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Funding Options and Incentives

Funding Options and Incentives


With Government incentives, cheap loans and other incentives available there has never been a better time to invest in renewable energy solutions.


In addition to Government backed funding and subsidies, we offer a range of affordable finance options and leasing arrangements to ensure that you have access to the technologies you want to install in your property.


Green Deal Initiative


As part of the Government's policy to reduce our carbon emissions, they have now launched the new Green Deal Initiative, which will allow home owners and tenants to make energy efficiency measures to their property with no upfront costs.


In essence, the Green Deal is a privately financed loan to undertake energy efficiency improvement measures and is repaid via payments collected through the property's electricity bill.


To see if your property qualifies for the Green Deal finance, you must have an EPC (dated after 1st April 2012) carried out on your property before contacting a Green Deal Provider. This will calculate what energy improvements can be made and what your expected financial savings are likely to be.






















Energy Companies Obligations ECO


The ECO were introduced in January 2013 to help reduce the UK’s energy consumption and support people living in fuel poverty. It does this by funding energy efficiency improvements worth around £1.3 billion every year.


Parliament passed the Electricity and Gas (Energy Companies Obligation) Order 2012 on 4th December 2012 and it is now in effect. The ECO will run until March 2015, supporting the installation of energy efficiency measures in low-income households and areas, and in properties that are harder to treat. It works alongside the Green Deal to give consumers support and funding for energy efficiency improvements in their homes.


The Green Deal and the ECO will help reduce carbon emissions from the UK’s domestic building stock, which is an essential part of the UK’s plan to meet its statutory domestic carbon emission reduction targets by 2050.


Leasing Renewable Energy Systems


Depending on your circumstances it may be possible to lease a renewable energy system from us on a fixed or variable price contract of 10 to 25 years in length.  Although you won't qualify for any funding or incentive payments you will get affordable heating at a competitive price.


Lease Purchase


Unlike leasing where you never actually own the equipment, with a lease purchase the equipment will transfer to your ownership at the end of the lease period, typically 3 to 7 years.


We have sourced a number of finance providers who specialise in low interest loans for renewable energy technologies, subject to individual circumstances.  You can of course source your own provider if you prefer.


Non-Domestic Renewable Heat Incentive RHI


The Renewable Heat Incentive (RHI) is a Government funded payment over 20 years to encourage investment in specific renewable heat generating technologies. Payments vary according to the technology, heat generated and tariff rate. Tariff rates are linked to the Retail Price Index, thus representing a real return on investment.


  • Tariffs aiming for 12% return on capital expenditure, except solar thermal which is 5%
  • Payments made quarterly over 20 years
  • Payments based on actual heat usage, system size and tariff. See tariffs for individual technologies below
  • The scheme is administered by Ofgem


Non-Domestic RHI is also compatible with Energy Savings Trust (EST) small business loans: 5% interest rate if also collecting RHI, with loans from £1,000 to £100,000 repayable over 8 years.


Non-domestic applications include commercial, public sector and not-for-profit organisations. This also includes bed and breakfasts and multiple dwellings sharing the same heat source (providing they are on separate council tax bandings).


Biomass boilers, ground source heat pumps and solar thermal systems are all eligible, amongst others and retro fitted systems and new builds, properties on and off the gas grid are all eligible.


MCS accredited installers and products are required for installations up to 45kW and installations must be heat metered with RHI compatible meters.


You can claim capital allowances when you buy energy efficient low or zero-carbon technology for your business and this reduces the amount of tax the business has to pay.


Domestic Renewable Heat Incentive RHI


On 20th September 2012 the Department for Energy and Climate Change DECC published a consultation document on the Domestic Renewable Heat Incentive (RHI).  The consultation closed on December 7th and on the 12th July 2013 DECC published the final policy subject to State Aid and Parliamentary approval.


The proposed scheme in the Consultation applies to MCS accredited installations of biomass, solar thermal and heat pumps up to 45kW with an appropriate EPC rating.  It should lead to a significant contribution to the capital cost of a system, if not full payback, within 7 years.  In addition owners would benefit from fuel savings over the lifetime of the system.


Key points are:


  • the scheme launches in Spring 2014
  • eligible systems installed since 15th July 2009 will qualify when the scheme begins
  • legacy applications may not be accepted initially, but phased over time
  • payments made quarterly over seven years
  • for biomass, a small amount of income may be held back and paid in years 7 to 20

Feed In Tariffs (FiTs)


FiTs are a Government guaranteed payment scheme for renewable electricity generating technologies.  Solar PV is a qualifying technology and payments last until 2035.  Payments vary according to the tariff rate and amount of electricity generated.


The benefits of Feed-in Tariffs are:


  • index linked payment from electricity company
  • index linked payments paid to the system owner annually or quarterly for twenty years, which means real returns
  • tariff set by government and paid by the electricity company you sign up with
  • income is non-taxable in domestic applications
  • when tariff rates reduce it applies to new installations; you keep the rate that applies when your system is registered



For more information about funding options and advice on your applications please call us on 0121 241 5250 or email:


KM Renewable Energy UK

Renewable Energy, Prefab Construction,

Energy Efficiency & Finance

25 Lee Bank Business Centre

Holloway Head


B1 1HP

0121 241 5250


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