The £9,000 BUS grant covers oil and LPG homes from April 2026
If you heat your home with oil or LPG, you have likely felt the sting of rising fuel bills. The Boiler Upgrade Scheme (BUS) now offers a specific grant for off-gas-grid homes to help you switch to a heat pump.
From April 2026, households replacing an oil, LPG, or solid fuel heating system with an air source or ground source heat pump can claim £9,000 through the BUS. This is a direct payment to your installer, reducing the upfront cost you pay, not a loan or tax credit you have to reclaim (GOV.UK – Boiler Upgrade Scheme guidance, 2026). Gas-heated homes remain at £7,500, making this the highest grant rate available for heat pumps in the UK (Ofgem BUS statistics, Q1 2026).
Total installed cost ranges from £3,000 to £12,000 after the grant
The grant covers a significant portion of the installation cost, but the final amount you pay depends on the system and your home. An air source heat pump for a typical 3–4 bedroom home costs between £12,000 and £18,000 before the grant (Energy Saving Trust heat pump cost estimates, 2026). After the £9,000 BUS grant, your out-of-pocket cost falls to between £3,000 and £9,000.
Ground source heat pumps are more expensive, with installation costs ranging from £20,000 to £35,000 before the grant (MCS installer survey data, 2026). After the £9,000 grant, you would pay between £11,000 and £26,000. The exact cost depends on factors like the size of your property, the type of heat pump, and whether you need new radiators or underfloor heating.
Annual savings on oil and LPG heating are £900–£1,600
Switching from oil or LPG to a heat pump can significantly reduce your annual heating bills. According to DESNZ, a typical 3-bedroom home switching from oil to a heat pump saves £1,200–£1,600 per year, while switching from LPG saves £900–£1,300 per year (DESNZ “Heat pump vs oil boiler running costs” publication, 2026).
These savings assume a heat pump with a Seasonal Coefficient of Performance (SCOP) of 3.5, meaning it produces 3.5 units of heat for every 1 unit of electricity. The comparison uses oil at 6.5p/kWh and LPG at 7.2p/kWh, based on January 2026 data (Ofgem price cap data, January 2026; Sutherland Tables fuel cost comparison, 2026).
Quick numbers costs, savings, and payback
| Metric | Air source heat pump | Ground source heat pump |
|---|---|---|
| Average heat pump cost before grant | £12,000–£18,000 | £20,000–£35,000 |
| BUS grant amount (oil/LPG home) | £9,000 | £9,000 |
| Typical homeowner cost after grant | £3,000–£9,000 | £11,000–£26,000 |
| Annual saving vs oil | £1,200–£1,600 | £1,200–£1,600 |
| Annual saving vs LPG | £900–£1,300 | £900–£1,300 |
| Simple payback period (oil home) | 2–4 years | 7–16 years |
| Simple payback period (LPG home) | 3–8 years | 8–20 years |
| Heat pump lifespan (years) | 15–20 years | 20–25 years |
Payback takes 2–8 years depending on your current fuel
The payback period for a heat pump depends on your current fuel type and the net cost after the grant. For oil-heated homes, payback is 2–4 years after the grant, based on £1,200–£1,600 annual savings and a net cost of £3,000–£6,000. For LPG-heated homes, payback is 3–8 years, based on £900–£1,300 savings and a net cost of £4,000–£9,000 (Energy Saving Trust payback calculator methodology, 2026).
Payback shortens if oil or LPG prices rise above current levels, which DESNZ fuel price projections suggest is likely over the next five years (DESNZ fuel price projections, 2026). Ground source heat pumps have longer payback periods, but they also have longer lifespans and lower running costs over time.
You must use an MCS-certified installer to claim the £9,000
To qualify for the BUS grant, your installation must be carried out by an MCS-certified contractor. The Microgeneration Certification Scheme (MCS) ensures installers meet industry standards for design, installation, and commissioning (Ofgem BUS scheme rules, 2026). Installers must also be registered with TrustMark for consumer protection.
You can check the MCS register at mcscertified.com for certified companies in your area. The installer applies for the grant on your behalf, so you do not need to submit paperwork. This process is straightforward, but you should confirm the installer handles the BUS application before agreeing to any work.
Eligibility requirements for the oil and LPG heat pump grant
Your property must have an Energy Performance Certificate (EPC) with no outstanding recommendations for loft or cavity wall insulation (GOV.UK – BUS eligibility criteria, 2026). If your EPC recommends insulation, you must install it first or provide evidence it is already in place. The heat pump must replace an existing oil, LPG, or solid fuel heating system, and the property must be in England or Wales. Scotland has separate Home Energy Scotland grants (Ofgem BUS application guidance, 2026).
You do not need to have a smart meter or be on a specific electricity tariff to qualify. However, the heat pump must be installed in a property that is your primary residence, not a second home or rental property.
The £9,000 grant is the direct answer to “oil lpg heat pump grant uk”
As of April 2026, the UK Boiler Upgrade Scheme offers £9,000 to households replacing oil or LPG heating with a heat pump (DESNZ press release, March 2026). This is the highest grant amount available for heat pumps in the UK, specifically for off-gas-grid homes. The grant is available until at least March 2028, subject to government budget reviews (Ofgem BUS annual report, 2026).
Guide to heat pump running costs and savings How to find an MCS-certified installer
Frequently Asked Questions
You are eligible if you replace an oil, LPG, or solid fuel heating system with an air source or ground source heat pump. The grant is available from April 2026 under the Boiler Upgrade Scheme (BUS), as confirmed by GOV.UK guidance.
The grant is £9,000, paid directly to your installer to reduce upfront costs. This is £1,500 more than the £7,500 grant for gas-heated homes, according to Ofgem BUS statistics for Q1 2026.
After the £9,000 grant, an air source heat pump costs £3,000–£9,000 for a typical 3-4 bedroom home. A ground source heat pump costs £11,000–£26,000, based on Energy Saving Trust and MCS installer data from 2026.
You can save £1,200–£1,600 per year switching from oil to a heat pump, or £900–£1,300 per year from LPG. These figures come from the DESNZ publication on heat pump vs oil boiler running costs (2026).
The Boiler Upgrade Scheme (BUS) offers a £9,000 grant to off-gas-grid households replacing oil or LPG heating with a heat pump. It is a direct payment to your installer, not a loan, and is managed by Ofgem under GOV.UK rules.
