Finance is rarely the obstacle on new-build solar — 0% VAT relief, self-build mortgage staged drawdowns, green-mortgage cashback, and the AHP 2026-31 funding envelope all work in the homeowner\'s and developer\'s favour. The challenge is knowing which of the available routes applies to your specific procurement scenario. This page breaks down the four main finance pathways and how to optimise across them.
1. 0% VAT on new-build solar PV
Since 1 April 2022 (extended indefinitely in the March 2024 Spring Budget), the supply and installation of energy-saving materials on dwellings attracts 0% VAT. This covers solar PV panels, mounting hardware, inverters, batteries, air source heat pumps, ground source heat pumps, biomass boilers, MVHR units and EV chargers. The relief applies equally to:
- •New-build self-build dwellings — full 0% on both materials and labour
- •Conversion of non-residential to residential — full 0%
- •Retrofit to existing dwellings — full 0%
- •Plot sales by volume housebuilders — the developer reclaims VAT through the standard VAT recovery on residential sales
On a typical 5 kWp + 13 kWh battery + 8 kW ASHP self-build package (gross cost ~£17,000 inclusive of labour), the 0% VAT relief saves £3,400 versus the 20% rate. For developers the relief is already baked into the per-plot price as plot sales are zero-rated for VAT.
2. Self-build mortgage staged drawdowns
Self-build mortgages release funds in stages against build progress rather than as a single advance. The typical drawdown schedule:
| Stage | Cumulative % | Solar PV cost trigger |
|---|---|---|
| Land purchase | ~25% | — |
| Foundations + ground floor | ~35% | — |
| Wall plate / weatherproof | ~50% | Panel order deposit (10%) |
| First fix | ~65% | Solar PV install (50%) |
| Second fix | ~85% | Battery + ASHP (30%) |
| Completion / final fix | 100% | Commissioning & handover (10%) |
Self-build lenders comfortable with this aligned schedule include Ecology Building Society, Hanley Economic, Buildstore, BuildLoan and Newbury Building Society. We provide our standard 4-stage invoicing schedule on request, formatted for the lender\'s monitoring surveyor.
3. Green mortgage cashback for EPC A/B new builds
FHS-compliant new builds achieve EPC band A or upper band B in almost all cases (average score 89 across our recent case studies). This qualifies for green-mortgage product enhancements at multiple UK lenders:
| Lender | Product | Benefit |
|---|---|---|
| Nationwide | Green Additional Borrowing | 0% interest on £5k-£15k for energy-saving works |
| Halifax | Green Living Reward | £250 cashback for EPC A/B properties |
| Barclays | Greener Home Mortgage | Rate reduction ~10bps for EPC A/B |
| NatWest | Green Mortgage | Rate reduction + cashback for EPC A/B |
| Santander | Greener Home Reward | £500 cashback for EPC A/B new build |
| HSBC | Energy Efficient Mortgage | Rate reduction for EPC A/B properties |
On a £400k mortgage, a 10-basis-point rate reduction saves approximately £400/year. Combined with a £250-£500 cashback at completion, the total green-mortgage benefit on an FHS-compliant new build is typically £650-£900 in year 1 and £400/year ongoing — material against the FHS price premium.
4. Developer credit lines and procurement terms
For volume housebuilders we offer two procurement models:
- Per-plot fixed price with staged payment: Total per-plot cost agreed at procurement (e.g. £4,200/plot for 3-bed semi). Payment schedule: 10% deposit on bulk order placement, 30% on first plot delivery to site, 50% on completion of each plot installation (paid weekly in arrears against MCS certificates issued), 10% post-handover. 30-day payment terms standard.
- Schedule of rates with monthly account: Day-rate and unit-rate pricing applied to actual installations completed in the period. Monthly invoicing with 30-day payment terms. Suits developers with variable plot release programmes where exact volume is not pre-committed.
For top-tier housebuilders (Top 10 by annual completions) we offer extended 90-day payment terms against a small premium. Cash-flow management for large bulk procurement (500+ plots) typically structured around 3-month rolling invoice cycles.
5. Affordable Homes Programme 2026-31 funding
Homes England\'s Affordable Homes Programme 2026-31 funding round requires Future Homes Standard-equivalent specifications for social housing schemes seeking grant funding. The relevant funding bands cover the additional cost of FHS-compliant fabric and renewables:
- •Standard funding band: covers FHS-compliant per-unit cost envelope
- •Enhanced funding band: covers additional renewables expenditure (battery storage, BIPV where heritage-required)
- •Strategic Partner status: top-tier housing associations with multi-year delivery commitments receive blended funding rates
See our LHC framework case study for a worked AHP 2026 procurement example. For Welsh schemes, the equivalent Welsh Government Social Housing Grant route applies. For Scottish schemes, the Affordable Housing Supply Programme.
Need a fixed-price quote with our standard staged invoicing schedule? Use the contact form with your plot details. For a 30-second indicative cost based on your ground floor area, use the FHS PV calculator.