Budget 2025: What It Really Means for Home Energy and the Road Ahead

Rachel Reeves’ much-anticipated Budget 2025 delivered headlines and discussion points aplenty, but in amongst the noise was a little welcome headline for households. The Government confirmed an average reduction of around £150 a year on energy bills.

It sounds positive, doesn’t it? As is often the case, the context matters. That £150 saving comes mainly from lowering of electricity levies – in practice, this equates to less than a penny reduction per kilowatt hour of gas for a typical home. After years of steep rises, that level of reduction is helpful, but modest. The real gains for households won’t come from Budget tweaks. They will come from reducing waste, strengthening the fabric of the home and preparing for an electric-led future.

The last few years have demonstrated the unpredictability of the energy market. Families have dealt with sudden price swings, shifting government support and a growing national push toward electrification. Heat pumps, home battery systems, solar panels and home EV charging have all moved into the mainstream.

For homeowners, the message is clear. A small drop in unit rates won’t shield you from rising costs if your property leaks heat or relies on outdated heating and hot water systems. The homes that benefit most over the next decade will be those that use electricity cleanly and efficiently, retain warmth in the building and make charging a vehicle at home as cheap as possible. Future-proofing your home isn’t just an environmental choice; it’s a financial one.

Electric vehicle owners may have felt aggrieved at the introduction of a 3p-per-mile road tax for EVs from 2028, but this shouldn’t deter drivers from switching. Electric vehicles can be charged at home for as little as 7p per kWh – or even less if you’re generating your own electricity via solar panels.

To put this into context, even with the upcoming road tax, it can still cost as little as 5p per mile to run an electric vehicle, compared with around 12p per mile for even the most efficient petrol or diesel cars. For the average UK driver, that’s a saving of roughly £700 per year in fuel costs alone.

While EVs won’t suit everyone, they’re certainly worth exploring, especially for those who can predominantly charge at home overnight. And with bi-directional charging technology beginning to emerge, there may soon be additional cost benefits in using your EV battery to help power your home.

Landlords face even stronger headwinds. Alongside rising running costs and ongoing expectations of tighter Minimum Energy Efficiency Standards, the Budget confirmed a major tax shift. From April 2027, rental income will be taxed at new standalone property-income rates, which are two percentage points higher than today’s standard income tax bands. Combined with the ongoing effect of Section 24 mortgage interest restrictions, it puts more pressure on net rental yield and increases the need to look at reducing operating costs through home efficiency.

Budget notes also confirmed that personal allowances and some reliefs will be set against other income first, with property income coming last. This reduces the opportunities many landlords previously used to shelter rental profits.

Short-term and holiday let operators are also affected, as local authorities will gain the power to introduce visitor levies on overnight stays. For landlords who shifted into serviced accommodation or Airbnb-style models to improve returns, this is another nudge to check what you need to do to ensure the numbers still work.

Taken together, the Budget reinforces the same long-term direction we’ve seen for years. Efficient homes are rewarded with lower bills, stronger demand and more stable long-term value. Inefficient homes are becoming harder to run, harder to let and more exposed to future policy changes. Whether you are a homeowner trying to stay ahead of rising energy prices or a landlord safeguarding your portfolio, the smartest approach is to prepare early, not react late.

This is where the Vibrant Energy Saving Audit (VESA) can make a real difference. For only £79, a VESA gives you an in-person assessment, an updated EPC rating and a personalised roadmap that shows you how to cut waste, reduce running costs and protect long-term value.

Homeowners save money. Landlords protect yield. EV Drivers retain huge cost savings. Everyone gets a clear, informed plan in an unpredictable market.

Book your VESA today and take control of your energy future.