The Boiler Upgrade Scheme (BUS) is a UK government grant programme that helps homeowners and small non-domestic properties cover the upfront cost of replacing a fossil-fuel heating system with a low-carbon alternative. Administered by Ofgem, the scheme is open to eligible properties in England and Wales.
This guide explains what the scheme offers, who can apply, and what the process looks like — so you can decide whether it makes sense for your property.
What Is the Boiler Upgrade Scheme?
The Boiler Upgrade Scheme was introduced in May 2022 under the British Energy Security Strategy. It replaced the earlier Renewable Heat Incentive (RHI) for domestic properties. The current scheme runs until 31 March 2028, giving homeowners a fixed window to access the funding.
Under the scheme, Ofgem pays the grant voucher directly to the MCS-certified installer, who passes the saving on to the homeowner by reducing the total invoice. You never handle the grant money yourself — you simply pay the net amount after the grant has been deducted.
How Much Is the Grant?
Grant amounts (as of 2025) are:
- Air source heat pump: £7,500 — subject to eligibility
- Ground source heat pump (including water source): £7,500 — subject to eligibility
- Biomass boiler: £5,000 — subject to eligibility (limited eligibility criteria apply; rural properties only in most cases)
These figures are set by the Department for Energy Security and Net Zero (DESNZ) and are reviewed periodically. The grant does not need to be repaid, provided you keep the heat pump installed and meet the scheme’s ongoing conditions.
Important: the grant reduces the upfront cost of installation but does not cover it entirely. A typical air source heat pump installation in a UK home costs £10,000–£15,000 before the grant, depending on the size of the property, the heat pump model, and whether additional work such as radiator upgrades or pipework changes is required. A home survey is the only reliable way to get an accurate quote for your property.
Who Qualifies for the Boiler Upgrade Scheme?
To be eligible for a BUS grant, the following conditions must all be met:
- The property is in England or Wales (the scheme does not cover Scotland or Northern Ireland, which have their own programmes)
- The property is an existing building — new builds are not eligible
- You are replacing a fossil-fuel heating system (gas boiler, oil boiler, or direct electric heating); or, in limited circumstances, replacing a biomass boiler with a heat pump
- The property has a valid Energy Performance Certificate (EPC) with no outstanding recommendations for loft or cavity wall insulation (unless the property is listed, protected, or technically unable to have these installed)
- You are the property owner or have appropriate consent from the freeholder
The EPC insulation requirement is one of the most common reasons applications are declined. If your EPC recommends cavity wall insulation and it has not been installed, you will need to either have the insulation completed or obtain an installer’s letter confirming it is technically not feasible before your application can proceed.
How Do You Apply?
The application process runs through your installer, not directly through Ofgem. Here is how it typically works:
- Get a home survey. A qualified installer assesses your property to confirm suitability and produces a detailed quote. This survey is essential — heat pump sizing depends on the property’s heat loss calculation (typically completed as a BS EN 12831 heat loss assessment).
- Installer applies for the voucher. Once you accept a quote, your MCS-certified installer applies to Ofgem for a BUS voucher on your behalf. Vouchers are typically issued within a few days and are valid for three months.
- Installation takes place. The heat pump is installed and commissioned. The installer submits evidence to Ofgem after completion, including the MCS installation certificate and a signed declaration.
- Grant is claimed. Ofgem pays the grant directly to the installer, who has already reduced your invoice by the grant amount.
The entire process from survey to installation typically takes four to twelve weeks, depending on equipment lead times and installation schedules.
Frequently Asked Questions
Can I apply for BUS on a new build?
No. The Boiler Upgrade Scheme is only available for existing buildings. New builds receiving planning consent from April 2025 onward are subject to separate regulations under the Future Homes Standard, which requires low-carbon heating from the outset — but that is a building regulation requirement, not a grant programme.
Does my home need to be well-insulated to get a heat pump?
Good insulation improves the efficiency and reduces the running cost of a heat pump, but it is not a legal requirement for BUS eligibility on its own. The main requirement is that the EPC does not flag outstanding loft or cavity wall insulation recommendations. Properties built before 1930 or with solid walls may not be suitable for cavity wall insulation and can still apply, provided a surveyor confirms this in writing.
What VAT rate applies to heat pump installations?
Air source and ground source heat pumps qualify as energy-saving materials and are currently rated at 0% VAT. This rate applies until 31 March 2027 under the current government legislation. After that date, the standard rate may apply — always confirm the rate that will apply at the time of your installation with your installer.
Can I use BUS alongside other grants or schemes?
You cannot combine BUS with the Energy Company Obligation (ECO4) for the same measure. However, you may be eligible for other funding sources — for example, the Great British Insulation Scheme for insulation improvements prior to heat pump installation. A qualified installer can advise on what funding may be available for your specific situation.
What happens if I sell my house after getting a heat pump via BUS?
You are not required to repay the grant if you sell the property, provided the installation met all the scheme’s conditions. The heat pump and MCS documentation should be disclosed to buyers as part of the conveyancing process.
Is the Boiler Upgrade Scheme available in 2026?
Yes. The scheme is funded through to 31 March 2028. Ofgem continues to issue vouchers subject to annual budget allocations set by DESNZ. In previous years, annual budgets were fully committed before the financial year-end, so applying early in the scheme year (which runs April to March) is advisable.
Is a Heat Pump Right for Your Property?
The Boiler Upgrade Scheme makes heat pumps more affordable, but the technology is not automatically the right choice for every home. A heat pump works most efficiently in a well-insulated property with low-temperature heat distribution (underfloor heating or oversized radiators). In a draughty, poorly insulated home, running costs may be higher than a gas boiler until insulation is improved.
The best way to assess suitability is a professional home survey. RnR Renewables installs air source heat pumps across England and offers a no-obligation survey to assess whether your property is a good candidate. Contact us on 07907 001 957 or use the enquiry form to arrange a visit.
Last updated: June 2026. Grant amounts and eligibility criteria are set by the UK government and may change. Always verify current figures at ofgem.gov.uk before making a purchase decision.