The National Wealth Fund (NWF) has confirmed an initial £150 million financial guarantee to support The Housing Finance Corporation (THFC) to make long-term, unsecured loans to help social housing providers improve the energy efficiency of their housing stock.
The guarantee means the providers can access capital at pricing usually reserved for secured lending. Following the confirmation pensions insurer Rothesay committed to provide THFC with 100% of the initial £150 million investment.
THFC and the NWF hope to grow the scheme to £250 million over the next six months depending on take-up.
The retrofit loans can be used by social housing providers across the country for low carbon heating or lighting, insulation, renewable energy, ventilation and heating controls,.
High upfront costs are often prohibitive for low-income households to access. NWF said social housing retrofit can be rolled out at scale faster than in other forms of housing tenure.
Currently, it says 34% of socially rented homes in England have an Energy Performance Certificate (EPC) rating below C, with social housing representing almost 15% of all homes in fuel poverty in the UK.
John Flint, NWF Chief Executive Officer, said: “The launch of a long-term, attractively priced, unsecured offer into the market by THFC, will accelerate uptake and increase the ambition of projects in retrofit. Our support for THFC builds on our work in the sector, helping mobilise long-term institutional capital like Rothesay’s into social housing retrofit which will give confidence to both the sector and associated supply chains”.