Boiler Upgrade Scheme: How to apply for £7,500 heat pump grant

Air source heat pump

Homeowners in England and Wales can get £7,500 towards installing a heat pump under the  government’s Boiler Upgrade Scheme (BUS). Find out what grants are available and what this could mean for your home.

The grant is aimed at helping households replace fossil fuel heating systems, such as a gas boiler, with a heat pump or biomass boiler.

According to the Energy Saving Trust, homeowners looking to cut energy bills and become more environmentally friendly could save an average £385 a year by switching from a gas boiler to an air source heat pump.

Originally, grants were available for £5,000 for air source heat pumps, and £6,000 for ground source heat pumps. But from 23 October 2023, this went up to £7,500.

Here we’ll look at the finer details of the scheme, including what the scheme covers and how to apply.

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What is the Boiler Upgrade Scheme (BUS)?

The scheme, which replaced the Clean Heat Grant, opened to applications and payments from 23 May 2022. Homeowners looking to take advantage need to apply via an authorised installer (we explain this in more detail below).

The scheme makes £7,500 grants available towards air source heat pumps and ground source heat pumps.

There’s also £5,000 grants available towards the cost and installation of biomass boilers. This is only available in rural locations, provided the property isn’t connected to the gas grid.

Government figures show that, between May 2022 and October 2023, the following grants have been issued in England and Wales:

  • Air source heat pumps: 15,456
  • Ground source heat pumps: 455
  • Biomass boilers: 174

Reporting an uplift of 57% in applications following the increase to the grant, the government allocated an additional £1.5 billion to the scheme in December 2023.

Does the scheme cover the whole cost and installation?

Unfortunately, the scheme largely doesn’t cover the entire cost of a new low-carbon heating system. 

Let’s say you’re thinking of getting an air source heat pump. The exact price will vary, depending on things like the size and age of your property. But on average, an air source heat pump costs around £14,000 to buy and install, according to the Energy Saving Trust. This means households will have to stump up the cost for the rest.

It’s worth watching this space though. British Gas advertises  that its heat pumps could cost homeowners as little as £499, after getting the grant. And Octopus is advertising heat pumps from £500 to existing customers, subject to qualifying for the scheme and Octopus’s own eligibility criteria. 

And with continuing sky-high energy prices, it may also be worth taking advantage of the scheme to cut down on energy bills in the long term. Not only may it save money in the future, but you’ll be cutting back your household’s carbon footprint for years to come.

The Energy Saving Trust estimates that – if you’re replacing an old (G-rated) gas boiler in an average-sized, three-bedroom semi – you’ll save £355 a year on your bills. You’ll also be reducing your emissions by 2,900 kgCO2 per year.

Who’s eligible for the Boiler Upgrade Scheme?

To be eligible, you must live in England or Wales and own your property. This must have an installation capacity of up to 45kWth (this covers most homes) and a valid Energy Performance Certificate (EPC). Your installer will be able to advise you on whether your property is suitable.

If you have a new-build property, you may be able to apply for a heat pump if it’s been built with a fossil-fuel burner. However, most new-builds aren’t eligible, plus you can’t apply if the developer is still in the process of building the property.

How do I apply for the Boiler Upgrade Scheme?

To apply for the boiler upgrade scheme, you must:

  • First find an MCS certified installer in your area that is able to carry out the work. The MCS quality assurance scheme ensures that installers are competent, and the products they use meet the correct standards. It’s always best to shop around though, so try to get quotes from at least three different professionals.
  • The installer will then advise you on whether an installation is eligible for a grant and will provide you with a quote for the installation. 
  • The installer applies for the grant on your behalf. 
  • Ofgem, the energy regulator, will contact you to confirm that the installer is taking part in the scheme.
  • The value of the grant is taken off the final price you pay, so be sure that you’re happy with the final cost before you proceed.

At the time of writing, the scheme will run until 2028.

Are gas boilers being banned?

The Boiler Upgrade Scheme is part of the government’s bigger plan to make the UK greener and reach net-zero emissions by 2050.

It’s thought that gas boilers could be banned from 2035 to make homes more eco-friendly and help slow climate change.

But it’s worth noting that, at present, there’s no finalised gas boiler ban. It was previously announced that, from 2025, gas boilers mustn’t be installed in new properties. But on 20 September 2023, Prime Minister Rishi Sunak announced that this would be put back to 2035 for homes off the mains gas grid, and also that there may be exemptions for some households and types of property.

Plus schemes to replace fossil-fuel burners with low-carbon alternatives are voluntary. The government has set aside £450m to pay for BUS grants, and it’s hoped more households will opt in as the eco-alternatives become cheaper. But the lifespan of people’s boilers is another factor, as at some point they won’t be able to replace it with a new one.

Are there other ways to go greener and save on my energy?