Boiler Upgrade Scheme Explained

In 2022, the UK Government increased their efforts to decarbonise England and Wales with the introduction of the Boiler Upgrade Scheme.

In this guide, we’ll explain what the Boiler Upgrade Scheme is, its benefits for homeowners and how you can apply as an installer on behalf of your customers.

What is the Boiler Upgrade Scheme?

The Boiler Upgrade Scheme (BUS) is a UK Government grant for people in England and Wales, designed to incentivise and increase the installation of low-carbon heating solutions, such as heat pumps and biomass boilers. Funding for the scheme has now been confirmed up until the 31^st March 2028.

On 21^st September 2023, the Department for Energy Security and Net Zero issued a change notice per BUS Regulation 13(4) to increase the BUS grant level for air-source heat pumps and ground-source heat pumps.

The scheme is administrated by Ofgem, the government regulator of electricity and downstream natural gas markets in the UK.

What funding is available in the scheme?

£450m has been made available for the boiler upgrade scheme, with the grant towards a heat pump increasing from £5,000 to £7,500 on 23^rd October 2023. Installers, while acting on behalf of homeowners, can apply for:

• £7,500 off the cost and installation of an air source heat pump.
• £7,500 towards the cost and installation of a ground source heat pump.
• £5,000 towards the cost and installation of a biomass boiler.

However, if an application for the grant was made before 23^rd October 2023, the levels are:

• £5,000 off the cost and installation of an air source heat pump.
• £6,000 off the cost and installation of a ground source heat pump, including water source heat pumps.
• £5,000 off the cost and installation of a biomass boiler.

Any vouchers that were issued will still receive the grant stated when they are submitted for redemption. These vouchers are still redeemable after the 23^rd October 2023, as long as they are submitted within their validity period.

All installations commissioned from 1^st April 2022 will continue to be eligible to apply for a grant.

Can installers apply for the Boiler Upgrade Scheme?

Whilst the scheme is designed to help homeowners and owners of small business properties with the cost of their new heating system, the application is installer-led, and it is the responsibility of the installer to apply for the grant on the property owner’s behalf.

Applications can be made through the UK government website.

How do I know if the property and owner is eligible for the scheme?

There are some requirements that both the property owner and the heating system itself must fulfil to be eligible for the Boiler Upgrade Scheme, including:

• The property owners must have a valid (within 10 years) Energy Performance Certificate with no outstanding recommendations for loft or cavity insulation  (unless they have an exemption).
• The property must have an installation capacity of up to 45kWth.
• The commissioning date of the heating system must be on or after 1^st April 2022.
• Biomass boilers are only eligible in rural properties that are not connected to the gas grid; however, this does not apply to heat pumps.
• The existing fossil fuel heating system must be fully replaced, whether it be an oil boiler, gas boiler or electric heating system.
• The property cannot be a new-build home or part of social housing, however self-build properties are eligible.

How do I apply?

You can apply on behalf of the property owner on the GOV.UK site, up until the closing date for applications on 31^st December 2027. The steps of the application are as follows:

Step 1.

Start the application to Ofgem, the scheme administrator, on the GOV.UK site.

Step 2.

Provide the property owner’s details, who will be contacted to consent to your application on their behalf.

Step 3.

You will liaise with Ofgem about the scheme requirements and complete the installation in line with industry standards.

Step 4.

You will now be able to redeem the voucher provided by the scheme and receive the grant.

Boiler upgrade scheme FAQs

Is the boiler upgrade scheme available in Scotland or Northern Ireland?

No, but there is alternative funding available in those areas.

For Scotland, the Home Energy Scotland Loan currently offers loans for heat pumps and biomass boilers:

• Up to £15,000 (£7,500 grant plus up to £7,500 loan) for air source and ground source heat pumps. Qualifying rural properties can get an extra £1,500 grant.
• Up to £15,000 (£7,500 grant plus up to £7,500 loan) for biomass boilers.

For Northern Ireland, installers should contact NI Energy Advice to find out more about funding available to customers.

My customer has a newly built property, is this eligible?

New build properties aren’t eligible for the Boiler Upgrade Scheme unless a fossil fuel boiler was already in place when the homeowner moved into the property. This could be considered a retrofit project and is eligible for the scheme.

What if my customer is claiming other grants or funding?

Homeowners can still benefit from the Boiler Upgrade Scheme if they have already received separate funding for energy-efficient upgrades – such as insulation or energy-efficient doors and windows.

Any property that has already received government funding or support for a heat pump or biomass boiler isn’t eligible for the Boiler Upgrade Scheme – including the Green Homes Grant.

Summary

The Boiler Upgrade Scheme will allow you to offer your customers a more efficient heating solution, whilst saving money, incentivising us all to help the UK’s drive towards carbon neutrality. For more information on the Boiler Upgrade Scheme and how it can benefit your customers, please get in touch today.