Replacing your gas boiler with a heat pump is not cheap. That's the honest starting point. So when the government offers up to £7,500 toward the switch, the first thing most people ask is: does that money actually cover the labour and fitting, or just the unit itself?
Short answer, both. But not always in full. Here's what you need to know before calling anyone out for a quote.
What Exactly Is the Boiler Upgrade Scheme?
Run by Ofgem and backed by the UK government, the Boiler Upgrade Scheme is a grant for homeowners in England and Wales who want to ditch fossil fuel heating. It launched in 2022 and currently runs until March 2028.
The money doesn't come to you. It goes straight to your installer, who knocks it off your bill before you even see an invoice. No claims, no waiting, no reimbursement headaches.
So Does the Grant Pay for Installation Too?
Yes, the grant is applied against your total job cost, not just the equipment. Labour, fitting, and the unit itself all fall under one combined figure. The grant chips away at that overall price.
Say the full job comes to £14,000 for an air source heat pump. With the £7,500 grant deducted, you'd pay £6,500. Your installer handles the Ofgem paperwork. Once approved, they claim the funds and bill you for what's left.
Worth noting: installations rarely fall below £7,500. Most people still pay something out of pocket, depending on the property size and system type.
What Does the £7,500 Actually Cover?
The grant amount stays the same across the main eligible systems, £7,500 for an air source heat pump, ground source heat pump, or biomass boiler (the latter only applies in off-gas-grid properties).
That pot can go toward:
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The heat pump or boiler hardware
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Fitting costs and labour charges
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Pipework or radiator upgrades, if your installer confirms these are needed for the system to run properly
That last point matters. Not every installer includes extras automatically. Ask specifically what falls within the grant-covered scope before agreeing to anything.
Who Actually Qualifies?
Eligibility is fairly clear-cut, though a few details catch people off guard:
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Property must be in England or Wales
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You need to own the home, or be a landlord with tenants' agreement
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Your current heating system runs on fossil fuels, gas, oil, or LPG
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Your Energy Performance Certificate (EPC) must be current, with no open recommendations for cavity wall or loft insulation
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The installer and the system both need MCS certification
That insulation point trips up a surprising number of applicants. If your EPC flags missing loft insulation, you'll need to sort that first. It's not a huge job, but it delays things if you're not expecting it.
Which Heating Systems Are Eligible?
Three options qualify under the current rules:
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Air source heat pumps: the most widely installed type across the UK
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Ground source heat pumps: higher upfront cost, but strong long-term efficiency
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Biomass boilers: only available for homes off the gas network, typically in rural areas
One thing people often get wrong: a brand-new energy-efficient gas boiler does not qualify. The whole point of the scheme is to move away from gas, not upgrade within it.
How Does the Application Actually Work?
You don't fill in any forms yourself. When you apply for Boiler Upgrade Scheme funding, your MCS-certified installer handles the submission to Ofgem on your behalf. The steps go roughly like this:
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Get quotes from at least two or three MCS-registered installers
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Confirm the system, scope of work, and total cost
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Installer submits the grant application to Ofgem
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Approval comes through, and the discount gets applied to your quote
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Installation takes place within 12 months of approval
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Installer claims the grant payment once the job is signed off
One practical tip, ask installers upfront how many BUS applications they've handled. Experience with the paperwork makes a difference. Errors in submissions cause delays, and some smaller firms are still learning the process.
What If Something Goes Wrong With the Application?
Rejections do happen. Common reasons include an expired EPC, unresolved insulation recommendations, or a system that doesn't meet the technical standards.
Your installer will get feedback from Ofgem explaining the issue. In most cases, it's fixable, just slower.
What Should You Do Before Getting Quotes?
Check your EPC on the government's register. If it flags insulation gaps, book that work first. Then approach two or three MCS-certified installers, ask for itemised quotes, and get clarity on what the grant covers in their specific proposal.
The grant is real money. It just works a little differently from what most people expect.
Frequently Asked Questions
Is the Boiler Upgrade Scheme grant taxable?
No. It's a government grant, so it doesn't count as taxable income.
Can landlords use the scheme?
Yes, provided the property meets eligibility requirements and the heating system serves a domestic space.
How long does approval take?
Typically a few weeks, though it depends on the installer's submission accuracy and Ofgem's current workload.
Can I choose any installer?
Only MCS-certified installers can submit applications. Check the MCS database before committing to anyone.
Does the scheme cover flats or leasehold properties?
It can, but you'll likely need written consent from the freeholder or management company first.
