The Boiler Upgrade Scheme (BUS) is scheduled to close on 31 March 2025, the end of the three-year window set when it opened. The scheme was officially launched on 1 April 2022, with a total budget of £450m, and was scheduled to run from 1 April 2022 to 31 March 20251. It is administered by Ofgem on behalf of the government1.
The grant paid up to £6,000 to households in England and Wales towards a low carbon heating system1. The rates were set as follows:
| Measure | Grant |
|---|---|
| Air source heat pump | £5,000 |
| Ground source heat pump | £6,000 |
| Biomass boiler | £5,000 |
Grants were available to owners of existing homes in England and Wales, including private landlords, with new build properties not eligible unless self-built1. The grant could only be used to replace fossil fuel heating such as gas, oil or direct electric heating, not to replace an existing low carbon system1. Applicants needed a valid energy performance certificate less than ten years old with no outstanding recommendations for loft or cavity wall insulation; where insulation could not be installed because a property is listed, in a conservation area or otherwise exempt, evidence of exemption was required1. Installed heat pumps had to meet the full space heating and hot water demand of the property, with a capacity of no more than 45 kWth and a seasonal coefficient of performance of at least 2.81. Biomass boilers were eligible only in rural properties not connected to the gas grid, and not in urban areas or properties fuelled by mains gas, with an urban area defined as one with a population of 10,000 or more and classified as urban by the Office for National Statistics1.
Homeowners could not apply directly. They had to find an MCS certified installer, who applied to Ofgem on their behalf, and the value of the grant was deducted from the installer's bill, with the installer receiving the payment after installation and commissioning1. Any eligible heating system commissioned from 1 April 2022 onwards could receive a grant, though the voucher application system opened later, on 23 May 20221.
On the budget, the scheme's £450m was described as enough for 90,000 installations in total, or 30,000 homes a year, at £5,000 each1. The Energy Saving Trust's typical cost for an air source heat pump was given as between £7,000 and £13,000, so a £5,000 grant could cut the cost to around £2,000 to £8,000, before any additional work such as radiator, pipework or insulation upgrades1.
Why it matters for households
For a household that has not yet installed a heat pump or biomass boiler, the scheduled closure removes the main upfront subsidy for replacing a fossil fuel heating system in England and Wales. The grant was designed to narrow the gap between a low carbon system and a conventional gas or oil boiler, and the figures above show that gap was not closed entirely: the typical air source heat pump cost exceeded the grant by several thousand pounds even before any associated work1. A home's energy independence turns on what it uses for heat and hot water, and the BUS was the route by which many homes could move off gas, oil or direct electric heating without carrying the full capital cost. The scheme's structure also tied eligibility to the fabric of the property, through the EPC and insulation conditions, so the grant was not available to every home that wanted it1. Whether a replacement scheme will follow has not been reported.
What happens next
The scheme is scheduled to end on 31 March 20251. No successor arrangement is set out in the available information. Households considering a heat pump can read how the Boiler Upgrade Scheme worked, including how much the grant was worth, how the application worked and who qualified.