliance framework are part of the same policy document.
When will the Warm Homes Fund loan details be confirmed? The government expects to publish details following its call for evidence — anticipated spring/summer 2026. This article will be updated when confirmed.