The Government has launched a new scheme offering low and no-interest loans to help households pay for solar panels, home batteries and heat pumps, with some eligible projects attracting finance of up to £35,000.
The Department for Energy Security and Net Zero published details of the Warm Homes Loan Scheme on 27 October 2026. Ten lenders are participating initially, and repayment terms may extend to 30 years for some products. The loans are available across England, Scotland, Wales and Northern Ireland.
How much can households borrow?
The published maximum loan amounts depend on the technology: up to £15,000 for solar panels; £15,000 for electrical battery storage; £20,000 for an air-to-water heat pump; £35,000 for a ground-source heat pump; £20,000 for a biomass boiler; £7,500 for a heat network connection; and £20,000 for a micro-renewable system. Air-to-air heat pumps may qualify for up to £10,000 when the relevant MCS certification becomes available.
Which lenders are involved?
The ten initial participants are HomeServe, working with E.ON; HTG Finance; Propensio; Secure Trust Bank; Selina Finance; South Manchester Credit Union; Sunsave; Tandem Bank, working with British Gas; The Money Co-op; and This Bank. Interest rates, repayment periods, installer restrictions and eligibility may vary between providers.
What savings does the Government expect?
Ministers estimate that installing a heat pump, battery and solar panels could reduce annual energy bills by up to £550, with a further £300 possible using a suitable time-of-use tariff. These are illustrative estimates, not guaranteed savings. Actual outcomes will depend on the property, equipment, energy use, tariff and finance costs.
The Government says it has worked with lenders to reduce borrowing rates by up to five percentage points compared with some conventional lending products. This does not mean that every applicant will receive an interest-free loan or the same discount.
Can loans be combined with grants?
The Department says eligible homeowners may be able to combine borrowing with a grant of up to £9,000 through the Boiler Upgrade Scheme, or with applicable Home Energy Scotland support. Grant eligibility and the available amount depend on the installation and relevant programme rules.
How do households apply?
Applicants should compare installation quotations and finance offers, check for available grants and approach a participating lender or installer. Lenders will carry out affordability, credit and eligibility checks. Most eligible installations must use MCS-certified installers.
Loans, not free upgrades
The scheme addresses upfront costs by spreading repayments over time, but households remain responsible for the debt and any applicable interest or fees. Consumers should compare total repayments as well as monthly costs, particularly where loan terms extend over many years. The Government says more lenders and products may be added as the scheme develops.
Sources
Sources: Department for Energy Security and Net Zero, Warm Homes Loan Scheme factsheet, 27 October 2026; Government lender participation information; Warm Homes Plan.