Some of the measures introduced included: confirmation that every household will see around £150 removed from energy bills from April next year as an attempt to deliver on the government’s pledge to bring down energy bills by up to £300 a year by 2030, through two major steps:
Ending the Energy Company Obligation (ECO) from March 2026, removing its cost from bills.
Government funding 75% of the domestic cost of the Renewables Obligation between 2026–29.
The Chancellor also announced £1.5 billion of additional capital for the Warm Homes Plan and that the Boiler Upgrade Scheme’s budget is being protected.
Matt Isherwood, managing director, Aira UK said: 'For households under cost-of-living pressure, a £150 annual reduction in energy bills is undeniably welcome.
“We welcome the £1.5bn additional capital expenditure to tackle fuel poverty in the warm homes plan. We hope some of this funding is invested into new, well-designed policies to fill the ECO gap.
“The Chancellor’s commitment to channel Budget savings into reducing electricity bills is the right move and will help the poorest households who rely on direct electric heating. However, freezing the main rate for liquefied petroleum gas risks creating a de facto fossil-fuel subsidy worth billions. This choice directly undermines the UK’s ambition to make clean electricity the default, affordable power source for every household.
“Budget decisions must pull the UK toward a cleaner, cheaper, more secure heating future, not keep us tethered to fuels of the past. We urge the government to urgently publish the Warm Homes Plan to prevent further delays.'
The Electrical Contractors' Association (ECA) welcomed the removal of the ECO scheme and the Renewals Obligation levy on household bills, which will help reduce the high cost of electricity for consumers, while retaining Government support for renewables.
The association said it would continue to call for a review of energy taxation to bring gas and electricity to parity. Further reductions in electricity prices are essential for the widespread adoption of electric transport, heating, and energy—necessary steps to reduce carbon emissions.
ECA’s head of external affairs, Jane Dawson added: “Without bolder action from Government, the UK risks falling behind net zero delivery, missing investment opportunities, and limiting economic growth.”
Dan Marsden, director of renewables, Wolseley Group said: “We are encouraged that the Government has taken a step in the right direction, maintaining the full £13.2 billion funding pot for the Warm Homes Plan in today’s Budget, and confirming the Boiler Upgrade Scheme will continue as planned.
“While we eagerly await the publication of the Warm Homes Plan in full, this confirmation provides a positive signal to the wider renewables industry.
“The reduction in electricity bills for consumers announced today is also welcome. By moving Renewables Obligation costs, renewables such as heat pumps will be more cost-effective for consumers, encouraging them to switch from more traditional heating systems.
“High quality heat pump installations will also enable consumers to capitalise on these energy bill savings further. Through Renewables Centre, installers can access technical, administrative, and MCS support which unlocks the BUS grant. Helping drive successful installs.
“Both Renewables Centre and Wolseley believe the Warm Homes Plan can unlock investment to accelerate the renewables transition by setting a clear, long-term implementation timeline for policy schemes, regulations, and the technologies underpinning homes decarbonisation.”
Malcolm Farrow, director of marketing and external affairs at OFTEC, commented: 'Amid the widespread speculation ahead of the Budget regarding a potential VAT cut on gas and electricity bills, our position was clear: if the government acted, it had to be fair and include off-grid homes too. It appears the Chancellor has changed course and focused mainly on reducing electricity bills. Its approach to achieving this is scrapping the ECO scheme which, amongst other measures, is expected to reduce household bills by £150.
“Questions over the exact details remain, and the statement suggests more clarity will be outlined in the upcoming Warm Homes Plan. Whilst oil heating currently remains one of the cheapest forms of heating, households are still grappling with the wider cost of living, so any reduction in their overall energy costs will be welcome.
“However, the Chancellor also set out that everyone is being asked to contribute more through rising taxes to balance the public finances. In the wider context of the drive to net zero, it’s clear the need for affordable low carbon heating solutions is even more critical. We cannot expect consumers to face rising taxes and high living costs, while simultaneously taking on the heavy financial burden of expensive new heating technologies.
