A £60 million fund will help councils to transform thousands of properties across Scotland into warmer, environmentally friendly homes that are easier and cheaper to heat.

The money will be targeted at fuel-poor households and will be used for the installation of energy-efficiency measures such as solid wall insulation.

Councils will be allocated a share of the funding and also have the opportunity to apply for further funding for larger-scale schemes. It is expected to help lever in about £120m of investment from top utility firms to deliver the projects.

Housing and welfare minister Margaret Burgess said: "We are determined to help householders to keep their homes warm wherever we can.

"Basic energy-efficiency measures can make a huge difference to Scottish families who are struggling to make ends meet, allowing them to heat their homes more cost-effectively.

"Today's funding will see thousands of homes across Scotland receive new measures like solid wall insulation and double glazing – it will help to drive down the number of people living in fuel poverty. Not only is this new investment very positive news for Scottish householders, it will also help to generate work and support jobs – providing a much-needed boost to our economy.

"To help tackle fuel poverty we are actively working with councils and energy companies to ensure that Scotland continues to get its fair share of funding for efficiency programmes like these. Unlike the UK Government, we believe it is important to provide this type of funding, which is why we are committing around a quarter of a billion pounds to it in this spending review period."

A total of £30m has been allocated to local authorities, and councils are being invited to submit proposals for an extra £30m.

An Age Scotland spokesman said: "It's a positive step to tackling the scandal of fuel poverty that affects so many old people."