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Solar panels are increasingly popular among homeowners as energy prices rise: about 1.3 million households in the UK have opted for this sustainable energy option.
The average cost of solar panels for a three-bed house is about £9,000 including a battery, but once installed, solar panels equal a potential annual saving of £1,190, meaning you could break even within eight years.
While a solar panel system is not cheap, there are ways of making the investment cheaper. If you receive benefits, for example, there’s a good chance you’ll qualify for a grant to help with the cost.
Solar panel grants offer free solar panels to qualifying households, helping mitigate the large upfront costs. Our experts have explored the latest grants and funding options, so you have all the information you need to make the most out of solar energy opportunities.
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UK homeowners have access to several solar panel grants, as well as other incentives designed to encourage the adoption of renewable energy and reduce your household bills.
We regularly review solar panel funding, updating our information with the latest government and financial organisations’ announcements. Last updated 17 April 2024.
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The eligibility requirements for grants for solar panels vary greatly according to the scheme you’re applying to. You may be required to live in a certain area or type of property to benefit, meet certain income or financial requirements, or live in a building with particularly poor energy efficiency, for example.
Before you start an application, do check that you understand and meet all the eligibility criteria for the particular grant so you don’t waste time and effort applying to something you are not eligible for. The exact details of these criteria will be outlined by the organisation administering the grant.
The Energy Company Obligation (ECO) is a UK government scheme managed by Ofgem. It places a Home Heating Cost Reduction Obligation (HHCRO) on medium and large energy suppliers and aims to improve the country’s least energy-efficient homes – those with an Energy Performance Certificate (EPC) of D or below. It also targets low-income families and other vulnerable households receiving government benefits, such as income support or child benefits.
Under the ECO, there have been multiple phases, each with slight changes in focus and eligibility criteria. If you receive any of the following benefits, you could be eligible for ECO4 funding:
Anyone with additional Department for Work and Pensions (DWP) benefits could also be eligible for ECO4, regardless of whether they receive Universal Credit.
The primary focus of the grant is on homes occupied by their owners. However, it will also extend support to energy inefficient social housing and privately rented residences, provided the property owner permits works to take place.
Applying for an ECO4 grant is quick and straightforward, and there are a number of companies that offer the grant. These can be found through an online search. The application follows a similar process, whoever you choose to go through.
LA Flex (Local Authority Flexible Eligibility) is an extension of the ECO4 scheme. Under this initiative, local authorities can determine eligibility criteria for energy efficiency measures and identify households that may not have been eligible under the national criteria. However, they typically include conditions such as:
It’s also important to note that private tenants can be eligible under LA Flex, with their landlords’ permission.
If you are eligible under ECO4, or LA Flex, you could be entitled to up to 100 per cent off your solar panels.
To gain a deeper understanding of how the ECO4 grant works, our researchers spoke to Kevin Henney, Director at ECO4 Hub.
Independent Advisor: First, please tell us a little about yourself and your role.
Kevin Henney: I currently serve as Director at ECO4 Hub. I am responsible for managing and overseeing all the activities related to the ECO4 grant programme. This includes reviewing grant applications, coordinating with local authorities, and ensuring the smooth and efficient installation of energy-efficient systems for our clients.
IA: How many grants have been approved over the past year? Have you seen an increase in grant applications over the past 12 months?
Henney: Over the past six months, we have successfully finished more than 60 installations, and we currently have more than 100 slated for the near future.
Over the last 12 months, we’ve indeed observed a significant uptick in grant applications. This surge can be attributed to the rise in the cost of living and energy, as well as increased awareness about the grant.
IA: Can you give us an idea of how much money people are awarded? Is there a range or an average amount you can share?
Henney: The amount of money awarded per grant varies greatly depending on the work required for each individual property. Our goal under the regulations is to maximise energy efficiency.
We’ve dealt with diverse projects, from single-measure installations like a boiler replacement worth £5,000, up to comprehensive energy makeovers involving internal wall insulation, loft insulation, an upgrade to an air source heat pump and the installation of solar panels, with a total value exceeding £80,000.
IA: How long does it typically take for someone to get their grant approved?
Henney: The approval time for a grant depends on a few factors, mainly the two routes that can be followed:
IA: Once a grant is approved, what are the next steps for a homeowner? How long does it take from grant approval to solar panel installation?
Henney: Upon approval of a grant and once the client confirms they are happy with the proposed work, we can proceed to installation. In some cases, we’ve even completed installations within the same week of approval.
IA: Are there any common mistakes people make when applying that can delay the grant approval process?
Henney: The most common errors made during application that delay the process include not using the exact spelling of the applicant’s name and not having the necessary documentation for local authority approval, such as a council tax bill. It’s essential to pay attention to these details to ensure a smooth application process.
IA: What documentation is required when applying for the ECO4 grant?
