More than 60,000 heat pumps were installed in UK homes last year under the government’s Boiler Upgrade Scheme – a record high. That is roughly double the number installed in 2022, when the scheme launched with a £5,000 grant.
As reported by BBC News, the Department for Energy Security and Net Zero confirmed the figures, which include both air-source and ground-source heat pumps. The scheme now offers £7,500 per installation – up from £5,000 in October 2023.
Who qualifies – and who doesn’t
The Boiler Upgrade Scheme is open to homeowners and small landlords in England and Wales. You must replace an existing fossil fuel heating system – typically a gas boiler – with an air-source or ground-source heat pump. The property must have a valid Energy Performance Certificate with no outstanding recommendations for loft or cavity wall insulation.
Ofgem, which administers the scheme, confirmed to Axiom that applications rose 40% in the final quarter of 2024. Yet the total remains modest: 60,000 installations against the government’s target of 600,000 per year by 2028. The gap is wide.
Scotland runs its own scheme, Home Energy Scotland, which offers up to £7,500 for heat pumps plus an additional £1,500 for those on low incomes. Northern Ireland has no equivalent grant as of March 2025.
What it costs a typical 3-bed semi
Installing an air-source heat pump typically costs between £7,000 and £13,000, including the unit, labour, and any necessary pipework or radiator upgrades. The £7,500 grant brings the net cost to between £0 and £5,500 for most households. Ground-source heat pumps cost more – typically £14,000 to £19,000 – but the grant covers the same amount.
Running costs depend heavily on your home’s insulation. A well-insulated 3-bed semi using 10,000 kWh of heat per year will pay roughly £450–£550 annually with a heat pump at current electricity prices (24.5p/kWh). A gas boiler doing the same work costs about £600–£700 at 6.5p/kWh. The gap narrows if you have solar panels or a time-of-use tariff.
But the catch is that many UK homes leak heat. The Energy Saving Trust estimates that a typical 3-bed semi built before 1990 loses 30–40% of its heat through uninsulated walls and lofts. Installing a heat pump without first insulating is like filling a bathtub without a plug.
Why the UK still trails Europe
France installed 1.1 million heat pumps in 2023. Germany installed 350,000. Norway, with a fifth of the UK’s population, installed 120,000. The UK’s 60,000 is a record – but it is also an embarrassment.
The difference is policy. France banned gas boilers in new builds from 2022. Germany’s Building Energy Act mandates that new heating systems run on at least 65% renewable energy from 2024. The UK has no such mandate for existing homes. The Boiler Upgrade Scheme is a carrot, not a stick.
Yet the stick may be coming. The government’s Clean Heat Market Mechanism, due in 2025, will require boiler manufacturers to sell a rising share of heat pumps or pay a penalty. That has already pushed some manufacturers to cut heat pump prices and offer free installation to early adopters.
What this means for your home
If you are replacing a broken gas boiler, a heat pump is now financially viable for most homes with basic insulation. The £7,500 grant is available until 31 March 2027. Ofgem says typical application processing takes 12 weeks, but installers report delays of up to 20 weeks in some regions.
Your EPC rating will improve by up to 10 points if you switch from a gas boiler to a heat pump, according to the Energy Saving Trust. That can push a D-rated home to a C or a C to a B – which matters for selling or renting.
Households on standard variable tariffs can apply through gov.uk from 4 November. Eligibility closes on 31 March 2027. If you wait, the grant may shrink or disappear. Book an insulation survey first – it will save you more in the long run.
Frequently Asked Questions
Air-source heat pumps are permitted development in England and Wales, meaning you usually do not need planning permission. But if you live in a listed building, a conservation area, or a World Heritage Site, you must check with your local council. Scotland has similar rules but requires building warrant approval for the electrical and plumbing work.
Yes, but it will cost more to run. Heat pumps work best in well-insulated homes because they run at lower temperatures than gas boilers. If your home is draughty, you will need to upgrade loft insulation to at least 270mm, fill cavity walls, and draught-proof windows and doors. The Energy Saving Trust recommends doing this before installing a heat pump.
