Solar Panel Grants and Schemes
Explore solar panel grants. schemes and financing options to help you harness the power of solar power
Introduction to solar panel grants and schemes in the UK
Thinking about switching to solar power? You're making a smart move — solar panels not only help the environment but can also help to trim down your energy bills. Understanding the cost involved is key, and here's some good news: the UK government offers various solar panel grants and financial schemes to make solar power generation more accessible and affordable for homeowners and businesses.
The UK government recognises that solar panels are a savvy investment, and it offers some helpful green energy grants and incentives to drive solar uptake across the country.
But there's more — besides government grants, there are other financing options available to help you embark on your solar journey. These include local initiatives, private grants, and flexible financing plans offered by solar providers. It's always smart to explore all your options.
Remember, grants and schemes are dynamic — they change and evolve. New solar panel funding opportunities can emerge even as current ones close, which is why it’s essential to stay informed and up-to-date.
We recommend reading on our guide to solar panel grants. Once you know what you’re eligible for, you can use our solar panel comparison tool to find the best providers and solar setups for your needs.
Are you a homeowner?
UK solar panel grants for homeowners
With the help of solar panel grants, harnessing solar power and reducing your carbon footprint is more accessible than ever. These grants are designed to make the switch to solar energy both affordable and straightforward for homeowners and businesses.
Each grant has its unique features, eligibility criteria, and savings potential so you’re sure to find a solar grant to help you make the most of renewable energy. We suggest exploring the options below to see which will suit your property and solar needs best.
ECO4
The Energy Company Obligation (ECO) scheme, in its fourth phase (ECO4), focuses on reducing carbon emissions and tackling fuel poverty. It includes funding for solar panel installations and is set to run until March 2026.
Eligibility criteria
The ECO4 is primarily aimed at low-income households and those in fuel poverty. Eligibility often depends on factors like your income, property type, and whether you receive certain benefits.
How much could you save?
Those eligible could receive significant subsidies on the installation of solar panels and even get them for free. On average, this could reduce your energy bills by £290 a year, with significantly more savings for those with more energy-inefficient homes.
Solar Together
There is also Solar Together, a group-buying scheme that offers homeowners the chance to purchase solar panels at a reduced rate. It works by gathering a large number of interested parties and using collective buying power to negotiate better prices.
Eligibility criteria
Homeowners within participating regions, including Buckinghamshire, Plymouth, and Wiltshire, can sign up. The scheme periodically opens for new registrations, so keeping an eye on announcements is key.
How much could you save?
The savings can be considerable due to the lower prices negotiated through the group-buying scheme, making solar panels more affordable. This has saved participants £2000 on average in installation costs and £140 on energy bills each year.
Nest
Are you looking for solar panel grants in Wales? The Warm Homes Nest Scheme is the Welsh Government's scheme offering a range of energy-saving improvements, including solar panels, particularly to those on lower incomes or living in hard-to-heat homes.
Eligibility criteria
You need to be a homeowner or rent from a private landlord in Wales, and either receive a means-tested benefit or live in a property with a poor energy efficiency rating.
How much could you save?
Qualified households can receive free or heavily subsidised solar panel installations, leading to significant reductions in energy costs, averaging £442 per year.
Home Upgrade Grant (HUG 2)
Set to run until March 2025, this scheme focuses on increasing the energy efficiency of low-income households through improvements like solar panel installations.
Eligibility criteria
The Home Upgrade Grant targets low-income households living in the least energy-efficient homes. Qualification often depends on income levels and your home’s existing energy efficiency rating.
How much could you save?
The scheme can cover a substantial part, if not all, of the cost of installing solar panels, leading to significant energy bill reductions. Some households could receive up to £10,000 depending on their property type and location.
Home Energy Scotland Grant and Loan Scheme
The Home Energy Scotland Grant and Loan scheme was launched in June 2023. This green energy grant supports Scottish homeowners with support to install solar panels or a solar-powered heating system.
Eligibility criteria
Any households in Scotland can apply for the Home Energy Scotland Grant and Loan scheme.
It’s important to note that, while the scheme will continue to run, new applicants cannot only put themselves forward for solar panels until the 31st of July 2024. Beyond this date, you will only be able to apply for support with other home improvements, including clean heating systems and energy efficiency improvements.
How much could you save?
Successful applicants can receive up to £6,000 for solar panel installation or £5,000 to help install a solar water heating system.
Green energy grants for businesses
We’ve explored solar panel funding options for homeowners but what energy grants are available for commercial settings? Well, there are some grants available to help businesses install solar panels and lower their carbon footprint.
Public Sector Decarbonisation Scheme (PSDS)
In February 2024, the Department for Energy Security and Net Zero (DESNZ) confirmed a fourth phase of the Public Sector Decarbonisation Scheme (PSDS). This scheme, which aims to reduce 75% of public sector building emissions by 2037, is led by Salix Finance.
Although this grant doesn’t focus specifically on solar panels, it is introducing a new targeted funding allocation, prioritising projects with the most significant direct carbon reductions.
The PSDS also has a sister scheme, the Public Sector Low Carbon Skills Fund, which will endeavour to supply different institutions with renewable technologies, including solar panels.
Other financial support for solar panels
Aside from solar grants, there are several other incentives to encourage both homeowners and businesses to install solar panels.
