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Guide · UK · Renovation energy upgrades

Warm Homes Loan Scheme and the Boiler Upgrade Scheme for a heat pump or solar on a renovation

For self-builders and contractor-led renovators weighing up a heat pump, solar panels or a battery. The Warm Homes Loan Scheme offers government-backed no- and low-interest loans; the Boiler Upgrade Scheme can take a grant off a heat pump. This page sticks to what GOV.UK has published.

Last updated 2 November 2026. Based on the DESNZ factsheet of 27 October 2026. More lenders and products are expected to join.

Not financial or legal advice. Check the GOV.UK factsheet, your lender's terms and your installer's advice before you commit.

The Warm Homes Loan Scheme in brief

  • Government-backed no- and low-interest loans for clean energy technology such as heat pumps, batteries and solar panels, set out in a DESNZ factsheet published on 27 October 2026.
  • Available to households across the UK: England, Scotland, Wales and Northern Ireland.
  • The government says it has worked with lenders on an up-to-5% reduction in interest rates compared with regular loans. Ten lenders are initially offering loans, some interest free, with up to 30 years to repay in some cases.
  • All installations except heat network connections are carried out by MCS-certified installers.
  • The lender carries out normal affordability, credit and eligibility checks. Some lenders only work with specific installers.
  • The loan can be combined with a Boiler Upgrade Scheme grant (and Home Energy Scotland in Scotland).

Maximum loan by technology

  • Solar panels: up to £15,000
  • Electrical storage battery: up to £15,000
  • Air-to-water source heat pump: up to £20,000
  • Air-to-air source heat pump: up to £10,000 (when MCS certification is available)
  • Ground source heat pump: up to £35,000
  • Biomass boiler: up to £20,000
  • Heat network connection: up to £7,500
  • Micro-renewable system: up to £20,000

Source: GOV.UK — Warm Homes Loan Scheme: Factsheet (DESNZ, 27 October 2026).

The Boiler Upgrade Scheme alongside the loan

  • Open in England and Wales only.
  • £7,500 towards an air source or ground source heat pump; £2,500 towards an air-to-air heat pump; £5,000 towards a biomass boiler. One grant per property.
  • Until March 2027, an extra £1,500 towards an air or ground source heat pump if the property is heated by oil or LPG and has no mains gas connection. That is where the factsheet’s ‘up to £9,000’ comes from.
  • You must own the property and be replacing fossil fuel heating (oil, gas, electric or LPG). Hybrid systems are not covered.
  • Your MCS-certified installer applies to Ofgem on your behalf, and the grant is taken off your quote and invoice. You do not apply yourself.
  • The installer must commission and install the heat pump within 120 days of applying.

New self-builds: GOV.UK says most new build properties cannot get a grant, and new builds the developer is still building are not eligible. A self-build is eligible if you or the original owner built it (or paid a builder to) and it has never been owned by a business or organisation, and the scheme is for replacing fossil fuel heating. Ask your MCS installer to confirm before you count on the grant. For more, see our Boiler Upgrade Scheme on a self-build guide.

Sources: GOV.UK — BUS: what you can get, check if you're eligible and how to apply.

The order of steps

  1. Decide which upgrade you want (heat pump, solar, battery) and get quotes from MCS-certified installers.
  2. For a heat pump in England or Wales, ask the installer whether the property is eligible for the Boiler Upgrade Scheme. If it is, the installer applies and the grant comes off the quote.
  3. Compare Warm Homes Loan offers on the amount left to pay. Look at the total amount repayable, the term and any monthly fees, and check whether the lender ties you to particular installers.
  4. Apply to a participating lender or installer. The lender runs its own checks.
  5. Keep the quote, finance agreement, invoice, proof of purchase and MCS certificate.

Budgeting it as a funding line

In ConstructionPro.io you add the Warm Homes Loan and any BUS grant as funding lines, and the heat pump or solar installation as a cost line, each with its date. The app doesn't check eligibility or apply for you, and it doesn't track loan interest or repayments — it shows what is planned against what is committed and spent.

Try the UK Self-Build sandboxHow to structure a self-build budget

Warm Homes Loan FAQ

What is the Warm Homes Loan Scheme?

A government-backed scheme of no- and low-interest loans from participating lenders for clean energy technology such as heat pumps, batteries and solar panels, set out by DESNZ on 27 October 2026.

Which nations does it cover?

The factsheet says the loans are available to households across the UK: England, Scotland, Wales and Northern Ireland. The Boiler Upgrade Scheme grant is England and Wales only.

How much can I borrow?

The maximum loan supported is £15,000 for solar panels, £15,000 for a battery, £20,000 for an air-to-water heat pump and £35,000 for a ground source heat pump, among other technologies. Each lender decides what it will offer you.

What interest will I pay?

GOV.UK does not set one rate. It says lenders offer up to a 5% reduction on regular loan rates, some loans are interest free and some allow up to 30 years to repay. Check each lender’s total amount repayable.

Can I combine it with the Boiler Upgrade Scheme?

Yes. The factsheet says the loan can be combined with a Boiler Upgrade Scheme grant. The BUS grant is £7,500 for an air or ground source heat pump, with an extra £1,500 until March 2027 for oil or LPG heated homes without mains gas.

Is a new self-build eligible for the Boiler Upgrade Scheme?

Not necessarily. GOV.UK says most new build properties are not eligible, new builds that a developer is still building are not eligible, and you must be replacing fossil fuel heating. A self-build is eligible if you or the original owner built it (or paid a builder) and it has never been owned by a business. Your MCS installer confirms eligibility. This guide is aimed at renovations of existing homes.

Does ConstructionPro.io apply for the loan or grant?

No. In ConstructionPro.io you add the loan and any BUS grant as funding lines, and the installation as a cost line, each with its date. The app doesn’t check eligibility, apply for you or model repayments.

Related: Future Homes Standard on a self-build and the UK market overview.