The Boiler Upgrade Scheme Explained: £7,500 Off a Heat Pump

The Boiler Upgrade Scheme (BUS) is the UK government grant that pays a fixed amount toward replacing a fossil fuel boiler with a low-carbon heating system in England and Wales. It is the single biggest lever in the heat pump economics conversation: it converts a five-figure installation into, for many homes, a low four-figure one.

Three things make it unusually painless as government schemes go:

• It is a flat grant, not a means-tested rebate. The amount does not depend on your income.
• The installer does the paperwork. An MCS-certified installer applies for the grant on your behalf, and the money comes off your quote. You never front the cash and wait for reimbursement.
• It has a long runway. The scheme has been extended to 2030, though individual provisions (like the oil and LPG uplift) have their own windows.

All amounts and rules on this page are accurate as at June 2026.

For the air source heat pumps this site covers, the headline is simple: £7,500 off, or £9,000 off from 21 July 2026 if your home is heated by oil or LPG.

Set against typical installed prices of £8,000-14,000 (Ofgem reports an actual average around £12,500 for an 8kW system, January 2026), the grant takes most projects to £500-6,500. Octopus reports post-grant averages around £4,460, and straightforward swaps in well-suited homes can land near £1,000.

From 21 July 2026, homes heated by oil or LPG (that is, off the mains gas grid) qualify for an increased grant of £9,000 instead of £7,500. The uplift is expected to run to around March 2027.

Why these homes get more: oil and LPG households, concentrated in rural England and Wales, face delivered-fuel prices and often older housing stock, and they are exactly the homes where a heat pump replaces the most expensive heating. If that is you, the timing question writes itself: a quote signed under the uplift is £1,500 better off than the same quote a month too early or too late.

If you are oil-heated and your boiler is on its last legs, talk to installers now and time the application window with them. Brands like Grant Aerona3 have built their UK reputation in precisely these oil-belt homes; see our brand guide.

The rules, in plain English (accurate as at June 2026):

• Location: the property must be in England or Wales. Scotland has its own scheme (below). Northern Ireland is not covered.
• Who can apply: owner-occupiers, small landlords and second-home owners are eligible. Most new-build properties are not (the assumption being that new homes should be built with low-carbon heating in the first place).
• What you are replacing: the scheme is for replacing fossil fuel heating (gas, oil or LPG boilers, or electric heating in some cases) with a low-carbon system.
• EPC: the old requirement to hold a valid EPC with no outstanding loft or cavity wall insulation recommendations was removed on 28 April 2026. You no longer need an EPC certificate to get the grant. Sensible insulation is still good advice for running costs, but it is no longer a grant precondition.
• The installer: the installation must be carried out by an MCS-certified installer. This is a scheme requirement, not a recommendation: no MCS certification, no grant.

The process from your side is refreshingly short:

1. Get quotes from MCS-certified installers. Quotes should show the system price and the grant deduction explicitly.
2. Accept a quote. The installer applies to the scheme for a voucher on your behalf. You confirm to the scheme administrator that the installer is acting for you when asked.
3. Installation happens. The installer redeems the voucher and receives the grant money directly.
4. You pay the post-grant balance. The £7,500 (or £9,000) was never in your hands and never needs reclaiming.

Two practical implications. First, the installer being MCS-certified is what makes the whole machine turn, so confirm certification early. Second, because the grant flows through the installer, comparing quotes means comparing post-grant prices for the same scope of work: heat loss survey, radiators included or excluded, cylinder included or excluded. Our replacement guide walks through the scope items.

Indicative June 2026 figures for an air source heat pump in England and Wales:

Indicative ranges, accurate as at June 2026. Your quote depends on your home; always compare multiple itemised quotes.

What pushes a quote toward the top of the range: converting a combi home (adding a hot water cylinder), upgrading radiators for low flow temperatures, awkward pipework, and larger properties needing bigger units. What pulls it down: an existing cylinder, modern radiators, and a straightforward outdoor location. Octopus's much-quoted ~£4,460 post-grant average and the near-£1,000 quotes both exist in the same market; the difference is the scope of work, not magic.

VAT helps too: 0% VAT applies to residential heat pump installations until 31 March 2027 (5% after that), worth £1,000-3,000 on typical jobs and already inside quoted prices.

Scotland is not in the BUS but has arguably the stronger package. The Home Energy Scotland (HES) Grant and Loan scheme offers:

• A grant of up to £7,500 toward a heat pump
• A £1,500 rural and island uplift, taking the grant to up to £9,000 for qualifying locations
• An optional interest-free loan of up to £7,500 on top of the grant

That means a Scottish household can fund up to £15,000-16,500 of project cost through the scheme, half of it as a non-repayable grant. Applications go through Home Energy Scotland.

Northern Ireland has no Boiler Upgrade Scheme equivalent as at June 2026. Limited energy-efficiency support exists for some households; check niDirect for current schemes. We say this plainly because NI readers deserve the honest picture: the heat pump maths there rests on running costs and the UK-wide 0% VAT, without a purchase grant.

Three dates frame the decision:

• 1 July 2026: the Ofgem price cap gas unit rate jumps from 5.74p to 7.33p/kWh, a 27% rise in a single quarter that pushes typical bills up around 13%. Every quarter on gas costs more than the last one did.
• 21 July 2026: the £9,000 oil and LPG uplift begins (expected to run to around March 2027). Oil-heated homes should aim their project at this window.
• 31 March 2027: 0% VAT on residential heat pump installations ends and 5% applies. On a £12,000 gross job, that is several hundred pounds of difference.

None of this argues for panic; the BUS itself runs to 2030. It argues for planning: deciding your replacement before the boiler forces the decision, and timing it to collect the windows that apply to you. Run your own numbers with the gas boiler vs heat pump calculator, read the wider Boiler Upgrade Scheme hub, then get free quotes from local MCS-certified installers.