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By applying for a solar panel grant, you could receive heavily discounted or even free solar panels, resulting in annual energy bill savings upwards of £1,100. We recently conducted a survey of over 1,540 Independent readers who own solar panels* to understand how they made the most of the solar panel funding available to them. And almost four in five respondents (79.40 per cent) said solar panel grants were an important part of their decision to go green.
With that in mind, we’ve put together a comprehensive guide on how you can minimise your solar panel costs, whether that’s through ECO4, a solar panel government grant, the Smart Export Guarantee, or one of the UK’s other solar panel funding schemes.
UK solar panel grant or scheme | Potential savings | Where can I get the grant? | Eligibility | Run time |
---|---|---|---|---|
Energy Company Obligation 4 (ECO4) inc LA Flex | Households could receive free solar panels, new boilers, air source heat pumps and insulation as part of an overall home energy upgrade | England, Scotland and Wales | People on eligible benefits, low-income households, and households with people vulnerable to the cold | April 2022 to March 2026 |
Solar Together | Savings vary between 10 and 25% | England | Homeowners and renters living in a participating council area | Ongoing |
Home Upgrade Scheme (HUG2) | Local authority dependent, can be in excess of £18,000 | England | Low-income and off-grid households, as well as low energy efficiency–rated properties | April 2023 to March 2025 |
Smart Export Guarantee (SEG) | 1-40p per kWh of excess electricity produced by solar panels | England, Scotland and Wales | Homes with a Microgeneration Certification Scheme (MCS) certificate or equivalent document. Installation must include an export meter and have a maximum capacity of 5MW | Ongoing |
Zero per cent VAT | Savings dependent on solar panels cost | UK-wide | Solar panel purchases and installations made in England, Scotland, Wales or Northern Ireland | April 2022 to March 2027 |
Welsh Government Warm Homes Nest Scheme | Households could receive free solar panels | Wales | Welsh households receiving income-related benefits and properties with low energy–performance ratings | Ongoing |
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ECO4 is a government grant managed by Ofgem which places an obligation on medium-to-large energy providers to make energy-efficient upgrades accessible to vulnerable, low-income families living in homes with an Energy Performance Certificate (EPC) rating of D or below.
An ECO4 grant may entitle you to free solar panels as part of wider energy efficiency improvements for your home including boilers, heat pumps and insulation measures. More than 17 per cent of Independent readers who own solar panels took advantage of an ECO4 grant when installing their system*.
The ECO scheme has gone through several phases, each with slight differences in focus and eligibility criteria. Currently in its fourth phase, you could qualify for ECO4 funding if you receive any of the following benefits:
You could be eligible for ECO4 if you receive other benefits from the Department for Work and Pensions, regardless of whether you receive Universal Credit.
The ECO4 grant mainly focuses on owner-occupied homes. That said, if you’re a landlord with private tenants, you can apply for ECO4 on behalf of tenants who receive any of the benefits above. Similarly, you may also be eligible if you live in social housing.
Applying for an ECO4 grant is quick and straightforward; you have to apply directly through the solar panel installers who provide the grant. The application process generally follows the same timeline, no matter which installer you choose.
The Local Authority Flexible Eligibility (LA Flex), also known as ECO Flex, is an extension of the ECO4 scheme. Under this initiative, local authorities decide on household’s eligibility for energy efficiency measures and award them to those that may not have qualified under the national criteria. Eligibility criteria may include the following:
Private tenants can qualify under LA Flex with their landlords’ permission. If you’re eligible, you could be entitled to up to 100 per cent off the cost of your solar panels.
Sarah Blyth lives in Whitstable, Kent, with her two children. Her home had an EPC rating of E, and she receives Universal Credit, which includes Housing Benefit and Child Tax Credit. She talked us through her journey to getting free solar panels.
“I was surprised by how simple it was. I applied online, and the same day I got a call back from the installer to say I had been pre-approved for ECO4 funding. I had to answer a few more questions – all very easy – and, later the same week, got told my home assessment was booked.
