What grants are there for air source heat pumps?

Looking to go greener at home with an air source heat pump? There are plenty of different grants available to encourage people to move away from fossil fuel heating. In this guide, we’ll give you an overview of what financial help is currently on offer across the UK.

What are the different types of heat pump grant?

There’s no single heat pump grant that applies to everyone in the UK, which means the picture can look a bit complex at first. The type of grant that’s best for you depends on where exactly you live, and whether you’re a homeowner or not.

Here’s a quick overview before we dive into the detail:

Grants for homeowners

  • England and Wales – the £7,500 Boiler Upgrade Scheme
  • Scotland – £7,500 from Home Energy Scotland (plus £1,500 for rural areas)

Grants for homeowners and renters on low incomes

  • England – the ECO scheme
  • Wales – the Nest scheme
  • Scotland – Warmer Homes Scotland

How to apply for a heat pump grant

Each heat pump grant is awarded by a different body, so the way to apply varies from grant to grant.

If you’re a homeowner in England or Wales, for example, the Boiler Upgrade Scheme is very simple. British Gas will check if you’re eligible, included the grant as a £7,500 discount in your quote and if you go ahead with the purchase, process the grant application on your behalf.

Other schemes work a bit differently though, so we’ll explain how to apply when we look at them in more detail below.

Heat pump grants for homeowners

Heat pumps are a great way of keeping your home cosy while cutting your carbon footprint. And for the country as a whole, they’re also an important step towards meeting our collective net zero goals.

That’s why generous government grants are available to encourage more and more of us to move away from fossil fuel-based heating systems.

Here’s everything you need to know about the different schemes currently available for homeowners in the UK.

England and Wales – the Boiler Upgrade Scheme

The Boiler Upgrade Scheme was introduced in April 2022 (replacing previous schemes called the Renewable Heating Incentive and the Clean Heat Grant).

The scheme gives homeowners in England and Wales £7,500 to help with the cost of upgrading from a fossil fuel boiler to a low-carbon alternative like an air source heat pump.

Who is eligible?

You can get the grant if:

  • You own the property
  • You’re replacing a fossil fuel system (e.g. gas, oil or LPG boiler)
  • Your property has a valid Energy Performance Certificate (EPC)
  • Your EPC has no outstanding recommendations for loft or cavity wall insulation (we can help with this if you need it)

How to apply

It’s very easy. British Gas will check you’re eligible when you enquire about a heat pump. Then we’ll manage the grant application for you and include the £7,500 as a discount in your overall price.

Scotland – Home Energy Scotland

The Scottish system for heat pump grants is a little different. Homeowners can apply directly to Home Energy Scotland for grants of up to £7,500 (or £9,000 in some remote areas) – and they can also apply for interest-free loans of up to £7,500 more should there be any outstanding cost.

Unlike the Boiler Upgrade Scheme in England and Wales, your installer can’t apply for the Scottish grant on your behalf. You need to apply for it yourself, although British Gas can give you plenty of advice about how to go about it.

How does the scheme work?

A typical heat pump costs between £7,000 to £13,000 to install, so let’s imagine your heat pump costs £10,000.

Your grant will cover £7,500 of that and you can get an interest-free loan for the other £2,500. This could then be paid back over five years, which would mean monthly instalments of £41.66.

And the more you need to borrow, the longer the maximum term of the interest-free loan:

  • Under £5,000 – 5 years
  • £5,000 - £9,999 – 10 years
  • Over £10,000 – 12 years

You can pay the loan back more quickly than the maximum if you wish – and you can also pay the loan off early at no extra cost. So it’s a very flexible way of spreading the cost of your investment in a new heat pump.

Who is eligible?

The scheme is open to all homeowners in Scotland (but not landlords, businesses or property developers).

You’ll need to get an Energy Performance Certificate (EPC) for your property before and after the installation, as proof that the heat pump was installed.

Although applying for the grant yourself might seem complicated, the British Gas team will be able to talk you through what’s involved – and also give you a good idea of whether your application is likely to be successful.

How to apply

Simply contact Home Energy Scotland and talk to one of their advisers. They’ll spend about 30 minutes taking some details, discussing your options and explaining the next steps.

Heat pump grants for homeowners and renters on low incomes

Making your home more energy-efficient is often a big investment. But if you live on a low income, there’s actually plenty of government help out there that could help you make the switch to low-carbon heating. Here’s a rundown of what’s available across the UK.

England – the ECO scheme

ECO (sometimes called ECO4) is the latest version of the Energy Company Obligation scheme.

