Renewable heat scheme for Scottish homeowners

Renewable heat scheme for Scottish homeowners

16 November 2020

A new £4.5 million cashback incentive to help people install renewable and energy efficiency measures in their homes has been announced by the Scottish Government.

Homeowners will be able to apply for 75% cashback up to the value of £7,500 towards the cost of a renewable heating system and a further 40% cashback up to £6,000 for energy efficiency measures.

Both incentives operate on a first-come-first-served basis until the end of financial year 2020/21.

This is in addition to the £4 million renewable heat cashback scheme for SMEs which opened for applications last week.

Scotland’s Energy Minister, Paul Wheelhouse, said:

“This new scheme is part of our ongoing work to support people to install renewable heat measures and the improve energy efficiency in homes across Scotland while we also seek to stimulate development of local supply chains.

“The Scottish Government already provides a substantial free advice and support service to Scottish households to support them to make the transition to renewable heat and improve energy efficiency in their homes.

“Through this new cashback incentive homeowners could receive up to £13,500 of Scottish Government support, helping them to improve energy efficiency in their homes, reduce energy usage and save money on their bills.

“This new scheme is part of our action to reduce emissions from heating our buildings and to support a green economic recovery from COVID-19 and I hope suitably qualified businesses are able to also pick up some valuable local work. Our wider package of work to support the recovery includes a £4 million renewable heat cashback scheme which opened to SMEs last week.”


The cashback offering for owners of domestic premises is an extension of the Home Energy Scotland loan scheme which offers interest free loans for those wishing to install renewable and energy efficiency measures in their homes.

More information about the cashback grant scheme to encourage homeowners can be found on the Home Energy Scotland website.

There are certain things you need to do to claim the loan, both when applying and carrying out the work.

  • Anyone who is a homeowner can apply.
  • You can use the loan for home renewables systems or energy storage systems.
  • Remember, the loan is only available for properties in Scotland.

What you need to do

You can only apply using the application form provided to you by Home Energy Scotland.

You must contact Home Energy Scotland personally to get impartial advice about your home, which will help decide the best options for you. Third parties – for example, installers or letting agents – are not allowed to apply on behalf of clients.

How much can you borrow?

What you can borrow depends on what improvement or installation you want. They’re grouped into two types:

Energy efficiency improvements
The most you can borrow is £15,000 (including a maximum cashback amount of £3,750).

Maximum loan amount and cashback available for each energy improvement:

  • Solid wall insulation: up to £10,000 (£7,500 loan plus £2,500 cashback)
  • Heating system (gas, LPG or oil boilers): up to £5,000 (no cashback available)
  • Heating system (warm air units or high heat retention electric storage heaters): up to £5,000 (£4,600 plus £400 cashback)
  • Gas connection: up to £5,000 (no cashback available)
  • Glazing: up to £4,500 (£4,100 loan plus £400 cashback)
  • Insulated doors: up to £4,500 (no cashback available)
  • Flat roof or room-in-roof insulation: up to £4,000 (£3,000 loan plus £1,000 cashback)

Loft, floor or cavity wall insulation: up to £1,000 (£750 loan plus £250 cashback)

For certain measures the cashback values stated above are 25% of total costs. These will soon increase to 40% (launch date to be confirmed) with a cap of £6,000 per property. Additional cashback is subject to availability of funds and will be allocated on a first-come, first-served basis.

Renewables systems

(including energy storage systems and district heating scheme connections)

You can apply for up to two home renewables systems per home up to £17,500 in total, plus an energy storage system up to a maximum of £6,000 – read Home Energy Scotland Loan – in detail to find out more.

Maximum loan amount:

  • Wind or hydro turbines: £2,500
  • Solar photovoltaic (PV) or solar water heating systems: £5,000
  • Energy storage systems (heat or electric batteries): £6,000
  • Hybrid PV-solar water heating systems: £7,500
  • Heat pumps (either air source to water, ground source to water, water source to water or hybrid air source to water): £10,000
  • Biomass boilers or stoves (non-automated, non-pellet stoves or room heaters are not eligible): £10,000
  • Connections to a renewably-powered district heating scheme: £5,000

Cashback of up to 75% of the total cost will be available for certain renewable heating systems in late 2020 (date to be confirmed). Eligible systems are biomass boilers, solar hot water systems, and heat pumps (ground source to water, and air source to water heat pumps).

If you have already applied for a Home Energy Scotland Loan you do not need to do anything. We will let you know if you are eligible for cashback when we send you a loan offer (if this is after the launch date).

Secondary improvements

You can also borrow up to £500 (including up to £125 cashback currently, or up to £200 from late 2020, date to be confirmed shortly) for what are known as secondary improvements. They’re not available on their own – you need to combine them with one of the energy efficient improvements or renewables systems listed above. Examples include cylinder thermostats, heating controls or hot water jackets.

Call Home Energy Scotland on 0808 808 2282 for further information

Loans are administered by Energy Saving Trust. Successful loans are subject to an administrative fee of 1.5%, up to a maximum of £150. Work must not commence before a loan offer has been made. For certain improvements, you will need to use a certified installer.