Only 3,000 heat pumps were installed in UK homes last month. The government wants 600,000 a year by 2028. At current rates, that target is 16 years away, not four.
The Boiler Upgrade Scheme grant rose from £5,000 to £7,500 in October 2023, the biggest single subsidy boost in the scheme’s history. Yet installations have barely budged, as reported by pv magazine Global. The question is why, and what it means for the 19 million UK homes still on gas boilers.
What the grant actually covers
A typical air-source heat pump installation costs £10,000 to £14,000. The £7,500 grant leaves the homeowner with a bill of £2,500 to £6,500. That is still two to five times the cost of a new gas boiler (£800–£1,500). Energy Saving Trust figures show the average household saves £200–£400 a year on heating bills after switching. At that rate, the payback period is 6 to 15 years, longer than many homeowners plan to stay in their current property.
The grant is not the problem. The gap between grant and total cost is.
Who qualifies, and who doesn’t
The Boiler Upgrade Scheme is available to homeowners in England and Wales. It covers air-source and ground-source heat pumps but not hybrid systems that pair a heat pump with a gas boiler. The property must have a valid Energy Performance Certificate with no outstanding recommendations for loft or cavity wall insulation. That rule alone excludes an estimated 40% of homes, according to government data.
Listed buildings and homes in conservation areas face additional hurdles. Many local planning authorities require detailed heritage impact assessments before approving external units. The cost of that assessment, often £500–£1,500, is not covered by the grant. Installers in rural areas report losing half their leads at the planning stage.
Installer shortage is the real bottleneck
The UK has roughly 4,000 certified heat pump installers. It has 130,000 registered gas engineers. Even if every gas engineer retrained tomorrow, which they won’t, the industry would need five years to meet the 2028 target. Training takes 6–12 months and costs £3,000–£5,000 per person. The government’s Heat Training Grant of £500 per trainee barely covers the exam fee.
Meanwhile, demand is suppressed by long waiting times. Homeowners who call a local installer in January are often quoted September installation dates. That kills momentum. People who want to switch this winter are told to wait until next winter. Many give up and order a new gas boiler instead.
What this misses
The grant increase was never going to solve the structural problems. The UK still has the most expensive electricity in Europe, roughly 28p per kWh versus 6p per kWh for gas. Even a highly efficient heat pump with a coefficient of performance of 3.5 costs more to run than a gas boiler when electricity is four times the price of gas. Ofgem’s price cap adjustments have not closed that gap. The government’s own analysis shows that running costs parity requires electricity prices to fall by at least 30%.
The catch is that network charges make up 25% of an electricity bill but only 5% of a gas bill. Until that structural imbalance is addressed, heat pumps will remain the rational choice for the planet but the irrational choice for the household budget.
What needs to change
Three things would unblock the market. First, the grant needs to cover the full installation cost for low-income households, not just a fixed sum. Second, the electricity-to-gas price ratio must be tackled by shifting network charges from electricity to gas, a policy the Climate Change Committee has recommended since 2020. Third, the installer training pipeline needs a tenfold increase in funded places, with a clear pathway for gas engineers to add heat pump certification.
Homeowners considering a switch should still apply for the current BUS grant before the scheme’s budget runs out, it is capped at 50,000 installations per year and typically fills by late autumn. Check eligibility on the Ofgem website. For those in listed buildings, contact the local planning authority early. And for anyone waiting for a cheaper, simpler solution: the economics will not improve until electricity prices fall. That could take another two to three years.
Frequently Asked Questions
For many households, no. After the grant, a typical installation still costs £2,500 to £6,500, compared to £800–£1,500 for a gas boiler. The payback period can be 6–15 years, depending on your current heating system and insulation levels.
Three main reasons: high upfront costs even after the grant, a severe shortage of certified installers (only 4,000 vs 130,000 gas engineers), and running costs that remain higher than gas due to the UK's electricity-to-gas price ratio of roughly 4:1. Planning rules for listed buildings also add delays and costs.
