- Government grants, including ECO4 and the Home Upgrade Grant, can help you get free solar panels in the UK (except Northern Ireland)
- Once installed, solar panels can help reduce your electricity bills by as much as 70% (around £660 a year for an average home)
- Solar Together and the Smart Export Guarantee can also help consumers make some money from their panels, perhaps as much as £45 to £80 a month
- Four companies let you pay for solar panels in installments
Depending on the size of your house and type of panel you want, solar panels cost between £4,216 and £9,837. This is a big investment for homeowners, especially during a cost-of-living crisis.
Although inflation is slowly declining, consumers are continuing to struggle. Solar panels can help reduce your monthly energy bill – and if you think you can’t afford them, there is help available.
Solar panels can reduce your annual electricity bill by 70% and for the average three-bedroom house, solar panels will pay for themselves in 15.56 years. After that, they can actually start to earn you money for the remaining 10 to 15 years of their 25 to 30-year lifespan.
If you want to benefit from solar panels, but can’t pay thousands of pounds upfront for them, there are options available to you. Solar panel grants, financing schemes, loans, and discounts are available that could help you make a green investment in your home.
We’ve highlighted what these schemes are in more detail below, as well as eligibility and how to apply for them, so you can get solar panels for less.
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Compare nowSolar panel grants and solar panel funding schemes at a glance
There are several options available to help reduce the upfront costs of solar panels. Use the table below for more information:
Grant or scheme | What is it? | Who’s it for? |
---|---|---|
ECO4 | Funding for energy-efficient retrofits to fuel-poor households, or ones with occupants on certain benefits | Have an EPC rating of D or below, have an existing electric heating system |
ECO Flex | Part of the ECO4 scheme, ECO Flex extends eligibility criteria to households referred to the scheme by their local authorities or energy supplier | Under the scheme, participating local authorities can refer private people it believes to be living in fuel-poor households, on a low income or vulnerable to the effects of living in a cold home. Your local authority may contact you about the scheme, but you can also contact them to ask if you’re eligible. |
The Home Upgrade Grant | Households not connected to the gas grid in 45 select local authorities can receive up to £10,000 in funding for solar panels | Own and live in a property that’s within one of the 45 local authorities offering the grant, not use a gas boiler and have an EPC rating between D and G |
Smart Export Guarantee | The Smart Export Guarantee (SEG) is a government-backed scheme and was launched in 2020. It enables homeowners to receive payments from energy suppliers for any unused solar-generated electricity they export back to the grid. This includes solar panels, wind turbines and other low-carbon technology | You must use have an MCS certificate or equivalent, as well as an export meter |
Solar Together | A group-buying initiative that allows communities to buy solar panels for their homes at a competitive price | Low-income households & live within a participating council’s district |
0% VAT | Homeowners will pay 0% VAT on solar panels until April 2027. Exceptions include needing to use the same provider to supply and install the solar panels | UK homeowners |
Home Energy Scotland Grant and Loan | Launched in 2023, homeowners in Scotland can get up to £6,000 – a £1,250 grant and an optional £4,750 loan | Homeowners and landlords in Scotland with a low income of £36,000 or less |
Nest | The Nest scheme is to help people install solar panels, including advice and support | Homeowners based in Wales |
Each grant has different eligibility criteria, as well as the benefits they provide. Applying for them isn’t always straightforward. You can learn more about applying for each grant and scheme later in this article.
Am I eligible for free solar panel grants?
The eligibility criteria for solar panel grants differ significantly depending on the specific program. For instance, in order to qualify, you might need to reside in a specific area or type of property, meet certain income or financial criteria, or live in a building with a low energy efficiency rating.
Before you apply for any grant, make sure that you understand and meet all of the eligibility criteria. This step can help you save a substantial amount of time and frustration.
Normally, the organisation overseeing the grant will specify the requirements and publish them on the relevant scheme’s website.
As well as the UK, governments around the world have introduced grants to make it easier to install solar panels.
