What is the Boiler Upgrade Scheme?
The Boiler Upgrade Scheme (BUS) is a UK government grant programme that provides £7,500 towards the cost of replacing your existing fossil fuel heating system with a low-carbon heat pump. Administered by Ofgem, the scheme launched in April 2022 and has been extended to 2028, giving homeowners in England and Wales ample time to make the switch.
The grant was increased from £5,000 to £7,500 in October 2023, making heat pumps significantly more affordable. For many homes, the grant covers 50-70% of the total installation cost, bringing a technology that was once prohibitively expensive well within reach of most homeowners.
Unlike ECO4, which is means-tested, the Boiler Upgrade Scheme is available to all homeowners regardless of income. The only requirements relate to your property and the type of heating system you're replacing.
Key fact: Your installer applies for the BUS grant on your behalf. You don't need to fill in any government forms — the £7,500 is deducted from your installation quote directly.
How much does a heat pump cost with the BUS grant?
| Heat Pump Type | Typical Total Cost | After £7,500 Grant | Annual Running Cost |
|---|---|---|---|
| Air source heat pump (ASHP) | £10,000–£15,000 | £2,500–£7,500 | £900–£1,200 |
| Ground source heat pump (GSHP) | £18,000–£35,000 | £10,500–£27,500 | £700–£1,000 |
Air source heat pumps are by far the most popular choice, accounting for over 90% of BUS applications. They're cheaper to install, don't require extensive groundwork, and are suitable for most UK properties.
Who is eligible for the Boiler Upgrade Scheme?
- You own the property — homeowners only (not available for tenants)
- Property is in England or Wales — Scotland has its own scheme (Home Energy Scotland)
- You have a valid EPC — an Energy Performance Certificate must be lodged for the property
- Replacing fossil fuel heating — gas boiler, oil boiler, LPG, electric storage heaters, or coal
- Not a new build — the property must not have been built within the last 2 years
- No previous BUS grant — one grant per property
- MCS-certified installer — the work must be carried out by an MCS-accredited company
How to apply for the Boiler Upgrade Scheme
- Get quotes from MCS-certified installers — We can connect you with vetted, local installers. Enter your postcode above to get started.
- Choose your installer — Compare quotes, check reviews, and select the installer you're most comfortable with.
- Your installer applies — They submit the BUS application through Ofgem's online portal. This typically takes a few days to process.
- Voucher issued — Ofgem issues a grant voucher to your installer, which is valid for 3 months (extendable to 6 months).
- Installation — Your heat pump is installed. ASHP takes 2-3 days; GSHP takes 1-2 weeks.
- Grant applied — The £7,500 is deducted from your final bill. You only pay the difference.
Air source vs ground source heat pumps
| Feature | Air Source (ASHP) | Ground Source (GSHP) |
|---|---|---|
| Upfront cost | £10,000–£15,000 | £18,000–£35,000 |
| Efficiency (COP) | 2.8–3.5 | 3.5–4.5 |
| Space needed | Outdoor unit (like AC) | Garden for ground loops |
| Installation time | 2–3 days | 1–2 weeks |
| Noise | Quiet hum (40-50 dB) | Silent |
| Lifespan | 20+ years | 25+ years |
| Best for | Most homes | Larger properties with gardens |
Running costs: heat pump vs gas boiler
One of the biggest questions homeowners have is whether a heat pump will actually save money compared to their gas boiler. The answer depends on several factors, but for most homes the answer is yes, particularly with rising gas prices.
A well-installed air source heat pump has a Coefficient of Performance (COP) of around 3.0, meaning for every 1kWh of electricity it uses, it produces 3kWh of heat. Even though electricity is more expensive per unit than gas, this efficiency advantage means overall heating costs are comparable or lower.
| Heating System | Annual Cost (3-bed semi) | CO₂ Emissions |
|---|---|---|
| Old gas boiler (G-rated) | £1,800–£2,200 | 4.5 tonnes/year |
| New gas boiler (A-rated) | £1,200–£1,500 | 2.7 tonnes/year |
| Air source heat pump | £900–£1,200 | 1.0 tonnes/year |
| Ground source heat pump | £700–£1,000 | 0.8 tonnes/year |
Preparing your home for a heat pump
Heat pumps work best in well-insulated homes. Before installation, consider:
- Insulation — Loft insulation to 300mm, filled cavity walls, and draught-proofing all help. You may qualify for free insulation through ECO4 or the Great British Insulation Scheme.
- Radiators — Heat pumps run at lower temperatures than boilers. You may need to upgrade some radiators to larger ones, or consider underfloor heating.
- Hot water cylinder — Heat pumps need a hot water cylinder (if you currently have a combi boiler, one will need to be installed).
- Electrical supply — Some installations require an upgrade to your electrical supply. Your installer will assess this during the survey.
Pro tip: Get your insulation sorted first. Many homeowners combine free ECO4 insulation with a BUS-funded heat pump for the best energy savings. Check ECO4 eligibility →
Common BUS concerns addressed
Will a heat pump work in an older house?
Yes. Heat pumps can work in properties of any age, provided insulation is adequate. Victorian and Edwardian homes may need additional insulation work first, but thousands of older UK homes now run efficiently on heat pumps.
Are heat pumps noisy?
Modern air source heat pumps operate at around 40-50 decibels — similar to a quiet conversation or a modern fridge-freezer. Ground source heat pumps are virtually silent. Planning rules require outdoor units to meet noise limits at your property boundary.
Do I need planning permission?
Air source heat pumps are typically permitted development, meaning no planning permission is needed provided you follow rules about placement (1m from the boundary) and noise. Listed buildings and conservation areas may have additional requirements. Your installer will advise.
What about the smart export guarantee?
If you also have solar panels, you can use the electricity generated to run your heat pump, dramatically reducing running costs further. The Smart Export Guarantee pays you for surplus electricity exported to the grid.