“They looked around my house, including the loft, and explained that to take my house from its EPC rating of E to C, I could have insulation, a boiler upgrade and solar panels. It wouldn’t cost me anything, nor affect my benefits, so of course I said yes.
“Within a month, all the work was done! The house is warmer, all the condensation has gone and, thanks to the new solar panels, my electricity bills are almost zero. If you are living in a cold, damp house – like we were – apply for ECO4.”
To get a better understanding of how the ECO4 grant process works, we spoke with Kevin Henney, director at ECO4 Hub.
Independent Advisor (IA): First, please tell us a little about yourself and your role.
ECO4 Hub Director Kevin Henney: I currently serve as Director at ECO4 Hub. I’m 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 12 months? And have you seen an increase in grant applications during that period?
Henney: Over the past six months, we’ve successfully finished over 60 installations and have more than 100 slated for the near future.
Over the last year, we’ve observed a significant uptick in grant applications. This surge can be attributed to the rising cost of living and energy and increased awareness about the grant.
IA: Can you give us some idea of how much money successful applicants are typically granted? Is there a range or an average amount you can share?
Henney: The amount awarded per grant varies greatly depending on the work required for each property. Our goal under the regulations is to maximise energy efficiency.
We’ve dealt with diverse projects, from single-measure installations, such as a boiler replacement worth £5,000, 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 generally take for an applicant to get their grant approved?
Henney: The approval time for a grant depends on a few factors, but there are two main routes that can be followed:
IA: Once a grant has been approved, what are the next steps for the homeowner? How long does it take from approval to solar panel installation?
Henney: Once a grant is approved and the client confirms they’re 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 frequent mistakes people make when applying that can slow down the grant approval process?
Henney: The most common issues that can delay the process include incorrect spelling of the applicant’s name and not having the necessary documentation for local authority approval, such as a council tax bill. Paying attention to these details is essential to ensure a smooth application process.
IA: What documents are applicants required to submit 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 apply under the LA Flex criteria, you’ll need your council tax bill, ID and proof that the annual household income is under £31,000. This evidence may be in the form of a pension statement, three months’ payslips and bank statements or a P60 dated in the last six months.
What is it?
Solar Together is a community buying scheme for solar panels which operates in the UK’s local council regions. The scheme aims to bring together households and local authorities to make solar power more accessible and affordable for homeowners and small businesses. Panels bought through Solar Together are typically between 10 and 25 per cent cheaper than market price.
Our recent survey found that 28.91 per cent of Independent readers who received solar panel funding to buy solar panels used the Solar Together scheme*.
Who is eligible?
Homeowners and renters in participating council areas are eligible for Solar Together.
Application deadline
The application period for Solar Together is ongoing, but varies by council.
Tim from Aylesbury, Buckinghamshire had 10 panels installed through Solar Together, as well as battery storage capacity, enabling him to use generated electricity efficiently, reducing reliance on grid-supplied power. He’s saved £405 in the first year alone, alongside the ability to sell back surplus energy to the grid – earning an additional £167.
Here’s what he had to say about the process: “It was really easy. The process came together smoothly from the start, and the installers were very professional. Although there was an upfront cost for the panels, the investment has paid off.”
What is it?
The Home Upgrade Grant Phase 2 (HUG 2) scheme has been running since April 2023 and will continue to accept applications until March 2025. It supports low-income families with awards of up to £10,000 for solar panels and other energy-efficient home improvements.
Who is eligible?
To be eligible, you must:
If you’re a landlord with low-income tenants, you must own a maximum of four properties and be willing to contribute one third of total upgrade costs.
Application deadline:
The HUG 2 scheme comes to an end in March 2025.
What is it?
Introduced by the UK government on 1 January 2020, the Smart Export Guarantee (SEG) replaced the Feed-in Tariffs (FIT) scheme. It allows solar panel owners to sell the excess energy they generate back to the grid. The rate you are paid for your excess energy ranges from 1p per kilowatt hour (kWh), to 40p per kWh (if you meet the supplier’s eligibility requirements).
