Air source heat pump grant: how to get £7,500

Installing an air source heat pump can significantly reduce your home's carbon footprint and energy bills. The UK government provides financial incentives, primarily through the Boiler Upgrade Scheme (BUS) in England and Wales, to make this transition more affordable for homeowners. This guide explains how these grants work, who is eligible, and how to apply, helping you take control of your home's energy future.

Understanding the Boiler Upgrade Scheme (BUS)

The BUS is a cornerstone of the UK government's strategy to encourage the adoption of low-carbon heating technologies. It aims to reduce reliance on fossil fuels and accelerate the decarbonisation of home heating across England and Wales. The scheme is administered by Ofgem on behalf of the Department for Energy Security and Net Zero.

What is the Boiler Upgrade Scheme?

The BUS is a government initiative designed to help homeowners in England and Wales with the upfront costs of installing low-carbon heating systems, such as air source and ground source heat pumps, and in some cases, biomass boilers.

How much is the BUS grant for air source heat pumps?

The BUS offers a grant of £7,500 towards the cost and installation of an air source heat pump in England and Wales. This grant is applied directly to your invoice by your installer, meaning you only pay the reduced amount. Since 21 July 2026, households in England and Wales currently using heating oil can claim an uplifted £9,000 to move off the oil grid.

Key requirements for the BUS

To be eligible for the BUS, your property must meet certain criteria. It needs to be in England or Wales, and you must be the homeowner or a private landlord. The property must have a valid Energy Performance Certificate (EPC) with no outstanding recommendations for loft or cavity wall insulation. If your EPC recommends insulation, you need to install it before applying for the grant. This ensures that the heat pump operates efficiently in a well-insulated home. The scheme is designed to replace existing fossil fuel heating systems, such as gas, oil, liquefied petroleum gas (LPG), or electric storage heaters.

Eligibility for an air source heat pump grant

Understanding the eligibility criteria is crucial for a successful grant application. These requirements cover your property, your status as a homeowner, and the standards for installers and products.

Property eligibility criteria

Your property must be an existing home in England or Wales. Most new-build properties are generally not eligible, unless they are self-build homes that meet specific criteria. For a self-build property to be eligible, you or the original owner must have built it, and it must never have been owned by a business or organisation. Flats and maisonettes can be eligible, but may have additional requirements regarding building consent. The property must also have a valid EPC that does not recommend further loft or cavity wall insulation. You can find your property's EPC on the government's EPC register, or your installer can advise you during a survey.

Homeowner eligibility

The grant is available to homeowners and private landlords. You must be replacing an existing fossil fuel heating system (such as a gas boiler, oil boiler, or LPG boiler) or an electric heating system without a heat pump. The grant is tied to the property, so a landlord with multiple qualifying properties could apply for each one separately.

Installer and product requirements

All installations under the BUS must be carried out by an MCS (Microgeneration Certification Scheme) certified installer. MCS is a nationally recognised standards organisation that assures the quality of the product and the competence of the installer. The heat pump itself must also be MCS-certified.

Applying for your heat pump grant

The application process for the BUS is designed to be straightforward, with your installer playing a central role.

The installer-led application process

The BUS scheme is installer-led, meaning an MCS-certified installer applies for the grant on behalf of the homeowner. Your chosen installer will:

1. Assess your property and provide a quote for the heat pump installation.
2. Apply for the BUS voucher on your behalf.
3. Discount the grant amount directly from your total installation cost. You will need to confirm that the installer is acting on your behalf when Ofgem contacts you.

What happens after you apply?

Once your installer has submitted the application and the voucher is issued, the funding is reserved. The installer then proceeds with the installation. After completion, they register the installation with MCS, and Ofgem processes the grant payment directly to the installer. This means you don't have to fill out complex forms or wait for a cheque.

Common reasons for application delays or rejections

Applications can be delayed or rejected for several reasons. The most common include:

• An invalid or out-of-date EPC.
• An EPC with outstanding recommendations for loft or cavity wall insulation that have not been addressed.
• The chosen installer not being MCS-certified for the technology being installed.
• The property not meeting the specific eligibility criteria, such as being a new build that does not meet self-build exceptions.