Use the table below to find potential savings, the average cost of a solar panel, and your typical percentage savings on your electricity bills.
Grant/discount | How much can you save/earn? | Who can apply? | Typical % saving | Average cost of solar panels after saving |
---|---|---|---|---|
ECO4 | Home Upgrade Grant | Smart Export Guarantee | Solar Together | VAT discount |
Up to 100% of the cost | Up to £10,000 | £160 per year | £2,555 on average | £393 |
Energy-inefficient households on certain benefits | Low-income, off-gas grid homes with EPC rating of D, E, F, or G | Small renewable generators | Homeowners and tenants (with permission) in an active scheme area | Solar panel buyers get it automatically |
Up to 100% | 97%-100% | 21% of your electricity bills | 30-35% | 5% |
£0 | £0-£200 | N/A | £5,305 | £7,860 |
*Quoted prices and grant information correct as of March 2024
The ECO4 scheme
ECO4 is the fourth iteration of the government’s Energy Company Obligation scheme in Great Britain. It aims to help tackle fuel poverty and reduce carbon emissions.
The scheme requires medium and large gas and electricity suppliers — including British Gas, EDF Energy, Ovo, Scottish Power, and SSE — to help households with energy efficiency measures, including free solar panels (or partial payment) if you are eligible.
The Ofgem-administered scheme also covers insulation, boiler repairs, and heat pump installation.
There is no set amount to how much funding you can receive with ECO4 since it’s dependent on your home’s needs. The energy company is responsible for the level of funding, as well as for the projects and installers that are used. The level of funding will also depend on the type of measure and a number of other factors.
You can contact any of the suppliers covered by the scheme to do the work (provided the eligibility criteria are met) – it doesn’t have to be your supplier. The scheme runs in England, Scotland and Wales, but not Northern Ireland.
The scheme launched in April 2022 and will run until 31 March 2026.
To give you some idea of the amount you can get towards solar under ECO4, see below.
Property type | Solar panel system size (kWp) | Maximum grant amount (£) |
---|---|---|
Detached house | Up to 4 | 4,000 |
Semi-detached house | Up to 3 | 3,000 |
Terraced house | Up to 2 | 2,000 |
Flat | Up to 1 | 1,000 |
Bungalow | Up to 2 | 2,000 |
*Please note that the ECO4 grant funding is subject to availability and may change at any time.
ECO4 eligibility requirements for solar panels
According to Ofgem, you might be eligible to get solar panels with the ECO4 scheme if:
- Your home has a low EPC rating (usually this means a ‘D’ rating or below).
- AND your home has an existing electric heating system
- You are living at private domestic premises. If you do not own your own home, you must have the permission of your landlord, including if your property is owned by a social housing provider or management company
You could be eligible if you receive at least one of the following benefits, meet the income requirements, and your home is classed as being in need of energy efficiency improvements:
- Child benefit
- Income-based Jobseekers Allowance (JSA)
- Income-related Employment and Support Allowance (ESA)
- Income Support (IS)
- Pension Credit Guarantee Credit (PCGC)
- Working Tax Credit and Child Tax Credit
- Universal Credit
- Housing Benefit
- Pension Credit Savings Credit (PCSC)
Remember, getting free solar panels with ECO4 isn’t a guarantee. It is up to energy suppliers to decide which energy efficiency measures they want to fund, and how much funding they provide. You might be asked to contribute to the cost of the installation.
Potential savings with ECO4
ECO4 can save you up to 100% of the cost of solar panels, as long as they power an electric heating system.
How to apply for ECO4
To apply for ECO4, there are a few avenues you’re able to take – and they are all quick and straightforward. Firstly, you can reach out to your energy supplier if they are considered to be an obligated supplier.
