Boiler Upgrade Scheme 2026: the £7,500 and £9,000 grants

An air source heat pump outside a brick house

The Boiler Upgrade Scheme (BUS) is a government grant, run by Ofgem, that takes £7,500 off the cost of an air source or ground source heat pump in England and Wales. If your home is off the gas grid and currently heated by oil or LPG, the grant is £9,000 until 31 March 2027. Eligibility criteria apply, and the money goes to your installer, not to you.

Shropshire Quotes is an independent introduction service, not a government or council body. Everything below comes from the gov.uk and Ofgem pages listed at the bottom of this guide.

What the grant is worth in 2026

System	Grant (eligibility applies)
Air source heat pump (air to water)	£7,500
Ground source heat pump (including water source and shared ground loops)	£7,500
Air or ground source heat pump replacing oil or LPG in an off-gas home	£9,000, from 21 July 2026 to 31 March 2027
Air to air heat pump	£2,500
Biomass boiler (rural, off-gas properties only)	£5,000

The £9,000 rate is the standard £7,500 plus an extra £1,500. Ofgem says the scheme itself has been extended to 2030, but the extra £1,500 is only promised until March 2027.

There is one grant per property. The heat pump must be no bigger than 45kWth for a single system, and hybrid systems (a heat pump working alongside a fossil fuel boiler) do not qualify.

What it means for the price

Official figures from MCS installation certificates put the median cost of an air source heat pump at £12,908 in April to June 2026, before the grant, with the middle half of jobs between £11,128 and £15,627. Take off £7,500 and a typical job lands at about £3,500 to £8,000. At the £9,000 rate it is about £2,000 to £6,500.

These are estimates from national data. Your quote depends on the house, the heat pump size and whether radiators or the hot water cylinder need replacing. Our heat pump cost guide goes through the figures in more detail.

Installing a heat pump in a home is also zero rated for VAT until 31 March 2027. From 1 April 2027 it goes back to 5%.

Who is eligible

You can get the grant if all of these apply:

You own the property. Homes, second homes, properties you let to tenants and small business premises all count.
The property is in England or Wales. All of Shropshire and Telford and Wrekin qualifies.
You are replacing a fossil fuel or electric heating system, such as oil, gas, LPG or electric heating.
The heat pump is sized to meet the home’s full space heating and hot water needs.
Your installer is MCS certified for heat pumps and a member of an approved consumer code.

There is no income test, and you do not need an EPC or any insulation work first. Having already had funding for insulation does not stop you applying.

Extra conditions for the £9,000 rate

To get £9,000 rather than £7,500, Ofgem’s installer guidance says the property must be off the gas grid. In practice that means:

the heating you are replacing runs on oil or LPG;
the property is not on mains gas, and has no record of a gas meter point, including a capped or clamped meter;
it is not connected to a heat network; and
it is not a new build or a self build.

If you miss one of these, you may still get £7,500 as long as the main rules are met.

Common reasons people are not eligible

Ofgem lists the reasons it turns applications down. The ones that catch homeowners out most often are:

Social housing, including shared ownership.
New builds still being built by the developer. Self builds can qualify for £7,500 if they have never been owned by a business.
A previous government or ECO funded heat pump or biomass boiler at the same property.
Replacing a low carbon system, such as an older heat pump.
A hybrid system that keeps the oil or gas boiler running alongside the heat pump.
An undersized heat pump that cannot heat the whole home on its own.
An installer who is not MCS certified.
Applying too late. The application must be made within 120 days of the heat pump being commissioned.

How the installer applies, step by step

You do not fill in a form yourself. The scheme is installer led.

Get quotes from MCS certified installers. Ofgem recommends comparing more than one. Our guide to choosing an MCS installer covers what a proper quote should include.
Agree a quote. The grant must be shown as a deduction on the quote and the invoice.
The installer applies to Ofgem on your behalf.
Ofgem contacts you to confirm that you consent and that you meet the rules. You have 14 calendar days to reply, or the application may be rejected. You can only give consent to one installer at a time, but giving consent does not commit you to them: that is down to your contract.
Ofgem issues a voucher. It is valid for 3 months for an air source heat pump and 6 months for a ground source system. The heat pump must be fitted and commissioned in that time.
The installer fits and commissions the system, registers it with MCS and claims the grant. Ofgem or MCS may phone you or visit to check the work.

How long it takes

The official timescales are the 14 days for your consent and the 3 or 6 month voucher. The design stage under the MCS heat pump standard should be complete within 60 days of agreeing the contract. Ask your installer for a realistic fitting date before you sign, particularly if you are aiming for the £9,000 rate before the end of March 2027.

What it means in Shropshire

Shropshire is one of the counties where the £9,000 rate matters most. Government estimates show 33.4% of domestic properties in the Shropshire Council area were not connected to the gas grid in 2024, against 15.6% across England. In the 2021 Census, 15.0% of Shropshire households heated with oil only and 3.3% with bottled or tank LPG only.

Those homes are mostly in the countryside rather than the towns. Shrewsbury itself is 78% mains gas, but several rural wards are 30% to 50% oil, including Llanymynech (52.7%), Clun (43.1%), Loton (43.9%) and Corvedale (42.4%). If you live in one of the villages around Oswestry or Ludlow, there is a good chance you qualify for the higher rate.

Telford and Wrekin is different: only 3.8% of homes are off the gas grid, so most Telford households replacing a gas boiler would be looking at £7,500.

The scheme is being used locally. DESNZ figures show 987 heat pumps paid for through BUS in the Shropshire Council area between May 2022 and June 2026. Nationally, the £9,000 rate made up 34% of all applications in July and August 2026, its first two months.

If you are on a low income

The Boiler Upgrade Scheme still leaves a bill to pay. If your household income is under £36,000, or you receive a means tested benefit, Shropshire Council’s Sustainable Warmth Shropshire scheme may cover heating and insulation for homes in council tax bands A to D with an EPC below C. You apply to the council directly, so check that route before getting private quotes.

Before you go ahead

Check whether your property has ever had a gas meter point. If it has, plan on £7,500, not £9,000.
Check your installer on the MCS register.
Make sure the quote shows the grant as a deduction and is based on a room by room heat loss calculation.
Compare running costs against your current fuel. Our guide to heat pump versus oil running costs shows the sums.

Planning a heat pump? Get a quote from a checked local installer.

Common questions

Do I get the Boiler Upgrade Scheme grant paid to me?

No. Ofgem pays the grant to your installer, who must deduct it from your quote up front. You pay the installer the balance.

Can I get £9,000 if my house has a capped gas meter?

No. Ofgem treats a capped or clamped gas supply as mains gas, and any record of a gas meter point at the property rules out the £9,000 rate. You may still qualify for £7,500.

Do I need an EPC or loft insulation to apply?

Not any more. The current gov.uk and Ofgem pages set no EPC or insulation condition, although Ofgem recommends improving energy efficiency because heat pumps work best in well insulated homes.

How long does the installer have to fit the heat pump?

Once Ofgem issues the voucher, it is valid for 3 months for an air source heat pump and 6 months for a ground source heat pump. If it expires, the installer has to apply again and you confirm consent again.

Is the Boiler Upgrade Scheme means tested?

No. There is no income test. If you are on a low income, Shropshire Council's Sustainable Warmth Shropshire scheme may be able to pay for more of the work, so check that first.