Applicants must have an export meter and an MCS certificate or equivalent document for their solar system to guarantee the quality of the installation. Including a solar storage battery with your system isn’t a requirement to qualify for the SEG, but it is beneficial in order to accumulate more energy.
More than half (57.45 per cent) of Independent readers with solar panels export their excess energy using SEG*, a number that jumps significantly if they have a solar battery installed.
Who is eligible?
Homes with solar panels or wind turbines, an export meter and a Microgeneration Certification Scheme (MCS) certificate are eligible to apply for a SEG tariff.
Application deadline
There is no deadline to apply for SEG tariffs.
What is it?
In the UK, the value added tax (VAT) rate on most goods and services is 20 per cent. However, as part of the government’s efforts to encourage energy efficiency and renewable energy adoption, certain energy-saving materials and equipment, including the best solar panels, qualify for a reduced VAT rate.
That amounts to a significant saving. For instance, the average 4.5kW system costs £7,100 for the panels and installation. If you had to pay VAT, that’d jump to £8,520, so in this case, zero per cent VAT is saving you £1,420.
Who is eligible?
All UK homes looking to purchase solar panels.
Application deadline
Until 31 March 2027, this reduced rate is set to zero per cent. From 1 April 2027, it will return to a reduced rate of five per cent.
There’s no need to apply for the zero per cent VAT scheme; your solar panel provider should automatically take care of it.
What is it?
The Welsh government’s Warm Homes Nest scheme offers free advice and funding for improving residential energy efficiency. Eligible households may qualify for free home improvements, including solar panel installation.
Despite its regional scope, Nest was the second most popular solar panel scheme among Independent readers*. Almost a fifth (18.48 per cent) of solar panel owners we surveyed* who used an incentive scheme benefited from Nest funding.
Who is eligible?
You could be eligible for free solar panels if you meet these three criteria:
Application deadline
There is currently no deadline to apply for the Welsh Government Warm Homes Nest scheme.
Our team of solar experts are standing by for announcements from the Labour government on its Warm Homes Plan[1] and the formation of GB Energy.[2]
This plan aims to upgrade every home that needs it to EPC standard C within a decade, dedicating £6.6bn to improve 5 million homes. Details of grants and low-interest loans have yet to be announced, but as soon as they are, we will let you know what’s available, who’s eligible and how to apply.
Several other organisations offer incentives to help UK homeowners finance solar panel installations.
What is it?
Barclays launched the Greener Home Reward scheme as part of its commitment to encouraging energy-efficient home improvements. The scheme involves a £1,000 cash payment for its UK residential mortgage customers to reward them for solar panel systems they have installed and paid for in full. To ensure that the solar installations are high quality, Barclays requires that they be carried out by businesses registered with TrustMark.
Who is eligible?
You’re eligible for the Barclays Greener Home Reward if you:
How to apply for the Barclays Greener Home Reward
You can apply on Barclays’ website – the process is quick and easy. If you have any questions, you can also phone Barclays.
What is it?
If you want to benefit from solar energy, without the upfront cost of installing panels, you could consider Effective Home’s Energy Shield. With this scheme, you won’t own the solar panels on your roof, nor will you be responsible for their upkeep.
Instead, you’ll simply pay a £99 onboarding fee, and then purchase the electricity generated by the system from Effective Home, at a pence per kilowatt (kW) unit rate that should be lower than the national average you’d pay for your energy. This tariff will be fixed, and is reviewed every five years.
Who is eligible?
All UK homeowners, including landlords, alongside local authorities and social housing organisations seeking to improve the energy efficiency of their properties.
How to apply for Effective Home Energy Shield
To apply for Effective Home’s Energy Shield, you will need to register your interest with the installer via its website. Effective Home will then be in contact as soon as possible to arrange a survey to assess your property’s suitability.
