If you are thinking about replacing an old gas boiler with a heat pump, the Boiler Upgrade Scheme is probably the single biggest reason it is more affordable than you might expect. It is a government grant that knocks thousands of pounds off the cost of a low-carbon heating system before you have paid a penny. The trouble is that the rules are easy to misunderstand, and a few small details, such as your EPC, can hold things up. This guide walks through exactly what the scheme is, who can claim it, and the practical steps to get the money applied to your installation.
What the Boiler Upgrade Scheme is and how much it's worth
The Boiler Upgrade Scheme, usually shortened to BUS, is run by Ofgem in England and Wales. It gives homeowners a grant towards the cost of installing a renewable heating system to replace fossil-fuel heating such as a gas, oil or LPG boiler. Rather than a cheque after the fact, the grant is applied as an upfront discount, so you only ever pay the balance.
The headline figures are straightforward. You can get up to £7,500 towards an air-source or ground-source heat pump, and up to £5,000 towards a biomass boiler (the biomass option is limited to rural properties in England and Wales that meet specific conditions). The grant amount is fixed regardless of your income, and there is no means test involved.
Who is eligible
Eligibility is refreshingly simple compared with some grants, but there are a handful of conditions worth getting right before you start. The scheme covers homeowners and small non-domestic property owners in England and Wales. Crucially, there is no income or means test, so it is open regardless of what you earn.
- Your property is in England or Wales.
- You own the property (this includes most landlords, and second homes are not excluded).
- You have a valid EPC (Energy Performance Certificate) with no outstanding recommendations for loft or cavity wall insulation. If your EPC flags these, you will usually need to address them first.
- You are replacing a fossil-fuel system such as a gas, oil or LPG boiler, or electric heating; the new system must be a heat pump or, in eligible rural cases, a biomass boiler.
- The installation is carried out by an MCS-certified installer.
The EPC requirement catches people out most often. An EPC is valid for ten years, and if yours is recent and clear of insulation recommendations, you are good to go. If it is out of date or recommends loft or cavity insulation, sorting that out first is the sensible path, and it tends to make the heat pump work better anyway.
The step-by-step claim process
One of the best things about the scheme is that you do not apply for the grant yourself. Your installer does all the heavy lifting with Ofgem on your behalf, which keeps the paperwork off your plate. Here is how it typically unfolds.
- Choose an MCS-certified installer and arrange a survey of your home.
- The installer designs a suitable system and gives you a quote that already shows the BUS grant deducted.
- The installer applies to Ofgem for the grant on your behalf and obtains a voucher.
- Once you accept the quote, the installation goes ahead.
- The grant is taken off the total cost as an upfront discount, and you pay only the remaining balance.
- The installer redeems the voucher with Ofgem after the work is complete and certified.
Because the discount is applied before you pay, you never need to find the full amount and wait to be reimbursed. The installer carries the administrative side and reclaims the grant from Ofgem once the system is signed off and registered.
What the grant does not cover, and how the costs stack up
The grant reduces the cost but rarely covers it entirely, so it helps to set expectations. As a rough guide, and depending heavily on your property, an air-source heat pump typically costs somewhere between £7,000 and £13,000 installed before any grant, while a ground-source system can run from around £15,000 to £30,000 because of the groundworks involved. After the £7,500 is deducted, the balance you pay can be considerably lower, but the final figure depends on your home's size, layout, existing radiators and insulation.
The grant is intended for the heating system itself. It does not stretch to wider renovation work, and any upgrades to radiators, pipework or insulation that your installer recommends may form part of the overall quote. This is exactly why a proper survey matters: it tells you the real, all-in number rather than a headline estimate.
How it stacks with 0% VAT and the looming deadline
The Boiler Upgrade Scheme works alongside another saving that often goes unmentioned. Heat pumps and a range of other energy-saving materials are currently zero-rated for VAT until 31 March 2027, which means there is no VAT to add on the installer's invoice in the first place. The two benefits are independent, so you get the 0% VAT treatment and the BUS grant on the same project, with both handled automatically by your installer.
Timing matters on both fronts. As of 2026 the BUS is scheduled to run until 31 March 2028, and the 0% VAT relief is set to run until 31 March 2027. These dates can change, so it is always worth checking the latest position on gov.uk before you commit. If you are weighing up a heat pump, there is a reasonable case for not leaving it to the last minute, as installer diaries tend to fill up as deadlines approach.
Because the discount is applied upfront by your installer, the grant feels less like a rebate you chase and more like a price cut you simply receive.
The Renovation Register Team
Why your installer must be MCS-certified
There is one non-negotiable condition running through everything above: the installer must be MCS-certified. MCS stands for the Microgeneration Certification Scheme, the quality standard for renewable installations in the UK. Without an MCS-certified installer, you cannot access the Boiler Upgrade Scheme at all, and you would also miss out on the Smart Export Guarantee if you later add solar.
Certification is your assurance that the system has been designed and fitted to a recognised standard, and it is what allows Ofgem to register and approve the grant. You can verify any installer's certification on the public MCS register at mcscertified.com, which is a quick and worthwhile check before signing anything.
Your next step
The Boiler Upgrade Scheme can take a meaningful chunk out of the cost of a heat pump, but the real numbers for your home only become clear once a qualified professional has looked at it. The simplest way to start is to find an MCS-certified installer through our directory at /installers and arrange a proper assessment of your property.
Renovation Register offers a free project assessment worth £380, in which an MCS-certified installer visits your home, surveys it and gives you a written recommendation with no obligation. It is the clearest way to confirm whether a heat pump suits your home, what it will genuinely cost after the grant and 0% VAT, and what, if anything, you should sort out first. You can request yours at /demande.
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