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Thinktank Urges Government to Cut Solar Panel Loan Costs with 'Solar Bonds'

A new report suggests the government could make solar panels more affordable for lower-income households by reducing loan costs through a "solar bonds" scheme.

  • The Common Wealth thinktank proposes a universal entitlement to solar panels, funded by "solar bonds."
  • Households could pay around half the current market interest rates for panels, potentially saving £250 annually on energy bills.
  • The Department for Energy Security and Net Zero stated that ministers are already promoting clean energy and offering zero and low-interest loans for solar panels.

A report by the Common Wealth thinktank is urging the government to intervene to make solar panels more accessible by reducing the cost of loans. The report suggests a scheme funded by "solar bonds," which would be retail investment products similar to national savings investments.

Under the proposed scheme, households would pay significantly lower interest rates for solar panels, estimated at about half the current market rates of 9% to 10%. Donal Brown, lead author of the Common Wealth report, estimates this could cut household energy bills by approximately £250 a year. The 25-year loans could be repaid through an addition to standard energy bills and would be attached to the property.

The Department for Energy Security and Net Zero stated that ministers are already promoting clean energy and working to lower energy bills. Energy Secretary Miatta Fahnbulleh highlighted that almost 150,000 solar installations occurred in the first six months of 2026. The department also mentioned zero and low-interest loans for solar panels, batteries, and heat pumps, which could save families around £550 annually.

Gemma Grimes, director of policy and delivery at Solar Energy UK, welcomed the proposal for green bonds as a way to accelerate rooftop solar adoption.

Why this matters: The high initial cost of £5,000 to £10,000 for solar panel installations makes them unaffordable for many households, despite potential annual savings on energy bills.

What this means for you: If such a scheme were implemented, you could potentially access solar panels with lower interest rates on loans, leading to reduced energy bills.

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