Boiler Upgrade Scheme: How the Grant Works and What It Actually Covers

If your home runs on oil, gas, electric or LPG heating and you want to switch to a heat pump or biomass boiler, the Boiler Upgrade Scheme (BUS) gives you up to £7,500 off the cost — no income or benefits test required. Here’s how it actually works.

What you can get

The grant amounts, set by the government and administered by Ofgem, are:

£7,500 towards an air source, ground source or water source heat pump
£5,000 towards a biomass boiler
£2,500 towards an air-to-air heat pump (residential properties only)

If your property is off the gas grid and heated by oil or LPG, you can get an extra £1,500 on top of the £7,500 heat pump grant — taking the total to £9,000. This higher off-grid rate is available until 31 March 2027.

The grant is deducted directly from your installation quote and invoice by the installer — you never receive the money yourself, and it isn’t taxable income.

What it doesn’t cover

This is a common source of confusion, so it’s worth being direct about it:

It is not for replacing one gas boiler with another gas boiler. The scheme only funds a switch away from fossil fuel or electric heating to a heat pump or biomass boiler.
It cannot be used to replace an existing low-carbon heating system (you can’t use it to “upgrade” a heat pump you already have).
It doesn’t fund insulation, solar panels or general home improvements — though GOV.UK notes heat pumps work best in a well-insulated home, so it’s worth checking your loft and wall insulation separately.
New-build properties are excluded, unless the home qualifies as a genuine self-build (built using your own labour/resources or a builder you paid directly, and never owned by a business).
Social housing is excluded.
You can’t apply if the property already received government funding for a heat pump or biomass boiler installation.

Biomass boilers carry extra restrictions: the property must be off the gas grid, in a rural area, the boiler needs emissions certification, and self-build properties don’t qualify for the biomass rate at all.

Who’s eligible

Unlike ECO4, there is no income or benefits test. Eligibility is based on the property and the installation, not the occupant’s finances. In summary, you must:

Own the property (this includes a second home, a business premises, or a home you rent out to tenants)
Be based in England or Wales (Scotland and Northern Ireland run separate schemes)
Be replacing an existing fossil fuel or electric heating system
Not be in a new-build (other than a qualifying self-build) or social housing
Use an MCS-certified installer

Because there’s no means-testing, this is the route worth checking if you don’t qualify for ECO4’s benefit-based criteria or the Warm Homes: Local Grant’s income thresholds, but you’re still willing to pay the balance of a heat pump installation yourself.

How you apply

You don’t apply directly to Ofgem — your installer does it for you. The process runs like this:

Get quotes from MCS-certified installers who are registered with the scheme.
Agree a quote — the installer will show the grant deducted from the price.
The installer submits the voucher application to Ofgem on your behalf, and you’ll need to confirm you’re happy for them to represent you.
Ofgem may contact you or visit the property to verify the installation before or after the work.
The voucher must be redeemed and the installation completed within the scheme’s timeframes — currently within 120 days of commissioning.

The scheme’s end date

The Boiler Upgrade Scheme’s current closing date, as listed on the government’s official grants finder, is 30 December 2029, though the enhanced £9,000 off-grid rate is time-limited to 31 March 2027. Funding, rates and dates for schemes like this have moved before (BUS itself was increased from £5,000 to £7,500 for heat pumps in 2023), so don’t take any date as locked in stone.

The bottom line

The Boiler Upgrade Scheme is the most straightforward of the current heating grants — a fixed discount, no means test, and the paperwork is handled by your installer rather than you. Its ceiling is that it only pays out if you’re switching away from fossil fuel heating, and you’ll usually still need several thousand pounds of your own money to cover the rest of a heat pump installation. If your income or benefits status makes you eligible for ECO4 or the Warm Homes: Local Grant, it’s worth comparing those first, since both can cover a much larger share — or all — of the cost.

Rules and rates can change — always verify current details on the GOV.UK Boiler Upgrade Scheme page before applying.

Sources: