Get business grants, green loans and financing for a retrofit

There are a number of funding schemes, tax breaks and loans that can help SMEs do a building retrofit.

Timing a renovation to take advantage of funding opportunities can be a key factor in deciding when and how to take on a retrofit.

Contents

  1. Find business grants and schemes
  2. Apply for the Boiler Upgrade Scheme
  3. Apply for the Industrial Energy Transformation Fund (IETF)
  4. Get a business rate exemption on energy generation and storage
  5. Save VAT on energy saving measures for home businesses
  6. Get a green loan

Find business grants and schemes

Use our finance and support page to find green business grant programmes in your region.

Many are designed to help with improving energy efficiency and offer:

  • grants with no payback requirement
  • matching funds up to a total amount or percentage of costs
  • loans with low or no interest
  • free expertise for energy assessments

Funding is dependent on the size of your business and where it’s located.

You can also use GOV.UK’s fund listing service to find programmes that apply to your business.

Apply for the Boiler Upgrade Scheme

You might be eligible for a grant to upgrade your boiler if you own a smaller non-domestic property in England or Wales.

The Boiler Upgrade Scheme gives £7,500 grants towards the cost of an air source heat pump or a ground source heat pump (including water source heat pumps and those on shared ground loops), and £5,000 towards a biomass boiler.

You may be able to claim if you:

  • are currently using a fossil fuel heating system or non-heat pump electric heat
  • install a system that meets minimum efficiency levels (your installer can advise you on these)
  • have an installation capacity of no more than 45kWth (this covers most homes)
  • have a valid Energy Performance Certificate (EPC) with no outstanding recommendations for loft or cavity wall insulation

Find a certified installer to check if your property is suitable.

The grant is automatically applied to your installation cost by the company doing the work if you’re eligible.

Find out if a heat pump is right for your business

Apply for the Industrial Energy Transformation Fund (IETF)

For larger sites with high energy use, the Industrial Energy Transformation Fund (IETF) provides up to £30M in matching funding per business for a variety of efficiency measures.

The scheme is designed to run until 2028 and is available across the UK.

Phase 3 of the IETF is open for new applications, supporting industry to cut their energy bills and carbon emissions through investing in energy efficiency and low carbon technologies. For queries about the IETF, contact IETF@beis.gov.uk.

Scotland has a similar IETF scheme. If your site is based in Scotland, you can apply for the Scottish Industrial Energy Transformation Fund (SIETF), or contact them at IETF@gov.scot.

Funds are available for:

  • feasibility or engineering studies
  • improving energy efficiency for an industrial process
  • reducing emissions caused by an industrial process

How much you will get will depend on the type of funding and the size of your business.

Get a business rate exemption on energy generation and storage

You can get a business rate exemption for eligible equipment used in on site renewable energy generation and storage.

According to the 2022 Spring Statement you must be located in England and purchase:

  • solar panels, heat pumps or other onsite renewable technology
  • energy from low-carbon heat networks

Check GOV.UK about business rate relief for full details when they become available.

Save VAT on energy saving measures for home businesses

From 2022 to 2027 VAT will no longer be charged on some domestic energy saving measures in England, Scotland and Wales.

It will be cheaper to make your home business more energy efficient, including insulation, heat pumps, solar panels, wind turbines and more.

Get a green loan

A number of banks can help SMEs finance projects such as building retrofits.

Usually banks who can help provide ‘green loans’ to pay for building upgrades.

To apply you might need:

Incentives for green loans can include:

  • waived fees
  • flexible repayment schedules
  • variable or fixed interest rates

Ask your bank about what they offer. Most banks also have green investment options. Green investment options allow you to put money into funds that work to improve sustainability.

Take part in the UK Net Zero Business Census
Take part in the UK Net Zero Business Census