Labour plan for all new homes could add almost £4,000 to cost | Personal Finance | Finance

Households could save £1,000 a year on energy bills under government plans to make solar panels mandatory on almost all new homes in England.

The proposals, set to be unveiled within weeks, would compel developers to fit rooftop solar panels as standard on the vast majority of new-build homes by 2027, as part of Labour’s drive to hit net-zero targets and cut household energy costs.

Fitting panels during construction is far cheaper than retrofitting older homes, and the government claims the typical semi-detached property could see annual savings of over £1,000, according to estimates from the green energy charity MCS Foundation. Detached homes could see even bigger savings.

However, these figures are disputed with separate research published by the Local Government Association suggesting the savings would be around £440 a year.

The policy, revealed in documents seen by The Times, is expected to add around £3,300 to the cost of building a semi-detached or terraced home and just under £4,000 for a detached one. But ministers argue homeowners would recoup this within a few years through reduced energy bills.

A government spokesperson said: “We have always been clear that we want solar panels on as many new homes as possible, because they are a vital technology to help cut bills for families, boost our national energy security, and help deliver net zero.”

Currently, only two in five new homes have solar panels. Under the new rules, about 80% would be fully compliant, while another 19% would receive partial exemptions based on roof design, shading, and orientation. Just 1% of new properties would be exempt altogether.

“We believe this proposal has the benefits of ensuring that the majority of new homes will be built with solar panels but that there is flexibility for legitimate cases when reduced or no solar panel coverage is appropriate,” officials said.

The move comes amid a public row between the Labour hierarchy and former Prime Minister Tony Blair, who this week appeared to brand some net-zero targets “irrational” and warned the rush to abandon fossil fuels was “doomed to fail”.

Downing Street hit back, saying the Prime Minister was pursuing a “very practical and pragmatic approach” and insisted the Cabinet was united behind the plan.

Separately, Unite, one of Labour’s largest union backers, warned that workers would not support the government’s green goals unless backed by jobs and serious investment. General Secretary Sharon Graham said: “We are not against net zero but it will not be achieved without serious investment in new jobs.”

While environmental campaigners welcomed the initiative, local councils warned it didn’t go far enough. The Local Government Association (LGA) called for legislation to ensure 100% of new homes are fitted with solar panels — pointing to research showing families could save £440 a year, or about 25%on bills.

Cllr Adam Hug, the LGA’s environment spokesperson, said: “Councils are ready to go further and faster on climate action – but we need a plan that works in partnership with local government. However, the funding or policies needed to empower them to help fully realise this ambition are not yet in place.”

The LGA’s latest report, Empowering Local Climate Action, outlines a wider package of reforms, including powers for councils to set energy standards, deliver home retrofitting, and modernise the energy grid.

Greenpeace described the solar panel requirement as a “common-sense” move. Lily Rose Ellis, a campaigner with the group, said: “For too long we’ve wasted the free energy that falls on the roofs of houses every single day.”

Developers have previously pushed back on compulsory solar panels, claiming they aren’t suitable for every home. But the Home Builders Federation now says the direction is clear.

Steve Turner, spokesperson for the group, said: “To meet the ever more challenging carbon reductions set by the government we will see solar on the overwhelming majority of new homes, albeit it is not appropriate in every situation.”

The new standards, part of the Future Homes Standard policy, could take effect as early as 2027 if legislation is passed this year.

The government is also expected to announce grants and loans for fitting solar panels to existing homes, in line with its aim to boost solar capacity to 47GW by 2030.