Boiler Upgrade Scheme 2025: How to Claim Your £7,500 Heat Pump Grant

The Boiler Upgrade Scheme offers UK homeowners £7,500 towards installing a low-carbon heating system. This substantial grant can make heat pumps cost-competitive with traditional gas boilers, helping you slash energy bills while reducing your carbon footprint. This comprehensive guide explains exactly how to claim your £7,500 grant and make the switch to renewable heating.

What is the Boiler Upgrade Scheme?

The Boiler Upgrade Scheme (BUS) is a UK government initiative designed to accelerate the transition from fossil fuel heating to renewable alternatives. Launched in April 2022 and extended through 2028, the scheme provides upfront grants to homeowners installing qualifying low-carbon heating systems.

Unlike means-tested schemes like ECO4, the Boiler Upgrade Scheme is available to all homeowners, regardless of income or benefits status. The only requirements relate to your property's energy efficiency and the heating system you're replacing.

Grant Amounts by Technology

The scheme has a budget to support approximately 300,000 installations between 2022 and 2028, with funding allocated on a first-come, first-served basis. As demand increases, applying sooner rather than later is advisable.

Who Qualifies for the £7,500 Grant?

Eligibility for the Boiler Upgrade Scheme depends on your property and the heating system being replaced, not your personal circumstances.

Property Eligibility

• Property type: Residential properties in England and Wales (Scotland has separate schemes)
• Ownership: You must own the property (not available for tenants, though landlords can apply)
• Existing heating: Must be replacing a fossil fuel heating system (gas, oil, LPG, or electric)
• EPC rating: Property must have a valid EPC with no outstanding recommendations for loft or cavity wall insulation
• Building regulations: Property must meet current Building Regulations standards

The EPC Requirement Explained

This is the most commonly misunderstood eligibility criterion. Your property needs a valid EPC (less than 10 years old), and crucially, the EPC must not recommend loft or cavity wall insulation.

If your EPC does recommend insulation improvements, you must complete these before applying for BUS. This ensures heat pumps operate efficiently in well-insulated properties. Practically, this means properties need an EPC rating of at least D, and ideally C or better, to qualify.

If your property needs insulation improvements, consider applying for ECO4 or GBIS grants first to get free insulation, then apply for BUS once your EPC is updated.

What You Can't Do

The scheme has important restrictions:

• Cannot be used for new-build properties
• Cannot replace an existing heat pump (only fossil fuel systems)
• Cannot combine with certain other government grants for the same property
• Cannot be used for self-build projects
• One grant per property (though multi-dwelling properties may qualify for multiple grants)

What Heat Pumps Qualify?

Not all heat pump installations qualify for BUS funding. The system must meet specific standards and be installed by certified professionals.

Air Source Heat Pumps (ASHP)

ASHPs extract heat from outdoor air and are the most popular choice due to lower installation costs compared to ground source systems. To qualify:

• Must be MCS (Microgeneration Certification Scheme) certified
• Minimum Seasonal Coefficient of Performance (SCOP) of 2.8
• Suitable for heating and hot water provision
• Installed by MCS-certified installer

Modern ASHPs typically achieve SCOPs of 3.0-4.0, meaning they generate 3-4 units of heat for every unit of electricity consumed. This exceptional efficiency is what makes them cost-effective despite higher electricity prices.

Ground Source Heat Pumps (GSHP)

GSHPs extract heat from the ground using buried pipes and typically deliver even better performance than air source systems. However, they require significant outdoor space and cost more to install:

• Must be MCS certified
• Requires suitable land for ground loop installation
• Typically achieves SCOPs of 3.5-4.5
• Installation costs £20,000-£35,000 (£12,500-£27,500 after £7,500 grant)

Ground source heat pumps are ideal for rural properties with substantial gardens but are overkill for typical suburban homes where air source systems perform excellently.

The MCS Certification Requirement

MCS certification is non-negotiable for BUS funding. This ensures:

• Equipment meets quality and performance standards
• Installers are properly trained and competent
• Installation follows best practice guidelines
• You receive warranty protection and insurance-backed guarantees

Always verify your installer's MCS certification before proceeding. Legitimate installers will proudly display their certification number and won't object to you verifying it on the MCS website.

