A new report from Common Wealth proposes a government-backed solar bond initiative to help UK households lower energy bills and accelerate the transition to net zero. By issuing long-term, low-interest loans funded through green sovereign bonds, the government could enable millions of families to install rooftop solar and battery systems. The authors argue that current private financing options are too expensive and short-term to provide immediate relief. This policy, they suggest, would democratize energy ownership, create thousands of local jobs, and build public support for decarbonization by delivering tangible financial benefits to households across the country.
The UK’s current energy market framework has often failed to pass the cost savings of renewable generation on to consumers, leaving households vulnerable to high prices. While the government’s Warm Homes Plan aims to subsidize private loans, the report contends that these measures do not go far enough. High upfront costs and short repayment terms currently lock out many low- and middle-income families, making rooftop solar a luxury for the wealthy. The proposed “solar edged securities” would allow the government to leverage its fiscal capacity to offer more favorable, long-term financing that ties repayments to the property rather than the individual.
Integrating battery storage into this national rollout is presented as a critical component of the strategy. By enabling households to store energy and participate in “time of use” tariffs, the proposal aims to protect consumers from peak pricing and help balance the grid. The authors estimate that 11 million homes are suitable for such installations, which could generate 35TWh of electricity annually—equivalent to nearly two Hinkley Point C nuclear power stations. This approach would not only reduce household bills by hundreds of pounds per year but also provide a material stake in the energy transition for millions of citizens.
From a fiscal perspective, the report argues that such a program could be designed to be neutral. By utilizing public financial institutions and structuring the loans as financial assets, the government could avoid breaking its fiscal rules while providing a significant boost to the renewable sector. Furthermore, the initiative would support the growth of local supply chains, with the Solar Trade Association estimating that an expanded rollout could create over 42,000 new jobs by 2030. By making clean energy accessible and affordable, the government could secure the public consent necessary to meet its ambitious 2030 and 2050 climate targets.