This beginner guide explains the main ways to fund a home energy upgrade in the UK. You have three broad options: grants, loans and a mix of both. Your nation, income and home decide which ones apply. We explain each option in plain terms and point you to the official sources.
Independent guide. We are not a lender or a government body. Always check current scheme rules with the official provider.
Grants
A grant pays part or all of the cost, and you do not repay it. Warm Homes: Local Grant supports low-income households in England. ECO4 also supports low-income households, but it ends on 31 December 2026. The Boiler Upgrade Scheme gives heat pump grants in England and Wales with no income test.
Scotland runs the Home Energy Scotland Grant and Loan. Wales adds the Welsh Government's Nest scheme. Homeowners in Northern Ireland should check official Energy Saving Trust advice.
| Scheme | Nation | Type | Who it suits | Key condition |
|---|---|---|---|---|
| Warm Homes: Local Grant | England | Grant | Low-income households in privately owned homes | EPC rating D to G; apply through GOV.UK or your council |
| ECO4 | England | Grant | Low-income households | Ends 31 December 2026, with no successor obligation |
| Boiler Upgrade Scheme | England and Wales | Grant | Homeowners replacing fossil fuel heating | MCS-certified installer; heat pumps and biomass boilers only |
| Warm Homes Loan Scheme | England and Wales | Loan | Homeowners who want to spread the cost | Eligibility and application process not yet published |
| Nest | Wales | Grant | Welsh households seeking efficiency support | Check the Welsh Government scheme for details |
| Home Energy Scotland Grant and Loan | Scotland | Grant and optional loan | Scottish homeowners; no benefits requirement | Written funding offer before work starts; MCS installer |
| Official advice | Northern Ireland | Advice | Homeowners in Northern Ireland | Check Energy Saving Trust advice for current schemes |
Loans
A loan spreads the cost, and you repay it with any interest. The Warm Homes Loan Scheme is a government-backed loan for England and Wales. Treasury backing lets lenders offer rates up to 5 percentage points below normal. Three details are not yet confirmed. The Government has not published the eligibility rules. It has not confirmed how or when you apply. Each lender has not yet published its rates.
Some loans are secured on your home, such as second mortgages. A secured loan puts your home at risk if you fall behind. Compare every loan on its total cost of credit.
Choosing your route
Check grants before loans, because grants do not need repaying. Then borrow only the balance. Follow these steps to find your route.
- Confirm which nation your home is in.
- Check your household income and any means-tested benefits.
- Find your home's EPC rating.
- Choose the upgrade you want.
- Match your answers to the schemes in the table above.
- Get two or three written quotes from MCS-certified installers.
Checklist
- Nation confirmed
- Income and benefits checked
- EPC rating found
- Grants checked before loans
- Any loan compared on total cost of credit
- Installer checked on MCS
Frequently asked questions
What is the difference between a grant and a loan?
You do not repay a grant. You repay a loan with any interest.
Do I need to be on benefits to get a grant?
No. Several schemes have no benefits test, including the Boiler Upgrade Scheme and the Home Energy Scotland grant.
Can I use a grant and a loan together?
Often, yes. A grant lowers the price, so you borrow less.
Is ECO4 still running?
Yes, until 31 December 2026. There is no successor obligation.
Where do I start in Wales?
Check the Boiler Upgrade Scheme, the Warm Homes Loan Scheme and the Welsh Government's Nest scheme.
So you can understand every funding route and pick the one that fits your home.
WHLS Editorial Team
Our editorial team writes independent, plain-English guides on home energy finance. We review guides when scheme rules change.
References
- GOV.UK – Notice of approved grant categories and values for the Boiler Upgrade Scheme (opens in a new tab)
- Energy Saving Trust – Boiler Upgrade Scheme (opens in a new tab)
- MoneySavingExpert – Warm Homes Loan Scheme news (October 2026) (opens in a new tab)
- Financial Conduct Authority – Financial Services Register (opens in a new tab)
- MCS – Find an installer (opens in a new tab)
- Energy Saving Trust – Warm Homes: Local Grant guide (opens in a new tab)
- GOV.UK – Extending the ECO4 end date: government response (opens in a new tab)
- Home Energy Scotland – Grants and loans (opens in a new tab)
- MCS – Home Energy Scotland Grant and Loan (opens in a new tab)
- Energy Saving Trust – Welsh Government Nest scheme (opens in a new tab)
