Government Grants for Solar Panels & Boilers

The UK government offers several schemes to help households reduce energy costs through solar panels, boiler upgrades, and energy efficiency improvements. With ECO4 now closed to new applicants (31 March 2026), the focus has shifted to a new generation of schemes — notably the Warm Homes: Local Grant and the Boiler Upgrade Scheme.

Here’s a complete, up-to-date guide to what’s available and how to qualify.

Warm Homes: Local Grant

The Warm Homes: Local Grant is the government’s new flagship energy efficiency scheme, designed to replace the ECO4 obligation for low-income and vulnerable households. It funds energy efficiency improvements — including insulation, heating upgrades, and in some cases solar panels — for households that meet income and property criteria.

What the Warm Homes: Local Grant Covers

• Insulation — Loft, cavity wall, and solid wall insulation
• Heating upgrades — Boiler replacement, heat pumps, and first-time central heating
• Solar PV — In some cases, funded as part of a whole-house package
• Heating controls — Smart thermostats, TRVs
• Ventilation and draught-proofing — Whole-house energy improvements

Warm Homes: Local Grant Eligibility

You may qualify if:

• Your household income is below approximately £36,000/year (thresholds vary by household size and region)
• Your home has an EPC rating of D, E, F, or G
• You live in a property that is owner-occupied or privately rented (social housing is covered under separate obligations)
• You are vulnerable to cold (elderly, disabled, young children, or long-term illness)

Local authorities help identify and refer eligible households, similar to the old ECO4 LA Flex route. Contact your local council’s energy efficiency team to ask about a referral.

How Much Is the Warm Homes: Local Grant Worth?

The grant can fund improvements worth up to £15,000 per household, depending on the measures needed and the property’s EPC uplift potential. For the most eligible households, the work is fully funded with no contribution required.

Boiler Upgrade Scheme (BUS)

The Boiler Upgrade Scheme (BUS) provides a government grant of £7,500 towards the cost of replacing an old fossil-fuel boiler with a low-carbon heating system — an air source heat pump, ground source heat pump, or biomass boiler.

BUS Details

• Grant amount: £7,500 for air source and ground source heat pumps
• Biomass grant: £5,000 for biomass boilers (rural properties only)
• What it covers: Air source heat pump, ground source heat pump, biomass boiler
• Eligibility: Most homeowners in England and Wales with a property EPC, currently heated by fossil fuel (gas, oil, LPG, coal). New builds are not eligible.
• How to apply: Through an MCS-certified installer who applies on your behalf — the £7,500 is deducted from your quote
• Deadline: Scheme runs until 2028

Why BUS + Solar Works Together

If you’re replacing a gas boiler with a heat pump, adding solar panels makes strong economic sense: the heat pump runs on electricity, and solar panels reduce the electricity it draws from the grid. Combined with the £7,500 BUS grant, the total system payback can be under 8 years. See our air source heat pump cost guide for details.

Smart Export Guarantee (SEG)

The Smart Export Guarantee (SEG) requires energy suppliers with more than 150,000 customers to pay households for excess solar electricity exported to the grid.

SEG Key Points

• Minimum rate: 1p per kWh (most suppliers pay more)
• Best rates: Up to 15p per kWh with certain suppliers
• Typical annual income: £80-£200 for a 4kW system
• Requirements: MCS-certified installation and a smart meter

SEG Rates by Supplier (2025-2026)

Solar Together (Collective Buying)

Solar Together is a group-buying scheme run by local councils that uses collective purchasing power to negotiate discounted solar panel prices.

• Discount: Typically 20-30% below market prices
• How it works: Register interest → auction → accept offer → installation
• Availability: Check if your local council participates
• No income criteria: Open to all homeowners

0% VAT on Energy Efficiency Measures (Until 2027)

Since April 2022, residential solar panel installations and energy efficiency measures have been eligible for 0% VAT instead of the standard 20%. This applies to:

• Solar PV panels and battery storage
• Air source and ground source heat pumps
• Insulation and draught-proofing
• Installation labour and related equipment

For a £7,000 solar system, the VAT saving is £1,400. For a heat pump install, the saving is similar. This relief is currently scheduled to end on 31 March 2027.

What About ECO4?

The Energy Company Obligation 4 (ECO4) closed to new applicants on 31 March 2026. It was the main government scheme for energy efficiency improvements from 2022 to 2026. Households that applied before the deadline continue to have their measures delivered, but no new applications are being accepted.

The government has consulted on a successor scheme, ECO5, expected later in 2026. In the meantime, the Warm Homes: Local Grant is the primary route for low-income households seeking funded energy efficiency improvements. See our dedicated guide: ECO4 has ended — what replaces it.

How to Apply for Grants

The application process varies by scheme, but the general steps are:

1. Check your eligibility — Use our free 60-second assessment tool
2. Gather documents — Energy bills, proof of income, EPC certificate (if you have one)
3. Speak to an advisor — We’ll guide you to the right scheme
4. Free home survey — An assessor visits to check your property
5. Approval & installation — If approved, work is completed quickly

Want to find out which grants you qualify for? Use the form above or check your eligibility now →