Boiler Upgrade Scheme updates

1 Boiler Upgrade Scheme
2 Update and consultation November 2025
3 Update April 2025
4 Update September 2023
5 First Year
6 Initial eligibility
7 Installer led application
8 Related articles on Designing Buildings

[edit] Boiler Upgrade Scheme

The Boiler Upgrade Scheme (BUS) is intended to support the decarbonisation of heat in buildings and is managed by Ofgem. It initially provided upfront capital grants to support the installation of heat pumps and biomass boilers in homes and non-domestic buildings in England and Wales. BUS supplies a grant to cover part of the cost of replacing a fossil fuel heating systems with for example a heat pump or biomass boiler and more recently an air source heat pump (fossil fuel heating systems include oil, gas or electric), along with a consultation of other alternative systems.

[edit] Update and consultation November 2025

More people will get money off technology that keeps their homes warm in winter and cool in summer, thanks to the expansion of the successful Boiler Upgrade Scheme announced in November 2025. The scheme currently offers grants of £7,500 off the cost of installing an air source or ground source heat pump, which can keep homes warm during the winter. As of November 2025 the scheme was been expanded to offer a £2,500 discount off the cost of installing an air-to-air heat pump, which can offer the best of both worlds, providing heat in winter and coolth in summer.

The first time air-conditioning units have been eligible for government funding, with 2025 being a record-breaking year for heat pumps, with September being the best month for applications on record. Grants are available to all households, and form part of the Labour government’s £13.2 billion Warm Homes Plan, which will bring down bills for 5 million families.

The typical cost of installing an air-to-air heat pump in a flat or small house is around £4,500, meaning the grant can cover most of the upfront cost. Furthermore households will be able to claim £2,500 off the price of heat batteries, which can store heat overnight for use during the day. Air-to-air heat pumps work like an air conditioning unit, but can provide both hot and cold air, while heat batteries use electricity to store heat, which can be released when needed to supply heating, and in some cases hot water.

A consultation "Exploring the role of alternative clean heating solutions" such as storage heaters, infrared panels or renewable liquid fuels, was launched on 18 November 2025 to further investigate solution has also been launched so that every household has a low-carbon option that is right for them.

Minister for Energy Consumers Martin McCluskey said:

"Air-to-air heat pumps offer the best of both worlds – keeping you warm in winter while cooling you down when summer comes along. With heat pumps more popular than ever, we want to make sure as many people as possible can benefit, especially those in flats or small homes without central heating, so they have greater choice when upgrading their property. We are also offering discounts for heat batteries and consulting on the role innovative, clean heating solutions can play, including thermal storage, infrared panels and renewable fuels."

Andrew Sissons, Deputy Director of Nesta’s sustainable future mission said:

"Air to air heat pumps are an efficient option for many homes. As we’re faced with a warming climate, it’s important that people have the financial support to both heat and cool their homes sustainably. The expansion of the BUS grant will help many households go green while staying comfortable all year."

Charlotte Lee, Chief Executive of the Heat Pump Association said:

"The Heat Pump Association welcomes today’s announcement to expand the Boiler Upgrade Scheme to include air-to-air heat pumps and heat batteries. Since its launch, the BUS has played a vital role in accelerating the transition to low-carbon heating, giving thousands of households access to clean, efficient technologies and helping to build the UK supply chain. Broadening the range of supported technologies is an important step in offering consumers more choice. To maintain this success, an ambitious budget allocation under the Warm Homes Plan will be key to ensuring that the scheme continues to deliver for households and industry, supporting jobs and long-term investment."

Abigail Ward, Policy Manager at Energy Saving Trust said:

"We welcome today’s announcement that the Boiler Upgrade Scheme will be expanded to include air-to-air heat pumps and heat batteries. This will make the upfront cost of low carbon technologies affordable to more households, who will be able to benefit from technologies that make their homes more comfortable all year round.

Accelerating the roll out of low carbon heating is key to cutting carbon emissions and reducing our reliance on volatile fossil fuels, one of the root causes of high energy bills."

[edit] Update April 2025

On 30 April 2025 the Labour government published a consultation seeking views on proposed amendments to the existing Boiler Upgrade Scheme (BUS) and to certification requirements for BUS and other clean heat schemes. The consultation (Closing date 11 June 2025) was set out in two parts: Part 1: Amendments to the Boiler Upgrade Scheme and Part 2: Certification of clean heat installations.

Part 1 seeking views on proposed amendments to the Boiler Upgrade Scheme (BUS) which provides grants to support property owners in transitioning to low carbon heating (LCH) systems. Proposed changes being designed to increase access, stimulate further demand and enhance existing consumer protections, including:

allowing new heat pump purchase options alongside the BUS grant
expanding eligibility for LCH technologies
reviewing potential barriers to the consumer installation journey
enhancing consumer protection by simplifying certification requirements and requiring installers to deduct grants upfront

Part 2 seeking views on the government’s proposal to require the Microgeneration Certification Scheme (MCS) as the sole certification scheme for clean heat installations, remove the option for multiple certification schemes to certify installations. delivered through:

[edit] Update September 2023

From 23 October 2023, the grant level for air source heat pumps and ground source heat pumps will increase from £5,000 (air source) and £6,000 (ground source) to £7,500.

[edit] First Year

The Boiler Upgrade Scheme (BUS) was launched on 23 May 2022 by February of 2023 only one third of the low-carbon heating scheme’s annual budget had used. The committee said that, by the end of January, £49.7m in vouchers had been issued, equating to 7,641 installations, according to Ofgem figures. The scheme has been allocated £150m a year in funds for three years. In a letter sent to the net zero secretary, Lord Callanan, the committee warned that if the current take-up rate continued just half of the allocated budget would be used. Saying the government target of hitting 600,000 installations a year was “very unlikely” to be met. In March 2023, the BUS was extended until 2028.

It continues to be available to provide upfront capital grants towards the cost of installing approved heat pumps and biomass boilers in homes and small non-domestic buildings in England and Wales. The eligibility criteria is as follows and more information and application can be found here:

[edit] Initial eligibility

The property must be a home or small non-domestic building in England or Wales. The maximum installation capacity of 45kWth covers the vast majority of these properties.
The property must have a valid energy performance certificate with no outstanding recommendations for loft or cavity wall insulation. (There are some exceptions to this, please speak to the installer for further information).
The commissioning date of the low carbon heating system must be on or after 1 April 2022.
Biomass boilers are only eligible in properties that are both in a rural location and not connected to the gas grid. Heat pumps do not have either of these restrictions.
It must be for fully replacing an existing fossil fuel system such as an oil or gas boiler, or an electric heating system such as storage or panel heaters. Funding will not be available for the replacement of existing low carbon heat systems.
One can still apply if in receipt of separate funding for energy efficiency upgrades such as insulation, doors or windows.
New-build homes and social housing are not eligible for the Boiler Upgrade Scheme, although self-build properties are eligible.

[edit] Installer led application

The application is installer-led, with the installer applying for the grant on the property owner’s behalf. The installer must need be certified by the Microgeneration Certification System (MCS), a nationally recognised standards organisation that gives assurance of the quality of product and competence of installer, ensures that the installer complies with consumer protection standards.

The installer will:

Discount the voucher amount from the customers quote.
Apply to Ofgem, the scheme administrator, for a grant voucher.
Provide customers details to Ofgem, who will then email the customer asking for consent to approve the installer applying on your behalf.
Liaise with Ofgem on most matters related to the scheme.
Complete the installation in line with industry standards and scheme requirements.
Redeem the voucher and receive the grant following installation and commissioning.