Financial support and grants
Installing a heat pump is a significant investment, but there are several government grants available to help cover the upfront costs.
Boiler Upgrade Scheme (BUS)
The most popular grant for heat pumps in England and Wales is the Boiler Upgrade Scheme.
- Grant amount: £7,500 for air source heat pumps and ground source heat pumps.
- Eligibility: You must be replacing an existing fossil fuel system (gas, oil, or electric).
- Property requirements: Your property must have a valid Energy Performance Certificate (EPC) with no outstanding recommendations for loft or cavity wall insulation.
How it works
You do not apply for the grant yourself. Instead, your MCS-certified installer applies on your behalf, and the £7,500 is taken off the price they quote you.
You can check your eligibility for the BUS grant on GOV.UK.
Energy Company Obligation (ECO4)
If you are on a low income or receive certain benefits, you may be eligible for a heat pump through the ECO4 scheme.
- Support: This often covers the full cost of the heat pump and any necessary insulation upgrades.
- Eligibility: Based on household income and benefit status. Check with your energy supplier or local authority.
0% VAT
Until March 2027, the installation of heat pumps is subject to 0% VAT. This can save you around £1,000 to £2,000 on a typical installation compared to standard 20% VAT.
More information
For a full list of all available energy grants, see our main grants and funding page, or read specifically about the Boiler Upgrade Scheme.