Householders installing measures under the Government's flagship home energy efficiency scheme could get up to £7,600 cash back.
The new "Green Deal home improvement fund" will provide money back to homeowners on the contributions they make to installing measures such as solid wall insulation and new heating systems.
Under the previous version of the fund, which is due to expire on June 30, householders could qualify for up to £4,420 back.
The Green Deal, in which providers meet the upfront costs of installing efficiency measures and householders pay the money back from savings they make on their energy bills, has struggled to get off the ground since it was launched more than a year ago.
Just 2,000 households had taken a green deal plan forward by February, the latest month for which figures are available, with 995 homes having completed the process of installing efficiency measures.
Up to £120 million is available to cover the higher incentives and could benefit as many as 70,000 homes, the Department of Energy and Climate Change (Decc) said.
Energy and Climate Change Secretary Ed Davey said "The best way for households to take control of their energy bills is to use less energy.
"Faulty boilers, draughty windows and insufficient insulation all cause properties to leak hundreds of pounds every year. But advice and support through the Green Deal can help put a stop to this.
"By installing energy-saving improvements, families across the country can enjoy the benefits of warmer, more energy-efficient homes and lower bills."
Under the new incentive scheme, householders can get up to £1,000 for installing two measures such as secondary glazing, a condensing boiler, flat-roof insulation, replacement doors or double glazing.
They can also qualify for up to £6,000 for solid-wall insulation, and to get up to £100 refunded for their initial green deal assessment, which looks at which measures should be installed.
But the Government was criticised for failing to improve energy efficiency with its Green Deal scheme.
Shadow climate change and energy minister Jonathan Reynolds said: "Rising energy bills are causing a cost-of-living crisis.
"The way to get energy bills down in the long term is to invest in insulation and save the energy that escapes through our windows, walls and rooftops. But the Green Deal has been a total flop.
"Today's announcement is just another example of a desperate Government trying to fix a broken scheme."
Friends of the Earth energy efficiency campaigner Sophie Neuberg said: "Extra money on making homes more efficient is long overdue.
"But an extra £120 million is a paltry sum given the scale of the problem, and should be targeted at the fuel poor - not those who can afford the upfront costs."
She said the incentives would not make up for cuts by the Government to the energy company obligation (ECO), which requires power companies to provide energy-efficiency measures for vulnerable households and hard-to-treat homes, to reduce "green" charges on bills.
"Energy efficiency is crucial for cutting fuel bills, reducing demand and tackling climate change. It should be at the core of Government energy policy.
"But the Government's flagship Green Deal is sinking fast - it will take more than a bit of extra cash to keep it afloat," she added.
John Alker, director of policy and communications at the UK Green Building Council, said: "We welcome this package of measures which represents a genuine attempt to rescue the Green Deal and shows that Government remains committed to home energy efficiency.
"The increased cash-back for solid-wall insulation is particularly encouraging following the cuts to ECO.
"But this isn't 'problem solved' for the Green Deal. The scheme's initial cash-back went unspent so it's important that history doesn't repeat itself.
"While this new package will certainly help, Government still needs to go further to make energy efficiency more attractive to consumers."