Heat Pump Grants in the UK (2025): How to Claim £7,500 Toward Your Installation

The UK government has made a significant move by extending and bolstering support for low-carbon heating, placing special emphasis on heat pumps. Starting in 2025, homeowners have access to increased funding through the Boiler Upgrade Scheme, offering grants up to £7,500 toward the installation of air source and ground source heat pumps. This financial boost has been designed to make energy-efficient systems more accessible while aiming for a greener, more sustainable future.

What Is the Boiler Upgrade Scheme and Why Was It Expanded?

The Boiler Upgrade Scheme (BUS), managed by Ofgem, is the government's answer to tackling both rising household energy bills and the urgent need to cut carbon emissions. In late 2024 and again in early 2025, the government announced substantial budget increases for the scheme, with funds exceeding £295 million for 2025/2026.

A key driver behind the expansion has been the desire to increase uptake of low-carbon technologies in homes and small non-domestic buildings. These grants directly lower the up-front cost of switching to a heat pump, removing one of the most significant barriers for homeowners. By increasing the funding pot and grant value, thousands more can benefit from cutting-edge, environmentally friendly heating solutions.

Who Is Eligible for the Boiler Upgrade Scheme?

Understanding whether you qualify is essential before planning your installation. The scheme broadly covers homeowners, as well as small landlords and private property owners. Eligibility depends on several factors:

• Type of Property: The grant covers both domestic and small non-domestic properties, provided they are located in England or Wales. Your property must have a valid, up-to-date Energy Performance Certificate (EPC).
• Existing Heating System: BUS primarily supports homes replacing fossil fuel systems (such as oil, gas, or electric boilers) with low-carbon heat pumps. New build homes generally do not qualify, unless they are self-built.
• Installer Requirements: Installations must be completed by an MCS-certified installer. The installer, not the homeowner, will apply for the grant on your behalf, ensuring compliance with technical standards.
• Rural and Urban Locations: Properties in rural areas qualify, but there is scope for homes in both urban and rural settings, based on Ofgem's updated guidance.

Income, property value, and existing heating solutions all influence eligibility. It's always best to confirm with Ofgem or your chosen installer for up-to-date requirements as the scheme evolves.

How the Application Process Works

Navigating the Boiler Upgrade Scheme application process is refreshingly straightforward. After choosing an MCS-certified installer and confirming your eligibility, your installer will handle the application process via the Ofgem website. Here are the steps involved:

1. Quote and Agreement: Contact an MCS-certified installer who will visit your property, propose a system, and provide a quote.
2. Installer Submits Application: Once you agree to proceed, your installer submits a grant application through Ofgem's portal.
3. Homeowner Consent: Ofgem sends you an email for consent, confirming you wish to claim the grant for your installation.
4. Validation and Voucher: Ofgem assesses the application, checks eligibility, and issues a grant voucher if all criteria are met.
5. Installation and Redemption: After installation, the installer uses the voucher to obtain the grant payment, which is deducted from your final bill.

Documentation Needed:
- An up-to-date Energy Performance Certificate (EPC) for your property
- Proof of ownership or permission to upgrade heating in the property
- The installer's certification

The process places minimal admin burden on the homeowner, with the installer coordinating the entire application and payment workflow.

Heat Pump Costs Before and After the Grant

Deciding to invest in a heat pump can seem daunting when just looking at sticker prices, and this is where the Boiler Upgrade Scheme demonstrates real impact. Understanding realistic heat pump costs and savings helps homeowners make informed decisions. Here's how the numbers stack up for typical UK installations:

Air Source Heat Pumps

• Average cost (2025): £8,000 - £15,000, including supply and installation, depending on system size and property type
• With the £7,500 BUS Grant: Out-of-pocket costs can fall as low as £500, potentially rising to about £7,500 for more complex jobs

Ground Source Heat Pumps

• Average cost (2025): £16,200 - £24,000 for residential properties
• BUS Grant Contribution: £7,500 off the total price, making installations from approximately £8,700 where conditions are suitable, up to £16,500 for larger, more complex projects

These examples use current UK figures and demonstrate why the scheme is so popular. For many, it moves heat pump technology from an aspirational goal to a realistic, affordable upgrade, bringing savings on energy bills and future-proofing homes against stricter carbon regulations.

Air Source vs Ground Source Heat Pumps: Efficiency, Cost, and Savings

Choosing between an air source and a ground source heat pump calls for careful consideration of your property, budget, and long-term goals.

Air Source Heat Pumps

• How They Work: Extract heat from ambient air and use it for central heating and hot water
• Efficiency: Around 300% efficiency, meaning they deliver three times more energy than they consume
• Installation: Generally simpler, faster, and with minimal ground works
• Running Costs: Typically lower than older gas and oil boilers, especially for well-insulated homes
• Upfront Cost: More affordable, especially after factoring in the Boiler Upgrade Scheme grant

Ground Source Heat Pumps

• How They Work: Draw energy from the earth through buried pipework, delivering reliable year-round performance
• Efficiency: Also reach around 300%, but can achieve even higher efficiencies where ground temperatures are consistently moderate
• Installation Complexity: Installation requires significant groundworks, which may limit suitability for smaller plots
• Lifespan: Known for durability, with ground loop systems often lasting over 40 years
• Savings: Higher upfront costs offset by even lower running expenses and a long operational lifespan

For most properties, air source systems make sense thanks to their lower cost and flexibility. Ground source setups become more attractive in larger homes or where land is available, offering top-tier efficiency and unparalleled longevity.

When deciding, many UK households consult reputable suppliers, such as ThermRite, for system selection. Always factor in insulation quality and property size to determine the best fit.

Are Heat Pumps Worth It?

Heat pump technology, supported by the Boiler Upgrade Scheme, has become a viable upgrade for households seeking efficiency, comfort, and lower carbon footprints. With up to £7,500 available, installation costs are often less than those of traditional heating replacements, and ongoing energy savings can further enhance the financial case.

UK homes stand to benefit from lower utility bills, more stable heating expenses, and improved EPC scores, factors that can help with both daily living costs and long-term property value. With installation made simpler by MCS-certified installers managing the grant process, making the switch to a heat pump is easier than ever. Whether you're weighing up a compact air source system or the long-term efficiency of a ground source configuration, examining comprehensive cost-benefit analyses can help determine the best path forward for your property.

Ready to take the next step? Reach out to a qualified installer and check your eligibility. If you're searching for the right heat pump for your project, reputable suppliers such as ThermRite offer systems suited to all property types and budgets. The opportunity to lower your heating bills, raise your home's efficiency, and future-proof your property is waiting.

Frequently Asked Questions

What is the maximum grant available through the Boiler Upgrade Scheme in 2025?

Homeowners in England and Wales can claim up to £7,500 toward the installation of air source or ground source heat pumps, thanks to the latest funding boost for the scheme.

Do I need to apply directly to Ofgem for the grant?

No, your chosen MCS-certified installer handles the application process on your behalf through Ofgem's online portal. You will need to provide your consent and supply any required documents.

Can I use the Boiler Upgrade Scheme grant for a new build property?

Grants are generally for existing homes. Self-builds may be eligible, but most standard new builds are excluded, in line with government policy to encourage retrofitting of existing stock.

Which heat pump type offers the best long-term value?

Ground source heat pumps cost more initially but often provide higher efficiency and longevity, especially suitable for properties with enough space for the required groundwork. Air source heat pumps are more affordable up front and simple to install, making them the preferred choice for most UK homes.

What documentation is needed to support my application?

You'll need an up-to-date Energy Performance Certificate (EPC), proof of property ownership or landlord permission, and confirmation your installer is MCS-certified.