Air Source Heat Pump Grants: What You Can Get

Our Guide To Heat Pump Grants In Summary

There are 5 main government grants for air source heat pumps in the UK: the Boiler Upgrade Scheme, 0% Vat Scheme, Warmer Homes Scotland, Nest Wales and ECO4. 

• The 0% VAT grant applies to all installations
• If you’re in receipt of benefits, have a health condition or are on a low income, typically Warmer Homes Scotland, Nest Wales and ECO4 are the best grants
• For everyone else, the Boiler Upgrade Scheme (BUS) is suitable

To be eligible for most heat pump grants, typically you can’t have had government funding for a central heating system upgrade previously. 

For the Boiler Upgrade Scheme, you’ll need to have an MCS certified fitter install and commission your unit within 120 days of applying for the £7,500 grant. Coupled with the government's 0% VAT benefit on clean energy solutions, that’s a huge saving. 

Use our heat pump installation tool here. Click a few options to tell us about your property, and get a fixed price on-screen. Discounts are automatically applied for both the 0% VAT grant, and the Boiler Upgrade Scheme.

Heat Pump Grants Available In The UK

With the UK aiming for net-zero by 2050, there are an increasing number of funding options available via government schemes. Some of the most prominent in the UK currently include: 

• The Boiler Upgrade Scheme (BUS) - One of the newer government grants offering up to £7,500 for eligible homeowners looking to upgrade their gas boiler to an air source heat pump
• 0% VAT - Materials for clean energy solutions (including air source heat pumps) qualify for 0% VAT
• Warmer Homes (Scotland) - A scheme designed to offer up to £10,000 in funding for eligible Scottish households
• Nest (Wales) - The Welsh government’s scheme that offers free air source heat pumps installations for low income households, or those receiving specific benefits
• Energy Obligation Scheme (ECO4) - A government initiative to provide funding via main energy suppliers, to improve heating and insulation for those receiving certain benefits

We’ll explain all of these air source heat pump grants in full below, with most of the focus being around the Boiler Upgrade Scheme (BUS). This tends to be the government grant with the loosest eligibility criteria, meaning it’s more than likely that you’ll qualify!

At Dwellow, we’ve developed a clickable tool you can use and get fixed prices on-screen within a couple of minutes. Our heat pump tool here will suggest any grants you may be eligible for. 

Boiler Upgrade Scheme

The Boiler Upgrade Scheme (BUS) is one of the best ways to get funding for your pump installation; the majority of air source heat pump grants come via BUS. You can check your eligibility for the BUS with our simple online tool.

The government is pushing the Boiler Upgrade Scheme massively. Previously, you’d only be eligible for a £5,000 grant. However, recent updates to the scheme mean you’ll be eligible for up to £7,500 towards heat pump installation costs.

Like most heat pump grants, you’ll need to make sure you meet the eligibility criteria before applying. For example, you can’t use the grant to fund a hybrid heating system that uses fossil fuels. So, if you’re planning to use an air source heat pump in conjunction with a gas boiler, you won’t be eligible for funding.

Eligibility 

Many other government heat pump grants are aimed at: 

• Low income households
• People receiving specific benefits (such as Job Seekers Allowance)
• Those living with specific health conditions

The Boiler Upgrade Scheme is a lot looser in terms of eligibility. Put simply, you’ll need to: 

• Own the property that you plan to have an air source heat pump installed in (business premises, buy to lets and second homes are eligible)
• Not have had prior funding to improve your central heating system; funding for the likes of cavity wall insulation won’t affect your eligibility
• The air source heat pump is fitted by a MCS certified installer; DIY installations or those completed by non-qualified MCS tradespeople won’t qualify for a heat pump grant
• Ensure your MCS certified installer commissions the system within 120 days of you applying for the Boiler Upgrade Scheme grant

Apply

The application process for the Boiler Upgrade Scheme involves contacting MCS (Microgeneration Certification Scheme) installers. Essentially, MCS is the body that maintains standards in the UK for low carbon installations in the UK (heat pumps, solar panels and biomass boilers). 

Dwellow’s team includes experienced MCS installers. Use our clickable tool here and get a fixed price for your heat pump installation. Our tool will determine if you’re eligible for the Boiler Upgrade Scheme grant, and if so, we’ll apply on your behalf. 

Still got questions about the Boiler Upgrade Scheme? Speak to our heat pump funding experts here. 

The government’s website has further details regarding the Boiler Upgrade Scheme here. 

0% VAT Scheme

Like most things in the UK, installation prices you see from VAT registered companies include VAT on both materials and labour. 

However, to continue the big push towards net-zero, government grants for air source heat pumps include a 0% VAT benefit for clean energy materials. When you consider a heat pump such as the Vaillant aroTHERM Plus 7kw is around £4,000 (unit only), that’s a substantial saving!

Eligibility

In Great Britain, all consumers pay 0% VAT on certain green energy products. The way this is charged depends on the size of the install, and the percentage of the overall heat pump installation cost that is materials, and the percentage that is labour.

For Northern Ireland, eligible households are limited to those receiving certain benefits. 

Apply

It’s your installers responsibility to charge the correct amount of VAT during an air source heat pump installation.

The way VAT is charged on the total cost of installation can be confusing. You can remove confusion from the equation by using our clickable tool here. We calculate which aspects of the install are eligible for 0% VAT, and apply the discount automatically to the price you see on-screen.

Details of the 0% VAT air source heat pump grant can be found here.

Nest (Wales)

‍

Nest is a Welsh government scheme that allows people to apply for upgrades to their properties, including getting a free air source heat pump. 