The full list of obligated suppliers include:
- British Gas: application portal
- E (Gas and Electricity): Email ECO@E.org
- E.ON Energy: application portal
- Ecotricity: Email compliance@ecotricity.co.uk
- EDF Energy: application portal
- Octopus Energy: application portal
- Outfox the Market: email hello@outfoxthemarket.co.uk or call 0800 103 2702
- OVO Energy: application portal
- Scottish Power: application portal
- Shell Energy: email eco@shellenergy.co.uk
- SO Energy (including ESB Energy): application portal or email eco@so.energy
- The Utility Warehouse: call 0333 777 0777
- Utilita Energy: application portal
Alternatively, you can also apply through the Gov UK website.
Most companies will have an online application to confirm your eligibility (see above) and once you have done this, you’ll receive an email containing a unique reference number and a document. You will be asked for your permission to contact the Department of Work and Pensions to confirm your benefits.
Within a week, you should be contacted to arrange a free survey. This survey will ask you to carry out a 10-15 minute inspection of your home’s energy efficiency measures and is designed to be minimally intrusive.
Once completed, your application should be approved and movement on your solar panels can move forward. Solar panel installation can take up to eight weeks.
Like most schemes, there are pros and cons to utilising it. However, we’ve highlighted these below, to ensure there’s no issues should you choose to apply.
- Easy to apply for online
- Most suppliers offer the scheme
- You aren’t limited to just your supplier, you can choose any of the obligated supplier listed above
- There’s no upfront cost for the homeowner to pay
- It’s rare for customers to be asked to make any contribution
- It allows lower-income consumers to install greener tech in their homes
- The amount of receive is dependent on your property
- Not everyone is eligible
- You aren’t guaranteed solar panels. It’s down to the discretion of the energy company
- The level of funding and installers are all dependent on your energy company
The ECO4 Flex scheme
If you don’t meet the criteria for the ECO4 scheme, you could still be eligible to receive funding from it via the Local Authority and Supplier Flex (ECO4 Flex) mechanism.
ECO4 Flex enables local authorities to widen the eligibility criteria, allowing them to tailor energy efficiency schemes to their area.
Under the scheme, participating local authorities can refer private people it believes to be living in fuel-poor households, on a low income or vulnerable to the effects of living in a cold home. Your local authority may contact you about the scheme, but you can also contact them to ask if you’re eligible.
ECO4 Flex eligibility requirements for solar panels
To get a referral from your local authority or devolved government, you must live in an energy-inefficient property, and also:
- Have a combined gross annual income of £31,000 or below
- Or a person in your household has a health condition that makes them vulnerable to the cold. Examples include a cardiovascular condition, a respiratory disease, limited mobility, or immunosuppression.
To get a referral from your energy supplier, you must live in an energy-inefficient house and fall into one of these key criteria:
- Be on a non-pre-payment meter and have been in fuel debt for more than 13 weeks
- Be on a pre-payment meter and have self-disconnected
- Have received supplier discretionary/friendly credit within the past 13 weeks
- Be in a debt repayment plan with your energy supplier
- Or be repaying your fuel debt through third party deductions
Citizens Advice or Citizens Advice Scotland can also refer households for the ECO4 Flex mechanism.
Similar to ECO4, a referral to the ECO4 Flex scheme does not guarantee that measures will be installed. When a household is referred to the scheme, the third party is stated they may be eligible to receive measures. The decision on which measures are installed rests with suppliers.
This scheme works through referrals only if you aren’t eligible for ECO4. To apply, it’s important to reach out to either your GP if you feel you are vulnerable to the cold, where they will be able to use a NHS-specific template to refer you. Alternatively, contact Citizens Advice or your local authority directly.
They will speak with you through the process, but it is similar to ECO4. All parties will need evidence or be in receipt of eligibility.
- It allows more homes to improve their energy efficiency
- No upfront payments for consumers
- Help low income families come out of debt by reducing overall bills
- You can only be referred to it by certain industries
- You aren’t guaranteed funding to install green tech
- The discretion lies with the supplier
- Not everyone will be eligible for the scheme, even if they are referred
The Home Upgrade Grant
The Home Upgrade Grant offers homeowners and landlords up to £10,000 in funding to energy-inefficient households located in 45 select local authorities across England. To find out if your local authority is offering the grant, all you will need is your postcode.
