Warm Homes Loan Scheme: Factsheet
How the government's Warm Homes Loan scheme can help households install clean energy technology and save money on bills.
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.
Why are you doing these?
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.
How will they save people money?
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.
Who is eligible?
These loans are available to households across the entire UK - in England, Scotland, Wales and Northern Ireland.
What interest rate will I pay?
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.
Where can I get one?
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)
- HTG Finance
- Propensio
- Secure Trust Bank
- Selina Finance
- South Manchester Credit Union
- Sunsave
- Tandem Bank
- The Money Co-op
- This Bank
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.
How much are the loans worth?
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
Will they be installed safely?
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.
Where can I find more information?
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consider which energy upgrades would work best for your home, with free advice available on GOV.UK
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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
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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
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submit your application to a participating lender or installer. The lender will carry out normal affordability, credit and eligibility checks
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keep records if your application is successful, including quote, finance agreement, invoice, proof of purchase and MCS certificate
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make the most of your new upgrades, including checking whether a smart energy tariff could maximise savings
Energy Secretary Miatta Fahnbulleh said:
Energy is an everyday essential that must be affordable for everyone. These government-supported loans will help families across the UK upgrade their homes with no upfront costs to make them warmer and cheaper to run.
Dr Rhian-Mari Thomas OBE, CEO, The Green Finance Institute and Co-Chair of the Green Home Finance Strategic Partnership, said:
The Green Finance Institute is pleased to co-chair the Green Home Finance Strategic Partnership alongside Minister McCluskey which has designed and coordinated the launch of the first tranche of government-backed Warm Home Loans. This was only made possible due to the close collaboration of the Partnership which united lenders, consumer advocates, government and industry to represent households, deliver financial solutions and drive energy efficiency upgrades.
Finance should not be a blocker of progress and the loans are just one of many solutions GFI looks forward to scaling to expand access for universal financial products so more homes can access home upgrades.
Ciara Davies, Chief Executive of The Money Co-op, said:
The Money Co-op is proud to be one of the first lenders to participate in the Warm Homes Loan Scheme. As a not-for-profit co-operative, we believe access to affordable finance can play an important role in helping people make their homes warmer, more energy-efficient and more affordable to run.
Taking part in this scheme is a natural fit with our credit union values of putting our members and communities first, while supporting a fairer, more sustainable future.
Matthew Boyes, Managing Director of Hometree Finance, said:
Affordable finance transforms home energy upgrades from a significant upfront cost to an achievable investment. The Warm Homes Loan Scheme goes further, reducing the cost of finance to help more households benefit from long-term energy savings and rely less on the grid.
We’re proud to help deliver the scheme through our installer partners, with a new range of flexible loans for solar and battery storage, and the option of built-in system care for added peace of mind.
Mike Jackson, CEO, HomeServe Finance, said:
As a participating Lender we are proud to support the Warm Homes Loan Scheme and its ambition to make cleaner, more energy-efficient homes accessible to more households. Affordable, responsible finance has an important role to play in helping customers overcome upfront costs and invest confidently in low-carbon home improvements.
Ian Corfield, CEO, Secure Trust Bank Group, commented:
Secure Trust Bank Group is pleased to be among the first lenders taking part in the Warm Homes Loan Scheme. Working with our retail partners through our V12 Retail Finance platform, we can help households spread the cost of energy efficient home improvements at a lower interest rate, making those upgrades accessible to more people.
Sheenagh Young, CEO, South Manchester Credit Union, said:
Autumn is the perfect time to launch the Warm Homes Loan Scheme. As energy prices keep rising and more people are looking for innovative ways to keep their homes cosy and comfortable, we are proud to stand ready to deliver Warm Homes Loans to the residents of Central and South Manchester.
Community credit unions are ideal partners for this national scheme as we are trusted by local people to serve them with safe financial products designed to build long term financial health and wellbeing. Protecting Planet Earth is also a mission which is close to our hearts.
Hubert Fenwick, CEO, Selina Finance, said:
For many homeowners, the desire to make their homes more energy efficient is there, but the upfront cost can be a significant barrier. Whether it’s installing solar panels, a heat pump or battery storage, these are investments that can deliver long-term benefits for households.
The Warm Homes Loan Scheme is an important step towards making these improvements more accessible. By helping homeowners spread the cost through more affordable finance, we can make it easier for more households to invest in their homes, reduce their energy bills and build a more sustainable future.
