The Boiler Upgrade Scheme grant has been increased by 20% from £7,500 to £9,000 for homes in England and Wales that use heating oil, making thousands of households eligible for financial support to switch to a heat pump and reduce energy bills.
Leaflets are being sent to 200,000 eligible homes this week, providing details on how to claim the extra funding. The government says the uplift will help rural households move away from heating oil, which saw prices spike earlier this year due to Middle East conflict disrupting oil supplies.
How Heat Pumps Work and Installation Costs
Heat pumps extract heat from the air, ground, or water and transfer it indoors, rather than burning fuel to create heat. This makes them cheaper to run. However, installation costs remain high. The Energy Saving Trust estimates an air source heat pump costs around £11,000 to install, while ground source heat pumps range from £29,000 to £57,000.
The £9,000 grant covers a significant portion of these costs, particularly for air source heat pumps. To be eligible, applicants must own their property and be replacing a fossil fuel heating system.
How to Claim the Grant
Eligible households need to contact a suitable MCS-certified installer to obtain quotes. The installer will then apply for the grant on the homeowner's behalf. The process is designed to be straightforward, with the installer handling the paperwork.
Government and Industry Reaction
Minister for Energy Consumers Martin McCluskey said: "This government is determined to bring down energy bills, but I know the war in the Middle East has hit households on heating oil especially hard. We have already taken action to support these households through confirming over £50 million in support for vulnerable customers on heating oil. Now, the Boiler Upgrade Scheme will help thousands of families across England and Wales switch to clean heat to protect them from volatile fossil fuels."
Charlotte Lee, CEO of the Heat Pump Association UK, commented: "The Boiler Upgrade Scheme continues to play a vital role in supporting households to adopt heat pumps, and this £1,500 uplift will make the transition significantly more affordable for the thousands of oil-heated homes. Many of these households have faced considerable price uncertainty in recent months, without the protection of the energy price cap, and this £9,000 grant will help shield families from volatile fossil fuel costs, by using home grown electricity, in the years ahead."
Matt Copeland, Head of Policy and Public Affairs at National Energy Action, added: "This is a positive step for households relying on heating oil, who have recently faced the highest and most volatile energy costs. Many families will be expecting to ration their heating in the coming winter, living in homes they cannot afford to keep warm, not through choice but constraint."
