Households throughout the United Kingdom can now apply for government-backed loans to install energy-saving technologies such as heat pumps, solar panels and batteries without any upfront payment, according to the Guardian.
The Warm Home Loans scheme, which opened for applications on Tuesday, provides financing ranging from £7,500 to £35,000 at interest-free or reduced rates. Energy Secretary Miatta Fahnbulleh said the programme will help families “upgrade their homes with no upfront costs to make them warmer and cheaper to run”.
Major energy suppliers including British Gas and E.On have formed partnerships with financial institutions such as Tandem Bank and Homeserve to deliver the loans directly to their customers at rates below those typically available from high street banks.
How much can households borrow and save
Homeowners looking to replace gas boilers with air-source heat pumps can access loans of up to £10,000, whilst ground-source heat pumps qualify for financing of up to £35,000. These loans can be combined with existing government grants worth up to £9,000 annually for households installing alternatives to fossil fuel heating systems.
According to government estimates, fitting a heat pump alongside a battery storage system and solar panels could reduce annual energy bills by as much as £550. Households that also switch to a time-of-use tariff—which charges lower rates during off-peak hours—could see total savings reach £850 per year.
Chris Norbury, chief executive of E.On UK, cited a recent trial in Coventry where fuel-poor customers saved an average of more than £250 annually by combining home batteries with time-of-use tariffs. He described the new loan scheme as “an opportunity to take that further” by “removing barriers to low-carbon technologies”.
Budget uncertainty over grant scheme
The loan programme launched a day before Chancellor John Healey is due to deliver his first budget on Wednesday. According to the Guardian, the budget is expected to include cuts to the existing boiler upgrade scheme, which provides grants for heat pump installation.
Treasury sources suggest hundreds of millions of pounds may be trimmed from the scheme’s £2.7bn five-year budget, as officials reportedly view it as a subsidy primarily benefiting middle-class households. The scheme currently offers grants of up to £7,500 towards the £13,600 typical cost of a heat pump, leaving households to cover a substantial gap.
However, grants of up to £9,000 are expected to remain available for properties not connected to the gas grid that rely on expensive heating oil. These households would be able to use the grants alongside the new low-interest loans to cover the full cost of installation.
Besides British Gas and E.On, other lenders participating in the Warm Home Loans scheme include HTG Finance, Propensio, Secure Trust Bank, Selina Finance, South Manchester Credit Union, Sunsave, The Money Co-op and This Bank.
What this means for Poles in the UK
Polish homeowners and long-term tenants in the UK with landlord permission can now significantly reduce energy costs through this scheme without needing savings for upfront installation. This is particularly valuable given that many Polish households in Britain face high energy bills, especially those in older, less efficient properties.
If you own your home or rent with permission to make improvements, you can apply for loans through participating energy suppliers or lenders. Repayments are spread over several years, making green technology accessible even on modest incomes. Those not connected to the gas grid—common in rural areas where some Polish families have settled—should particularly note the £9,000 grants that can fully cover heat pump costs when combined with the loans.
Check with your current energy supplier whether they participate in the scheme, or contact one of the listed lenders directly. Even renters may benefit if landlords agree to install the technology, as bill savings go to the occupant. With energy prices having soared in recent years, the potential £850 annual saving represents a meaningful reduction in household expenses for Polish families in the UK.