What is it?
With Otovo’s subscription service, you don’t need to make an upfront payment to benefit from solar energy. Instead, you pay a monthly fee, spreading the cost of purchasing and installing your solar panels over up to 20 years. You still have the option to buy the solar panel system at any point during that period. You can also include a battery, which has a contract length of 10 years.
How much you pay each month will depend on the size of your solar system you have installed. Therefore, so too will the amount you are paying each month versus the amount you save on your energy bills. You can also still sell any excess energy you generate using SEG.
Who is eligible?
Homeowners who register their interest with Otovo.
How to apply for an Otovo solar subscription
You can get a free quote for Otovo’s solar subscription service by putting in your postcode on the installer’s website.
What is it?
Like Otovo, Sunsave Plus offers a subscription service where you pay off the cost of purchasing and installing your solar panels (including a battery as standard) on a monthly basis. Despite the fact the payment period can last as long as 20 years, Sunsave states that you own your panels from day one
There are no upfront fees or deposits, and you can fully pay-off your panels at any point without incurring early repayment penalties. And Sunsave Plus comes with a 20-year guarantee that includes 24/7 performance monitoring, insurance from Aviva and free battery and inverter replacement. You can also export your excess energy using a SEG tariff.
Who is eligible?
Homeowners in England and Wales who register their interest with Sunsave. You can have up to two applicants. The lead applicant must be the owner of the property, and at least one application has to be between 18 and 60 years old.
How to apply for Sunsave Plus
To apply for Sunsave Plus, you’ll need to first fill out the installer’s online questionnaire to get a free quote and a savings estimate.
What is it?
Solar installer Unbound Energy offers its own solar panel and storage battery subscription service, SunFlex, which starts £60 a month with no upfront cost.
Unbound Energy takes care of installing the solar panels on your roof. You then benefit from the energy bill savings, minus your monthly subscription fee, without owning the panels. You’ll also benefit from any SEG payments you make. Remote monitoring, free repairs, insurance and downtime cover are all included in your monthly fee.
Subscription terms start from as little as three years – at the end of the subscription, you can either renew or have the panels removed. The subscription can also be transferred to your property’s new owner if you sell your home.
If you want to own the system, you can buy it from Unbound Energy at any time. The cost of this purchase will be shared with you when you sign up for your subscription. Alternatively, if you are subscribed for 30 years, Unbound Energy will ‘gift’ you the system, unless you want a new one installed.
Who is eligible?
Homeowners in England and Wales. You’ll need to be the owner of the property in question at the time of installation, and pass Unbound Energy’s credit check. There is also a version of SunFlex for landlords and tenants that allows both to benefit from solar energy savings.
How to apply for Unbound Energy SunFlex
You can fill out Unbound Energy’s savings estimate form to find out how much you could reduce your bills by, and if you are eligible for SunFlex.
What is it?
While the Home Energy Scotland Grant and Loan Scheme no longer gives out grants for solar panels, you can still apply for a loan worth £5,000. This loan is designed for the installation of solar thermal panels, which generate heated water rather than electricity, or hybrid solar PV/water heating systems, which generate both hot water and electricity. This does mean, however, that you can’t get a loan for standard solar PV panels.
Who is eligible?
Homeowners in Scotland, where the property is your only or primary private residence.
How to apply for the Home Energy Scotland and Loan Scheme
To apply for a Home Energy Scotland loan, you’ll either need to contact the scheme on 0808 808 2282 (8am to 8pm Monday to Friday, 9am to 5pm on Saturdays), or complete the online self-assessment form.
What is it?
Working in partnership with various local authorities, the Parity Trust offers secured loans to fund energy-efficient home upgrades such as solar panels. The loans come with a fixed interest rate for the entire payback period.
Who is eligible?
The Parity Trust loan is designed to help those who are self-employed, have a negative credit history, live in a low-income household, receive benefits or are retired. You will need to pass Parity Trust’s financial review and credit checks when applying.
