The 8 best solar panel grants & funding options

It can be confusing to navigate the grants and schemes for solar panels, but our guide will make it easy and show you how to save money while helping the environment.

In the meantime, if you’d like to take the first step towards sustainable energy independence, answer a few questions below to find out how much a solar & battery system could save you. All you need to do is provide a few quick details, and we'll give you a rough savings estimate.

Are there any grants and schemes for solar panels?

Depending on your circumstances, there can be lots of funding available to help you cover the cost of solar panels. These initiatives give financial support, tax breaks, or other favourable options to make solar panel installations cheaper and easier.

The support can range from direct grants and loans to discounts on value-added tax (VAT) and specific schemes for social housing. The eligibility requirements do vary, and it's important to note the expiration dates of these schemes to take full advantage of them.

If you think you're not likely to quality for any of these grants but are concerned about the upfront cost of solar panels, you should consider a solar subscription.

Here's a summary of the eight key grants and schemes:

How do I qualify for free solar panels in the UK?

You may qualify for free solar panels if you're eligible for assistance through the ECO4 scheme or Home Upgrade Grant, which are both national, government-backed programmes.

Unfortunately, these initiatives come with specific criteria that only a small minority of UK households fulfil.

We'll go into detail about these requirements further down the article.

What if I don’t qualify for any solar grants or schemes?

If you don't qualify for a solar panel grant, there's another way to start benefiting from solar electricity with zero upfront cost.

Sunsave Plus, the UK’s first solar subscription, will provide you with the best-in-class kit, all in one easy solar & battery package that comes with a 20-year Sunsave Guarantee.

Your installation will be tailored to your home, work seamlessly, look excellent, and save you money from day one.

What is ECO4?

ECO4, part of the UK government's Energy Company Obligation (ECO) programme, is a grant scheme with £4 billion of funding to improve the energy efficiency of eligible homes. Its goal is to help those struggling with fuel costs, especially low-income and vulnerable households.

Who is eligible for ECO4?

Whether you’re a homeowner, private renter (with your landlord's permission) or social housing tenant, you could qualify for the ECO4 scheme as long as your property has an Energy Performance Certificate (EPC) rating of D, E, F or G.

Eligibility requirements include receiving at least one of the following means-tested benefits:

• Pension Credit
• Universal Credit
• Income-based Jobseekers Allowance
• Income-related Employment & Support Allowance
• Income Support
• Housing Benefit
• Child or Working Tax Credit
• Child Benefit (with an annual income below specified thresholds, depending on who lives with you)

However, if you're not claiming the above benefits but earn under £31,000 per year, have health conditions worsened by a cold home, or are vulnerable to the effects of living in a cold home, you can also qualify through your council's ECO4 Flex rules.

How much money can ECO4 save you?

It’s difficult to provide specific numbers on how much money you could save with ECO4 since it depends on your situation and the changes you make.

However, the grants given under the ECO4 scheme can be substantial, potentially covering the entire cost of a new solar panel system and other energy efficiency improvements - all of which can make a big difference to your electricity bills.

How to apply for ECO4

To apply for the ECO4 scheme, you’ll first need to find out whether you’re eligible, which you can do by completing this Ofgem questionnaire. If you are eligible, you’ll then need to get in touch with one of the energy suppliers that’s part of the ECO4 scheme, such as British Gas, E.ON, or Scottish Power. Note: your ECO4 home upgrades provider does not have to be your current energy supplier. 

Check out the full list of ECO4 suppliers.

What are the most common ECO4 home improvements?

Although solar PV is one of the available measures via ECO4, it's not particularly common. Based on data from Ofgem, the vast majority of ECO4 home improvements between July 2022 (when the scheme began) and January 2024 is new or upgraded heating controls, followed by various forms of insulation.

Most popular ECO4 home improvements, July 2022-Jan 2024

What is the Home Upgrade Grant?

The Home Upgrade Grant (HUG) is another government initiative that provides funding of up to £700 million for energy-efficient upgrades in homes across England - but specifically for homes that don't rely on gas for heating.

Along with solar panels, the grant supports a variety of energy-saving improvements like insulation, air source heat pumps and storage heaters.

