Warm Homes Loan Scheme (WHLS)Government-Supported Finance for Home Energy Upgrades
Through the scheme, homeowners and private landlords can access reduced-interest finance towards technologies including solar panels, battery storage and heat pumps, helping to reduce the upfront cost barrier to upgrading a property.
Government funding is used to reduce the cost of borrowing through participating lenders, potentially making a major home energy upgrade considerably more affordable than financing the same installation using standard borrowing.
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What is the Warm Homes Loan Scheme?
The Warm Homes Loan Scheme is part of the Government’s wider Warm Homes Plan, which aims to help households improve the energy performance of their homes, reduce energy bills and accelerate the transition to low-carbon heating and renewable energy.
Unlike a traditional home improvement grant, the WHLS provides support through government-supported, reduced-interest finance offered by participating lenders.
The Government provides participating lenders with grant support of up to 20% of the eligible loan amount, enabling them to offer eligible customers a reduced interest rate. The grant is paid to the lender rather than directly to the customer.
This means you still borrow money and repay your loan, but the cost of borrowing can be significantly lower than it would be without the government support.
How does the Warm Homes Loan Scheme work?
The process will depend on the participating lender and the type of home improvement you choose, but broadly it works like this:
- Choose your home energy upgrade – such as solar PV, battery storage or an eligible heat pump.
- Get an eligible installation quote – for applicable technologies, the installation must use an MCS-certified product and MCS-certified installer and meet the relevant MCS design and installation standards.
- Apply through a participating lender – the lender will carry out its normal eligibility, affordability and creditworthiness checks.
- Government funding reduces the borrowing cost – participating lenders receive government support which must be reflected in a reduced interest rate for the customer.
- Your system is installed and verified – eligible installations must meet the relevant scheme requirements.
- Repay your finance – you make the agreed repayments to your lender over the chosen loan term.
Importantly, WHLS does not have a government-set household income threshold. Instead, participating lenders decide whether an applicant can afford the finance using their normal lending and affordability criteria.
How much government funding is available?
The Warm Homes Loan Scheme forms part of a major package of government investment in home energy upgrades.
The Government has set out plans for up to £1.7 billion from the Warm Homes Fund for new low- and zero-interest consumer loans, alongside up to £300 million of additional government funding designed to reduce borrowing costs.
For the initial WHLS, the Government says the scheme will deploy £300 million of grant capital while working with participating lenders to increase demand for home retrofit and reduce the cost of finance.
The important point for homeowners is that this funding isn’t normally handed to you as cash.
Instead, government support is provided to participating lenders and used to make eligible finance cheaper.
How much can WHLS reduce the interest rate?
Under the current scheme rules, government support is designed to provide an interest-rate reduction of up to 5 percentage points from the lender’s relevant starting rate, subject to the scheme funding cap.
The actual interest rate and APR you are offered will depend on factors including:
- the participating lender
- the finance product
- the amount borrowed
- the repayment period
- your individual circumstances and credit assessment
- the amount of government support applicable to the loan.
Some qualifying loans could potentially reach a 0% supported interest rate where the lender’s starting rate and available government support allow it. However, WHLS should not be described as a universal 0% finance scheme: the rate available will depend on the individual participating product.
Government support is currently available on eligible loans with a term of three years or more.
What can I finance with the Warm Homes Loan Scheme?
The WHLS focuses on low-carbon heating, renewable electricity generation and energy storage technologies.
Solar photovoltaic (PV) panels are eligible under the scheme.
This includes:
- new rooftop solar PV systems
- adding additional solar panels to an existing installation
- eligible installation and associated works
- certain electrical works required for the installation.
Solar panels generate renewable electricity from daylight, helping you buy less electricity from the grid.
Combining solar PV with battery storage can allow more of the electricity generated by your home to be used when you need it.
Home battery storage is also eligible.
A battery can be installed:
- alongside a new solar PV system
- alongside an existing solar installation
- as a standalone battery system.
Battery storage allows electricity to be stored for use later, which can help households make better use of their own solar generation or potentially take advantage of suitable time-of-use electricity tariffs.
Eligible air-to-water heat pumps, often referred to simply as air source heat pumps, can be financed through WHLS.
An air-to-water heat pump extracts heat from the outside air and transfers it into your home’s wet central-heating system to provide space heating and hot water.
WHLS can also potentially be combined with the Boiler Upgrade Scheme (BUS).
This means an eligible household may be able to receive a Boiler Upgrade Scheme grant towards the cost of a heat pump and use a Warm Homes Loan Scheme product to finance eligible installation costs remaining after the grant has been applied.
The new heat pump must not replace an existing low-carbon heating technology, such as an existing heat pump.
Air-to-air heat pumps are also being brought within government support for low-carbon heating.
Unlike an air-to-water system, an air-to-air heat pump transfers heat directly into rooms through indoor units rather than heating water for radiators or underfloor heating. Many systems can also provide cooling.
The Boiler Upgrade Scheme currently provides a £2,500 grant towards an eligible air-to-air heat pump.
Under the current Warm Homes Loan Scheme rules, however, air-to-air heat pumps can only become an eligible WHLS measure once the required MCS product, design and installation standards have been introduced.
