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The Scottish Government provides various schemes to assist householders and businesses with the installation of heat pumps. These come in the form of grants and loans, with some schemes tailored specifically to assist people on benefits or those most vulnerable to fuel poverty.

Heat pump funding for businesses and homeowners

The Scottish Government offers funding for heat pumps to businesses through its SME Loan Scheme. There is £100,000 available as an unsecured interest free loan and a grant up to £10,000.  

The Home Energy Scotland Grant and Loan Scheme offers funding to householders for heat pumps. Customers can apply to receive a grant of up to £7,500 and they can also apply for an interest free loan of up to £7,500 for a total of £15,000 funding. Increased grant funding is available to those in eligible rural and island postcodes. 

The funding on offer is shown below: 

Grant fundingLoan fundingTotal funding
SME Loan Scheme£10,000£100,000£110,000
Home Energy Scotland Grant and Loan Scheme£7,500£7,500£15,000
Home Energy Scotland Grant and Loan Scheme with rural uplift*£9,000£7,500£16,500

*The rural uplift is available to households in eligible rural and island postcodes

Funding for businesses

Funding for homeowners

Warmer Homes Scotland

Warmer Homes Scotland is funded by the Scottish Government. The installations are managed by Warmworks and referrals are handled through Home Energy Scotland. It covers the installation of energy efficiency home improvements and heating systems, including in some cases renewables, to help alleviate fuel poverty. It also includes energy advice, benefits checks and tariff advice support.

Households must meet qualification criteria and live in a property with a Standard Assessment Procedure (SAP) rating of 72 or below.

Find out more

Energy Company Obligation

The Energy Company Obligation (ECO) funds the installation of insulation, district heating connections, renewables, heating installations and repairs. It supports lower income and vulnerable domestic owner occupiers, private sector and social tenants depending on eligibility criteria.

Under ECO, medium and larger energy suppliers are obliged to fund the installation of energy efficiency measures in households.

The obligated energy suppliers work with installers to introduce certain efficiency measures into homes, such as loft or wall insulation, or heating measures.

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District Heating Loan Scheme

The District Heating Loan Scheme is managed by Energy Saving Trust. It provides unsecured loans of up to £1M+ towards capital measures for district heating or heat network projects. Large standalone anchor load buildings can also be supported.

Find out more