The grant opened in April 2023 and will run until March 2025. It can be used to fund home improvements, such as insulation, heat pumps, double glazing, solar thermal, and solar PV panels.
As of February 2024, 28% of the grants handed out have been for solar panels, so applying for the grant is worth a shot if you’re eligible. We highlight this below.
Home Upgrade Grant eligibility requirements for solar panels
To be eligible for the Home Upgrade Grant, you must:
- Own and live in a property that’s in one of the 45 local authorities offering the grant
- And not use a gas boiler as a heating system
- And have an EPC rating of D, E, F or G
In most cases, you must also have a household income of £36,000 a year or less, but some local authorities accept applicants earning more. If you’re unsure, remember to ask, as your local authority will best guide you before you start the application process.
If your income exceeds the £36,000 threshold, you may have an interview with your local authority, and they will determine your eligibility based on other factors.
Potential savings with the Home Upgrade Grant
Local authorities have covered an average of 97% of the upfront costs associated with solar panels, as of February 2024. In some cases, local authorities have covered 100% of the upfront costs.
For the typical three-bedroom house – where local authorities have covered 97% of the upfront costs – this adds up to a saving of £7,000 on a £7,200 installation. This is before you calculate the savings you’ll make on your annual energy bill – which equates to £454.45, according to our calculations.
How to apply for the Home Upgrade Grant
If you aren’t sure whether your local authority offers the Home Upgrade Grant, you can search using your postcode.
Once you’ve determined if they offer the grant, reach out to them to start the process. All their contact information will be on the government website.
Alternatively, you can use the government’s eligibility and application tool, to help speed through the process.
The process asks whether you have a gas boiler and other questions like your country of residence, property ownership, EPC rating and household income.
- Allows those on lower income to benefit from solar panels
- Most local authorities have covered 97%-100% of the upfront costs
- Grants of £10,000 are available
- It’s available across 45 different local authorities
- It’s only available to those earning £31,000 or less
- It is only available to those who don’t have a gas boiler installed
The Smart Export Guarantee (SEG)
The Smart Export Guarantee (SEG) is a government-backed scheme and was launched in 2020. It enables homeowners to receive payments from energy suppliers for any unused solar-generated electricity they export back to the grid. This includes solar panels, wind turbines and other low-carbon technology.
The SEG is not technically a grant, but it’s worth including it in this guide, as the guarantee can help increase the savings you make from solar panels. It also reduces the time it takes to break even, so rather than taking 14 years, it could be significantly less.
Energy suppliers who are registered as an SEG Licensee determine the rate, contract length and other terms, which SEG homeowners receive. The tariff rates must always be above zero and payments are calculated by using export meter readings.
For example, Octopus Energy enables homeowners to earn a flat rate of 4.1p per kilowatt hour (kWh) for every unit of power exported. However, its Intelligent Octopus Flux scheme can see rates of up to 29.3 per kWh. So, it’s worth contacting energy suppliers directly to find the best tariff for you.
Meanwhile, British Gas offers a rate of 6.4p per kWh, which is available to anyone who’s eligible. For existing customers of British Gas, homeowners can earn 15p per kWh.
As you can see, the rates vary from supplier to supplier so it’s worth doing some research and shopping around. Each energy supplier also has their own application process.
The savings – as you can see from the table below – will also vary depending on a variety of factors. This includes how often you’re home, whether you’re in all day or after 6pm. The table below gives a rough idea on the savings you could make with the SEG in London, other locations may vary.
SEG eligibility requirements for solar panels
The scheme is open to anyone with an installation of one of the following technology types up to a capacity of 5MW, or up to 50kW for micro-CHP.
