Low-cost loans for deep home retrofits will not be available until summer

New €8 billion scheme set to provide up to €25,000 towards the cost of works

Low-cost loans to supplement State grants for deep retrofit will not be available until summer, the Government said on Tuesday.

However, with the new €8 billion scheme set to provide up to €25,000 towards the cost of works, Green Party leader Eamon Ryan told a press conference in Dublin that people could also apply for financing from existing lenders, or consider funding the non-grant part of their retrofit projects themselves.

Once in place, the low-cost loan element will aim to provide finance at an interest rate between three and 3.5 per cent, lower than most personal loans available in the market today.

However, the Government will have to battle uphill against labour shortages and capacity constraints.


Tánaiste Leo Varadkar said the Coalition is "finding a difficulty" in getting people to take relevant courses, and encouraged people to go into construction.

The challenge facing the State to deliver on its targets is considerable. Ministers were warned in a private Cabinet memo that an “exponential” rise in delivery is needed.

While 15,500 home upgrades were completed last year, only 4,600 were done to a level of B2 in the State’s energy rating system – 500,000 must be delivered by the end of the decade. Meanwhile, the workforce needs to quadruple from 4,000 to 17,000 by the middle of the decade, Ministers were told. About 8,600 homes will be made to a B2 standard this year.

‘Huge step’

The scheme will see Government grants of between 45 and 51 per cent of a project cost, compared to the current system, which funded between 30 and 35 per cent. An emergency scheme to cover the cost of attic and cavity insulation will provide up to 80 per cent of costs – but this will be reviewed after a year, it is understood, and could be withdrawn or revised.

Mr Ryan said the scheme is a “huge step in the right direction”, and would create a pipeline of significant upgrades that would leave the housing stock of the State “fit for the future . . . where anyone buying it knows they have a house fit for the future, and they’re going to pay more money for that house”.

It is expected the scheme could bring down energy bills by up to €100 per month, with grants available in the days and weeks ahead, including through a “one-stop shop” scheme that will assist homeowners through the process by managing the grants and subcontractors involved in the works.

Taoiseach Micheál Martin said the targets under the Government’s Climate Action Plan were “hugely ambitious” and “will require real change in all aspects of our economy and society”.

He said, however, that the retrofit scheme would also make for more comfortable homes which would make the State less vulnerable to volatile energy prices and less dependent on imports “from an increasingly unpredictable world.”

Energy poverty

The Government also announced that it will reform the existing Better Energy Homes system, increasing the level of grants available in line with those given under the new scheme, and allowing people to invest in a step-by-step fashion, rather than in one big investment under the deep retrofit programme. Fewer improvements will be available to those moving in a piecemeal way, and they will have to fund the works upfront before claiming their grant back.

Households in energy poverty will still be able to apply for 100 per cent funding, but the criteria will be changed once a current backlog of about 7,000 homes is cleared. New applicants will see older homes prioritised for investment first, which could lead to longer waiting times for those in newer units who are still living in fuel poverty.

The average wait time is currently 26 months, due to a Covid backlog, and those applying under the new criteria can expect to wait between 18 and 24 months.

Jack Horgan-Jones

Jack Horgan-Jones

Jack Horgan-Jones is a Political Correspondent with The Irish Times