The Boiler Upgrade Scheme – £7,500 Grant for Renewable Heating

Claim £7,500 towards the upfront costs of installing an air source heat pump through the Boiler Upgrade Scheme.

What is the Boiler Upgrade Scheme?

In order to speed up the decarbonisation of heating systems, Ofgem has introduced the Boiler Upgrade Scheme. The aim of the ‘BUS’ voucher scheme is to lower the costs of installing a renewable heating solution. With the voucher, fitting heat pumps and biomass boilers should be similar to fossil fuel systems. In 2023, Boiler Upgrade Scheme vouchers were increased from £5,000 to £7,500.

In addition to the BUS scheme, the renewable heating system VAT rate has dropped to 0% until 2027.

How much could I receive from the BUS Scheme?

The following systems are eligible for funding through the Boiler Upgrade Scheme:

Air Source Heat Pumps – £7,500
Ground Source Heat Pumps – £7,500

The grant is paid as an upfront contribution towards the costs of an installation. For example, if an air source heat pump installation was quoted to cost £11,000 then the property owner would contribute £3,500 and the BUS scheme would contribute £7,500.

The Boiler Upgrade Scheme is open to domestic and non-domestic properties in England and Wales. Although non-domestic property can be eligible, total system capacity must not exceed 45kWth and heat pumps must have a minimum performance factor (SCOP) of 2.8.

Am I eligible for a BUS Voucher?

Although widely accessible and not means-tested, there are eligibility criteria for those looking to benefit from the Boiler Upgrade Scheme.

Customer Eligibility

You must:

– Live in England or Wales
– Own or rent your property
– Be self-building your own home (new build developments of more than 1 house aren’t eligible)

Property Eligibility

Your home must:

– Have a valid EPC (Energy Performance Certificate) dated within the last 10 years (you can check to see if your home has an EPC by clicking here to visit the online database).
– The property’s EPC must not have recommendations for loft insulation or cavity wall insulation. Any recommendations for loft or cavity wall insulation will need to be rectified before an application will be successful. A new, eligible EPC will be needed.
– The renewable installation will need to replace a fossil fuel system (unless a self-build).

System Eligibility

The renewable heating system must:

– Be an MCS-approved technology
– Air source and ground source heat pumps must have a SCOP of at least 2.8
– Systems commissioned on or after 1st April 2022 are eligible
– Replace the existing fossil fuel system (hybrid systems are not eligible)
– Supply all of the home’s primary space heating and hot water demand
– Not exceed a system capacity of 45kWth (which will cover most homes and small businesses)

How do you apply for and redeem the Boiler Upgrade Scheme?

Applications to the Boiler Upgrade Scheme are led by the installer. As a result, there is minimum customer input into the application process.

Customers will need to obtain and agree a proposal with an MCS-approved installation company (like GreenGenUK!). GreenGen would advise on eligibility and any additional works, such as increasing insulation, ahead of submitting an application. The customer will then need to give Ofgem consent for GreenGen to deal with the application on their behalf.

The installation company will then discuss this with Ofgem. Once approved, the customer will be granted a BUS voucher. The voucher is usable for three months (or six months for ground source heat pumps). Once signed off and certified, the installation company will redeem the voucher and claim the £7,500 voucher directly through Ofgem.

The property owner never sees or spends this money. In the meantime, the end user will need to make any financial contribution required. The installer will set this out in their payment terms.

Find more details on the Boiler Upgrade Scheme on Ofgem’s website.