'This is why we welcome the government’s recent consultation on Alternative Clean Heating consultation which recognises this challenge. We are ready to engage positively to show how renewable liquid fuels can provide a pragmatic solution, by both removing the high upfront costs associated with other technologies whilst keeping long term energy bills down.
'But the government does need to provide more certainty. The recent speculation, inconsistency and delay in off-grid policy decisions are unhelpful for both industry and consumers who are trying to plan for the future. That’s why the government needs to urgently publish the Warm Homes Plan. This will help provide the clarity needed to deliver a transition that is fair, practical, and affordable.”
Martyn Bridges, director of external affairs at Worcester Bosch said: 'ECO 4 started on the 1st April 2022 and continues until 31st March 2026. In that time, it has fully funded just under 39,000 heat pumps up until the end of September 2025, an average of around 1,000 appliances a month. In the budget, the Chancellor announced that ECO will not continue after the 1st April 2026, saving households around £150 annually on their energy bills.
“As these appliances were all eligible to be counted towards the target quota that manufacturers have to meet to avoid fines under the Clean Heat Market Mechanism (CHMM), then the CHMM targets need re-appraising. Removing on average 12,000 funded heat pumps from the market would potentially result in fines in excess of £6m for manufacturers as they cannot meet their quotas.'
Fernando de la Cruz Quintanilla, EMEA new markets director at global leader in climate control, Airzone, said: “The chancellor’s Autumn budget rightly prioritises reducing household energy bills, which is a welcome step forward in combatting the ongoing cost-of-living crisis. However, this short-term measure comes at a significant cost. Cutting green levies will ultimately slow progress toward the UK’s long-term carbon reduction goals, further delaying the transition to cleaner heating solutions such as heat pumps and other clean energy heating options. There is also concern that electricity is being made more expensive than gas, which could undermine the financial incentives for households to switch to more energy efficient electric heating.
'Striking a careful balance between immediate affordability and long-term environmental priorities will be vital to ensure households can manage their energy costs today without the government compromising on the UK’s shift to a more sustainable future.”
Yselkla Farmer, CEO of BEAMA, said: 'We welcome the Government’s focus upon driving down energy bills for UK households, but further measures are needed to ensure that we are creating a sustainable energy system by supporting investment from consumers and businesses with credible, delivery-focused policies that bring the public along with us.
'With much still to do to achieve Clean Power by 2030 and a need to accelerate progress towards the Net Zero 2050 requirement, now is not the time to introduce uncertainty. The scrapping of the Energy Company Obligation and other domestic electricity levies will deliver immediate savings to energy bills. However, without a clear policy on how this essential funding will be replaced within the twice-delayed Warm Homes Plan, the Budget has added further policy confusion as we work towards Clean Power 2030.
'Manufacturers need policy consistency over time and tangible delivery plans to encourage investment, and Government should understand this investment cannot appear overnight. Businesses also continue to struggle with energy and hiring costs which have not been materially improved by today’s Budget.
'Our members enthusiastically welcomed the action plans for Clean Power, Industrial Strategy and Green Jobs, demonstrating the positive sentiment that Government can set. But manufacturers quickly need a clear and consistent policy to ensure short term relief is followed by long term improvements that will bring benefits to consumers for decades to come.
'Our members have consistently supported policies to reduce electricity costs as a top priority to help consumers and encourage investment in energy saving technologies. As such the bill savings announced in today’s Budget are welcome a short-term measure.
'However, while the Government has announced an additional £1.5bn capital spending to the Warm Homes Plan pot, industry will want to receive clarity as soon as possible on how this will be raised and spent following the scrappage of the Energy Company Obligation (ECO).
