Warm Homes Loan Scheme: Factsheet

Official release

Households will save money on their energy bills thanks to the new Warm Homes Loan Scheme for technology like heat pumps, batteries and solar panels.

The no- and low-interest loans will allow people to install clean energy technology without any upfront cost, instead spreading payments over many years.

We know demand for these technologies is soaring, with almost 150,000 solar panel installations in first six months of this year. Heat pump sales also reached a record high in 2025.

And our loans will help thousands more households cut their energy bills quickly.

Energy is an everyday essential that must be affordable for everyone.

One of the best ways to achieve that is by helping more people with the upfront cost of installing things like solar panels, a battery or a heat pump.

These upgrades can reduce energy bills and leave households less exposed to price shocks caused by conflict abroad.

New, government-backed no- and low-interest loans will allow people to install clean energy technology without any upfront cost, instead spreading payments over many years, and cut their energy bills quickly.

Installing a heat pump, battery and solar panels could help families save up to £550 a year on their energy bills, rising by a further £300 a year with a time-of-use tariff.

These loans are available to households across the entire UK - in England, Scotland, Wales and Northern Ireland.

The government has worked with lenders to deliver an up-to-5 per cent reduction in interest rates from regular loans offered by banks or high street lenders.

For example, a homeowner borrowing £10,000, at 8%, over seven years could expect to repay around £155 a month with a loan available right now. Through the loan scheme, they could save up to £285 a year on repayments.

Ten lenders are initially offering loans, some interest free, meaning people can shop around for the one that works best, with up to thirty years to repay in some cases.

These lenders are:

Homeserve (partnering with E.On)

Secure Trust Bank

South Manchester Credit Union.

Tandem Bank (partnering with British Gas)

The Money Co-op

Homeowners will also be able to combine a loan with a grant of up to £9,000 through the government’s Boiler Upgrade Scheme (and Home Energy Scotland in Scotland), further reducing the cost of installing a heat pump.

This is the first part of the scheme’s offer, with further lenders and products expected to join the scheme as it develops.

The maximum size of loan supported for each available technology is:

Solar panels – up to £15,000

Electrical storage battery – up to £15,000

Air-water source heat pump – up to £20,000

Air-air source heat pump – up to £10,000 (When MCS certification available)

Ground source heat pump – up to £35,000

Biomass boiler – up to £20,000

Heat network connection – up to £7,500

Micro-renewable system – up to £20,000

All installations, except for heat network connections, will be carried out by MCS-certified installers, giving consumers confidence that recognised technical and consumer-protection standards will be met.

Consider which energy upgrades would work best for your home, with free advice available on gov.uk.

Check if you might also be eligible for a grant, particularly if you are on a lower income. Boiler Upgrade Scheme and Home Energy Scotland grants may also be used alongside the loans.

Compare installation quotes and choose the loan that works best for you. You should carefully consider the total amount repayable – including how long you will have to pay it back, as well as monthly fees. Some lenders will partner with specific installers only, whereas others will allow you to choose from any that are MCS certified.

Submit your application to a participating lender or installer. The lender will carry out normal affordability, credit and eligibility checks.

Keep records if your application is successful, including quote, finance agreement, invoice, proof of purchase and MCS certificate.

Make the most of your new upgrades, including checking whether a smart energy tariff could maximise savings.

Energy Secretary Miatta Fahnbulleh said:

Dr Rhian-Mari Thomas OBE, CEO, The Green Finance Institute and Co-Chair of the Green Home Finance Strategic Partnership, said:

Ciara Davies, Chief Executive of The Money Co-op, said:

Matthew Boyes, Managing Director of Hometree Finance, said:

Mike Jackson, CEO, HomeServe Finance, said:

Ian Corfield, CEO, Secure Trust Bank Group, commented:

Sheenagh Young, CEO, South Manchester Credit Union, said:

Hubert Fenwick, CEO, Selina Finance, said:

Chris Waring, CEO, thisbank, said:

Darvish Heshejin, Managing Director of Home Improvement Lending at Tandem, said:

Ben Graves, co-founder, Sunsave, said:

Andrew Asaam, Managing Director, Consumer Credit, Lloyds Banking Group, said:

Chris Norbury, CEO of E.ON UK, said:

Gary Booker, Managing Director of British Gas, said:

Carl Hogg, Managing Director of Services at Good Energy, said:

Beth recently had solar panels and a battery installed on her home in Birmingham. She and her husband wanted to reduce energy bills, but also generate more of their own renewable electricity, rely less on the grid and have greater control over their energy future.

Beth had 14 solar panels and battery installed, generating 4800kWh annually, with projected savings of £1,050 per year.

Tony wanted to save money without the expense of paying the one-off cost up front. The solution from Sunsave meant he was going to at least be cost neutral in year one from my current electricity cost, with the possibility of making savings of £600+, if things panned out as predicted.

Tony had 18 solar panels and a battery installed, and his gross energy bill savings per month are £191.

David lives in a three-storey home in Bristol. Wanting to make his home greener and cheaper to run, he installed an air source heat pump, a 7.5 kWh solar array and battery in 2025.

His has a projected annual generation of 7034 kWh and projected yearly savings of £1,694.

Stuart wanted to use solar power to lock in lower energy costs at a time when money was less certain, without spending a lump sum to do it. He installed 24 solar panels (10.8 kWp) and 11.52 kWh battery in February of this year.

UK Department for Energy Security and Net Zero · Open Government Licence v3.0. © Crown copyright. Text excerpted and formatting simplified; media and third-party quotations excluded. No endorsement implied.

Source: UK Department for Energy Security and Net Zero ↗ · Updated 27 Oct 2026, 6:30 pm IST