The Government’s August 2026 WHLS rules therefore state that air-to-air heat pumps are not yet eligible for WHLS applications, because they cannot currently meet the scheme’s MCS certification requirement.
Air-to-air heat pumps are not currently eligible for WHLS applications. Further information will be provided when the necessary MCS standards are available.
An electric vehicle chargepoint can be included as an eligible ancillary cost when it is installed as part of a qualifying solar PV and/or battery storage installation.
A standalone EV charger is not currently an eligible WHLS measure.
The chargepoint and installer must meet the applicable OZEV approval requirements. WHLS cannot fund a chargepoint installation that has already received an OZEV or other public grant for the same chargepoint.
The Warm Homes Loan Scheme also supports a number of other eligible low-carbon heating and renewable energy technologies.
Ground source heat pumps
Eligible ground source heat pumps, including certain water source heat pumps and systems using shared ground loops, can be financed through WHLS.
Biomass boilers
Eligible biomass boilers can be supported for qualifying rural properties, where the applicant is receiving an applicable Boiler Upgrade Scheme or equivalent devolved-nation grant.
Heat network connections
WHLS can help finance the cost of connecting a domestic property to an eligible existing or planned low-carbon heat network, which supplies heating and/or hot water to multiple properties from a shared heat source.
Micro-renewable energy systems
Eligible domestic wind turbines and micro-hydroelectric systems can also be supported through WHLS, subject to the scheme’s technical and installation requirements.
How much can I borrow through the Warm Homes Loan Scheme?
The amount you can borrow through the Warm Homes Loan Scheme depends on the energy-saving measures you are installing, the total cost of the project and the lending criteria of your chosen finance provider.
The Government has set maximum supported amounts for individual technologies, as well as an maximum WHLS-supported loan amount of £35,000.
This is important if you are installing more than one measure. For example, although solar PV has a £15,000 cap and battery storage has a separate £15,000 cap, adding several technologies together does not mean you can borrow without limit. The total WHLS-supported loan must remain within the maximum WHLS-supported loan amount of £35,000.
The current individual measure caps are:
| Eligible technology | Maximum supported amount |
|---|---|
| Solar PV | £15,000 |
| Battery storage | £15,000 |
| Air-to-water heat pump | £20,000* |
| Air-to-air heat pump | £10,000* |
| Ground source heat pump | £35,000* |
| Biomass boiler | £20,000* |
| Heat network connection | £7,500 |
| Micro-renewable system | £20,000 |
| Maximum WHLS-supported loan amount | £35,000 |
*The heat-pump and biomass caps are stated before any applicable Boiler Upgrade Scheme or equivalent devolved-nation grant is deducted. Air-to-air heat pumps have a £10,000 technology cap under the Scheme Rules but are not currently eligible for WHLS applications because the necessary MCS standards are not yet available. The Government’s current scheme rules confirm the individual measure limits.
What happens if I install more than one measure?
You can potentially finance a combination of eligible technologies through the same project, subject to the lender’s product and the WHLS rules.
For example, you could consider:
- solar panels and battery storage
- solar panels, battery storage and an eligible heat pump
- a heat pump alongside other qualifying renewable technologies.
Each individual measure must stay within its own technology cap, while the combined WHLS loan must not exceed £35,000.
For example, a £12,000 solar PV installation plus a £10,000 battery system would result in a £22,000 eligible project, subject to lender approval.
A £15,000 solar installation, £15,000 battery system and £10,000 of eligible heat-pump costs would total £40,000. Although the individual measures may each sit within their respective technology limits, only up to £35,000 could be supported within a single WHLS loan, subject to the lender’s affordability and credit assessment.
Do the caps include installation costs?
Yes. The relevant measure cap includes eligible costs needed to deliver that technology, including qualifying installation, labour and permitted ancillary works.
For example, eligible solar costs can include items such as scaffolding, temporary installation safety equipment and grid connection. Eligible heat-pump costs can include necessary associated works such as certain radiator, pipework and hot-water-cylinder upgrades.
Those ancillary costs still count towards the relevant technology cap.
Can I borrow more than £35,000?
A participating lender may choose to offer separate additional finance for costs that fall outside the Warm Homes Loan Scheme, such as insulation, replacement windows and doors or roofing work required before a solar installation.
However, that additional borrowing would be a separate finance product and would not receive WHLS government support.
These are scheme maximums rather than guaranteed borrowing amounts. The amount you can actually borrow will depend on your installation cost, the technologies selected, the participating lender, its product limits and its affordability and creditworthiness assessment.
Can I combine WHLS finance with a government grant?
In certain circumstances, yes.
Under the current Scheme Rules, WHLS can be used alongside specified government support, including the Boiler Upgrade Scheme (BUS) and the Home Energy Scotland Grant for Heat Pumps, where the relevant eligibility requirements are met.
For example, an eligible customer receiving a BUS grant towards a heat pump may be able to use WHLS finance for eligible installation costs remaining after the grant has been applied.
Who is eligible for the Warm Homes Loan Scheme?
The scheme is primarily designed for:
Owner-occupiers
homeowners looking to install eligible energy technology at their own domestic property.
