The government has launched the Warm Homes Loan Scheme. Here is what it offers for solar panels, home batteries and heat pumps, who qualifies and what to check first.
The government has today launched the Warm Homes Loan Scheme, a new way to pay for solar panels, home batteries and heat pumps without finding the money upfront. It has been a long time coming, and for a lot of households it changes the question from “can we afford it?” to “does it pay for itself?”.
Here is what has actually been announced, what it means for you, and what to check before you sign anything.
What the scheme is
The government is not lending the money itself. Instead, it is paying approved lenders to cut their interest rates on loans for clean energy technology. According to the GOV.UK factsheet, rates come down by up to 5 percentage points compared with a standard loan, some products are interest free, and repayments can be spread over up to 30 years with some lenders.
There is nothing to pay upfront, and the scheme is open across England, Scotland, Wales and Northern Ireland.
How much you can borrow
Each technology has its own cap:
- Solar panels: up to £15,000
- Battery storage: up to £15,000
- Air source heat pump: up to £20,000
- Ground source heat pump: up to £35,000
Biomass boilers, micro-renewables and heat network connections are also covered. EV chargers are not.
For context, our solar and battery systems start from around £6,500 for 6 panels with a 10 kWh battery, and a 12 panel system with the same battery from around £7,770. Typical home systems sit well inside the limits.
Who can apply
The scheme is for owner-occupiers and private landlords. There is no income threshold and no minimum EPC rating, which makes it far broader than most previous support. Lenders will still run their own credit and affordability checks, so being eligible for the scheme does not mean any particular lender will say yes.
The first ten lenders
The first tranche includes HomeServe (with E.ON), Hometree Finance, Propensio, Secure Trust Bank, Selina Finance, South Manchester Credit Union, Sunsave, Tandem Bank, The Money Co-op and thisbank. More are expected to join.
One detail worth knowing: some lenders only work with their own installer partners, while others let you choose any MCS certified installer. If you already have an installer in mind, check which lenders will accept them before you apply.
Why MCS certification matters
Every installation funded through the scheme, other than heat network connections, must be carried out by an MCS certified installer. Lenders will check the MCS number on your quote and the MCS certificate after the work is finished. If an installer cannot show you both, the loan is not available.
Solar Panel Experts is a Grant Store Ltd company, MCS certified and RECC registered, so our installations meet that requirement.
Heat pumps: the loan stacks with the grant
If you are thinking about a heat pump, this is the important bit. In England and Wales, the Boiler Upgrade Scheme still takes £7,500 off the price of an air source heat pump, or £9,000 if your home is heated by oil or LPG. The Warm Homes Loan can then cover what is left. We claim the grant for you, so it comes off before any borrowing is worked out. Our heat pump grant checker will tell you in 30 seconds whether you qualify.
What to check before you borrow
A cheaper loan is still a loan. Before you commit:
- Compare the total amount repayable, not just the interest rate
- Look at the term: longer terms lower the monthly payment but usually cost more overall
- Ask about arrangement or monthly fees
- Make sure the system is sized from a real survey, so the savings figures are honest
The government estimates a home with solar, a battery and a heat pump could save up to £550 a year, plus up to £300 more on a time of use tariff. Your numbers depend on your roof, your usage and your tariff, which is exactly why we quote from a survey rather than a brochure.
Our take
This is the most useful piece of support for solar and batteries in years. Solar typically pays back in 5-8 years, and spreading the cost at a lower rate makes it reachable for far more households. The scheme only works if the system is designed properly, though, so get the design right first and the finance second.
We have put everything in one place on our Warm Homes Loan Scheme page. If you would like to know what the scheme could fund at your home, book a free, no-obligation survey and we will give you an MCS quote with honest figures to take to the lender of your choice.
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