The Boiler Upgrade Scheme (BUS) remains the single biggest pot of money available to most homeowners in England and Wales who want to swap a gas or oil boiler for a heat pump. It knocks £7,500 off the cost of an air source or ground source heat pump, the discount comes off your quote up front rather than as a rebate months later, and you barely have to touch the paperwork yourself.
Even so, plenty of confusion persists about who qualifies, what the money covers and what a realistic bill looks like once the grant is applied. Here is where the scheme stands in 2026.
What the £7,500 actually covers
The grant applies to heat pumps that heat water — in other words, systems that run your radiators or underfloor heating and fill your hot water cylinder, just as a boiler does. Two technologies qualify:
- Air source heat pumps (air-to-water): the familiar outdoor unit that extracts heat from the air. This is what the overwhelming majority of BUS installations are.
- Ground source heat pumps: buried loops or boreholes extract heat from the ground. Same £7,500 grant, though the overall job costs considerably more.
Two things catch people out. First, air-to-air units do not qualify — wall-mounted systems that blow warm or cool air into a room have no wet heating circuit, so they sit outside the scheme entirely. Second, hybrids don't qualify either: pairing a heat pump with a boiler that stays in place rules the installation out. The scheme is designed to replace fossil fuel heating, not supplement it.
Who qualifies in 2026
The core conditions are straightforward. You need to own a domestic property in England or Wales — Scotland runs its own separate grant and loan support through Home Energy Scotland, and Northern Ireland is not covered by BUS. The heat pump must be replacing an existing fossil fuel or electric heating system, which is why most new-build homes are excluded (self-builds are a notable exception).
The EPC requirement
Your home needs a valid Energy Performance Certificate — one issued within the last ten years. If you have bought or let the property in the past decade you almost certainly have one; the government's EPC register takes a minute to check, and a fresh assessment is a modest cost if yours has lapsed.
The insulation rule that no longer exists
Out-of-date advice still circulates on this one. When the scheme launched, homes with outstanding loft or cavity wall insulation recommendations on their EPC had to deal with those first. That requirement was removed in 2024 — an EPC flagging missing insulation no longer blocks your claim. Insulating first is still sensible (a better-insulated home needs a smaller, cheaper heat pump and runs it for less), but it is now a recommendation, not a condition.
How the grant is claimed — you don't apply
One of the scheme's genuinely good design decisions: the homeowner never applies for anything. Your installer must be MCS certified, and it is the installer who applies to Ofgem for the grant on your behalf. Your role is limited to confirming consent — Ofgem emails you to check you are happy for the installer to claim against your property — and the £7,500 is simply deducted from your quoted price. You pay the net figure; the installer recovers the grant afterwards.
In practice, choosing the installer is the application process. Check certification on the MCS website, get two or three quotes, and expect a proper room-by-room heat loss survey — an installer who prices your home over the phone is guessing at the size of system it needs.
What you'll actually pay after the grant
Prices vary with property size, how many radiators need upsizing and whether you need a new hot water cylinder, but the broad picture for a typical home looks like this (figures are approximate):
| System | Typical installed cost | BUS grant | Typical net cost |
|---|---|---|---|
| Air source heat pump | ~£8,000–£15,000 | £7,500 | ~£500–£7,500 |
| Ground source heat pump | often £20,000+ with ground works | £7,500 | varies widely by site |
At the lower end of the air source range — a well-insulated three-bed with a straightforward layout — the net cost can land close to that of a new boiler, which is the comparison that matters. Larger or harder-to-heat homes sit toward the top, and radiator upgrades or a new cylinder (if you currently have a combi) add to the bill. Insist that every quote itemises these extras and shows the £7,500 clearly deducted.
The 0% VAT bonus — and yes, you get both
Domestic heat pump installations currently attract 0% VAT under the energy-saving materials relief, and this is not an alternative to the grant — the two stack. Your installation is zero-rated, and the £7,500 comes off that already-VAT-free price. A properly prepared quote should show the zero rate explicitly; if a quote is silent on VAT, ask.
Finding an installer: the regional picture
The MCS installer base has grown substantially since the scheme launched, but coverage is uneven. Availability varies by region: homeowners in the far South West can read a local breakdown of the Boiler Upgrade Scheme in Cornwall, while Yorkshire households are relatively well served, with a strong pool of MCS-certified heat pump installers across Leeds, Sheffield, York and the surrounding towns keeping quotes competitive.
Wherever you are, quotes from installers who regularly fit heat pumps in your kind of housing stock — solid-stone terraces behave very differently from 1990s cavity-wall semis — will be more accurate and usually keener on price. Rural, oil-heated homes deserve a special mention: they tend to see the biggest running-cost improvements from switching.
Sensible next steps
- Check your EPC on the government register; arrange a new one if it has expired.
- Get two or three quotes from MCS-certified installers, each based on a full heat loss survey.
- Scrutinise the numbers: the £7,500 deduction, 0% VAT, and any cylinder or radiator work should all be itemised.
- Confirm your consent when Ofgem's email arrives — that is the whole of your paperwork.
- Budget honestly for extras so the final invoice holds no surprises.
A final note on timing. The grant level has changed before — it launched at £5,000 in 2022 and rose to £7,500 in late 2023 — and demand keeps climbing, so getting surveys and quotes done while the £7,500 figure stands is the pragmatic move. The scheme will not pay for your heat pump outright, but for most eligible homes it turns a daunting number into a manageable one — and it asks almost nothing of you in return.