Private landlords
landlords in the private rented sector looking to finance eligible improvements to residential properties.
The property must be a domestic property in the United Kingdom.
Unlike some energy-efficiency grants, the WHLS does not impose a government household income limit and does not require every applicant to live in a particular council area or postcode.
However, this is still borrowing.
Your lender will therefore carry out its own creditworthiness and affordability assessment, and lenders can apply additional eligibility requirements to their individual WHLS products.
Approval is not guaranteed.
Warm Homes Loan Scheme FAQs
Not currently as standalone eligible WHLS measures.
The current Warm Homes Loan Scheme is primarily focused on eligible low-carbon heating, renewable electricity generation and storage technologies.
For example, insulation isn’t funded as an ancillary part of a WHLS heat pump installation, and replacement roofing or structural work required before solar panels can be fitted isn’t covered by the solar measure.
A participating lender may separately offer other home-improvement finance for these costs, but that additional borrowing would not necessarily receive WHLS government support.
If you are on a lower income, it is also worth checking whether you qualify for separate fully funded energy-efficiency support, such as the Warm Homes: Local Grant in England, which can fund measures including insulation for eligible households.
Despite the similar names, these are different types of support.
The Warm Homes Loan Scheme (WHLS) provides government-supported finance. You borrow money from a participating lender and repay it, with government funding helping to reduce the cost of borrowing.
The Warm Homes: Local Grant provides fully funded home improvements to qualifying lower-income households in England. Eligible households do not repay the cost of the agreed improvements.
So, broadly:
WHLS = reduced-cost finance that you repay.
Warm Homes: Local Grant = grant-funded improvements for qualifying households.
If you’re eligible for fully funded support, you should consider your grant options before taking out borrowing.
For households that want to improve their home but don’t want – or aren’t able – to pay the full installation cost upfront, WHLS could make technologies such as solar panels, batteries and heat pumps more accessible.
Potential benefits include lower borrowing costs, less money required upfront, the ability to spread the cost of an installation over several years and access to finance for technologies that could reduce your reliance on purchased energy.
However, finance repayments are an additional household commitment. Any expected energy-bill savings should not automatically be assumed to cover the cost of your repayments.
The suitability of an installation and finance product will depend on your home, energy consumption, chosen technology, installation cost and personal financial circumstances.
Not necessarily.
The Government’s wider Warm Homes Plan includes an ambition for low- and zero-interest consumer finance, but individual WHLS products will vary.
Under the current scheme rules, government support is designed to reduce the lender’s relevant starting interest rate by up to around five percentage points, subject to the applicable funding cap.
That means some products or customers could potentially receive finance at 0%, while others will pay a reduced rate above 0%.
Always check the interest rate, APR, total amount repayable, monthly repayments and loan term before accepting finance.
The scheme is government-supported, but the consumer finance itself is provided by participating lenders. The Government does not underwrite individual WHLS loans or make lending decisions.
The lender remains responsible for its product, pricing, affordability and credit decisions, while government funding supports the lender in reducing the cost of eligible finance.
You therefore repay the lender rather than repaying a loan directly to the Government.
WHLS stands for the Warm Homes Loan Scheme, a UK Government-supported scheme designed to make finance for eligible low-carbon home improvements more affordable.
Yes. Eligible rooftop solar photovoltaic (PV) installations are included within the current Warm Homes Loan Scheme.
Yes. Eligible electrical battery storage can be financed either alongside solar panels or as a standalone battery installation.
Yes. Eligible heat pump installations are included. Depending on the technology and location, WHLS finance may also be used alongside an applicable government grant such as the Boiler Upgrade Scheme.
Yes. The current scheme includes private rented sector landlords as an eligible borrower group, although individual lender criteria will apply.
There is no government-set income threshold for WHLS. Participating lenders will instead assess whether you can afford to borrow and repay the finance.
There is no scheme-wide EPC rating requirement under the current WHLS rules, although individual lenders may introduce their own requirements.
Potentially, yes. WHLS does not have a government-set maximum household income. Your application will instead depend on the eligibility and lending criteria of the participating finance provider.
The current WHLS scheme cap for eligible solar PV installations is £15,000. The actual amount available to you will depend on the lender and your individual application.
The current maximum supported amount is £20,000 for an air-to-water heat pump and £35,000 for a ground source heat pump, before applicable grant funding is deducted.
Yes, where the relevant eligibility requirements are met. WHLS can be used to finance eligible heat-pump installation costs remaining after an applicable Boiler Upgrade Scheme grant.
They are not standalone eligible measures under the current WHLS rules. Other government schemes may provide support for insulation and wider energy-efficiency improvements.
No. WHLS is a finance scheme, so applications remain subject to the participating lender’s eligibility, affordability and creditworthiness requirements.
For applicable microgeneration technologies, yes. The product must be MCS certified and installed by an MCS-certified installer in accordance with the relevant MCS design and installation standards.
Potentially, yes. Owners of multiple properties can apply for WHLS finance for each eligible property, subject to the Scheme Rules and the participating lender’s eligibility, affordability and creditworthiness requirements.