What Is the Boiler Upgrade Scheme?
The Boiler Upgrade Scheme (BUS) is a government grant that reduces the upfront cost of installing a low-carbon heating system. It is administered by Ofgem and available to homeowners in England and Wales who want to replace their existing fossil fuel heating with a heat pump.
The grant is applied by your installer directly against the cost of the work - you do not pay the full amount and claim back later. Your installer claims the grant from Ofgem after the installation is complete and passes the saving on to you at the point of invoice.
The BUS grant is currently set at £7,500 for both air source and ground source heat pumps. This figure has been confirmed through to at least March 2028 under current government commitments.
Who Can Apply?
You are eligible for the Boiler Upgrade Scheme if you meet all of the following conditions:
- You own the property where the heat pump will be installed (including self-build)
- The property is in England or Wales
- The property has a valid EPC (Energy Performance Certificate) issued in the last 10 years with no outstanding recommendations for loft or cavity wall insulation
- The installer you use is MCS-certified (Microgeneration Certification Scheme) for the heat pump technology being installed
- The heat pump replaces a fossil fuel heating system (gas boiler, oil boiler, electric storage heaters)
The scheme does not currently apply to:
- Landlords or rental properties
- New-build homes that have never had a fossil fuel system
- Properties in Scotland (Scotland has its own separate scheme - the Home Energy Scotland grant)
- Commercial properties
What Does It Cover?
The £7,500 grant applies to the full installed cost of the heat pump system - equipment, labour, pipework, controls and commissioning. It does not have to be spent on any specific element; it simply reduces your total invoice by £7,500.
It does not cover:
- Upgrading the distribution system (e.g. replacing radiators with larger ones or adding underfloor heating) - though this work can be done at the same time and may be quoted alongside
- Electrical upgrades to the consumer unit or grid connection
- Hot water cylinders, unless specified as part of the heat pump package by the installer
- Solar PV panels or battery storage
Air Source vs Ground Source
Both air source heat pumps (ASHP) and ground source heat pumps (GSHP) qualify for the same £7,500 grant. The choice between them depends on your property rather than the grant level:
- Air source heat pumps extract heat from outdoor air and are suitable for most properties. They require external space for the unit (similar in size to an air conditioning unit) and work well in most UK climates. Typical installed cost before grant: £10,000-£18,000.
- Ground source heat pumps extract heat from the ground via buried pipes or boreholes. They are more efficient but require significant land area or borehole drilling. Typical installed cost before grant: £18,000-£35,000.
In both cases the grant reduces your net cost by £7,500. For most domestic properties, an air source heat pump is the practical choice.
How to Apply
You do not apply to Ofgem directly. The process works through your installer:
- Get quotes from MCS-certified heat pump installers. Your installer must be MCS-certified for the scheme to apply. You can find certified installers on the MCS website (mcscertified.com).
- Check your EPC. Your installer will confirm whether your EPC is current and whether any outstanding insulation recommendations need to be addressed first. A new EPC costs around £60-100 if yours is out of date.
- Your installer submits a BUS voucher application to Ofgem before work starts. This reserves the grant against your installation.
- Installation takes place within the voucher validity period (typically 3 months, extendable once).
- Your installer redeems the voucher after commissioning. Your invoice is reduced by £7,500 at the point of payment - you do not handle the grant money directly.
Important: the BUS application must be submitted by your installer before installation begins. A voucher cannot be applied retrospectively to a system that has already been installed.
Is a Heat Pump Right for My Property?
Heat pumps work most efficiently in well-insulated properties with low-temperature distribution systems (underfloor heating or oversized radiators). In a poorly insulated home with small radiators designed for a gas boiler at 70-80 degrees C, a heat pump will struggle to reach set-point and run inefficiently.
Before committing to a heat pump, it is worth getting a heat loss calculation done for your property. This determines how much heating output you actually need and helps size the system correctly. An oversized heat pump is less efficient; an undersized one cannot meet demand on the coldest days.
Our heat pump calculators can give you an initial sizing estimate based on your floor area and insulation level before you approach installers.
Check eligibility on gov.uk →