What Is Renewable Energy? A Guide for UK Homes

If you're looking for ways to lower your energy bills, reduce your carbon footprint, or become more energy independent, renewable energy could be the answer. This guide explains what renewable energy is, how it works in UK homes, and what options are available to generate electricity or heat where you live.

What Is Renewable Energy?

Renewable energy comes from natural sources that replenish themselves, like sunlight, wind, and water. Unlike fossil fuels (such as gas, coal or oil), renewable energy sources don’t run out and don’t produce carbon emissions when generating electricity, though some emissions are created during manufacturing or installation.

In the UK, renewable energy is being used more than ever before. Homes across the country are installing solar panels, switching to heat pumps, and even adding batteries to store excess energy for later use. In fact, over 1.3 million UK homes already generate their own electricity using solar power.
(Source: https://energysavingtrust.org.uk/advice/solar-panels/)

Below are some useful definitions to clarify the terminology used, and what it means for consumers.

Renewable Electricity

The term “renewable energy” means technologies used to generate electricity for use in your home or business. Any excess electricity you don’t use can be stored in a battery or exported to the grid for payment via the Smart Export Guarantee (SEG).
(Source: https://www.ofgem.gov.uk/environmental-and-social-schemes/smart-export-guarantee-seg)

Solar Panels (PV)

Solar photovoltaic (PV) panels capture sunlight and turn it into electricity. They are suitable for many UK homes, depending usually on the location, roof direction and size, though they do not always make economic sense, so it’s important to understand the costs involved, and the time it will take for the energy savings to pay back the initial costs incurred. Solar panels are usually mounted on a south-facing roof, but ground-mounted or balcony options are also available. Panels work even on cloudy days and can help power your lighting, appliances, and more.

Read our full guide to solar panels

Micro Wind Turbines

Micro wind turbines may be suitable for rural or exposed locations. They are small wind turbines that convert wind energy into electricity. Rooftop versions are available, but standalone pole-mounted turbines are more effective. These normally need planning permission and are best suited to open, windy areas.
(Source: https://energysavingtrust.org.uk/advice/wind-turbines/)

Energy Storage

The term energy storage refers to the technology that help you make the most of the renewable energy you generate.

This typically takes the form of home batteries which may be suitable if you have solar panels (PV). A home battery stores any excess electricity that your solar panels generate during the day, for a short time, so you can use it in the evening or on cloudy days – but it is not designed for long-term energy storage. Home batteries can help reduce your reliance on the grid and are often recommended when installing solar panels, though it does come at an extra cost. (Source: https://energysavingtrust.org.uk/advice/solar-panel-battery-storage/)

Renewable Heating

When we talk about renewable heating, this refers to the whole range of technologies that use renewable energy to heat your home or hot water, rather than gas or oil. Some systems may be eligible for government grants, like the Boiler Upgrade Scheme.

(Source : https://energysavingtrust.org.uk/advice/storing-energy/)

Technologies

Air Source Heat Pumps

Air source heat pumps are the most common type of heat pump used in UK homes. They are suitable for many homes, and grants are often available to help cover the cost of installation.
These systems extract heat from the air outside and use it to warm your home and hot water. They work even in winter and are most efficient in well-insulated homes.

Read our guide to heat pumps

Ground Source Heat Pumps

Ground source heat pumps may be suitable, depending on outdoor space. These use underground pipes to absorb heat from the ground. They’re efficient and low-carbon, but installation costs are higher and you’ll need garden space or land.
(Source: https://energysavingtrust.org.uk/advice/ground-source-heat-pumps/)

Read our guide to heat pumps

Solar Water Heating (Thermal Panels)

Slightly different from solar panels used to supply electricity throughout your home or business, these can supplement your hot water needs. Solar thermal panels collect heat from the sun and use it to warm your water. These are typically roof-mounted and work best alongside a regular boiler or immersion heater.
(Source: https://energysavingtrust.org.uk/advice/solar-water-heating/)

Biomass Boilers

Biomass boilers are not suitable for most urban homes. Biomass boilers burn wood pellets or chips to provide heating and hot water. They’re better suited to rural properties and need space for fuel storage. While they do not consume fossil fuels directly, there is some pushback due to the environmental cost of producing wood chips for biomass boilers, and other renewable sources may be more carbon friendly.
(Source: https://energysavingtrust.org.uk/advice/biomass/)

PV Diverters

A PV Diverter is a simple way to reduce water heating costs. If your solar panels produce more electricity than you’re using, a PV diverter can automatically send that surplus to heat your water tank via the immersion heater. It won’t cover all your hot water needs but can help reduce bills.
(Source: https://energysavingtrust.org.uk/advice/solar-panels/#pv-diverters)

Electric Vehicle (EV) Charging

If you have, or plan to get, an EV, then a charging point is essential. Charging your electric car using your own solar energy means cheaper, cleaner driving. You’ll need a compatible home EV charger. If your EV and charger supports bidirectional charging, you can also tap into the car’s much larger battery to boost your home’s storage capacity which turns your vehicle into an extra power bank when you need it.
(Source: https://energysavingtrust.org.uk/advice/electric-vehicles/)

Renewable Energy Costs, Payback & Support

The costs and typical payback time for any renewable energy solution will vary depending on your particular situation, as well as the provider or installer you choose, and any grants available at the time. In almost every instance, there is a positive impact on the environment and your CO2 emissions, but it’s important to make sure that your home or business is set up correctly to allow you to take advantage of possible savings (for example, excellent insulation is needed before considering a heat pump installation).

Below are some initial guideline costs, but it’s important to source multiple quotes to make sure you are getting a good deal, and the correct advice.

Solar Installation

A domestic solar PV system costs around £6,100, depending on the size of the system, any difficulty accessing your roof, whether you choose panels or tiles, whether you integrate the panels into the building, and whether you need to renew the roof covering.
Adding battery storage may cost another £5,000 to £8,000, but helps store energy for later use.
Solar PV systems pay for themselves in 9 to 15 years. Adding a battery increases upfront costs but can improve flexibility and reduce grid reliance.
(Source: Energy Saving Trust)

Heat Pumps

Air-source heat pump (ASHP): £7,000–£13,000
Ground-source heat pump (GSHP): £15,000–£30,000
The Boiler Upgrade Scheme offers up to £7,500 off in England and Wales; 0% VAT applies to eligible installs until March 2027
Typical payback: 7–15 years, with a lifespan of around 20 years
Heat pumps are generally around four times as efficient as a new gas boiler (Energy Saving Trust).
(Source: Read our guide to heat pumps)

Government Schemes

The ECO4 Scheme helps low-income households by providing funding to install insulation and modern heating systems
0% VAT rate on solar panels, heat pumps, and batteries (until 31March 2027)
(Source: https://www.gov.uk/government/collections/find-energy-grants-for-you-home-help-to-heat)

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Choosing the Right Renewable Energy for Your Home

Every home is different. What works for a rural cottage might not suit a city flat. If you’re planning to get an EV or switch to a heat pump, consider that when sizing your solar system. Before committing, think about:

Your location and roof direction
Available space (indoors and outdoors)
Planning permissions
Your energy usage habits
Your budget

You can use the Home Renewables Selector tool provided by the Energy Saving Trust — note this tool is tailored for Scotland only. Currently, there’s no equivalent for homes in the rest of Great Britain, but local authorities or regional energy hubs may offer tailored advice.

What Is Renewable Energy? A Guide for UK Homes