How to apply for the Parity Trust loan
You can apply for a Parity Trust loan on the organisation’s website. You’ll need to provide your name, address, and reason for the loan. This initial step won’t affect your credit score.
Although there aren’t many grants for solar panels in Scotland, Scottish residents can take advantage of programmes such as the Home Energy Grant and Loan Scheme and ECO4. If you’re looking for a Welsh government grant for solar panels, the Warm Homes Nest scheme offers free advice, and eligible homeowners could receive financial assistance for solar panel installation. While there are no specific grants for solar panels in Northern Ireland, homeowners can still save on the initial cost of solar system installation thanks to the zero VAT scheme and the Barclays Greener Home Reward.
Our experts conducted extensive research into the various funding schemes and government grants for solar panels and found several websites that claimed to offer government-backed funding. However, on further investigation, they discovered that those websites are not linked to any official programmes. To protect yourself from these sorts of scams and ensure you apply for legitimate, beneficial government grants, be sure to follow these simple steps:
Several UK solar panels grants have recently expired. In most cases, the schemes had fixed durations or budgetary limits – once a certain date was reached or the available funding ran out, the grant was closed to new applicants. The following are some examples of recently expired schemes:
The UK government created the FiT scheme to encourage the uptake of a range of small-scale renewable and low-carbon electricity generation measures.
With this scheme, homeowners who installed sustainable electricity systems – such as solar panels, wind turbines and hydroelectric power – could receive payments from their energy supplier. Payments were based on the amount of electricity the homeowners generated and used themselves as well as any excess energy fed to the National Grid.
Although the scheme closed to new applicants in March 2019, existing contracts continue to be honoured for a maximum of 20 years. The FIT scheme has been replaced by the SEG scheme.
Several solar panel grants are available to households in the UK, for example the ECO4 and the SEG schemes, allowing more people to benefit from the advantages of solar panels. Local authorities in England and the governments of Scotland, Wales and Northern Ireland also offer a range of grants, loans and schemes to aid solar panel installation.
Solar panel grants may close for a variety of reasons, one of them being finite government resources. If a grant or scheme is deemed to be badly managed, have low uptake or poor results, it may be scrapped by the government. At the moment, solar panel costs are significantly cheaper than they were 10 years ago, so market forces alone are sufficient to encourage solar adoption, so the government may not treat solar subsidies as a priority.
Since the Labour government was elected on 5 July 2024, there are likely to be changes when it comes to government funding available for solar panels. While the new Energy Secretary Ed Miliband’s “solar rooftop revolution” promise does not mention of specific grants and schemes, it’s very likely that Labour will endeavour to make it easier for households to benefit from solar energy.[3]
Grants for solar panels are generally available to homeowners, landlords and sometimes tenants. Eligibility for these grants depends on factors such as income, property type and location.
Pensioners may be eligible for grants or subsidies for solar panel installations. Eligibility criteria depends on factors such as income, property location and energy rating. Pensioners should enquire with local authorities and energy providers about specific programmes and grants that may be available to help with solar panel installations.
While there are no specific schemes that provide free solar panels for recipients of personal independence payment initiatives such as ECO4 offer free or partially-funded solar panel installations to low-income households, including those who receive various means-tested benefits.
Eligibility criteria for different solar panel grants vary significantly, but they often require the recipient to reside in a specific area, not exceed a certain income threshold or inhabit a property with a low energy-efficiency rating. Before applying, check grant administrators’ websites to ensure you understand and meet all criteria to avoid wasted effort.
*The Independent Advisor, survey of 1,544 Independent readers who own solar panels, June 2024.
[1] Labour.org.uk, Make Britain a clean energy superpower.
[2] Open Access Government, UK Government to quadruple solar power investment through GB Energy initiative, July 2024.
[3] The Guardian, Labour’s ‘rooftop revolution’ to deliver solar power to millions of UK homes, July 2024.