Warm Homes Loan Scheme: cheaper loans for solar panels and batteries explained

The key facts, taken from the government's own guidance and factsheet published on launch day.

The government has put £300 million into the scheme, but the money doesn't come to you. It goes to the lender as a grant worth up to 20% of each loan, and the scheme rules require the lender to pass that on as a lower interest rate. Your loan balance stays the same; what changes is how much interest you pay on it.

That distinction matters. You still repay every pound you borrow, so the real cost depends on the rate you're offered, how long you take to repay and any fees. Some lenders offer terms of up to 30 years. A longer term brings the monthly payment down but usually means paying more interest overall, so compare loans on the total amount repayable, not the monthly figure.

The rules are short. You must own the home you're applying for, with or without a mortgage, it must be in the UK, and it must be residential rather than commercial. There's no income threshold and no minimum EPC rating, unlike most government energy schemes. Each lender adds its own conditions, such as age limits, a minimum income or a clean credit history, so passing the scheme rules doesn't guarantee a loan.

If you rent, you can't apply yourself, though some lenders lend to landlords. If you're on a lower income, look at the free route first. The Warm Homes: Local Grant in England pays for upgrades, solar panels included, for households that usually earn £36,000 or less and live in a home rated EPC D to G. Our guide to solar panel grants explains it, and the Scottish and Welsh equivalents.

The loan has to be spent on one or more approved low-carbon improvements, and you can combine several in a single loan. For solar, that includes adding panels to a system you already have, and an EV charger fitted as part of the job counts as part of the cost. A battery qualifies on its own or alongside solar. These are the caps the government published on launch day.

Ten lenders joined at launch, listed below in alphabetical order. How you reach them varies more than you might expect. Some lend directly, some only through retailers or installers they partner with, and one only lends on systems it installs itself. That matters because a loan tied to a partner installer also decides who fits your system. We haven't ranked them: rates and terms depend on your circumstances, so contact each lender for its current products.

This is only the first group. The government expects more lenders and products to join, with a second window for lenders opening in late 2026 and onboarding in early 2027. Lloyds Banking Group is quoted in the launch announcement as looking forward to working with the scheme, but it isn't on the list yet. If you're not in a hurry, it may be worth seeing what the next round brings before choosing.

First, work out what suits your home. Our solar estimator and battery finder give you an indicative size and saving in a couple of minutes. If you're on a lower income, check whether a grant could pay for the work instead, because a grant never has to be repaid.

Next, get quotes from MCS-certified installers and compare loans on the total amount repayable, the length of the term and any fees. You then apply to a participating lender directly, through the installer or retailer arranging the work, or through your mortgage provider. The loan paperwork will say it's government-funded through the scheme. The lender runs its usual credit and affordability checks.

If you're approved, keep everything: the quote, the finance agreement, the invoice, proof of payment and the MCS certificate. After installation you may be picked at random for an audit, either by an auditor working for the Department for Energy Security and Net Zero or by MCS checking the quality of the work. Being picked doesn't mean anything is wrong, and you'll get at least 48 hours' notice of any visit.

The main rule is that you can't use a Warm Homes loan and other government funding to pay for the same improvement. The exception is heating: the Boiler Upgrade Scheme grant of up to £9,000 for a heat pump (or Home Energy Scotland in Scotland) can sit alongside a loan for the rest.

For solar and batteries, the loan works alongside 0% VAT on installation, which runs until 31 March 2027, and you can still earn Smart Export Guarantee payments for the power you send to the grid. Some mortgage lenders also pay cashback for installing solar; our guide to which mortgage lenders pay you for solar covers who pays what. Those rewards depend on your mortgage rather than how you pay for the system, but check the bank's terms before relying on both.

A loan only makes financial sense if what you save on bills comes close to, or beats, what you repay. On today's prices we estimate a typical 4kW solar system saves around £600 to £670 a year, and 4kW of solar with a 10kWh battery around £980 to £1,020 a year in a home using 3,500 kWh. The government's headline of up to £550 a year relates to a combination including a heat pump, so don't plan around it for solar alone.

Compare the loan with your other options. Paying cash avoids interest altogether. If you already have a Nationwide mortgage, its 0% green further advance may cost less. And check any loan your installer offers against the scheme lenders. Be wary of anyone who uses the scheme's name to rush you, pitches free solar, or quotes well above the typical range in our quote checker. We don't provide, arrange or advise on finance, and nothing in this guide is financial advice.

Questions about a loan product go to the lender. If you can't resolve a problem with a lender, you can usually take it to the Financial Ombudsman Service; problems with an installer go to MCS. For questions about the scheme itself that neither can answer, the government's scheme team is at WHLS@energysecurity.gov.uk.

Expect cold callers to borrow the scheme's name. The government doesn't sell these loans directly, so treat any call claiming to be from the Warm Homes scheme with suspicion. Suspected fraud or misuse can be reported to WHLScounterfraud@energysecurity.gov.uk.