Over a quarter of homes will be offered an energy efficient refit in a bid to cut their fuel bills and reduce their carbon emissions.
Energy and climate change secretary Ed Miliband and communities and local government secretary Hazel Blears are expected to make the announcement the plans later this week, reports the Guardian.
Some seven million homes will be made more energy efficient through measures such as the installation of insulation in a project which Mr Miliband has likened to the conversion of homes from coal heating to using North Sea gas in the 1960s and 1970s.
Friends of the Earth head of UK climate, Ed Matthew, told the newspaper: "27 per cent of emissions in this country come from people's homes and if they don't cut emissions from homes radically we have got no hope of achieving our climate change targets."
The UK has committed to cutting carbon emissions by 80 per cent compared to 1990 levels by 2050.
Boosting the energy of the existing housing stock was recommended by the Committee on Climate Change.
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