Air Source Heat Pump Grants UK

Last updated: November 15, 2023

Can you get financial support for a new air source heat pump installation in the UK? Here we explain the latest financial support available to UK households.

If you are considering the idea of replacing your home’s primary heat source with a renewable form of heating like a modern air source heat pump you are likely wondering how much it costs, as well as the available funding.

Let’s explore the current air source heat pump grants available…

Air Source Heat Pump Grants & Funding

Before we go over and explain the current funding available for heat pumps, it’s worth explaining that there are several schemes that are now defunct and no longer available, these include the following:

  • Renewable Heat/Energy Incentive – now closed
  • Green Homes Grant – now closed

So what’s still available in terms of financial assistance?

Boiler Upgrade Scheme (BUS)

The Boiler Upgrade Scheme (BUS) is a UK government initiative that aims to encourage property owners to transition from traditional fossil fuel heating to low-carbon heating systems to heat their homes – including air source heat pumps.

The scheme opened for grant applications on 23rd May 2022 and will run up to 2025 with a £450m funding confirmed for the three years.

The scheme is available for a range of home heating technologies including the following:

  • Air source heat pumps – £5,000 off cost and installation
  • Ground and water source heat pumps – £6,000 off cost and installation
  • Biomass boilers – £5,000 off cost and installation

Who Can Apply To The Scheme?

Domestic and small non-domestic properties like homeowners and small business owners in England and Wales can apply.

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You’ll also be eligible if you’re a private landlord or second home owner. You’ll get one grant per property. To apply, you’ll need to:

  • Own your property.
  • Have a valid Energy Performance Certificate (EPC). The EPC must not have any outstanding cavity wall or loft insulation recommendations unless you have an insulation exemption. The heating system works more efficiently with these insulation measures in place.
  • Have a property with an installation capacity up to 45kWth.

Which Properties Are Excluded?

Grants are not available under the scheme for:

  • Properties already supported or funded by the government for a biomass boiler or heat pump.
  • Social housing, including rentals or accommodations provided at lower market value.
  • New build properties apart from particular self-builds. If you own a self-build property and wish to be eligible, it must have been built using the resources or labour of the first owner and has never been owned by an organisation or business. You’ll need to provide proof that the property is self-build.

How Can I Access The Scheme?

The BUS is an installer-led scheme, meaning you’ll need an installer to apply for the grant on your behalf.

Your installer will advise on the heating system suitable for your property and help you understand the different options available.

Low carbon heating systems installed, thoroughly checked, and commissioned by the installer on or after 1st April 2022 are eligible for funding under the scheme.

The new heating system must:

  • Replace an existing fossil fuel heating system like electric, gas, or oil. You cannot get funding for replacing existing low-carbon heating systems.
  • Be capable of meeting your home’s whole space hot water and heating requirements.
  • Meet specific technical standards like minimum efficiency requirements. The installer will advise you on these.
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Finding a Heat Pump Installer

You need to choose an installer certified by the Microgeneration Certification Scheme (MCS).

The MCS is a standards organisation recognised nationally.

It assures you of the competence of your installer and the quality of your product. It also ensures you get an installer who complies with high consumer protection standards.

You can find an MCS-certified installer here. The grant value is deducted from the final price you pay, so ensure you get quotes from different installers to get the best deal.

What Will The Installer Do?

  • Makes an application for a grant voucher on your behalf to Ofgem, the scheme administrator.
  • Provides your details to Ofgem. You’ll receive an email from Ofgem asking you to consent for the installer to apply on your behalf.
  • Completing the application according to scheme requirements, industry standards, and procedural guidance from Ofgem.
  • Redeeming the voucher and receiving the grant following installation and commissioning. Ofgem makes payments to installers after successful voucher redemption applications.

How Does the Process Work?

The process of getting grants through the Boiler Upgrade Scheme involves the following steps:

  1. Find an installer certified by the MCS in your area who is capable of carrying out the work.
  2. The installer will advise you whether the installation is eligible for a grant under the scheme.
  3. Agree on a quote for the installation with your installer. The grant value must be deducted from your quote upfront, and the installer is responsible for passing on the discount that the BUS grant provides to you from the total amount.
  4. Confirm that the installer is acting on your behalf. Ofgem will contact you after your chosen installer has applied for your property to confirm you’ve consented and that you meet the relevant eligibility criteria for the scheme.
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If Ofgem doesn’t receive your confirmations within 14 calendar days, your application may be rejected.

How Long Should The Project Take To Complete?

Your installer will have three months from the moment the application is approved to complete the installation according to scheme requirements and industry standards. You’ll get six months for ground source heat pumps.

The installer can claim the grant amount from Ofgem after the new system has been installed and thoroughly checked.