How Much Will You Pay After the Grant?

The £7,500 grant significantly reduces the upfront cost of heat pump installation, making it comparable to premium gas boiler installations.

Air Source Heat Pump Costs After Grant

Installation complexity depends on:

• Whether existing radiators need upgrading (larger radiators work better with heat pumps)
• Hot water cylinder installation (if you currently have a combi boiler)
• Electrical upgrades (heat pumps require dedicated circuits)
• Pipework modifications
• Outdoor unit placement challenges

Comparing to Gas Boiler Costs

A new gas boiler installation costs £2,500-£4,500. With the BUS grant, a heat pump costs £2,500-£7,000, putting the technologies in a similar price bracket for many installations. When you factor in lower running costs (in well-insulated homes), heat pumps can deliver better value even without considering environmental benefits.

How to Apply for the Boiler Upgrade Scheme

The application process is straightforward but must be handled by your MCS-certified installer. You cannot apply directly as a homeowner.

Step-by-Step Application Process

1. Get Your EPC: Ensure you have a valid EPC (less than 10 years old). If you don't have one, arrange for an assessment. If your EPC recommends loft or cavity wall insulation, complete these improvements first.
2. Find an MCS-Certified Installer: Use the MCS website to find certified heat pump installers in your area, or use our quote service to connect with vetted professionals.
3. Home Survey: The installer conducts a detailed survey to assess your property's suitability, heat loss calculations, and system sizing requirements.
4. Receive Quote: You'll receive a quote showing the total cost and the £7,500 BUS grant deduction.
5. Installer Applies for Grant: Once you accept the quote, the installer applies for the grant on your behalf through the Ofgem portal. This typically takes 1-2 weeks for approval.
6. Installation: After grant approval, the installer schedules your installation. Most ASHP installations take 2-5 days.
7. Commissioning: The installer commissions the system, provides training on operation, and completes MCS certification paperwork.
8. Grant Redemption: The installer receives the £7,500 grant directly from Ofgem after installation is complete and certified. This is deducted from your final bill.

Timeline Expectations

From initial survey to completed installation:

• Survey and quote: 1-2 weeks
• Grant approval: 1-2 weeks
• Installation scheduling: 2-8 weeks (depending on installer availability)
• Installation completion: 2-5 days
• Total timeline: 6-12 weeks from initial contact to completed system

Running Costs: Heat Pump vs Gas Boiler

The financial case for heat pumps depends heavily on your property's insulation quality and your heating usage patterns. Our detailed heat pump vs gas boiler cost comparison provides comprehensive analysis, but here's a summary.

Best-Case Scenario (Well-Insulated Home)

For a property with EPC rating C or B, requiring 8,000 kWh of heat annually:

• Gas boiler: £660 per year
• Heat pump (standard tariff): £560 per year
• Heat pump (specialist tariff): £300 per year
• Annual saving: £100-£360

Average Scenario (EPC D)

For a typical property requiring 12,000 kWh of heat annually:

• Gas boiler: £940 per year
• Heat pump (standard tariff): £1,030 per year
• Heat pump (specialist tariff): £630 per year
• Outcome: Comparable or cheaper with right tariff

Heat Pump Electricity Tariffs

Several energy suppliers offer special rates for heat pump users:

• Octopus Cosy: 15p per kWh for heat pump usage
• E.ON Heat Drive: Dedicated heat pump rates
• British Gas Heat Pump Energy Tariff: Competitive rates for heat pump owners

These tariffs can reduce heat pump running costs by £200-£400 annually compared to standard electricity rates, making heat pumps cheaper to operate than gas boilers in many scenarios.

Combining BUS with Other Grants

While you can't combine BUS with certain grants for the same measure, you can strategically layer grants for comprehensive home upgrades.