These types are:
- Solar photovoltaic (solar PV)
- Wind
- Micro combined heat and power (micro-CHP)
- Hydro
- Anaerobic digestion (AD)
These installations must be located in Great Britain and you must have a Microgeneration Certification Scheme (MCS) certificate, or equivalent document. This will be provided by your installer once you are up and running.
You must also have an export meter, which is a meter that’s capable of measuring your exported electricity.
Good news if you have a smart meter, as that automatically qualifies. If you’re unsure whether you have an export meter or want to install a smart meter, check with your SEG supplier. Once a smart meter has been installed, you can start to make savings under the SEG.
Potential savings with the SEG
Solar panel saving with Smart Export Guarantee (SEG) | ||||
---|---|---|---|---|
House size | Annual household electricity consumption | Solar PV system size | Annual savings without SEG | Average annual savings with SEG |
1-2 bedrooms | 1,800kWh | 3kW | £440 | £480 |
2-3 bedrooms | 2,700kWh | 4kW | £660 | £700 |
2-3 bedrooms | 2,700kWh | 5kW | £660 | £745 |
4-5 bedrooms | 4,100kWh | 6kW | £1,005 | £1,060 |
Prices and savings figures shown are estimates. For the best prices, we recommend contacting professional installers.
As a rough guide, with an average household consumption of 3,000kWh, at a tariff of 5.5p per kWh, a household generator could earn £160 each year.
Realistically, however, the average household will actually use about half of the electricity being generated, so savings will be approximately £80 per year.
But over the course of a solar panels’ lifespan, this adds up to between £2,000-£5,000 – just from the SEG.
If you want to utilise the higher savings, you’ll need to use all the electricity that your panels generate. To achieve this, instead of exporting the electricity, you should consider getting a solar battery. Installing one enables you to store excess electricity your panels produce during the day and use it at night.
How to apply for the SEG
To apply for the SEG, contact your chosen energy supplier, as each one has their own application process.
If you want to join Octopus Energy, for example, you can sign up online and the process takes two days to finalise. This is because Octopus Energy applies to the DNO for an export MPAN, which is a unique number for the electricity meter in your property.
The creation of the MPAN takes approximately one to four weeks, which is the longest part of the application process. After this, your export MPAN number is enrolled onto your account and you will receive an email for your first meter reading.
You’ll need to submit a photo to confirm it is the correct reading. Your account is then checked to ensure that any crediting has been successful.
It’s worth adding that you don’t have to get your SEG tariff from the same company that you buy your electricity from, but some suppliers offer higher SEG rates to their own customers. If that’s the case, you can switch energy suppliers to get the best SEG rate.
- Receive payments for any unused electricity
- It’s possible, in some cases, to get a better rate if you take an SEG tariff with your existing supplier
- It’s a simple application process where your supplier will do most of the work
- It’s open to everyone
- It can be a long application process
- You need to submit a photo with your reading
- You might get lower rates if you use a different supplier than your main supplier
Solar Together
Solar Together is a group-buying initiative that allows communities to buy solar panels for their homes at a competitive price. You can also choose to fit a domestic battery system to store surplus electricity generated by the solar panels and use it when it’s needed.
The initiative is owned by iChoosr, which has been running collective schemes for energy-switching and solar panels for more than a decade.
Once enough people in a participating council have signed up, solar installers are allowed to enter an auction for the right to do the job, with the lowest bid winning.
You will fully own your new solar panel system and it would have cost less than it would if you purchases solar panels on your own.
Like most of the grants and initiatives available, there’s a set list of installers working with the Solar Together initiative. These include:
- Project Solar
- CRC Electrical and Renewables Ltd
- Everyone’s Energy UK Limited
- The Eco Roof and Wall Company
- 0800 Repair
- Solar Fast
- Warma UK
- Greener Energy Group
Within this, Everyone’s Energy told The Eco Experts that 80% of their customers came from Solar Together.
Solar Together eligibility requirements for solar panels
To join a Solar Together scheme, you must be in receipt of the following:
- Live in a council that’s participating in a Solar Together scheme. You can find out which local authority is part of the scheme through the Solar Together website.
