Free Loans for Solar Panels: The Warm Homes Plan Explained
Alongside grants for the poorest homes, the UK government’s Warm Homes Plan is set to offer interest-free and low-interest loans so middle-income households can install solar panels with nothing to pay upfront, and repay from the money they save on their bills.
Quick Answer
The Warm Homes Plan, the government's £13.2bn home-upgrade programme, includes interest-free and low-interest loans for solar panels and other energy measures, not just grants for low-income households. The aim is to let "able to pay" homeowners install solar with no upfront cost and repay the loan over several years from their energy bill savings. Full loan terms are being finalised through 2026. In the meantime, 0% APR finance from MCS-certified installers already offers the same "pay nothing now, repay from savings" model and is available today.
What loans does the Warm Homes Plan offer?
The Warm Homes Plan is a £13.2 billion government programme running from 2025 to 2030. Most coverage focuses on the grants element, fully funded measures for low-income households on certain benefits. But the plan also sets out a second route for households who do not qualify for a grant: government-backed finance.
In its policy documents and the 2024 manifesto behind it, the government committed to offering “low-interest loans and other support” so that “able to pay” homeowners can upgrade their homes without a large upfront bill. For solar, that means a loan covering the install cost, repaid in monthly instalments that are designed to be lower than the savings the panels generate.
Two routes under one plan
- Grants, fully funded solar for eligible low-income households via the Warm Homes: Local Grant (delivered by your council).
- Loans, interest-free or low-interest finance for “able to pay” households, so you spread the cost with £0 upfront and repay from bill savings.
The exact loan terms, rates, the loan ceiling, and which lenders deliver it, are being finalised by the Department for Energy Security and Net Zero (DESNZ) through 2026. We update this page as detail is confirmed.
How the “repay from savings” model works
The principle behind a Warm Homes loan, and the 0% finance already offered by installers, is simple: your monthly repayment is set lower than the amount solar knocks off your energy bill. So from the first month, you are cash-flow positive. You never pay out of pocket; the panels effectively pay for themselves.
Step 1
Install solar with £0 upfront, the loan covers the full cost.
Step 2
Your bill falls. Self-use savings plus SEG export payments add up each month.
Step 3
Repay the loan from those savings. Once it's cleared, the savings are all yours.
Because you own the panels from day one, this is fundamentally different from the old rent-a-roof “free solar” schemes, where a company kept the panels and the income. Here, the asset, the electricity, and the export earnings are all yours.
Loan vs grant vs 0% finance: what’s the difference?
There are three ways to get solar for little or no upfront cost in the UK. Which one fits depends mostly on your income and benefits.
| Feature | Warm Homes Grant | Warm Homes Loan | 0% Installer Finance |
|---|---|---|---|
| Upfront cost | £0 | £0 | £0 |
| Do you repay? | No, fully funded | Yes, from bill savings | Yes, from bill savings |
| Interest | None | Interest-free or low | 0% APR (typical) |
| Who it's for | Low income / on benefits, EPC D–G | “Able to pay” households | Any homeowner (credit check) |
| You own panels? | Yes | Yes | Yes |
| Available now? | Yes (via council) | Rolling out through 2026 | Yes, today |
If you receive qualifying benefits and your home is EPC D or below, aim for the grant first, it is free money. If you do not qualify for a grant, a loan or 0% finance gives you the same £0-upfront outcome with affordable repayments.
Who qualifies for a Warm Homes Plan loan?
Loans are aimed squarely at the households that fall outside the grant criteria, the “able to pay” middle. While final rules are being set, the loan route is expected to be far broader than the grant route:
Likely to suit a loan
- Working households not on means-tested benefits
- Homes already EPC C or above (excluded from grants)
- Owner-occupiers who can pass an affordability check
- Anyone who wants a larger system or a battery
Likely to suit a grant
- On Universal Credit, Pension Credit, ESA, JSA, etc.
- Household income below the local threshold
- Property rated EPC D, E, F, or G
- Referred by your local council or energy supplier
Not sure which route is yours? Use our free solar eligibility checker to see whether you fit the grant, loan, or finance route.
Worked example: £8,000 system on an interest-free loan
Here is how a typical 4–5kW system stacks up on an interest-free loan, using the same “repay from savings” maths that 0% installer finance already uses today.