Henney: If you receive benefits, you must sign a consent form, which the Energy Saving Trust verifies, and provide a copy of a utility bill. If you are applying under the Local Authority Flexibility criteria, you’ll need your council tax bill, ID, and evidence that the household income is under £31,000 per annum, whether in the form of a pension statement, three months’ payslips and bank statements, or a P60 dated in the last six months.
Solar Together is a group buying scheme for solar panels operating in local council regions of the UK. Its goal is to make solar power more accessible and affordable for homeowners and small businesses.
The scheme brings together households and local government authorities to create a collective buying group for solar panels. Interested parties register, and solar panel providers bid for the opportunity to install their panels for the group. This typically results in a competitive installation price, lower than an individual household could negotiate.
Once a winning provider is selected, registered participants receive a personal recommendation tailored to their specific needs. They can then decide whether or not to go ahead with the installation.
The Solar Together scheme aims to promote the use of renewable energy, reduce carbon emissions, and help residents save money on their energy bills. It not only provides a platform for more cost-effective solar panel installations and high-quality installations, full technical surveys, and thorough customer service throughout the process.
The HUG2 scheme has been running since April 2023 and will accept applications until March 2025, supporting low income families by awarding grants of up to £10,000 for solar panels and other energy efficient home improvements.
Privately rented property eligibility is limited to landlords with a portfolio of four properties or fewer. Landlords must contribute one-third of the total cost of any upgrades.
To be eligible, you must:
or
The Home Energy Scotland Grant and Loan Scheme is available to all homeowners in Scotland and is designed to award either grants or provide interest-free loans for energy efficient home improvements.
A rural uplift is also available to provide extra support to rural and island homes, which can face increased costs to install home improvements.
The Scottish Government’s scheme can help with:
The Warm Homes Nest Scheme from the Welsh government offers free advice on making homes energy efficient, and eligible households could receive free home improvements, including solar panels.
You could be eligible for free solar panels if you meet all three conditions below:
This scheme came into effect on 1 January 2020 (after being introduced by the UK government), with the view to replace the previous Feed-in Tariff scheme. The SEG mandates that larger energy suppliers must offer an export tariff to their customers who generate their own renewable electricity, such as through solar panels or wind turbines.
Anyone who installs a renewable energy system, such as solar panels or wind turbines, with a capacity up to 5MW can qualify for the SEG. They must also have an export meter installed and a Microgeneration Certification Scheme (MCS) certificate, or equivalent document. While it’s not necessary to incorporate a solar storage battery into your system to be eligible for SEG, it could be a useful addition, ensuring no surplus energy is wasted.
How to apply for SEG
In order to receive payment under SEG, you will need to apply directly to a supplier offering SEG tariffs. The energy suppliers providing these tariffs are listed on the Ofgem website.
It’s worth noting that the supplier who provides your energy doesn’t necessarily need to be your SEG tariff supplier. These can be two separate entities.
Suppliers under the SEG are mandated to offer you a tariff, but they have the discretion to set the terms of that tariff, which could be either fixed or variable.
Be aware that these tariffs can shift over time, so it’s advisable to regularly review your current tariff to ensure it remains competitive.
If you possess a storage device like a household battery or an electric vehicle capable of importing and exporting electricity, you could benefit from the SEG. You can seek advice about this from your potential SEG tariff supplier.
In the UK, the VAT (Value Added Tax) rate on most goods and services is 20 per cent. However, as part of the UK government’s efforts to encourage energy efficiency and the use of renewable energy sources, certain energy-saving materials and equipment including the best solar panels are eligible for a reduced VAT rate.
This reduced rate is currently 0 per cent until 31 March 2027, and it applies to the supply and installation of solar panels on residential properties in England, Scotland, and Wales.
Several other organisations offer assistance to fund solar panel installations.
| Scheme | Run time | Eligibility | Potential savings |
|---|---|---|---|
| Barclays Greener Homes | Ongoing | First time claimers with a Barclays residential mortgage customers who pay by direct debit | £1,000 |
| Lloyds Bank Eco Home Reward | Register by 31 October 2023 | Lloyds Bank mortgage customers | £500 cashback |
| Halifax Green Living Reward | Register by 31 October 2023 | Halifax mortgage customers | £500 cashback |
| Sunsave Plus subscription | Waiting list for applications | UK resident between 18 and 60 years old, property owner, and in full-time employment. Acceptance is subject to status | Pay for your solar installation in monthly instalments |
As part of its commitment to encouraging energy-efficient home improvements, Barclays has launched the Greener Home Reward scheme. This initiative is designed to assist its UK residential mortgage customers in installing solar panels. By registering online for the scheme, eligible customers can enjoy a financial incentive towards solar technology.
Under this scheme, Barclays offers a cash reward of £1,000 to its residential mortgage customers who have installed and fully paid for their solar panel systems. However, to ensure quality, a business registered with TrustMark must carry out the installation.
Once the installation is complete, the customer is eligible for the £1,000 cash reward, thereby making their shift to sustainable energy more affordable.
