UK homeowners can access low-cost loans for solar panels and heat pumps

The UK Government has announced the Warm Homes Loan Scheme, offering homeowners interest-free or low-interest loans to buy solar panels, batteries, heat pumps and other renewable technologies. The Guardian reports that energy suppliers including British Gas and E.On have partnered with lenders including Homeserve, Tandem Bank and The Money Co-op to provide the loans.

Loans can reach £15,000 for solar panels or a storage battery, or £30,000 for both. Air-to-water heat pumps qualify for up to £20,000, air-to-air models up to £10,000, and ground-source systems up to £35,000. Some loans will charge interest. The Government says rates will be reduced by up to 5% compared with regular bank or high-street loans, and repayment periods can extend to 30 years in some cases.

The Government estimates that a household installing a heat pump, solar panels and a battery could save up to £550 a year on energy bills, plus £300 more through solar exports. It gives an example of a £10,000 loan at 8% over seven years, with monthly repayments falling from about £155 to about £130 under the scheme, saving up to £285 a year.

Some homeowners may also qualify for a heat-pump grant of up to £9,000 through the Boiler Upgrade Scheme. However, The Guardian reports the grants may be redirected to households in remote areas without gas-network connections. The source says all loan-funded installations will use MCS-certified installers. The scheme is available across England, Scotland, Wales and Northern Ireland.