The UK Department for Energy Security and Net Zero published the details of its Warm Homes Loan Scheme on 27 October 2026. The government-backed loans cover solar panels, home batteries, heat pumps and a few other clean energy upgrades, with no upfront cost and the payments spread over several years. Some of the loans are interest free. The scheme is open to households in England, Scotland, Wales and Northern Ireland.
Rates and an example
The government says it worked with lenders to cut interest rates by up to 5 per cent compared with regular loans from banks and high street lenders. Its example: borrowing £10,000 at 8% over seven years costs around £155 a month with a loan available today, and the scheme could save up to £285 a year on those repayments. In some cases the repayment period stretches to 30 years. Lenders still run their normal affordability, credit and eligibility checks.
Ten lenders are taking part at the start: Homeserve (with E.ON), Hometree Finance, Propensio, Secure Trust Bank, Selina Finance, South Manchester Credit Union, Sunsave, Tandem Bank, The Money Co-op and This Bank. The government calls this the first part of the scheme, with more lenders and products expected to join. Some lenders work only with specific installers, while others accept any MCS-certified one.
How much per technology
The maximum loan depends on what is installed:
- solar panels: up to £15,000
- home battery: up to £15,000
- air-to-water heat pump: up to £20,000
- air-to-air heat pump: up to £10,000, once MCS certification is available for it
- 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
A heat pump loan can be combined with a grant of up to £9,000 from the Boiler Upgrade Scheme, or from Home Energy Scotland in Scotland. All installations except heat network connections must be done by MCS-certified installers.
What the savings depend on
The government's headline figure is that a heat pump, battery and solar panels together could save a household up to £550 a year, and a further £300 a year on a time-of-use tariff. That second number is where home batteries and smart tariffs come in: the battery charges when electricity is cheap and covers the home's use when prices go up. E.ON UK CEO Chris Norbury said that in Coventry, fuel-poor households combining a home battery with a time-of-use tariff have saved more than £250 a year on average. The factsheet itself advises checking whether a smart energy tariff could increase the savings.
Demand is already high. The government counts almost 150,000 solar installations in the first six months of this year and says heat pump sales hit a record in 2025. Energy Secretary Miatta Fahnbulleh said: "Energy is an everyday essential that must be affordable for everyone."
The factsheet asks borrowers to look at the total amount repayable, the length of the loan and monthly fees, not only the interest rate, and to keep the quote, finance agreement, invoice and MCS certificate.