If you applied on or before 31 January 2024, you’ll need to submit your claim form by 31 July 2024, and a further month to provide proof of the home improvements.
Applications received on or after 1 February 2024, you’ll need to claim the reward within nine months from the date of application and provide proof of the completed work.
If you already have, or are applying for, a Lloyds Bank mortgage, or are borrowing funds for home improvements, you can claim up to £500 cashback for a solar panel installation.
Once you’ve checked your eligibility, and registered either online or in person, use your preferred supplier to install your solar panels, before claiming your cashback.
Whether you’re an existing Halifax mortgage holder, in the process of applying for one, or securing funds for home improvements, you’re eligible to claim up to £500 cashback for installing solar panels.
To take advantage of this offer, you’ll first need to verify your eligibility and register. Following this, you can proceed with the installation of your solar panels using the supplier of your choice. Once the installation is completed, you’re ready to claim your cashback.
Sunsave has been installing solar panel systems since 2022 and, as part of the government’s push towards renewable energy, it has received funding for its Electric Roof project. Designed to make solar panels affordable for more homeowners, Sunsave Plus is a subscription service with a monthly starting fee of £69 and no up-front costs.
The subscription plan includes a 20-year maintenance and monitoring service, battery and inverter replacements, and access to tariffs for varied electricity rates, increasing savings.
There might not be many grants for solar panels in Scotland, but Scottish residents can take advantage of schemes like the Home Energy Grant and Loan Scheme, as well as ECO4. If you’re looking for a Welsh government grant for solar panels, the Warm Home Nest Scheme offers free advice and eligible homeowners could receive financial help for solar panel installation. While there are no specific grants for solar panels in Northern Ireland, homeowners can still make savings via the zero per cent VAT scheme and the Barclays Greener Home Reward.
During our extensive research into funding schemes and government grants for solar panels, our experts found several websites claiming to offer government-backed funding. However, they were not linked to any official programme upon further investigation. You can protect yourself from falling victim to scam solar panel schemes and ensure you’re participating in legitimate, beneficial government grants by following these simple steps:
There have been a number of solar panels grants that have recently expired. Such schemes typically had set durations or funding limits, meaning that once a certain date was reached or the available funding was exhausted, the grant would expire. This means while the grants could have provided significant assistance at the time, they are no longer available for new applicants. Here are a few examples of schemes that have now expired.
| Feed-in Tariff | Expired 1 April 2019 (Those registered before this date will continue to benefit for the remainder of the 20-year period they signed up for) | Owners of solar panels, wind turbines, and micro combined heat and power (micro-CHP) systems | Generation Tariff – 6.38p – 13.88p per kWh Export Tariff – 4.77p per unit |
| Green Homes Grant | Expired 31 March 2021 | All homeowners in England | Up to two-thirds of the total cost (up to £5,000); or up to 100% (maximum of £10,000) for those on qualifying benefits |
| Renewable Heat Incentive (RHI) | Expired 31 March 2022 | Owners of biomass boilers, heat pumps, and solar thermal collectors | Up to £2,981 |
| Free Solar Panel Scheme | Expired March 2019 | All homeowners | Fully free solar panel system (in exchange for your installer receiving all Feed-in Tariff payments) |
The Feed-in Tariff (FiT) was a UK government scheme designed to encourage the uptake of a range of small-scale renewable and low-carbon electricity generation technology.
Under the FiT scheme, homeowners who installed renewable electricity systems, such as solar panels, wind turbines, or hydroelectric power, could receive payments from their energy supplier. These payments were for the electricity they generated and used themselves, as well as any surplus electricity they exported back to the national grid.
Although the scheme closed to new entrants in March 2019, existing contracts, up to a maximum of 20 years, continue to be honoured.
Our experts answer all your burning questions about government grants for solar panels
Yes. Several grants are available in the UK so more people can benefit from the advantages of solar panels.
Solar panel grants and incentives include the ECO4 scheme and SEG. Local authorities in England and the devolved governments of Scotland, Wales, and Northern Ireland also have a range of grants, loans and other types of support available for installing solar panels.
The primary reason for some solar panel grants closing is budgetary constraints. Governments operate with finite resources and need to make decisions about how to allocate funds. Sometimes, the cost of running a grant scheme outweighs the perceived benefits, or other initiatives might be deemed a higher priority.
Another reason could be changes in government policy or strategy. For example, as the cost of solar panels has decreased significantly over the past decade, governments could feel that market forces alone are sufficient to encourage adoption, and that subsidies are no longer necessary or could be better used to support other, newer technology.
A grant or scheme might also close due to issues with its implementation or outcomes. For instance, if there are problems with administration, the scheme isn’t delivering the expected results, or uptake from eligible people is low, it might be discontinued.
If you’re considering installing solar panels, looking into grants, incentives, and other forms of financial support can be a worthwhile part of your research. They can significantly reduce the up-front cost of the installation and increase the financial return on your investment.
