The Irish Government backed Home Energy Upgrade Loan (HEUL)
About this good practice
In Ireland there are many grants available to those carrying out energy-efficiency upgrades, but they won’t cover the full cost of making homes warmer & more energy efficient. Especially in the case of a deep retrofit. As a result, people will either need to have significant savings or else take out a loan.
The HEUL Scheme helps bridge this gap by providing homeowners with access to low-cost loans. It is expected that some 5,000 home energy upgrades will be assisted before the scheme ends in 2026.
The HEUL Scheme is a €500m scheme established in April 2024 and offered by the Strategic Banking Corporation of Ireland (SBCI) and benefits from a guarantee that has been provided by the European Investment Fund (EIF) & European Investment Bank (EIB) & supported by the Government of Ireland.
The purpose of the loan must be to carry out home energy upgrade works that are also grant-aided through the Sustainable Energy Authority of Ireland (SEAI). Amounts from €5,000 to €75,000 can be borrowed for a term of up to 10 yrs. Loans are available through participating finance providers. The interest rates will be significantly lower than those generally available in the market but will differ among the finance providers.
This initiative will encourage homeowners and furthermore, 'communities of homeowners' or local sustainable energy communities to come together and collectively upgrade their homes, including the addition of renewable solar or heating energy.
Resources needed
In Ireland’s case €500 million of borrowings will be made available by the Irish Government to support homeowners invest in renewable energy and energy efficiency measures. The scheme is guaranteed by the European Investment Fund (EIF) and European Investment Bank (EIB).
Evidence of success
Not all finance providers have declared their Home Energy Upgrade Loan (HEUL) interest rates but those that have:
• Allied Irish Bank have offered a rate 3.55% this is favourable when compared to its green personal loan 6.40% APR rate
• Bank of Ireland have an unsecured variable HEUL rate of 3% APR compared to its Green Home Improvement Loan of 6.50%
• PTSB home improvement loans start at 7.9% with a 2% subsidy given as part of the HEUL.
Potential for learning or transfer
The HEUL aims to make residential energy upgrades more accessible & affordable for eligible homeowners. The loan can be drawn down before work starts which removes some of the upfront financial barriers to getting upgrade works done.
As the SEAI i.e. Irish State encourages and incentivises communities to invest in energy efficiency and renewable energy works for their homes, this scheme will allow a wider community with different financial circumstances to invest in energy works and reduce their carbon footprint.
Similarly, the scheme could be used in other countries to enable a sustainable energy community to get the financial support necessary to implement renewable energy and energy efficiency technologies in their community of homes.
The HEUL is guaranteed by the European Investment Fund (EIF) and European Investment Bank (EIB) other European Countries could also provide this guarantee if there was a government funded interest rate subsidy available.
Further information
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