First, the Warm Homes Loan Scheme will use public money to provide low- and no-interest loans across the UK for certain types of home energy improvements, including heat pumps, solar panels and batteries. Ten private-sector lenders are initially offering the loans, which do not require money up front. Their rates are being lowered by up to 5% with government investment.

Homeowners will also be able to combine a loan with a grant of up to £9,000 through the government’s Boiler Upgrade Scheme (and Home Energy Scotland in Scotland), the government said. That £400mn scheme was not reduced in the budget.

Reacting, Greg Jackson at Octopus Energy said: ‘The government is right to support the development of the UK heat pump industry. With companies and public sector working together, we can continue the path of innovation and cost-reduction that will enable us to reduce Britain’s dependency on gas – a critical plank to improve our security and reduce heating bills. Moreover, this creates a secure future for the thousands of skilled professionals who’ve trained to install heat pumps and manufacture them here in Britain.’

Sachin Vibhute, Technical Consultant and Product Training Manager at heat pump supplier LG Electronics, commented: ‘It’s reassuring to see that heat pump subsidies have remained intact in the budget. The Boiler Upgrade Scheme (BUS) has been an important barometer of public confidence in low-carbon energy solutions. And, with August 2026 seeing the second-highest number of voucher applications since the scheme began, the demand for this technology is clear.’  

‘However, to ensure the industry can meet this growing demand, we need greater certainty about the future of the policy, including a clear timeline from the UK government on its long-term plans for the scheme.’

‘Skills shortages also remain a challenge for the wider rollout and long-term maintenance of heat pumps. Building resilience in the low-carbon heating sector will require greater investment in training and skills development. Clear, sustained support from the UK government will be essential to building the skilled workforce needed to deliver the transition.’

In related news, almost all (99%) of the 500 heat pump engineers, and heating, ventilation and air conditioning (HVAC) engineers surveyed by services provider Correla say they face barriers around training on heat pump technology, including time constraints, the complexity of the technology and a lack of skilled trainers.