Gordon Brown has agreed a £910m heating package with energy giants.
All UK households will be entitled to half price insulation and pensioners and fuel-poor households will get free cavity wall and loft insulation, as a result of a deal struck between Brown and six energy firms.

The energy firms will have to spend nearly £1 billion towards the National Home Energy Saving Programme, with £560m going into the home energy efficiency programme CERT, which funds subsidised insulation work.

Brown wants every home in Britain insulated by 2020, and energy companies and councils be making house visits in poorer areas to promote the National Home Energy Saving Programme.

Brown has asked energy firms not to pass the costs on to consumers, however the big six energy firms have not ruled this out.

Out of the government's energy efficiency package of nearly £1bn, £75m of this will go into the Warm Front scheme over three years.

Warm Front was set up by the government to provide grants of up to £2700 to households to install energy efficient heating systems in vulnerable households.

A Gateshead couple have said they will be warmer and better off this winter thanks to their Warm Front grant which enabled them to replace part of their inefficient heating system with an energy efficient and cheaper to run system for free. Jean and Brian Budd had their radiators replaced for free by Tyneside-based Warmer Heating under the Warm Front scheme.

Warm Front is funded by Defra and administered by Eaga. Warmer Heating was appointed by Eaga to deliver the grant programme in the region. Warmer Heating gave the couple 'economical control' of their heating system with Thermostatic Radiator Valves (TRVs) on their new radiators.

Jean Budd said 'We used to have to wear two jumpers in the cold weather. This couldn’t have come at a better time with gas and electricity prices being so high'.

National Energy Action is a fuel poverty charity campaigning for affordable warmth in the homes of vulnerable people. While many fuel poverty campaigners demanded a windfall tax be imposed on energy firms, Maria Wardrobe, director of communications at NEA, welcomed today's announcement by the government.

Wardrobe said “NEA welcomes this focus on long term energy efficiency, which ensures year on year benefit. The increased funding for Warm Front is excellent news, we have campaigned for this for some time and it is refreshing that government now seems to be listening and has acted”

Fuel poverty is defined as the need to spend over 10% of household income on fuel costs. A recently published National Housing Federation report says almost a quarter of people will be in fuel poverty by 2009.