Solar Panel Grants & Funding in 2026

The UK government and energy industry offer several grants, tax breaks, and payment schemes that make solar panels more affordable and more rewarding than at any point in the past decade. Whether you are a homeowner looking to reduce your electricity bills, a lower-income household eligible for funded installations, or a business seeking tax relief on renewable energy investment, there is financial support available.

D&R Energy helps customers across Bristol, North Somerset, Bath, and the wider South West navigate the full range of solar grants and incentives. Our team stays up to date with every scheme so we can advise you on exactly what you qualify for and ensure you receive every penny of support available.

The Warm Homes: Local Grant is the government's replacement for the ECO4 scheme, providing up to £15,000 of funded energy improvements — including solar panels, heat pumps, insulation, and heating upgrades — for eligible lower-income households.

To qualify, your household income must be below approximately £36,000 per year and your property must have an EPC rating of D, E, F, or G. The grant is delivered through local authorities and can cover multiple measures in a single installation, meaning you may receive both solar panels and insulation at no cost.

Lendology CIC is a community interest lender that provides affordable, interest-free (or low-interest) loans for home energy improvements, including solar panels and battery storage. Unlike bank loans, Lendology loans are specifically designed for energy efficiency upgrades and are repaid in flexible instalments based on your circumstances.

If you are based in Somerset, B&NES, or North Somerset and your household income is modest but above the Warm Homes Grant threshold, Lendology may bridge the gap. Loan amounts are typically up to £15,000 and there is no interest charged for qualifying applicants. D&R Energy can refer you directly to Lendology as part of your installation planning.

Since April 2022, solar panels, battery storage, and other energy-saving materials have been zero-rated for VAT in the UK. This means you pay no VAT at all on your solar installation, saving you between £1,200 and £1,800 on a typical domestic system compared to the standard 20% rate. The 0% VAT rate is confirmed until at least March 2027, giving homeowners a clear window to take advantage of this significant saving.

The 0% VAT applies to solar panels, inverters, battery storage systems, mounting equipment, and the labour cost of installation. It covers both new solar installations and the addition of battery storage to existing systems. This is not a grant that requires an application or means-testing. Every homeowner in the UK is entitled to 0% VAT on solar panels and batteries, regardless of income or property type.

It is worth noting that the government has not yet confirmed whether the 0% VAT rate will be extended beyond March 2027. If the rate returns to 20%, the cost of a typical 4.5kWp solar installation would increase by approximately £1,500. This makes 2026 an optimal time to invest in solar while the full VAT saving is still available.

The Smart Export Guarantee is a government-mandated scheme that requires licensed energy suppliers with more than 150,000 customers to offer a tariff that pays you for surplus solar electricity exported to the national grid. Every MCS-certified solar installation is eligible for the SEG, and D&R Energy registers your system as part of our installation service.

SEG tariff rates vary between energy suppliers and change periodically, so it pays to shop around. Some suppliers offer fixed-rate tariffs while others offer variable rates linked to wholesale electricity prices. When wholesale prices spike, variable SEG tariffs can pay significantly more per kilowatt-hour exported. D&R Energy advises all our customers on the best SEG tariffs available at the time of installation and helps you set up your account.

The SEG works particularly well alongside battery storage. Your battery stores solar electricity for your own evening use, and only genuinely surplus energy is exported to the grid. This maximises the value of every kilowatt-hour your panels generate: you use the most valuable electricity yourself and sell what you cannot use. For a typical 4.5kWp system in Bristol or Somerset, SEG payments can add £100-£300 per year to your savings, depending on your tariff and consumption patterns.

The combination of 0% VAT, the Warm Homes Local Grant, Lendology interest-free loans, and the Smart Export Guarantee makes 2026 one of the best years on record to invest in solar panels. However, these incentives are not permanent. The 0% VAT rate is only confirmed until March 2027, and funded grant programmes have fixed budgets allocated on a first-come, first-served basis. Waiting could mean missing out on thousands of pounds in support.

D&R Energy is based in Portishead and serves homeowners and businesses across the entire South West. As an MCS-certified installer, every system we install qualifies for the Smart Export Guarantee and meets the highest quality standards in the industry. We provide free, no-obligation quotes with transparent pricing, and our team will guide you through every available grant and incentive.

Call us today on 0800 772 0758 or fill in our online contact form to check your eligibility for the Warm Homes Local Grant and get a free quote for your solar installation.