Alongside grants for heat pumps, they also offer free advice to consumers to help: 

• Reduce energy consumption and therefore, energy bills
• Ensure they’re on the best tariffs from utility providers
• Find out if there are any benefits they might be eligible for, to help with the increased cost of energy bills

Nest can install free heat pumps, solar panels and insulation for those that are eligible. 

Eligibility 

To be eligible for the Welsh government’s air source heat pump grant, you’ll need to: 

• Own your own your home, or rent from a private landlord (housing association and local authority properties are not eligible)
• Live in a low income household, receive a means tested benefit or, have specific health conditions
• Live in a property with an EPC rating of 54 (E) or less, this is upped to 68 (D) for those with specific health conditions

This is one of the few air source heat pump grants in the UK available for those that have health issues. Asides from the Boiler Upgrade Scheme, the majority of others would need you to also receive a means tested benefit (such as Universal Credit), or, be living in a low income household.

Examples of health issues that mean you’d be eligible for the Nest government grant include: respiratory disease, circulatory disease, mental health, dementia and development disorders.

Apply

To determine if you’re eligible for the Nest air source heat pump grant, you need an on-site assessment. The contact number for Nest and to arrange this on-site assessment is 0808 808 2244.

If you’re unsure about which heat pump grants you qualify for, speak to one of our expert advisors here. Or, use our clickable tool which takes into account eligible government heat pump grants, and will give you a fixed price on-screen within a couple of minutes. 

Warmer Homes Scotland

Warmer Homes Scotland has already helped 35,000 households in Scotland to improve their energy efficiency, and reduce their overall EPC rating. 

The Warmer Homes grant in Scotland can be used for a range of upgrades, including the likes of loft insulation, draught proofing and central heating system upgrades (including air source heat pumps). 

Eligible households will be able to access up to £10,000 in funding. 

Eligibility 

The focus for eligibility here is quality of living. Warmer Home Scotland looks at the amount you pay in council tax, the size of your property, benefits you receive and determines (via an on-site assessment) if you’re eligible, on a case by case basis.

Generic criteria includes whether or not you:

• Own your own house, or live in a privately tenanted property (property size of 230m2 or less)
• Live in a property with a council tax band of A-F
• Receive specific benefits
• Have lived in the property for 6 months or longer
• Live in a property where conditions are not "tolerable"; this needs to be determined by an on-site assessment
• Are over 75 with no central heating, or are terminally ill (a DS1500 or BASRiS certificate will need to be provided)

Apply

Unsure if you’re eligible for the Warmer Homes Scotland air source heat pump grant? Use their self-assessment tool here. 

ECO4 (Energy Obligation Scheme)

ECO4 (Energy Obligation Scheme) is another government grant and one of the oldest; it was introduced back in 2013. 

The aim of the ECO4 scheme, like many other government grants, is to reduce the overall emissions produced by UK households. At the same time, it’s designed to help low income households, or those that qualify for certain means tested benefits. 

In general, if you qualify for the ECO4 scheme, you should expect to receive discounted or free upgrades to your property. These include the likes of loft insulation, cavity wall insulation and green upgrades to your central heating, such as fitting an air source heat pump.

Eligibility 

To be eligible for ECO4 air source heat pump grant, you'll need to: 

‍

• Receive a means tested benefits (such as Universal Credit, Housing Benefit or Child Benefit); these benefits all fall under the "Help To Heat" benefit scheme
• Currently live in accommodation that is social housing with extremely poor energy efficiency ratings; properties with D-G are eligible
• Meet the criteria for ECO4 Flex; combined household income of less than £31,000 and EPC of D-G

Detailed criteria is available on ofgem’s website here. 

Apply

The application process for ECO4 starts with the government’s website here. 

If you’re unsure whether you are eligible for the ECO4 heat pump grant, or any of the air source heat pump grants we’ve detailed, you can contact our team here. 

Or, use our on-site clickable heat pump tool, and get air source heat pump grants up to the value of £7,500.

Air Source Heat Pump Grants (FAQ)

What EPC Rating Is Needed For A Heat Pump Grant?

Typically you need an EPC rated property that’s D, E, F or G. That said, some grants are based on health, income and benefits and not on your property’s EPC rating.

How Much Of My Installation Cost Will Be Offset By A Grant?

This depends on the heat pump grant you’re eligible for. Some grants (such as Nest Wales) provide 100% funding; you’ll get a free heat pump. However, the likes of the Boiler Upgrade Scheme (BUS) will provide a £7,500 grant towards your heat pump installation costs.

Can I Get A Free Air Source Heat Pump?

Grants leading to free air source heat pumps are out there, but are few and far between. It’s possible to get free air source heat pumps via Nest (Wales) and ECO4 if you’re eligible.

Which Is The Best Heat Pump Grant?

The Boiler Upgrade Scheme (BUS), is the best heat pump grant. For those that aren’t receiving benefits or living in a low income household, it’s unlikely they’ll qualify for any other heat pump grant. BUS provides up to £7,500 in funding. 

How Do I Know If I’m Eligible For An ASHP Grant?

The Boiler Upgrade Scheme is available for the majority of UK households, with up to £7,500 available. Other schemes (ECO4, Warmer Homes Scotland, Nest Wales) have much stricter criteria based on your current health, and any benefits you are currently in receipt of.

Are There Government Grants For Heat Pumps?

Yes, the most popular heat pump grants are the: Boiler Upgrade Scheme, 0% VAT Scheme for green energy solutions, ECO4, Nest Wales and Warmer Homes Scotland. 

‍