Chris Waring, CEO, thisbank, said:
We’re pleased to be one of the finance providers supporting the government’s Warm Homes Loan Scheme. We offer retail finance through multiple partners, and this means we can help homeowners spread the cost of energy-saving upgrades in the same way.
Darvish Heshejin, Managing Director of Home Improvement Lending at Tandem, said:
We’re proud to be one of the first lenders participating in the government’s Warm Homes Loan Scheme. We’ve been financing green home upgrades for years, supporting the technologies, installers and industry bodies that make them possible, and to date have funded almost £1 billion of energy efficiency improvements.
We believe the scheme will encourage more households to adopt green home technologies, and we’re excited to work with our installer partners to help more customers heat and power their homes more efficiently.
Ben Graves, co-founder, Sunsave, said:
High upfront costs are the biggest barrier to adoption of home energy tech like solar and batteries, which are among the most effective ways to cut household energy bills. When we made it easy to switch to low-carbon tech with nothing to pay upfront, homeowners responded with huge interest. But for many, the cost of borrowing was still too high. This scheme tackles that head on, allowing us to offer low or zero-interest finance that puts one of the most effective ways to cut energy bills within reach of almost every UK homeowner.
Andrew Asaam, Managing Director, Consumer Credit, Lloyds Banking Group, said:
We know the difference having a home that’s warm and affordable to run can make. But finding the money upfront for energy-saving improvements can be a real challenge. We want to help customers make those changes in a way they can afford, so they can spend less on energy and feel more comfortable at home.
We’re looking forward to working with government on the Warm Homes Loan Scheme and seeing the difference it will make.
Chris Norbury, CEO of E.ON UK, said:
Today’s announcement is an important step towards removing barriers to low-carbon technologies like batteries, solar panels, and heat pumps that are proven to help people bring down their energy bills.
By allowing customers to store energy when prices are low, use it when they rise and get more value from the energy they generate, we can give them greater control over their energy use and put pounds back into their pockets.
We’ve seen what this can deliver in Coventry, where fuel-poor households combining a home battery with a time-of-use tariff have saved more than £250 a year on average. The Warm Homes Loan Scheme is an opportunity to take that further, bringing the benefits to more customers and making new energy work for everyone.
Gary Booker, Managing Director of British Gas, said:
We welcome the move to make it easier and more affordable for households to invest in low-carbon technology. We want as many people as possible to benefit from technologies like heat pumps, solar panels and batteries which make their homes greener and cheaper to run.
British Gas engineers already install more low-carbon heating technology than anyone else in the UK and we are ready to help even more households make the switch.
Carl Hogg, Managing Director of Services at Good Energy, said:
UK households increasingly want solar panels to generate their own electricity and reduce their exposure to volatile energy prices, but the upfront cost is often a barrier.
Being able to spread that investment with finance changes the equation - giving households another route to installing solar and beginning to generate their own renewable electricity at home.
The fact that one in four Good Energy solar customers are now considering finance shows just how important this policy is to help more households across the UK access the benefits of solar panels.
Case studies
Beth in Birmingham
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 4800 kWh annually, with projected savings of £1,050 per year.
Beth said:
Knowing that we’re securing our own energy for a lot of what we do will make quite a big difference. Saving money is a good thing but having that energy security is probably the bigger impact for us.
Tony in Bedfordshire
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.
Tony said:
I wanted to switch to solar to save some money. I was looking for somebody who would provide me with a solution that meant I would be cost-neutral at the end of it.
When I was talking to friends and family about the system that I was going to get, they were all a little bit sceptical about whether I would actually end up saving any money, and whether I’d have to pay anything upfront. But since they’ve seen how it’s performing, they’re all pretty happy that I went that way. They’re probably thinking about doing it as well now.
David in Bristol
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.
David said:
The impact of burning fossil fuels has been shown to be harmful for the planet and ultimately unsustainable. If technology can be used to get electricity from other sources, it’s the way forward.
It’s a comfort to know that the electricity being used in my house really is renewable, not just being generated by fossil fuels somewhere else.
Stuart in Stirling
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.
I’d been thinking about solar for a while, but the upfront cost kept it out of reach.
The system seemed to be what I was looking for – I don’t pay upfront and get a benefit for a number of years. I’d estimate in the first year (after costs) I’ve saved around £400 to £500.