- Own your own house or workplace, have your landlord’s permission, or be part of a commonhold association. Small and medium-sized enterprises (non-domestic) are also eligible.
- Be able to pay a £150 deposit, should you choose to go ahead with the installation
Potential savings with Solar Together
On average, participants of Solar Together can cut their costs by 30-35% compared to if they installed solar panels themselves.
This means that for a typical three-bedroom household, there’s savings of around £2,555 to be had on the upfront cost of solar panels. The average three-bedroom household will then pay between £4,471 and £5,000 instead of £7,026 for a solar panel system, so it’s definitely worth floating the idea around with your neighbours.
How to apply for Solar Together
All you need to do is register on the Solar Together website where you will be asked questions about your house, roof and electricity usage.
If you are registering for battery storage only, you will also be asked about your current solar PV system and electricity usage.
If you don’t have these, that’s fine. Solar Together can help you estimate industry and local averages if you aren’t sure of the exact figures of your roof size or electricity usage.
Once you’ve registered and you fulfil the eligibility requirements listed above, you’ll automatically be accepted onto your local scheme. There’s no obligation to go ahead with any solar panel installation.
The next step is the auction. The winning bid (the lowest bid) sets the price for all solar systems and battery systems. All installers are vetted by Solar Together and have to meet compliance criteria before they are accepted.
After the auction, you will receive a personalised recommendation, which will include information about the winning installer, a complete system, costs and savings. This recommendation is for consideration, but the Solar Together Helpdesk is on hand to help as well.
If you want to accept the recommendation, you’ll need to put down a £150 deposit to cover the costs of a roof survey and then pay the cost of your solar panel system.
If you’re struggling to pick your installer, it’s worth checking out our guide, ‘How to choose a solar panel installer’.
- Allows a group of people to bid on solar panels, installing them at a more competitive price
- Easy application process
- Wide range of approved installers
- You aren’t tied into anything straight away
- Small deposit needs to be paid
- Time frame can be longer due to auction dates
0% VAT for solar panels
Homeowners will pay 0% VAT on solar panels and other energy-saving materials until April 2027, compared to 5-20% previously. Though there are a few exceptions.
For example, you will need to use the same provider to supply and install solar panels to qualify for 0% VAT. However, if you buy from one supplier and use a different provider to install your solar panels, you will be charged 5% on the cost of installation.
You’ll also pay 5% VAT on the cost of any repairs or maintenance after your initial solar panel installation.
See below to give you some idea of the savings this could make.
PV system size | Savings (compared to 20% VAT) |
3kW | £1,300 to £1,500 |
4kW | £2,100 to 2,300 |
5kW | £2,300 to £2,500 |
6kW | £2,500 to £2,900 |
*Please note that the above-noted prices and savings figures shown are estimates only.
For a more in-depth analysis at what the 0% VAT cut means for energy-saving materials, check out our guide: Do you have to pay VAT on solar panels?
What’s more, as of 1 February, homeowners will also pay 0% VAT on solar batteries. This is a strong move from the government to ensure homeowners are able to save and store as much electricity as possible.
Prior to February, the 0% VAT only applied to storage batteries installed as part of a solar panel installation, rather than a standalone product. This is no longer the case.
With this new VAT reduction, you’ll pay 5-20% less on solar batteries, saving you £225 to £900 on average.
Which energy-saving materials does the 0% VAT apply to?
The 2022 0% VAT initiative to help homeowners invest in eco-friendly improvements are:
- Solar panels
- Air source heat pumps
- Controls for central heating and hot water systems
- Draught stripping
- Ground source heat pumps
- Insulation
- Micro combined heat and power units
- Wood-fuelled boilers
Potential savings with 0% VAT
The 0% VAT rate on solar panels will save the average three-bedroom home between £393, and you don’t need to do anything to secure it. It will just be applied to your purchase.