Who is eligible for the Home Upgrade Grant?

To be eligible for the HUG, you must:

• own your home or live in privately rented accommodation. If you live in social housing, you’ll need to look at the ECO4 scheme instead.
• be claiming one of the means-tested benefits listed earlier or have a household income of £31,000 or less (though, in some areas, household income is irrelevant)
• not have gas central heating as your property’s main source of heating
• have a property EPC rating of D or E for rented properties, or D to G for owned properties
• have permission from your landlord as a private renter - and they will need to contribute towards the cost of the upgrades​​

How much money can the Home Upgrade Grant save you?

The HUG can lead to significant savings on your electricity bills, as it aims to make homes more energy-efficient and cheaper to run. Again, your savings will vary depending on your specific improvements.

How to apply for the Home Upgrade Grant

It's only available in certain areas in England, so you'll need to check your eligibility and apply through your local council. If you’re eligible, your local council will arrange a home survey to assess potential energy efficiency improvements.

Before the survey, your landlord will need to pay a £500 deposit (which will be refunded if your home isn't suitable for improvements), but there’s no cost to you as a tenant.

What is the Home Energy Scotland Grant & Loan?

The Home Energy Scotland Grant & Loan scheme is a Scottish Government initiative providing grants and interest-free loans to create warmer, more energy-efficient homes.

Who is eligible for the Home Energy Scotland Grant & Loan?

• You need to be a homeowner in Scotland and actually live in your home. Unfortunately, being a Scottish homeowner doesn’t count if your property is in England.
• The scheme isn’t open to landlords - they can apply for the Private Rented Sector Landlord Loan instead.
• If you’re applying for grant funding, you can’t receive support from another source (e.g., local authority funding or the ECO4 scheme) for the same improvement.
• Self-builders can apply for support for solar panel systems and energy storage systems, but not for other energy efficiency improvements like insulation or double glazing.

How much money can the Home Energy Scotland Grant & Loan save you?

Grant funding for energy efficiency improvements is up to 75% of the combined cost of the improvements, with a maximum grant amount of £7,500 (£9,000 for households qualifying for the rural uplift). The rest of the funds can be taken as an interest-free loan.

For solar panel systems, you can get funding up to £6,000 (including a £1,250 grant and a £4,750 optional loan​).

How to apply for the Home Energy Scotland Grant & Loan

To apply for funding, contact Home Energy Scotland directly for impartial advice about your home and the best options available to you.

After consulting with an advisor and deciding to proceed, you’ll receive a personalised link to complete an online application form. At this point, you’ll also need an EPC or an energy report issued by a Home Energy Scotland advisor with recommendations to support the improvements you’re applying for​.

Just so you know, third parties - like installers or letting agents - aren’t allowed to apply on your behalf, so you’ll need to complete this process on your own.

What is the Smart Export Guarantee?

The Smart Export Guarantee (SEG) is a UK government initiative that compensates small-scale renewable energy generators for the electricity they export to the grid. It's been running since January 2020, following the end of the Feed-in Tariff (FIT) scheme.

The SEG scheme is available in England, Scotland, and Wales, but not in Northern Ireland.

Check out our page on the best SEG rates to find the latest top options for you.

Who is eligible for the Smart Export Guarantee?

To be eligible for SEG payments, you’ll need to be generating electricity via one of the following:

• Solar panels
• Wind turbines
• Hydroelectric systems
• Micro combined heat and power (micro-CHP)
• Biochemical processes like anaerobic digestion

Your installation can have a maximum capacity of up to five megawatts (5 MW) or up to 50 kW for a micro-CHP system and you’ll need an export meter to record how much electricity you’re exporting.

It’s important to note that your solar panel system must be certified under the Microgeneration Certification Scheme (MCS) to be eligible for SEG payments, so make sure you’re using an MCS-accredited installer.

How much money can the Smart Export Guarantee earn you?

Your average SEG earnings will vary depending on the tariff you are on as well as the size of your solar panel system. SEG tariff rates are always above zero, and payments are calculated using export meter readings.

