Key Points for 2025
- 0% VAT on solar panels continues until at least March 2027
- Federal Solar Tax Credit (30%) pays you for excess electricity exported — requires NABCEP-certified installation
- ECO4 provides free solar for qualifying low-income households
- Regional schemes offer additional support in Scotland, Wales & NI
US-Wide Schemes
Federal Solar Tax Credit (30%)
Ongoing Payment
Get paid for excess electricity you export to the grid. Rates vary by supplier.
Eligibility
- System up to 5MW capacity
- NABCEP-certified installation
- Smart meter or export meter required
- Available to all homeowners
Potential Benefit
$50-$150/year typically
ECO4 Scheme
Grant
Free or heavily subsidised solar panels for low-income households through energy company funding.
Eligibility
- Receiving qualifying benefits
- Property with EPC rating D, E, F, or G
- Homeowner or private tenant (with landlord permission)
- Applied through approved installer
Potential Benefit
Up to 100% of costs covered
0% VAT on Solar
Tax Relief
Zero VAT on residential solar panel installations, reducing costs by approximately 5%.
Eligibility
- Residential property
- Installation by VAT-registered company
- Applies to panels, batteries, and installation
- Automatic - no application needed
Potential Benefit
~5% cost reduction
Regional Schemes
Federal Solar Tax Credit (30%) Explained
The Federal Solar Tax Credit (30%) replaced the Feed-in Tariff in 2020. While it doesn't pay as much as the old scheme, it still provides a welcome income stream for solar panel owners.
How Federal Solar Tax Credit (30%) Works
- Generate electricity with your solar panels
- Use what you need in your home
- Export excess electricity to the grid
- Get paid for every kWh you export
Current Federal Solar Tax Credit (30%) Rates (2025)
Federal Solar Tax Credit (30%) rates vary by supplier and change regularly. Current rates range from around $0.03 to $0.15 per kWh. Some notable tariffs include:
- Octopus Energy: Up to $0.15/kWh (variable)
- EDF: $0.04-0.05/kWh
- British Gas: $0.03-0.04/kWh
- E.ON: $0.04-0.05/kWh
Note: Rates change frequently. Check with suppliers for current rates.
ECO4 Free Solar Panel Scheme
The Energy Company Obligation (ECO4) scheme runs until 2026 and can provide free solar panels to qualifying households. This is funded by energy companies and delivered through approved installers.
Do You Qualify?
You may be eligible if you receive any of these benefits:
- Universal Credit (with income under certain thresholds)
- Pension Credit
- Income-based Jobseeker's Allowance
- Income-related Employment and Support Allowance
- Child Tax Credit (with income under $16,480)
- Working Tax Credit
- Housing Benefit
Additional Requirements
- Your property must have an EPC rating of D, E, F, or G
- You must own your home or have landlord permission
- Your property must be suitable for solar installation
Local Council Grants
Some local councils offer additional grants or schemes for renewable energy. These vary by area and change frequently. Contact your local council or check their website for current schemes.
Many councils also participate in collective purchasing schemes that can reduce costs through bulk buying power.
Finance Options
If you don't qualify for grants, there are other ways to spread the cost of solar panels:
- 0% Finance: Many installers offer interest-free payment plans
- Green Mortgages: Some lenders offer better rates for energy-efficient homes
- Home Improvement Loans: Personal loans for home improvements
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