0% tax on solar panels
To encourage more homeowners and businesses to install solar panels, the government has introduced a 0% VAT incentive on energy-saving materials. This means you can install solar panels without paying any Value Added Tax.
The incentive covers the cost of related solar equipment, such as solar batteries and inverters, as well as the solar panels themselves, helping reduce the upfront cost of a solar installation.
Originally introduced in England, Scotland, and Wales in 2022, the scheme has also been available in Northern Ireland since 2023. It’s set to run until April 2027. After this time, the VAT rate on solar panels will be 5%.
Eligibility criteria
Anybody in the UK looking to invest in solar panels can benefit from this tax relief.
How much could you save?
The amount you save will depend on how much you spend. However, there’s the potential to save around £2,300 on 4kW solar panels and a solar battery.
Smart Export Guarantee
Another helpful incentive to consider is the Smart Export Guarantee (SEG). While this isn’t a solar panel grant as such, it does offer the chance to sell excess solar power back to the National Grid, speeding up the time it takes to break even on your investment.
Depending on where you live and your energy usage, the SEG could bring you up to £630 per year.
Previous solar panel funding options
Above are just a handful of available grants for solar panels, and there are always new incentives popping up. It can also be helpful to know what grants and schemes have been available in the past. Not only does this show the evolution of solar panel funding but it can also give an idea of what’s been successful and the types of initiatives that may come to light in the future.
Feed-in Tariff
One notable scheme was the Feed-in Tariff (FIT). Launched in 2010, this was a game-changer. It offered homeowners and businesses payments for generating their electricity using solar panels.
The FIT scheme not only helped with the initial cost but also paid for the electricity produced, making it a highly attractive option. It was a cornerstone in the UK's solar scheme's history but closed to new applicants in April 2019.
Renewable Heat Incentive
Another significant program was the Renewable Heat Incentive (RHI). This focused more broadly on renewable heating technologies, including solar thermal panels. Participants received payments over several years, based on the amount of renewable heat produced. This scheme was pivotal in promoting the use of renewable energy sources in heating systems, but applications closed in March 2021.
Green Homes Grant
Although it was short-lived, the Green Homes Grant was another ambitious initiative in the realm of solar panel grants. Launched in 2020, it offered vouchers to homeowners and landlords to cover part of the cost of energy-efficient improvements, including solar thermal panels.
Despite its potential, the scheme faced challenges and closed in March 2021.
Green Deal
The government’s Green Deal covered an array of home improvements to boost your property’s energy efficiency. It acted as a loan, with eligible households paying back the money each month through an additional fee on their energy bills.
Are you a homeowner?
How to find and apply for solar panel grants
Finding and applying for solar panel grants might seem daunting, but it's simpler than you think. Here's a step-by-step guide to help you navigate the process.
1. Finding solar panel grants and funding options
First, discover what solar panel grants are available. The options we’ve discussed above are a great starting point, and we also recommend exploring the UK government’s own website. It’s packed with the latest information on solar panel grants and schemes. Another helpful resource is Grants Online. This tool lets you search for various funding options, tailored to your specific needs.
If you’re looking for solar panels for a commercial space, you can also take a look at the Ofgem website (Office of Gas and Electricity Markets).
2. Checking if you’re eligible
Once you've identified potential grants, the next step is checking your eligibility. Each grant has its criteria. This could include the type of property you own, its location, and your personal or business energy needs. It's crucial to read these requirements carefully to ensure you qualify.
3. The application form
After confirming your eligibility, the application process begins. This typically involves filling out an application form, either online or in a paper format. Be prepared to provide detailed information about your property, energy usage, and why you're a good candidate for the grant. Some renewable energy grants may require additional documentation, like energy bills or plans for the solar panel installation.
Remember, applying for a grant is a competitive process. In our experience, it’s essential to make your application stand out by being thorough and clear. Explain how the grant will help you achieve your solar energy goals and contribute to a greener future.
4. Don’t miss the deadline!
Lastly, keep an eye on deadlines. Solar panel grant applications often have strict timelines, and missing a deadline could mean waiting for the next round of funding.
With these steps in mind, you're well on your way to securing a grant for your solar panels. And remember, SpotDif is here to help you compare and choose the best solar panel provider for your project, making your journey to solar energy smooth and successful.
Will Government planning rules make installing solar panels easier?
In November 2023, the UK government announced an update to planning permission in relation to solar panels.
Previously, both homeowners and businesses faced lengthy and complex permission processes, but the government is now simplifying the installation process with new planning permission rules designed to ease and speed up installations.
For businesses, the requirement for planning permission for over one megawatt installations will be eliminated, and homeowners can install solar panels without as much red tape and complication.
This shift is vital for the UK's transition to renewable energy, aiming to achieve 70GW of solar power by 2035 and reduce reliance on fossil fuels, leading to more affordable energy and a lower carbon footprint.
Search and compare solar panel providers with SpotDif
As you can see, there are plenty of grants and schemes available to help make solar panel installation more affordable and accessible. If you’re ready to get started on your solar power journey, SpotDif has just what you need.
Compare trusted solar panel providers and installation companies near you and get ready to embrace renewable energy.
Last updated on 25 Sept 2024