£67
Monthly repayment
(£8,000 over 10 years)
£80+
Monthly bill savings
+ SEG export income
£13+
Net positive cash flow
from month one
Once the loan is repaid (typically after 10 years), you keep the full £800 to £1,000+ of annual savings. With modern panels lasting 25 to 30 years, that is 15 to 20 years of pure profit after the loan ends.
Figures are illustrative, based on a typical UK 4–5kW system with average self-consumption. Your savings depend on system size, roof orientation, usage pattern, and your SEG export tariff.
Don’t want to wait? 0% finance is available today
The Warm Homes loan scheme is still being rolled out, but you do not have to wait to get the same outcome. Most MCS-certified installers already offer 0% APR finance over 5 to 12 years, with nothing to pay upfront. The repayment model is identical: your monthly payment is typically less than your bill savings.
What 0% installer finance gives you now
- £0 upfront, spread over 5 to 12 years
- 0% APR means you repay only what the system cost
- You own the panels from day one and keep all the electricity
- Full choice of panel brand, system size, and battery
- Keep all SEG export payments
See our full guide to solar finance options for how 0% deals, secured loans, and the Warm Homes route compare.
Warm Homes Plan Loans: FAQ
Are there really free loans for solar panels in the UK?
The Warm Homes Plan commits to interest-free and low-interest loans so "able to pay" households can install solar with no upfront cost and repay over time. "Free" refers to the lack of interest, not free money, you do repay the loan, but from your bill savings rather than out of pocket. Grants (genuinely free) remain available for eligible low-income households. The exact loan terms are being finalised through 2026.
How is a Warm Homes loan different from a grant?
A grant is fully funded and never repaid, it is aimed at low-income households on benefits with an EPC rating of D to G. A loan is repayable (interest-free or low-interest) and aimed at higher-income households who do not qualify for a grant but still want £0 upfront. Both let you own the panels from day one.
When will Warm Homes loans be available?
The Warm Homes Plan runs from 2025 to 2030 with £13.2bn of funding. The grant element is already live through local councils. The loan element is being designed and rolled out through 2026. Until it lands, 0% APR finance from MCS-certified installers offers the same pay-from-savings model today.
Will I be credit-checked for a Warm Homes loan?
Almost certainly. Like any finance product, a loan route will involve an affordability and credit assessment. The grant route does not, it is based on benefits, income, and EPC rating instead. If you are worried about a credit check, check your grant eligibility first.
Can I use a loan to add a battery, not just panels?
Yes. Unlike grants (which usually fund panels-only packages), a loan or 0% finance deal lets you choose a larger system with battery storage. You decide the spec; the loan simply covers the cost you then repay from savings.
Is repaying from savings guaranteed?
It is a design goal, not a guarantee. Repayments are set to be lower than typical bill savings, but your actual savings depend on system size, roof orientation, how much electricity you use during daylight, and your export tariff. A reputable installer will model your specific savings before you commit.
Is a Warm Homes loan better than 0% installer finance?
They are very similar in practice, both give £0 upfront and repay-from-savings. A 0% installer deal is available right now and lets you pick your installer and equipment freely. A government loan may offer longer terms or apply where installer finance is declined. Compare both when the Warm Homes loan launches.
Does this replace the old free solar panel schemes?
The old rent-a-roof free solar schemes (where a company kept your panels and the Feed-in Tariff income) ended when the FiT closed in 2019. The Warm Homes Plan is completely different: you own the panels, keep the electricity, and either get them grant-funded or repay an interest-free loan from your savings.
Related Guides
Free Solar Eligibility Checker
Check if you qualify for free or funded solar: benefits, EPC, income, region.
Warm Homes Plan Solar
£13.2bn UK government scheme funding solar for low-income households.
Free Solar Panels
Free solar panel schemes: ECO4, GBIS, rent-a-roof history, and scam warnings.
Solar Financing
Loans, payment plans, and how to finance solar panels.
Sources
- DESNZ, Warm Homes Plan policy paper, gov.uk
- gov.uk, Apply for the Warm Homes: Local Grant, gov.uk
- gov.uk, Find ways to save energy in your home, gov.uk
- Energy Saving Trust, Solar Panels, energysavingtrust.org.uk
Last updated: June 2026. Warm Homes Plan loan terms are being finalised by DESNZ, always check the latest gov.uk guidance before applying.
Fact-checked by John Rooney, Solar Energy Editor. Editorial policy
John Rooney is the founder of Solar Info and has been covering the UK solar energy market since 2023. He fact-checks all content against official MCS and Ofgem data and maintains relationships with MCS-certified installers across the UK.
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