The money is expected to help up to 8,000 fuel poor homes living off the gas-grid install first time central heating systems.
Warmth-on-prescription will be piloted by nine local authorities to help people in fuel poor households whose health is affected by cold homes. Health and social care professionals will be trained to identify eligible households and provide support via the installation of energy efficiency measures.
Energy secretary, Ed Davey, said: “The heat is on for warmer, healthy homes. Today’s £25m competition will go further to help thousands more.
“Fuel poverty has fallen every year since 2010, however there are still too many people affected by it. That is why we have introduced an ambitious Fuel Poverty Strategy and are mobilising frontline services to innovate how we identify and target those living in cold homes.”
Rachel Fisher, head of policy at the National Housing Federation, said: “DECC’s new £25m Central Heating Fund provides a unique opportunity to improve the quality of life of thousands of tenants by lifting them out of fuel poverty with the installation of new heating technologies, including renewable heat.
“We would encourage housing associations to take an in depth look at this funding to see how they can use to make the most lasting impact.”