Heat pump grants and support in Scotland

Homeowners in Scotland have separate schemes for heat pump grants, distinct from the BUS.

Home Energy Scotland grant and loan

Home Energy Scotland offers a grant of up to £7,500 for air source heat pumps. An additional £1,500 uplift is available for rural and island homes, potentially increasing the grant to £9,000. On top of the grant, an optional interest-free loan of up to £7,500 is available to cover any remaining costs.

Eligibility for Scottish schemes

To be eligible for the Home Energy Scotland Grant and Loan, you must be a homeowner living in Scotland, and the property must be your main residence. You need a qualifying energy report that recommends a heat pump for your home, which can be a free Home Energy Scotland report. Similar to the BUS, installations must use an MCS-certified installer and products. Your property must also meet minimum insulation standards, or you must upgrade insulation during the process.

How to apply in Scotland

The application process in Scotland is different from the BUS. You apply directly through Home Energy Scotland, rather than through your installer. The process typically involves:

1. Contacting Home Energy Scotland for free, impartial advice.
2. Arranging a home energy assessment.
3. Getting quotes from approved installers.
4. Applying for the grant and loan before installation begins.

Beyond the grant: other financial considerations

While grants significantly reduce the upfront cost, it's important to consider the overall financial picture of installing an air source heat pump.

The true cost of an air source heat pump installation

The total cost of an air source heat pump installation can vary, typically ranging from £7,000 to £15,000 before any grants. This figure depends on factors such as the size of your home, the specific heat pump model, and whether upgrades to radiators, pipework, or hot water cylinders are needed. The grant covers a substantial portion, but there will usually be a remaining balance.

Zero-rated VAT on energy-saving materials

Since April 2022, the VAT on the installation of energy-saving materials, including heat pumps, has been Zero-rated in the UK. This means you pay 0% VAT on both the equipment and the installation labour when they are supplied and installed together as a single service. This Zero-rate applies until 31 March 2027, after which it is scheduled to revert to the reduced rate of 5%. Compared to the standard 20% VAT rate, this can lead to significant savings on your installation.

Long-term savings and energy independence

Switching to an air source heat pump can lead to long-term savings on your energy bills. While the exact savings depend on your current heating system, insulation levels, and energy usage, a well-designed heat pump can be marginally cheaper to run than a gas boiler, especially on a specialist heat pump tariff. For homes switching from oil or LPG, the savings can be more significant, and you gain independence from fluctuating fuel prices and deliveries. Heat pumps also offer increased energy independence by using electricity, which can be increasingly sourced from renewable generation. Understanding your energy consumption in kilowatt-hours (kWh) can help you track these savings over time. You can learn more about what a kWh is to better manage your usage.

Making a power play for your home's energy future

Choosing an air source heat pump is a strategic move for homeowners, offering both environmental and financial benefits.

Benefits of switching to an air source heat pump

Air source heat pumps offer several advantages:

• Reduced carbon footprint: They produce significantly fewer carbon emissions than traditional fossil fuel boilers.
• Lower running costs: Heat pumps are highly efficient, converting one unit of electricity into several units of heat, leading to lower energy bills over time.
• Increased energy independence: By relying less on fossil fuels, you gain more control over your home's energy supply and costs.
• Consistent comfort: Heat pumps maintain a steady and consistent temperature throughout your home.
• Long lifespan: A well-maintained heat pump can last 20 years or longer.

Choosing the right installer

Selecting an MCS-certified installer is paramount for grant eligibility and a successful installation. They ensure your system is designed, installed, and commissioned to UK technical standards. It's advisable to get multiple quotes and compare them, ensuring each quote clearly outlines the grant deduction.

Next steps to a more abundant energy home

Accessing air source heat pump grants is a strategic 'power play' for homeowners to gain control over their energy consumption and costs. By understanding the eligibility criteria and application process, you can make an informed decision about upgrading your home heating system. Fuse Energy aims to support homeowners by providing clear information to help them navigate the grant application process, making energy upgrades more accessible. While Fuse Energy does not administer grants or install heat pumps, we aim to be a trusted advisor by providing clear information and directing users to official application channels. You can also ensure your home is ready for a heat pump by checking your EPC and considering a smart meter installation for better energy management.