Environmental and Green Grants in the UK

Farmers and land managers in England can access several DEFRA-funded environmental payment schemes. Countryside Stewardship pays farmers to carry out specific environmental management activities such as creating wildlife habitats, managing hedgerows, and improving water quality. Options are selected from a menu and paid per hectare or per activity per year.

The Sustainable Farming Incentive (SFI) is the main successor to EU agri-environment schemes and is open to all farmers with eligible land. It pays for actions supporting soil health, integrated pest management, and hedgerow management, with straightforward area-based payments. Farmers can stack SFI with Countryside Stewardship for compatible actions. Applications are made through the Rural Payments Agency (RPA).

Households and businesses can access several schemes to reduce energy use and move to low-carbon heating. The Boiler Upgrade Scheme (BUS) provides grants of £7,500 for air source heat pumps and £7,500 for ground source heat pumps, reducing the upfront cost of switching from gas boilers. Applications are made through MCS-certified installers.

The ECO4 scheme (Energy Company Obligation) funds insulation and low-carbon heating upgrades for lower-income households and those in fuel poverty, delivered by energy suppliers. The Great British Insulation Scheme funds single insulation measures for households in lower council tax bands or on means-tested benefits. For businesses, the Industrial Energy Transformation Fund (IETF) provides grants for energy efficiency projects and fuel switching in energy-intensive industries.

Beyond farming, organisations focused on nature recovery and environmental education can access funding from several sources. Natural England funds habitat creation and species recovery through targeted programmes. The Environment Agency funds flood risk management and catchment improvement projects in partnership with local authorities and community groups.

The National Lottery Heritage Fund has a dedicated Landscape strand for large-scale nature recovery projects. The Biffa Award funds environmental improvement and biodiversity projects from landfill tax credits. Esmée Fairbairn Foundation is a major private funder of nature and environment projects, particularly those involving systemic change or reaching underserved communities. Community groups can also apply to their local authority's environmental team for smaller grants linked to tree planting, community gardens, or clean-up initiatives.

The UK Government's Green Finance Strategy (updated in 2023) sets out the long-term framework for mobilising private capital alongside public funding to deliver net zero and nature recovery goals. For most grant applicants it is more relevant as context than as a direct source of funding, but it underpins several programmes that do offer direct grants. It has accelerated the development of voluntary biodiversity net gain markets and green bonds, creating new funding routes for environmental projects beyond traditional grant programmes.

The Nature for Climate Fund is a DEFRA programme providing targeted investment to restore and expand priority habitats — particularly peatland, woodland, and species-rich grassland — as part of the UK's broader commitment to halt biodiversity loss by 2030. Funding is channelled primarily through Natural England, the Forestry Commission, and delivery partners such as the Wildlife Trusts and the RSPB. Landowners, farmers, and conservation organisations can access this funding through schemes including the Peatland Code, the Woodland Carbon Code, and targeted restoration grants. Applications are typically competitive and require clear evidence of additionality and long-term management commitments.

DEFRA's suite of Environmental Land Management (ELM) schemes now forms the main mechanism for paying farmers and land managers for environmental outcomes in England. The three tiers are: the Sustainable Farming Incentive (SFI) for broad, accessible payments covering soil, hedgerows, and integrated pest management; Countryside Stewardship for more targeted environmental management; and Landscape Recovery for large-scale, long-term habitat restoration and net-zero projects led by groups of landowners. Together these schemes represent several billion pounds of public investment per year and are the primary route for environmental funding for the agricultural sector post-Brexit.