You can combine SEG with other grants and financial support, except if you’re already receiving FIT export payments - if that’s the case, you will need to opt out of FIT export payments before you can start receiving SEG payments.

How to apply for the Smart Export Guarantee

If your installation and technology type are eligible, contact an SEG Licensee to enquire about their specific SEG tariffs. Licensees set their own rates, contract lengths, and terms, so shop around to find your best fit.

What are solar panel loans?

Solar panel loans allow you to get solar panels without having to pay anything upfront.

Instead, you'll pay a monthly amount that will cover the cost of the system over a period of years, along with – in most cases – an additional interest payment.

And then there's Sunsave Plus, which is similar to a solar panel loan in that you'll pay a monthly amount. Ultimately though, it's a solar subscription, which is better in many ways.

You'll have longer to pay off the initial amount than you will with most loans, and you'll get the Sunsave Guarantee.

This aftercare and support package includes 24/7 monitoring, troubleshooting of any issues, downtime protection, and Aviva-backed insurance against damage, fire, and theft.

You can also look forward to a free battery and inverter replacement, which you won't find with most solar panel loans.

Who is eligible for solar panel loans?

To be eligible for a solar panel loan, you generally need to meet certain criteria (e.g. be the owner of your home, be between a certain age range, be a UK resident etc.)

In the case of Sunsave Plus, your application can have up to two applicants.

• The lead applicant must be an owner of the property
• At least one applicant must be in full-time employment, and not self-employed
• At least one applicant must be between 18 and 60 years old
• Both applicants must be UK residents

You won’t be eligible for Sunsave Plus if you’ve been declared bankrupt or received a county court judgement.

How much money can solar panel loans save you?

Solar panel loans can't save you any money by themselves, but they allow you to avoid paying the full cost of your solar panel system upfront – and they can enable you to save in other ways.

After all, you can take the money you would've spent on solar panels and invest it elsewhere, which could result in you generating some profits.

Thanks to the Sunsave Guarantee, Sunsave Plus can save you money in ways most solar panel loans can't – for instance, by supplying a free replacement battery and inverter, insurance, and monitoring and maintenance.

How to apply for a solar panel loan

Most solar panel loan providers simply require you to fill in an online application.

If you fulfil the company's initial requirements, you'll just need to choose the amount of time you want your loan to last for – usually three to 10 years – and complete a credit application.

You can apply for Sunsave Plus in much the same way, except it lasts for 20 years.

It's the UK’s first solar subscription rather than a solar panel loan, so it also comes with extra features, like a monitoring and maintenance package.

What are Green home rewards?

Green home rewards are cashback schemes offered by banks including Barclays, Halifax, and Lloyds to their own mortgage customers.

To qualify, homeowners with these banks have to sign up for the relevant scheme and make a qualifying energy-efficient improvement to their properties.

Nationwide also has a Green home reward scheme, but it's slightly different: customers can qualify for cashback not through eco-friendly measures, but simply by getting a mortgage on a property with an EPC rating of A or B.

Who is eligible for Green home rewards?

Anyone who mortgages or remortgages their property with Barclays, Halifax, or Lloyds – and anyone who gets a mortgage with Nationwide – is eligible for a Green home reward.

If you buy a home with a Nationwide mortgage that has an EPC rating of A or B, you will automatically receive your reward.

Nationwide will check your new home's EPC rating two weeks after it confirms your mortgage is in place, so there's no time to make improvements. To qualify, you just have to find a property that's already energy-efficient.

How much money can Green home rewards earn you?

Green home rewards can earn you between £250 and £2,000, depending on the measures you take and the financial institution you choose to be your mortgage provider.

Green home rewards from Halifax and Lloyds pay cashback amounts between £500 and £1,000 for installing a variety of measures from solar panels and heat pumps to double glazing and loft insulation.

Barclays' Greener Home Reward initiative comes with similar cashback amounts – except it goes as high as £2,000 for certain improvements.

Nationwide's scheme gives new mortgage holders £500 if the property has an A-rated EPC, or £250 if it has a B-rated EPC.

How to access Green home rewards

You can only access Halifax and Lloyds' Green home rewards if you apply directly for one of their mortgages – in a branch, over the phone, or online – instead of going through a broker.

