The Boiler Upgrade Scheme (BUS) has been expanded to include air-to-air heat pumps, a move that could reshape the economics of home heating for thousands of UK households. The change, reported by edie.net, means homeowners can now claim a £7,500 grant towards the cost of an air-to-air heat pump, which heats rooms directly rather than via a wet central heating system.
What the extension means for homeowners
Previously, the BUS only covered air-to-water heat pumps and biomass boilers. Air-to-air systems were excluded because they are not typically built to heat water for taps or radiators. But the government has now accepted that they offer a viable, lower-carbon alternative for homes that are well-insulated and do not have existing wet heating systems. As the Energy Saving Trust explains, the scheme is built to help households move away from fossil fuel heating, and air-to-air heat pumps can do that at a lower upfront cost.
The grant remains at £7,500, the same as for air-to-water systems. But the total installation cost for an air-to-air heat pump is often much lower, typically between £4,000 and £8,000, compared to £10,000 to £15,000 for an air-to-water system. That means the grant could cover the entire cost, or close to it, for many households.
Who qualifies, and who doesn’t
Eligibility criteria remain largely unchanged. You must own your home (or have permission from the landlord if you are a private tenant) and be replacing an existing fossil fuel heating system, such as a gas, oil, or LPG boiler. The property must also have a valid Energy Performance Certificate (EPC) with no outstanding recommendations for loft or cavity wall insulation. The Energy Saving Trust notes that the scheme is open to homes in England and Wales, with Scotland and Northern Ireland running separate programmes.
The catch is that air-to-air heat pumps are not a like-for-like replacement for a boiler. They heat rooms by blowing warm air, rather than circulating hot water through radiators. That means they work best in homes that already have good insulation and air tightness. If your home is draughty or has single glazing, the system will struggle to maintain a comfortable temperature, and your running costs could be higher than a modern gas boiler.
What it costs a typical 3-bed semi
For a typical three-bedroom semi-detached house with cavity wall insulation and double glazing, an air-to-air heat pump could cost around £5,000 to install. With the £7,500 grant, the homeowner would pay nothing, or even have money left over to cover any additional electrical work. Running costs are roughly comparable to a gas boiler, depending on electricity and gas prices. At current price cap rates (24.5p/kWh for electricity, 6.0p/kWh for gas), the heat pump’s coefficient of performance (CoP) of around 3.0 means the cost per unit of heat is about 8.2p/kWh, slightly higher than gas at 6.0p/kWh. But if you have solar panels, the running cost drops further.
The EPC impact is also worth noting. An air-to-air heat pump can improve your EPC rating by one or two bands, depending on your existing system. Replacing an old G-rated gas boiler with a modern heat pump could lift you from a D to a C, which matters if you plan to sell or rent the property. From 2028, the government’s proposed Minimum Energy Efficiency Standards (MEES) will require all new tenancies to have at least a C rating, so this upgrade could future-proof your home.
How to apply and next steps
Applications are made through the Ofgem portal, and you need a quote from an MCS-certified installer before you can apply. The grant is deducted from the installer’s invoice, so you pay the net amount. The Energy Saving Trust advises checking that your installer is registered with the Microgeneration Certification Scheme (MCS) and that the heat pump model is on the official product list.
Before you apply, get an up-to-date EPC assessment. If your EPC recommends insulation upgrades, you may need to complete those first, or risk being ineligible. The government’s ECO4 scheme and the Home Upgrade Grant (HUG2) can help fund insulation for low-income households, so check those too.
For most homeowners, the key question is whether an air-to-air heat pump suits your home and lifestyle. If you have electric storage heaters or a warm-air system already, the switch is straightforward. If you have a wet radiator system, you may need to keep a backup for hot water or install a separate system. The grant makes the financial case strong, but the technical fit matters more.
Households on standard variable tariffs can apply through the Ofgem portal from now. The scheme runs until March 2028, but funding is allocated on a first-come, first-served basis. With the expansion to air-to-air systems, demand is likely to rise. Contact an MCS-certified installer for a quote and check your EPC before you apply.
Frequently Asked Questions
Yes, the Boiler Upgrade Scheme now covers air-to-air heat pumps. You can claim a £7,500 grant if you own your home and are replacing a fossil fuel heating system, such as a gas or oil boiler. The installer must be MCS-certified and the heat pump must be on the approved product list.
It depends on electricity and gas prices. At current price cap rates, an air-to-air heat pump with a CoP of 3.0 costs about 8.2p per kWh of heat, compared to 6.0p for gas. However, if you have solar panels, the running cost can be much lower. The system is also cheaper to install, often costing £4,000-£8,000 before the grant.
Yes, the scheme requires your EPC to have no outstanding recommendations for loft or cavity wall insulation. Even if not required, good insulation is essential for air-to-air heat pumps to work efficiently. Check your EPC and consider using the ECO4 or HUG2 schemes to fund insulation upgrades first.
