Boiler Upgrade Scheme (BUS)

The Boiler Upgrade Scheme (BUS) is a UK government initiative that aims to encourage property owners to transition to low-carbon heating systems to heat their homes.

Almost a quarter (14%) of the UK’s carbon emissions currently comes from heating buildings.

Switching to heating our homes and workplaces with low carbon heat will reduce the carbon footprint.

It’s among the strategies aimed at combating climate change and helping the UK reach the net zero target by 2050.

Here’s everything you need to know about the Boiler Upgrade Scheme.

How Does The Boiler Upgrade Scheme Work?

The BUS provides grants to encourage property owners to replace existing fossil fuel heating systems with low carbon, more efficient heating systems.

These include ground source heat pumps, air source heat pumps, and biomass boilers in limited circumstances.

The scheme operates similarly to the Green Homes Grant Scheme. The government contributes a fixed sum towards the upfront costs of low carbon heating technologies, and the property owner pays for the rest.

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.

You’ll benefit from a 0% VAT rate on the purchase and installation of the low carbon heating technologies.

What Technologies Are Covered And How Much Funding Is Available?

  • 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.

The grant only covers biomass boilers in rural locations where the property is not connected to the gas grid.

You’ll need an emissions certificate to show that polluting emissions are kept at a minimum. You’ll not be eligible if the biomass boiler is for a self-build property.

Hybrid heat pump systems like those that combine a gas boiler with an air source heat pump are not eligible.

Who Can Apply To The Scheme?

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

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.

Finding An 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.

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.

Final Thoughts

The Boiler Upgrade Scheme can help you transition to a low-carbon heating system for your home or small business.

A first come, first served basis is used for eligible applicants, and you must ensure you utilise the grant promptly within the set validity period.