Every year, Halifax and Lloyds create an 11-month qualifying time period, so make sure to send in your mortgage application during this time, then register for a Green home reward within the next month.

If you have a Barclays mortgage, there are no time limits on when you can apply for the bank's Greener Home Reward programme.

You shouldn't even need to apply for a Nationwide Green Reward cashback, but it's worth bringing up the initiative to a representative during the mortgage application process, just in case.

What is the solar VAT discount?

The solar VAT discount is another UK government initiative that offers a 0% VAT rate on materials and installation costs for energy-efficient measures until April 2027, when the VAT rate will return to 5%.

By reducing the upfront costs of installing solar panels and other energy-saving materials, this initiative aims to encourage the installation of solar panels.

It’s important to note that the 0% VAT rate only applies to solar batteries if they are purchased as part of a whole solar & battery system, whereas just buying a lone storage battery will not lead to any VAT discount. 

However, from 1st February 2024 this rule will change, and after this time you will be able to get a standalone storage battery at 0% VAT.

Who is eligible for the solar VAT discount?

The solar VAT discount applies automatically to any eligible purchase of these materials:

• Solar panel systems
• Ground and air source heat pumps
• Loft and cavity insulation
• Micro-CHP systems
• And many more…

How much money can the solar VAT discount save you?

This discount can lead to big savings. Energy-efficient materials used to be taxed at 20%, but if you were on benefits or the materials cost less than 60% of the installation, the rate was reduced to 5%.

With the introduction of the 0% VAT rate, the average three-bedroom household can save around £400 when buying a new 3.5 kWp solar & battery system. Still, the discount varies for different households, typically ranging between £120 and £550 based on recent solar costs.

How to access the solar VAT discount

There is no specific application process for the solar VAT discount, as it’s automatically applied at the time of purchase​.

What are social housing PPA schemes?

Social housing Power Purchase Agreement (PPA) schemes are essentially lease agreements between renewable energy providers and social housing providers for a property’s roof space for a set number of years.

These schemes typically involve a third-party provider who finances, installs and maintains the solar panels on the roofs of social housing properties. In exchange, the tenants can get electricity from these panels at a cheaper rate than buying it from the grid. 

The third-party provider can also sell the surplus electricity to the grid.

Who is eligible for social housing PPA schemes?

As the PPA scheme is a business-to-business arrangement, it's only available to social housing providers or landlords directly.

How much money can social housing PPA schemes save you?

As a tenant, you’ll enjoy cheaper electricity, potentially amounting to hundreds of pounds in savings over the lifespan of the contract and/or panels. But, the company can change your electricity price at any time​.

How to apply for social housing PPA schemes

There's no direct application process for tenants. Instead, social housing landlords need to enter into a PPA with a specialist provider.

What is Solar Together?

Solar Together is a group-buying programme that allows you to buy and install solar panels at a much cheaper cost-per-system than the average market price.

The scheme works by getting a group of people together and having an auction, in which MCS-accredited solar panel installers bid on installing the systems. In the end, every member of the group gets their own solar panel system.

Who is eligible for Solar Together?

The scheme is open to homeowners, small or medium-sized businesses, and tenants (with their landlord’s permission). However, it’s not available in every town - check your regional Solar Together website to see if something is happening in your area.

How much money can Solar Together save you?

The scheme benefits from group purchasing power and competitive bidding, so you can expect to knock off around 30-35% of a solar PV system’s typical market price.

Registration for Solar Together is free, and there's no obligation to proceed with an installation. The costs involved are only for the purchase and installation of the solar panel system.

How to apply for Solar Together

The first step is to check if the scheme is running near you via the Solar Together website. From there, you can register for the programme online or add your details to a waiting list to be notified when it becomes available in your area.

During the application process, you’ll need to provide details about your house, roof space and typical electricity usage. These will be used to send you a personal recommendation (e.g. costs and specifications) for the solar installation once the auction takes place.

To find out how much a solar & battery system could save you on your energy bills, answer a few quick questions below and we'll generate a rough estimate.

Solar panel grants: FAQs