Heat Pump Grants UK – Government Grants for Air Source Heat Pumps

Upgrade your home with an energy-efficient air source heat pump and potentially save thousands on installation costs through government grants. The Air Source Heat Pump Grant is a government initiative designed to make energy-efficient heating systems more affordable for homeowners and property owners. Under the ECO4 scheme, eligible households may also qualify for free solar panel installation, in addition to support for ASHP installation, insulation, and other energy efficiency upgrades.

These grants aim to lower carbon footprints, reduce energy bills, and promote the adoption of sustainable heating solutions.

Find out if you qualify for funding.

Available Grants for Air Source Heat Pumps in 2025

Grant Scheme	Amount	Eligibility	Coverage	Duration
Boiler Upgrade Scheme (BUS)	£7,500	Homeowners in England and Wales	Air source heat pumps	Until March 2028
ECO4 Scheme	Varies	Low-income households in Great Britain (excluding Northern Ireland)	Potential full funding for ASHP installation	Until March 31, 2026
Home Energy Scotland Grant	Up to £7,500 (£9,000 for rural areas)	Homeowners in Scotland	Air source heat pumps	Ongoing
Warm Homes: Local Grant	Up to £30,000	Low-income households in England with EPC ratings D-G	Energy efficiency upgrades and low-carbon heating, including ASHPs	Launched April 2025

 

An air source heat pump (ASHP) is an innovative, energy-efficient heating and cooling system that extracts heat from the outside air and uses it to warm your home and provide hot water. These systems work on the principle of heat transfer, similar to how a refrigerator operates, but in reverse.

ASHPs consist of an outdoor unit, which looks similar to an air conditioning unit, and an indoor unit connected by pipes filled with refrigerant. The size of the heat pump depends on the heating requirements of your home – larger homes typically need bigger units to generate sufficient heat.

One of the most remarkable features of air source heat pumps is their ability to extract heat from the air even when outside temperatures drop as low as -15°C. This makes them suitable for use in various climates, including the UK’s.

ASHPs are highly efficient, often producing more heat energy than the electrical energy they consume. This efficiency, combined with their use of renewable heat from the air, makes them an environmentally friendly alternative to traditional heating systems, helping to reduce carbon emissions and energy bills

An air source heat pump (ASHP) extracts heat from outside air and transfers it into your home for heating and hot water. Here’s a simplified overview of the process:

Outdoor Unit: The evaporator absorbs heat from the air into a refrigerant.
Compression: The refrigerant is compressed, increasing its temperature.
Indoor Unit: The hot refrigerant releases heat into your home’s heating system.
Expansion: The refrigerant cools and expands, starting the cycle again.

ASHPs are efficient, extracting heat even at -15°C, making them a green alternative to traditional heating systems.

Eligibility for air source heat pump grants in 2025 depends on the specific scheme, but generally includes the following criteria:

General Eligibility Criteria

1. Property Ownership: You must own the property where the heat pump will be installed. This includes residential homes, second homes, rental properties (with landlord permission), and small non-domestic buildings.
2. Existing Heating System: The grant applies to replacing fossil fuel systems such as gas, oil, coal boilers, or electric heating systems (e.g., storage heaters). It does not cover replacing existing low-carbon systems.
3. Energy Performance Certificate (EPC): Your property must have a valid EPC issued within the last 10 years. As of May 2024, the requirement for loft or cavity wall insulation has been removed, making it easier for homeowners to qualify for the scheme
4. Property Type: New-build properties are generally not eligible unless they are self-builds. Social housing is excluded from most schemes.
5. Rural Properties: Homes in rural areas may qualify for higher funding amounts under certain schemes (e.g., £9,000 instead of £7,500 through the Boiler Upgrade Scheme).

Scheme-Specific Eligibility

Boiler Upgrade Scheme (BUS)

• Grant Amount: £7,500 (£9,000 for rural areas).
• Coverage: England and Wales.
• Requirements:
  • Must replace fossil fuel heating systems.
  • Cannot use multiple public funding sources for installation.
  • Self-build properties are eligible with proof of ownership.

ECO4 Scheme

• Focus: Low-income households in England, Scotland, and Wales.
• Requirements:
  • Annual household income below £31,000 or receiving qualifying benefits such as Universal Credit or Pension Credit.
  • Properties with EPC ratings D-G are prioritised.
  • May include insulation upgrades alongside heat pump installations.

Home Energy Scotland Grant

• Grant Amount: Up to £7,500 (£9,000 for rural areas).
• Coverage: Scotland.
• Requirements:
  • Available to homeowners and private landlords.
  • Must use MCS-certified installers and products.

Warm Homes: Local Grant

• Grant Amount: Up to £30,000.
• Coverage: England (via local authorities).
• Requirements:
  • Low-income households with EPC ratings D-G.
  • Privately owned or rented properties.

Note:

• The Boiler Upgrade Scheme has received additional funding of £55 million for 2024/2025, with the total budget increased to £205 million
• The government has authorised Ofgem to over-allocate vouchers up to £280 million to ensure continued availability of grants
• BUS funding is set to rise to £295 million for 2025/2026
• Planning regulations have been simplified, removing the 1-meter boundary rule for heat pump installations in England

The free UK heat pump grant aims to reduce the upfront costs of transitioning to low-carbon heating systems. Depending on the specific grant scheme and your eligibility, the funding may cover:

• Air Source Heat Pump Unit: The cost of purchasing a high-efficiency heat pump system.
• Installation Costs: Labor and materials required for professional installation.
• System Modifications: Necessary upgrades to your existing heating system, such as radiator replacements or pipework adjustments.
• Old System Removal: Safe removal and disposal of your outdated fossil fuel heating system.
• Energy Efficiency Improvements: Some schemes, like ECO4, may include additional measures such as insulation upgrades to maximise efficiency.

Switching to an air source heat pump through government grants offers several advantages:

Installing an air source heat pump can enhance your home’s Energy Performance Certificate (EPC) rating by improving energy efficiency. A higher EPC rating provides several benefits:

• Increase Property Value: Homes with better EPC ratings are often more desirable and can command higher prices in the market.
• Attract Buyers or Renters: Energy-efficient properties are increasingly sought after due to rising energy costs.
• Access Additional Schemes: A higher EPC rating may qualify you for further energy efficiency grants or incentives.