Heat pump grants in 2026.

The short version

For most UK homeowners, the Boiler Upgrade Scheme (BUS) is the main grant — £7,500 off your quote — and it stacks with 0% VAT. Lower-income households can often stack BUS with ECO4 to reach fully-funded installs. Scotland has its own parallel scheme with a mix of grants and interest-free loans.

1. Boiler Upgrade Scheme (BUS)

• Who: Homeowners & small landlords in England & Wales
• How much: £7,500 air-source, £7,500 ground-source, £5,000 biomass
• Income test: None
• Applied by: Your MCS-certified installer (not you direct)

This is the main scheme for the middle-income majority. See our full BUS Grant guide.

2. ECO4

• Who: Low-income & benefit-recipient households in Great Britain
• How much: Typically fully-funded or heavily discounted
• Income test: Yes — either income-based benefits or household income < £31k
• Applied by: Energy suppliers (British Gas, Octopus, E.ON etc.)

ECO4 is the big one for low-income households. It also typically bundles in insulation, which is a grant-qualifying pre-requisite for BUS anyway.

3. 0% VAT on heat pump installations

• Who: All UK residential installs
• How much: Saves 20% on the quote — typically worth £2,000–£3,000
• Duration: Until 1 April 2027

This isn't a grant, it's a tax break, but it functions the same way — applied automatically by any MCS installer.

4. Home Upgrade Grant 2 (HUG2)

• Who: Off-gas-grid, low-income households in England
• How much: Up to £20,000 for package of improvements including heat pump
• Income test: Household income < £36k, EPC band D or worse
• Applied by: Your local authority

5. Home Energy Scotland Grant & Loan

• Who: Scottish homeowners
• How much: £7,500 grant + up to £7,500 interest-free loan for air-source; £9k + £9k for ground-source; additional £1,500 rural uplift
• Income test: None
• Applied by: You, via Home Energy Scotland

6. Welsh & NI schemes

Wales mirrors BUS. Northern Ireland has the Affordable Warmth Scheme and Boiler Replacement Allowance, income-tested, typically worth £1,000–£2,500.

What you'll actually pay after stacking

Putting the headline schemes together for a standard UK retrofit:

Common mistake: the EPC trap

BUS, ECO4 and HUG2 all require your home to have no outstanding loft or cavity wall insulation recommendations on your EPC. If yours does, you'll need those addressed first — but this is exactly why ECO4 bundles insulation and a heat pump together.