The UK Government increased the level of grant funding available through the Boiler Upgrade Scheme (BUS) in December 2023, according to the Energy Saving Trust1. The scheme provides households with a grant of £7,500 towards the upfront cost of a heat pump1.
The grant had previously stood at £5,000 for air source heat pumps and £6,000 for ground source heat pumps, and was increased in October 20231. The Energy Saving Trust describes the December 2023 rise as an increase in the level of grant funding available through the BUS1. The two dates appear in the same account and are not reconciled there; the October 2023 figures are given as the earlier rates, and the December 2023 change is described separately1.
"Despite the UK Government increasing the level of grant funding available through the BUS in December 2023, there is still a large capital outlay for households that means heat pumps remain unaffordable for many."
The same account puts the average cost of installing a heat pump at around £14,0001. It states that financial support from the UK Government for low carbon heating has so far mainly consisted of the BUS1. Support has not been universal across the UK: the Northern Ireland Executive has provided only limited means tested financial support for low-income households seeking to decarbonise home heating, while financial support offered by the Scottish Government has gone beyond that offered by the UK Government1.
Progress on installing heat pumps has lagged. In 2022 the UK ranked 21st out of 21 European countries for heat pump installations per capita, and 32,910 MCS certified heat pumps were installed across the UK that year, rising to 39,268 in 20231. The Heat and Buildings Strategy, published in 2021, set a target of 600,000 heat pump installations a year by 2028 and an ambition for heat pumps to be no more expensive than gas boilers to buy and run by 20301. A total of £6.6 billion over this parliament, plus an additional £6 billion between 2025 and 2028, has been committed to improve energy efficiency and increase the installation of low carbon technologies1.
Why it matters for households
For a household weighing up a heat pump, the grant level is the most direct lever on the upfront cost, and the December 2023 increase raised the contribution towards that cost1. The Energy Saving Trust's position is that the higher grant still leaves a large capital outlay, with the average installation at around £14,0001. That gap between grant and installed cost is the practical figure for a home considering the switch.
The grant sits within a wider picture of running costs and eligibility. The stated ambition is for heat pumps to be no more expensive than gas boilers to buy and run by 2030, which has not been met1. For a home's energy independence, the relevant question is how much of the upfront cost a grant covers and what remains, and whether the property and its heating system qualify. The Boiler Upgrade Scheme eligibility rules and the grant amount determine what a given home can claim, and the application process sets out how a claim is made. Households with an existing gas boiler can check the gas boiler eligibility position, and those comparing support routes can look at BUS against ECO4. The full guide to home energy grants and schemes sets the BUS alongside other support.
What happens next
The Energy Saving Trust's account refers to a delay to the Clean Heat Market Mechanism, which it says keeps households dependent on gas boilers for longer, keeps the price of heat pumps high and creates uncertainty for the supply chain1. It also refers to a delay to the gas boiler phase out date1. No further change to the BUS grant level after December 2023 is reported in this account1.
Sources1 cited
- Decarbonising home heating - Energy Saving Trust, energysavingtrust.org.uk