Research the right solar panels for you, though, as every home is different. Also, reach out to different suppliers about costs. If you don’t know where to start, simply fill in this form, for a free quote across multiple suppliers.
Solar panel finance and loans
In the event that you aren’t eligible for any of the grants, schemes or initiatives, we’ve covered, some suppliers offer finance and loan options.
A loan or financing is not for everyone, so consider your financing beforehand or speak to a finance expert before applying. If you determine that the savings you’ll receive from installing solar panels are worth the monthly repayments, then it can be a strong way of doing so.
The key is to look for loans or finance options that offer low interest rates, so you aren’t reducing the amount of savings you’ll make throughout a solar panels lifespan.
Most banks will offer personal loans to cover home improvements, with many saying they can be used for renewable energy developments. Each bank will have their own approval and eligibility requirements, so work with them to ensure it’s the right move for you.
The companies that currently offer solar panels on finance are:
- E.ON
- Scottish Power
- SolarStyle
- Sunsave
The finance options each company offer require monthly instalments, with interest rates and repayment periods that vary. Prices will also vary depending on the amount of panels required, if your roof is in full sun or partial shade and what type of solar panels you want to have.
E.ON, for example, offers an interest-free option on a typical six-panel (2.61 kWp) solar system installed for £241.04 per month over 24 months. Scottish Power offers 0% APR over three years, while SolarStyle offers interest-free finance options over 12 months.
Sunsave also offers a ‘solar subscription’. It’s a monthly subscription that offers 24/7 monitoring and free replacement parts for total piece of mind.
Of course, affordability will differ per household, but financing solar panels can be a good way of getting the savings that solar panels offer, while spreading the cost.
How to get solar panels for less without a grant or loan
If you can’t afford the total upfront cost of solar panels and would rather not take out a loan, try getting quotes from multiple installers to find the cheapest solar panels.
Some councils around the UK are also offering to install solar panels onto council houses for a discounted price – but this depends on the amount of funding the borough has.
Find out more in our guide to getting solar panels for council and social housing.
Grants and funding available for Wales, Ireland, and Scotland
Certain grants are specific to certain regions, operating outside of England while still available in other parts of the UK. Let’s briefly cover two of these.
Scotland – Home Energy Scotland Grant and Loan
The Home Energy Scotland Grant and Loan, launched in June 2023, provides a total amount of £6,000, consisting of a £1,250 grant and an optional £4,750 loan. To be eligible for the grant, you must meet all of the following criteria:
- Those residing in a dwelling not connected to the main gas supply (such as those using oil, coal, LPG, or electric heating).
- Have an Energy Performance Certificate (EPC) between ratings D and G. Homes without an EPC rating will receive a free assessment.
- Meet the low-income threshold (below £36,000) or live in the most economically deprived areas (IMD 1-3)
Combined with the optional loan, this grant can cover the potential costs of a 3kW system, which would be ideal for a 2-bedroom house or a small 3-bedroom one.
We have an entire article dedicated to solar panel grants and financing if you want to know more.
Wales – Nest
Sadly, for those living in Wales, no dedicated solar panel grants are available at the time of writing (apart from ECO4, SEG, 0% VAT, etc). However, the Welsh government introduced the NEST scheme to help people interested in installing solar panels for Welsh residents.
This scheme includes advice and support on saving energy and money in your home and funded home energy improvements (including solar panels).
If you’d like to know more about it, read the dedicated Welsh solar panel grant article here.
Northern Ireland – None at present
Like Wales, Northern Ireland currently has no domestic incentives for solar panels, and this situation is unlikely to change anytime soon.
Businesses can receive funding for up to 20% of the cost of their solar panel system installation.
As of 1st May 2023, solar panels are now available with 0% VAT, resulting in a saving of approximately £1,000 on installation and a yearly saving of £500 on electricity bills.
International solar panel grants
There are a number of government grants for solar panel users across Europe, which proves the growing importance of solar energy and how governments are trying to encourage people to make the most of solar energy.