It’s designed to help low-income homeowners and renters to improve the energy efficiency of their homes, giving them lower energy bills and smaller carbon footprints. ECO can help with home improvement measures like insulation as well as with heat pumps.

Who is eligible?

To get support, you’ll need to live in a home that has an Energy Performance Certificate (EPC) of D or below. You’ll also need to receive one of these benefits:

  • Pension Guarantee Credit
  • Income-related Employment and Support Allowance (ESA)
  • Income-based Jobseeker's Allowance (JSA)
  • Income Support
  • Tax Credits (Child Tax Credits and Working Tax Credits)
  • Universal Credit
  • Housing Benefit
  • Pension Credit Saving Credit

How to apply

Although it’s a government scheme, ECO is the responsibility of energy companies (which is why it’s called the Energy Company Obligation).

And you don’t have to be a customer of an energy supplier to get help from them. You can apply to any of the energy companies listed on this OFGEM web page for ECO support.

To get funding from British Gas, visit our website and fill in the form to get started. Or if you prefer to use another energy company, just search their name and ‘ECO scheme’ to learn the next steps.

Wales – the Nest scheme

Nest is the Welsh Government’s scheme that provides advice and grants for home energy-efficiency improvements. It can help towards the cost of upgrades like new boilers, central heating systems, insulation, solar panels – and heat pumps.

Who is eligible?

You can apply for a grant if:

  • You own or privately rent your home (not from a local authority or housing association)
  • Your home isn’t energy efficient and costs a lot to heat

You’ll also need to:

  • Have a chronic respiratory, circulatory or mental health condition and be on a low income

Or

  • Have someone in the household who receives one of these benefits:
  1. Child Tax Credit (income below £16,105 a year)
  2. Council Tax Reduction (exemption and discount do not qualify on their own)
  3. Housing Benefit
  4. Income-based Jobseeker’s Allowance
  5. Income-related Employment and Support Allowance
  6. Income Support
  7. Pension Credit
  8. Universal Credit
  9. Working Tax Credit (income below £16,105 a year)

How to apply

Nest has a team of advisers. Just call the freephone number on the Nest website and they’ll guide you through every step of the application.

Scotland – Warmer Homes Scotland

Warmer Homes Scotland is the government’s programme designed to help people who are finding it hard to stay warm and pay energy bills.

They’ll arrange an expert visit to your home, to work out which insulation and heating improvements are right for you, including heat pumps. In most cases, all costs are met by the Scottish Government.

Who is eligible?

The scheme is open to homeowners and private tenants in Scotland. You’ll need to:

  • Have lived in your home for at least six months
  • Have a home with a poor energy rating
  • Additionally, you’ll need to meet one of the following criteria:
  • Over 75 with no central heating
  • Certified DS1500 or BASRiS by a medical professional
  • Receiving benefits (e.g. Universal Credit, Carer’s Allowance, Housing Benefit)

How to apply

To get help from Warmer Homes Scotland, you first need to contact Home Energy Scotland. They’ll check your eligibility and then organise an assessment of your home by an organisation called Warmworks. They’ll then work out a plan for making any changes to your home.

Frequently asked questions

How much does a heat pump cost with a £7,500 grant?

With the £7,500 grants for homeowners in England, Scotland and Wales, British Gas heat pumps start from just £500.

However, most homes need extra work to make them suitable for heat pumps. Things like new pipework and bigger radiators can add quite a bit to the overall cost.

Every installation is a bit different, so prices do vary – but to give you a rough idea, our average cost between 24th October 2023 and 21st February 2024 was £4,415 (including the £7,500 grant).

If you’re interested in finding out how much it would cost for your home, book a free survey. We’ll then give you a quote that includes everything you’ll need to make the switch to low-carbon heating.

For extra reassurance, our price match guarantee means we’ll match the quote of any other accredited installer.

Who is eligible for a heat pump grant?

There are lots of different grants for homeowners and private renters in the UK. Each has slightly different eligibility rules and application processes. Have a look at the relevant section in the article above for advice on the particular scheme that’s right for you.

What if you're not eligible for a heat pump grant?

If you’re not eligible for the heat pump grants explained in this article, British Gas offers a range of payment options, including interest-free credit, allowing you to spread the cost into manageable monthly payments.

And heat pumps aren’t the only way to make your home greener and more energy efficient. (insert link to heat pump eco/efficiency page that is part of the content clustering project) British Gas can help you with everything from EV chargers and smart lighting to solar panels and insulation.

Go greener at home