Boiler Upgrade Scheme: Get up to £6,000 Towards the Cost of a Heat Pump

The Boiler Upgrade Scheme – the new name for the Clean Heat Grant – launches in April 2022. Here’s everything you need to know.

The Clean Heat Grant, now known as the Boiler Upgrade Scheme (BUS), is a government scheme that will help to fund a transition from gas boilers to low-carbon alternatives such as air source heat pumps, ground source heat pumps and biomass boilers, homeowners will receive £5,000 towards the installing an air source heat pump, and £6,000 towards a ground source heat pump. Homeowners in rural areas could receive £5,000 towards the cost of a biomass boiler.

It is designed to replace the Domestic Renewable Heat Incentive (RHI), which will close to new applicants on 31 March 2022. The RHI scheme offered tariff payments for a period of seven years, rather than an upfront payment.

The Boiler Upgrade Scheme will launch in April 2022 to help homeowners and small business owners in England and Wales afford the upfront costs of heat pumps and biomass boilers.

The £450m policy was confirmed in the Heat and Buildings Strategy, with the government later confirming that the scheme is a formal renaming of what was previously the Clean Heat Grant.

Around 14% of the UK’s carbon emissions comes from heating our homes, the Committee on Climate Change (CCC) says, and the Boiler Upgrade scheme will be a key driver to help the UK reach its net zero target of 2050, and to ensure that all new heating system installations will be low carbon by 2035.

What is the Boiler Upgrade Scheme?

The government boiler scheme is part of more than £3.9bn funding announced in the Heat and Buildings Strategy to help cut carbon emissions from homes. Under the scheme, eligible homeowners will be able to receive government grants for the purchase of low-carbon heating systems such as heat pumps.

How Long will it Run for?

The Boiler Upgrade Scheme will run from April 2022 until April 2025, and will replace the Domestic Renewable Heat Incentive (RHI), which will close to new applicants on 31 March 2022 and the Previous Non Domestic RHI Scheme.

How Much Funding can I Receive ?

Homeowners and small business owners can apply to receive government grants of £5,000 for the purchase of air source heat pumps (ASHP) and biomass boilers, and grants of £6,000 for ground source heat pumps (GSHP).

The government says that a “proportionately higher grant level in relation to overall cost has been set for ASHPs given that the majority of existing properties are suitable for this technology”.

The government adds that it expects to see cost reductions during the lifetime of the scheme, and homeowners who install a heat pump on the scheme could end up paying a similar amount as if they were installing a traditional natural gas boiler.

How Much do Heat Pumps Cost ?

A basic ASHP can cost upwards of £10,000 for a small air source mono block unit with Cylinder, to around £14,000 for a top end large capacity fan unit.

Air Source Heat Pump and Boiler

Meanwhile, a basic ground source heat pump can cost between £20,000 to £25,000 depending on size and brand.
Biomass boilers, another renewable alternative, can cost anywhere from £11,000 to £25,000.

How will the Scheme Work?

The scheme will operate similarly to the Green Homes Grant, whereby the government will contribute a fixed sum towards the cost of a renewable heating system, and the homeowner will have to pay the rest. In its consultation response to the scheme, the government has proposed a first come, first served basis to those who meet the eligibility criteria.

As it was on the Green Homes Grant, applicants will have a set validity period to ensure the vouchers are utilised in a timely manner and that unused vouchers can be recycled. The validity period will be three months for ASHP and biomass boiler vouchers, and six months for GSHP vouchers.

Which Heating Systems are Eligible ?

The following types of heat pumps (high and low-temperature units) will be supported:
Ground source heat pumps
• Water source heat pumps (which the government considers in the same tech category as GSHPs)
Air source heat pumps

Biomass boilers will be supported, but only in rural areas with populations of 10,000 people or less. They won’t be offered to people in urban areas. Systems with a total capacity of up to 45kW will be eligible for the scheme.

How to Apply for the Government Boiler Scheme ?

There will be two stages to complete in order to claim a grant:
• Applying for a voucher before installation
• Redeeming the voucher once installation is complete

The government says that “this approach should simplify the consumer journey and streamline the voucher application and approval process”.

Homeowners will need a valid Energy Performance Certificate (EPC) to apply for the Boiler Upgrade Scheme. Typically one which has been issued in the last 10 years – with no outstanding recommendations for loft or cavity wall insulation.

Who will not be Eligible ?

Anyone living in new build and social housing will not be eligible for support under the scheme.

What About Self Builders?

Custom and self build homes will be eligible for the Boiler Upgrade Scheme, the government has confirmed.
Self builders will be given a three-month validity period to complete their installations, and will not have to provide an EPC to evidence insulation eligibility.

Which Systems will Not be Covered ?

Support will be available to installations providing space and water heating in buildings, but the grant will exclude:
• Process heating
• Hybrid heat pumps

Solar thermal will not be directly supported on the scheme. However, solar thermal systems can be installed as part of a heat pump or biomass system that is funded on the scheme, providing the heating system can meet the full space and water heating requirements of the home.

How will it Differ to the RHI ?

The Domestic RHI launched in April 2014 and has provided payments for the generation of renewable heat from eligible renewable heat technologies. The scheme will end on 31 March 2022, and the Boiler Upgrade Scheme will take its place from April 2022.

The RHI has operated through tariff-based support, where payments differ between properties in accordance with the efficiency of the property. Payments are made on a quarterly basis over a seven-year period after the system has been installed. The Boiler Upgrade Scheme will replace this funding with a flat-rate payment.

Is it available across the UK ?

The scheme will only be available in England and Wales. If you live in Scotland you can access funding to make energy-efficient home improvements through Home Energy Scotland and the Energy Efficiency Business Support Service.