'Uncertainty remains over the publication of the delayed Warm Homes Plan, Future Homes Standard, and longer term structural changes to electricity prices. These policies are a great opportunity to stimulate consumer and business investment, economic growth, and accelerated decarbonisation.
'We will be supporting the Government to accelerate policy development and decisions to boost industry confidence and press ahead with developing an energy system fit for the present and future.'
Kelly Becker, president, UK, Ireland, Belgium and The Netherlands, at Schneider Electric, said: “It’s essential that we strike the right balance between easing energy costs today and investing in the clean energy future the UK urgently needs. We welcome measures that provide immediate relief for households and businesses facing high bills. Cutting green levies, such as the Energy Company Obligation (ECO), will offer immediate savings for households affected by the cost-of-living crisis.
“However, it is critical that funding for programmes such as renewable energy investment and energy efficiency upgrades is not removed as these are vital for long-term energy security and resilience. Simply reducing these charges risks slowing progress toward net-zero, undermining energy efficiency schemes, and increasing exposure to volatile global fossil fuel markets.
“To deliver lasting benefits, we must pair short-term affordability measures with a clear commitment to long-term solutions – such as scaling up renewables, improving grid infrastructure, and supporting behavioural change. Only by prioritising these investments can we ensure a more sustainable, resilient energy future for the UK.”
Hamid Salimi, residential product manager, Daikin UK, said: “Daikin welcomes the government’s plan to reduce energy bills by an average of £150. Bringing down the cost of electricity will undoubtedly ease the cost-of-living crisis. This will make low-carbon heating and cooling more affordable and encourage households and businesses to make the switch.”
Ian Rippin, chief executive at MCS, said: “MCS is disappointed by the Government’s decision to end the Energy Company Obligation (ECO4), which will create substantial challenges for businesses, hinder sector growth, and adversely affect some of the most vulnerable households in the country. Government incentives have played an important role in increasing access to home-grown energy for households across the UK, including under ECO4. With ECO4 now set to end on 31 March 2026 and the Warm Homes Plan not yet published, this lack of continuity in support is likely to create substantial challenges for businesses, hinder sector growth, and adversely affect households that would rely on the scheme. That’s why in our consultation response earlier this year, MCS made the case to extend ECO4 and avoid any hiatus that will cause this kind of damage.
“While we await clarity over the Warm Homes Plan, MCS hopes to see a robust, fully funded offer to ensure that every household that was eligible under ECO4 can continue to access low-carbon energy and that confidence in home-grown energy continues to increase. ECO4 put financial responsibility for the installation of clean heat mechanisms on energy suppliers as a measure to support those in need to be able to access low-carbon technologies and reduce their bills. It is these households who will ultimately lose out. However, the cuts announced today won’t just impact households, it will impact industry growth and countless businesses across the country, including the MCS certified installers delivering installations under ECO4.
“There have been around 20,000 certified solar PV and 10,000 certified heat pump installations under ECO4 since February 2025 alone, showing that the grant has supported wider market adoption of low-carbon technologies as intended. Nearly 400 MCS certified installers are delivering work under ECO4 and will be greatly worried by today’s announcement and the impact it will have on their business.
“While parts of the industry are left with significant uncertainty after today’s Budget, MCS is pleased that the Boiler Upgrade Scheme (BUS) has not been impacted, despite unhelpful speculation in recent weeks that risked undermining the confidence in home-grown energy that MCS and the wider industry have long been building. Greater certainty over the BUS, which we hope to see more of in the upcoming Warm Homes Plan, will be welcomed not only by consumers, but by the 1,200 MCS certified installers delivering quality installations using the grant.
“As the intended sole certification scheme for clean heat measures under the Boiler Upgrade Scheme (BUS), Warm Homes: Social Housing Fund (WH:SHF), Warm Homes: Local Grant (WH:LG), and the Clean Heat Market Mechanism (CHMM), MCS looks forward to continue to support the deployment of clean heat measures across all UK under government schemes.”