For instance, if you lived in Ireland, you would be eligible for the Solar Electricity Grant and claim potentially €2,100 off the total cost of solar panels.
In Sweden, there is the Green Deduction, a tax incentive that directly applies to the total cost of a solar panel system to the value of £3,500 a year.
The 0% VAT on solar panels is also available in a number of European countries.
For more information on international solar panel grants and initiatives, visit our dedicated page.
How to avoid solar panel grant scams
There appear to be several fraudulent websites online that ostensibly claim to help you get funding you may be eligible for.
However, these sites are completely fraudulent and should be avoided at all costs.
Follow these simple steps to avoid getting scammed:
- Be wary of unsolicited offers: exercise caution when dealing with cold calls or emails offering solar incentives. Government agencies typically don’t target homeowners this way
- Seek official websites: check official government or grant websites to confirm that any offers that claim to be related to a scheme are genuine
- Verify identities: if you suspect you’re dealing with a scammer, ask them to confirm their identity. Representatives of legitimate businesses should be happy to provide you with official documentation
- Contact authorities: contact the relevant government departments or consumer protection agencies for advice concerning the legitimacy of any company or offer you’re uncertain about
What do I do if I don’t qualify for any solar panel grants?
If you don’t qualify for solar panel grants (for whatever reason), there are other ways (but explore all the alternative options previously mentioned first) to reduce costs. Here are just a few:
- We’ve mentioned this previously, but you could consider getting some financing options to install panels yourself. Fixed-interest loans can be spread over several years, making repayments fit your budget.
- Some companies offer solar panel leasing options. These allow you to lease the panels instead of buying them outright, resulting in lower electricity bills through a monthly fee.
- Participate in a community solar project where multiple households share the benefits of a single solar array. This can be a more cost-effective way to access solar energy without individual installations.
- Enhancing insulation, using energy-efficient appliances, and taking other measures can improve your home’s energy efficiency. This can lower your overall energy consumption and decrease your reliance on solar panels.
- Consider buying second-hand or refurbished solar panels as they can be much cheaper than new ones while still providing good performance.
Are there any grants for replacing existing solar panels?
If you have an existing solar panel system installed on your home, it is quite likely you’ll not meet some of the eligibility requirements for grants (like poorer EPC ratings, for example). Remember, the point of most of these schemes is to help households who currently do not benefit in any way from renewable energy technologies, like solar panels.
However, if the solar panels are older (and therefore less efficient), it may be worth you applying, in any case, to have them replaced as you may meet other eligibility requirements (like income, etc.).
Key learnings
There are no government grants specifically for solar panels, but are more steered towards improving energy efficiency. All is not lost, though, as some grants can be used to install them as part of energy efficient upgrades.
There are financing and loan options that make paying solar panels upfront costs more manageable, however, make sure to research if this is a viable option for you. Getting into debt to save some money might not be the best option for you.
The SEG pays solar panel owners for their excess electricity, increasing savings by £165 per year, on average. And the average home will save up to £537 per year with solar panels.
Sixty-nine per cent would buy a property with solar panels, up from 65% last year, according to our latest National Home Energy Survey. Finally, 2023 was a record year for residential solar installations.
Next steps
So there you have it, you’re now an expert in all things grants, schemes and initiatives for solar panels and energy efficiency improvements – as well as who’s participating in the schemes and how to apply.
In most cases, there will be some financial output needed, but savings are available. Plus, the additional savings you’ll make in electricity make it a worthwhile investment.
All the grants, financing schemes and initiatives we have mentioned are designed to help you manage the upfront costs of solar panels, plus, you’ll break even on them in 15.46 years on average.
That leaves you with a further 10-15 years of clean energy savings, meaning solar panels more than pay for themselves. As previously mentioned, if you’re interested in getting solar panels – regardless of if you qualify for a grant or not – you can fill in our short quotes form.
We’ll pass your details onto our trusted network of solar panel installers, who’ll get back to you with bespoke quotes for you to compare.