Subsidies for Heat Pumps in the UK

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With the government-financed Boiler Upgrade Scheme ("BUS") that has replaced the Domestic Renewable Heat Incentive (RHI) / the Green Heat Grant, you may receive an upfront discount when you install an energy-efficient and environmentally friendly heat pump in place of a traditional system. This page summarizes what you need to know to take advantage of the benefits that BUS offers.

What funding is available through the scheme?

Under the Boiler Upgrade Scheme, you can receive one grant per property and apply for it up until 2028. You can get up to £7,500 off the upfront installation cost of your chosen low-carbon system, applied for by an installer on your behalf. This amount will be deducted from the total installation cost.

You're entitled to claim the following:

• £7,500 towards an air source heat pump
• £7,500 towards a ground source heat pump (including water source heat pumps and those on shared ground loops)
• £5,000 towards biomass boilers

The system you choose to install must meet certain standards. To be eligible for the grant, it must have a seasonal coefficient of performance (SCOP) of at least 2.8, and its maximum capacity must be less than 45kWth.

Check if your property is eligible

Your property (home or small business) must be in England or Wales and have a valid Energy Performance Certificate (EPC) (less than 10 years old) with no outstanding recommendations for loft or cavity wall insulation. If you have such recommendations, you will likely need to get that work done first.

Find out what to do if your property has recommendations for loft or cavity wall insulation.

If you're unsure whether your property is suitable for a low-carbon heating system, consult an MCS certified installer. They can advise you on your options.

Additionally, to be eligible, you must meet the following requirements:

• You own the property you're applying for (including if it's a business, a second home, or a property you rent out to tenants).
• You have installed (or plan to install) your new heating system on or after 1 April 2022.
• You are replacing fossil fuel heating systems (such as oil, gas, or electric).

You will not receive subsidies from the scheme for:

• Most new build properties unless it is self-built and you are the original owner, or you have recently moved into a new build that has fossil fuel heating and it has never been owned by a business or organisation. Remember, you will need to show your installer proof that your property is a self-build, such as a copy of the title deeds.
• Social housing properties.
• A property that has already received government funding for a heat pump or biomass boiler.
• New build properties that are still under construction by the developer.
• Replacing an existing low-carbon heating system.

However, you can still apply for a grant if you have previously received funding to make your property more energy-efficient, such as for insulating your home.

Biomass boilers

You can get a grant for a biomass boiler if all the following are true:

• Your property is off the gas grid.
• Your property is in a rural location (check the Ofgem guidance for property owners if you're unsure).
• Your boiler has an emissions certificate showing that polluting emissions are kept to a minimum.

You cannot get a grant to install a biomass boiler in a self-build property.

How to access the subsidies under the BUS and apply

The scheme is installer-led and operates on a "first-come, first-serve" basis, with installers applying for grants on behalf of property owners. This process simplifies access to the scheme compared to its predecessors, directly benefiting homeowners by deducting the grant amount from the installation cost.

Installer Requirements:
Only Microgeneration Certification Scheme (MCS) accredited installers can apply, ensuring that installations meet high standards of quality and efficiency. Installers must also be members of a Consumer Code, like HIES, to participate. The process is managed through Ofgem as the supervisory authority. The Authority has powers to inspect installations, request additional information, withhold or reclaim grant payments, and revoke vouchers if non-compliance or misinformation is detected.

What is the Boiler Upgrade Scheme?

The Boiler Upgrade Scheme (BUS) is a pivotal UK government initiative aimed at promoting the decarbonisation of heating in buildings across England and Wales by providing financial incentives for the adoption of low-carbon heating solutions. This initiative is part of the UK's broader strategy to achieve net zero emissions by 2050, targeting a significant reduction in the carbon footprint of the country's residential and small non-domestic buildings. The BUS replaced the Green Heat Grant in April 2022.

It provides upfront capital grants to support the installation of heat pumps in households and small businesses across England and Wales.

The scheme allows you to upgrade your current inefficient heating and hot water systems to more energy-efficient alternatives, like heat pumps. The scheme will run until 2028, having been recently extended, with a budget of £1,950 million.

BUS has three main objectives:

1. Support continued deployment of low-carbon heating systems in homes and some small non-domestic buildings, following the closure of the Domestic RHI (up to 90,000 installations in total between 2022 and 2025).
2. Contribute to decarbonising heating in the UK and to meeting carbon budgets by delivering up to 1.1MtCO2e of carbon savings over Carbon Budgets 4 and 5, and 2.6MtCO2e over its lifetime.
3. Expand the existing low-carbon heat market and supply chain to support the mass roll-out of low-carbon heating technology.

The scheme was launched in England and Wales on 1 April 2022, with an approved £450 million funding up until 2025, and is being administered by Ofgem. The voucher application process opened on 23 May 2022. In December 2023, the government announced an additional allocation of £1.5 billion for 2025-2028.