Home Energy Loan Scheme – How much you’ll need to borrow for each upgrade

The new Home Energy Loan Scheme launched this week allows Irish homeowners to take out low-interest loans of up to €75,000 for home energy upgrades such as heat pumps and solar panels until the end of 2026.

The first of its kind programme means that people can borrow unsecured loans of between €5,000 and €75,000 for up to 10 years, with PTSB offering a 3.55% interest rate. Other banks are expected to follow suit in the coming weeks.

Home energy upgrades eligible for the scheme include heat pumps, solar panels, insulation, windows, ventilation and heating controls – and up to 25% of the money can be used for non-energy related works, such as redecorating.

James Dorrian, Managing Director of Energy Efficiency Ireland, explained that the cost of each of these upgrades will depend on factors such as the size of the property, individual installers’ rates, the price of the materials used, and the extent of the works to be carried out.

“While the exact costs will vary for each individual case, estimates can really help homeowners get an idea of how much they will need to borrow under the Home Energy Upgrade Scheme,” Mr Dorrian said.

“Upgrading insulation is becoming popular way of achieving more comfortable homes during the winter months, as poorly insulated homes can lose up to 30% of heat through the walls and roof.

“Attic insulation can cost anywhere from €600 to €4,000, while the average cost of floor insulation upgrades in Ireland is between €900 and €1,500.”

He explained that cavity wall insulation might be between €1,500 and €2,900, and external wall insulation for older properties is significantly more expensive, averaging between €10,000 and €30,000 – but it could be even more depending on the house.

James Dorrian said that it is no secret that solar panels can drastically reduce electricity bills, and with a payback period of around 7 years, they “essentially pay for themselves” in no time.

“This means that they generate totally free electricity for over 20 years before they start to become less efficient,” he said.

“The cost of solar panels is mostly determined by the size of the system, and this usually correlates to the property’s size.

“For example, a 12 panel solar PV system on a 4-bedroom house may cost between €7,000 and €9,000 – and on paper, they could generate over 4,000kWh of electricity per year.

“To put this into perspective, the average household’s electricity consumption is 4,200kWh – so the savings that homeowners could potentially make are enormous.

“Air source heat pumps have also taken off recently, as their 24-7 constant heat makes homes much more comfortable to live in. Heat pumps in Ireland currently cost in the region of €8,000 to €17,000.”

The average price range for window upgrades is generally between €450 and €1,700, he said, adding that replacing eight double-glazed windows in a 4-bedroom house could cost between €8,000 and €10,000.

Mr Dorrian also offered some valuable suggestions to those considering availing of the Home Energy Upgrade Loan Scheme over the weeks and months ahead.

“At Energy Efficiency Ireland the first piece of advice we always give homeowners is to be clear on what they want from the outset,” he said.

“This involves understanding which upgrades would benefit their home and, of course, how much they are willing to borrow. Getting a BER assessment will tell you how energy efficient your home is, and this should be done in the first instance.

“We also recommend getting quotes from reliable installers. Reading online reviews – while they don’t always show the full picture – are a practical way of avoiding overpriced businesses.

“Talking to friends and family who have had similar installations to get ideas or advice is another way to avoid being ripped off.

“When homeowners receive a quote for a particular home upgrade, for example, solar PV panels, they should then make sure they have a breakdown of costs so they can see where their money is going.

“Our advice would be to ask the contractor to fully explain the works – to outline exactly what to expect. Despite the new loan scheme making a massive difference, homeowners are still coughing up a lot of money – and you deserve clarity.”