Compatible Grant Combinations

• ECO4 insulation + BUS heat pump: Get free insulation through ECO4, then apply for BUS grant once EPC improves
• GBIS insulation + BUS heat pump: Same approach using the Great British Insulation Scheme
• Solar panel 0% VAT + BUS: Install solar panels (benefiting from 0% VAT) alongside heat pump to power it with renewable electricity

The Optimal Grant Strategy

For maximum savings, follow this sequence:

1. Apply for ECO4/GBIS to get free loft and wall insulation
2. Wait for updated EPC showing improved rating (D or better) with no insulation recommendations
3. Apply for BUS grant for £7,500 heat pump installation
4. Consider adding solar panels to generate electricity for heat pump operation

This approach can deliver £15,000-£20,000 in combined government support, transforming your home's energy efficiency comprehensively.

Common Questions and Concerns

Will a heat pump keep my house warm enough?

Yes, when properly sized and installed. Heat pumps are the primary heating systems in Scandinavian countries with far colder climates than the UK. The key is correct heat loss calculations and proper system design by your MCS installer. Modern heat pumps operate effectively down to -20°C.

Are heat pumps noisy?

Modern heat pumps produce 40-60 decibels of noise, similar to a refrigerator or quiet conversation. They're significantly quieter than older models and far quieter than oil boilers. Proper positioning away from bedrooms and neighbour boundaries minimises any disturbance.

Do I need planning permission?

Most heat pump installations fall under permitted development rights and don't require planning permission in England and Wales. However, restrictions apply in conservation areas, listed buildings, or flats. Your installer will advise on your specific circumstances.

What about hot water?

Heat pumps provide hot water through a storage cylinder (typically 180-300 litres). While different from on-demand combi boilers, modern cylinders maintain water temperature throughout the day. Families typically find no practical difference in hot water availability.

How long do heat pumps last?

Heat pumps typically last 20-25 years with proper maintenance, compared to 10-15 years for gas boilers. Annual servicing costs £100-£150, similar to boiler servicing. The longer lifespan means you avoid one or two boiler replacements over the heat pump's lifetime.

Will the grant run out?

The scheme is funded through 2028 with budget for approximately 300,000 installations. While not expected to run out soon, increasing demand as awareness grows means applying sooner is advisable. The government has indicated willingness to extend funding if uptake is strong.

The Environmental Case for Heat Pumps

Beyond financial considerations, heat pumps offer significant environmental benefits. With the UK committed to net-zero by 2050 and gas boilers likely banned in new builds from 2025, heat pumps represent the future of home heating.

Carbon Emissions Reduction

• Heat pumps produce 65-75% less CO2 than gas boilers
• As the electricity grid decarbonises, heat pumps become even greener
• By 2035, UK electricity is projected to be nearly zero-carbon
• A typical home switching to a heat pump prevents 1.5-2 tonnes of CO2 annually

Property Future-Proofing

Installing a heat pump now positions your property ahead of likely future regulations. With gas boilers being phased out and EPC standards tightening, properties with modern low-carbon heating will command premiums. Installing a heat pump typically improves your EPC rating by 1-2 bands, increasing property value by 5-10% in some markets.

Is the Boiler Upgrade Scheme Right for You?

The BUS grant makes heat pumps accessible for most homeowners, but they're not suitable for every property right now. Consider a heat pump if:

• Your property has decent insulation (EPC D or better)
• You're replacing an old gas, oil, or LPG boiler
• You're planning long-term ownership (5+ years)
• You value environmental impact alongside finances
• You have space for outdoor unit and hot water cylinder

Consider improving insulation first if:

• Your EPC recommends loft or cavity wall insulation
• Your property is rated E, F, or G
• You have single-glazed windows
• You notice significant draughts or cold spots

Free insulation through ECO4 or GBIS can prepare your home for a heat pump while immediately reducing your energy bills. Once insulation is improved, the heat pump will perform optimally and deliver maximum savings.

Take Action on Your £7,500 Grant

The Boiler Upgrade Scheme represents one of the most generous home improvement grants available, offering £7,500 towards technology that reduces both your carbon footprint and your long-term heating costs. With the scheme funded through 2028 and heat pumps becoming increasingly popular, now is an excellent time to explore whether this grant can work for your home.

Whether you're ready to proceed immediately or need to improve insulation first, the pathway to cleaner, more efficient heating is clearer and more affordable than ever. The combination of government grants, improving technology, and dedicated electricity tariffs means heat pumps are now practical alternatives for millions of UK homes.