The Boiler Upgrade Scheme grant for air-to-water and ground source heat pumps replacing oil or LPG systems rose to £9,000 for the 2026/27 financial year from July 2026, the Department for Energy Security and Net Zero confirmed in its Carbon Budget and Growth Delivery Plan investor factsheet for heat and buildings, published on 23 June 20261. Ofgem, which administers the scheme, recorded the change in version 5.1 of its property owner guidance, adding the "new uplifted grant of £9,000 for air-to-water or ground source heat pumps in eligible off-gas grid properties"2.
The £9,000 rate applies only to off-gas grid homes in England and Wales. Properties on mains gas keep the existing £7,500 grant3. The scheme's wider published figures remain £2,500 for air-to-air heat pumps and £5,000 off a biomass boiler, with a £2,500 heat battery grant to follow once legislation and product standards are in place1. The factsheet puts total Boiler Upgrade Scheme funding at £2.7bn to 20301.
"From July 2026 air-to-water heat pumps and ground source heat pumps replacing oil or LPG systems will receive a grant level of £9,000 for the 2026/27 financial year"
Trade body NAPIT, which welcomed the increase, said the grant was "being increased from £7,500 to £9,000 for homeowners wanting to make the move from heating oil to a heat pump" and that it would be available from 21 July5. Heat Geek reported the rate as expected in July 2026, with the exact date to be confirmed in a Grant Change Notice on GOV.UK3. Ofgem's guidance does not give a start date2.
| Measure | Grant |
|---|---|
| Air-to-water or ground source heat pump, oil or LPG property | £9,000 |
| Air-to-water or ground source heat pump, mains gas property | £7,500 |
| Air-to-air heat pump | £2,500 |
| Biomass boiler | £5,000 |
Eligibility for the uplifted rate requires an off-gas grid property using heating oil or LPG, owned by the applicant, in England or Wales, with installation by an MCS-certified installer who applies on the householder's behalf5. Ofgem's guidance notes that an EPC may not be required in some cases, reflecting 2026 regulation amendments, and that low-carbon heating systems able to operate alongside a BUS heat pump may be retained in some cases2. Ofgem may attend properties for audit purposes, and property owners are asked to retain quotes or invoices and allow access for audits2.
Why it matters for households
Oil and LPG households have no equivalent of the electricity price cap, so they absorb wholesale fuel price movements in full4. A £9,000 grant against a typical air source heat pump installation cost of £10,000 to £15,000 before grant changes the upfront arithmetic for a home with no mains gas connection4. Moving heating onto electricity also shifts a household's exposure from a delivered fuel it buys in tanker loads to a metered tariff, though running costs still depend on the heat pump's efficiency, the home's heat loss and the electricity tariff chosen4. The grant does not cover the cost of removing an old oil tank or boiler, and no figure for that work appears in the published material.
What happens next
Heat Geek reports that BUS voucher applications can be submitted up to 120 days after an installation is commissioned, so an installation completed before the new rate goes live may still qualify, and that an existing voucher can be withdrawn and reapplied for at the higher rate3. Ofgem states that property owners cannot seek pre-approval from Ofgem and that installers must request statutory reviews2. The government is consulting this summer on relaxing planning restrictions for heat pumps in flats and non-domestic buildings3. The Future Homes Standard technical specification was published on 24 March 2026, with standards coming into force on 24 March 2027 followed by a one-year transitional period1.
For the scheme's rules, see The Boiler Upgrade Scheme: Grants for Heat Pumps and Biomass and How much is the Boiler Upgrade Scheme grant?. For the technology, see Heat Pumps: The Full UK Guide and Replacing a Gas, Oil or LPG Boiler with a Heat Pump.
Sources5 cited
- CBGDP investor factsheet: Heat and buildings (web accessible) - GOV.UK, gov.uk
- Summary of updates in the BUS property owner, ofgem.gov.uk
- BUS Grant Changes and Government Energy Announcements | Heat Geek, heatgeek.com
- BUS Grant: What's Changed for Homes on Oil and LPG | Heat Geek, heatgeek.com
- Blog | New £9,000 Grant to Replace Oil Boilers with a Heat Pump Through Boiler Upgrade Scheme | NAPIT, napit.org.uk