What’s New in Boiler Grants for 2025? Government Schemes Explained

The Boiler Upgrade Scheme (BUS): Bigger, Better, and Extended

The flagship government programme  for 2025 is the extended and improved Boiler Upgrade Scheme (BUS). First launched in 2022, the scheme is now undergoing major improvements aimed at making it more accessible and more impactful.

Higher Grant Amounts

One of the most notable updates for 2025 is the increased value of grants. The government is offering:

• £7,500 for air source heat pumps

• £7,500 for ground source (or water source) heat pumps

• £5,000 for eligible biomass boilers

These grants are designed to significantly reduce the upfront cost of installation, which has historically been a major barrier for households. By increasing these amounts, the government aims to make green heating technologies a realistic option for more people.

Longer Scheme Duration and Bigger Budget

Originally planned to end in 2025, the BUS has now been extended until 2028. The funding for the scheme has also been boosted significantly, with a dedicated budget of nearly £295 million allocated for the 2025-26 financial year. This ensures that more households can benefit from the scheme without facing the uncertainty of limited funding.

Simpler Eligibility Requirements

In previous years, homeowners often had to meet strict insulation requirements—such as having cavity wall and loft insulation installed—before being eligible for the grant. These requirements have now been relaxed. The idea is to remove unnecessary hurdles that previously made the scheme less accessible, especially to lower-income households who couldn’t afford the added cost of preliminary upgrades.

Another important change relates to planning permissions. Previously, air source heat pumps had to be installed at least one metre away from a neighbour’s boundary, which was a challenge for homes with smaller gardens. From May 2025, this requirement is being lifted, making it easier for homeowners in more densely populated areas to take part.

New Focus on Biomass Boilers with Cooking Functions

An interesting addition to the scheme in 2025 is the inclusion of biomass boilers that also serve as cooking appliances. These dual-purpose systems are now eligible for grant support of up to £5,000 under certain conditions:

• The property must be located off the gas grid

• It should be in a rural area

• The boiler must meet strict emissions standards

This change reflects the government’s aim to support a broader range of heating systems, especially in remote areas where heat pumps may not be suitable due to the property's energy demand or local climate.

Potential Inclusion of Heat Batteries

Looking forward, there are early signals that the Boiler Upgrade Scheme could expand to support other emerging technologies, such as heat batteries. These systems store thermal energy and release it when needed, functioning as an alternative to traditional water-based heating systems.

A pilot project involving the installation of heat batteries in 50 homes is currently underway. If successful, this could lead to full inclusion in the grant programme, opening up even more options for homeowners seeking smart, low-carbon heating solutions.

What Hasn’t Changed?

Despite all these improvements, certain fundamental aspects of the scheme remain the same:

• The property must be located in England or Wales

• The grant only applies when replacing fossil fuel systems (like gas, oil, or LPG boilers)

• Installations must be carried out by Microgeneration Certification Scheme (MCS) certified installers

• New builds are not eligible, except for custom builds

Is the Scheme Working?

The government’s intention is clear: encourage the widespread adoption of low-carbon heating to reduce the UK's carbon emissions from homes. And the changes appear to be having a positive effect.

Since the increased grant amounts were announced, installations of heat pumps have jumped considerably. Industry data indicates that the number of BUS applications doubled within a few months of the updated scheme being rolled out. However, while the growth is promising, the country is still well below the target of 600,000 heat pump installations per year by 2028.

The key challenge? Electricity is still much more expensive than gas in the UK. This means that, despite the grant, the running costs of heat pumps may not always lead to major savings unless a home is already well insulated and energy efficient.

Other Government Schemes Supporting Heating and Efficiency

While the  Boiler Upgrade Scheme is the main grant for switching to low-carbon heating, it's not the only scheme available in 2025.

The Great British Insulation Scheme (GBIS)

Running alongside the BUS, the Great British Insulation Scheme  is aimed at improving the energy efficiency of homes by offering support for cavity wall, loft, and underfloor insulation. It is especially targeted at low-income households and homes with poor energy performance certificates (EPC ratings of D or below).

This scheme complements the BUS by helping homes reduce heat loss, making any new heating system more effective and cheaper to run.

ECO4 and GBIS Pathways

Under the Energy Company Obligation (ECO4), some households may also qualify for additional support to upgrade their entire heating systems, including first-time central heating and even solar panels in off-gas areas. In many cases, these grants are fully funded, meaning eligible households pay nothing at all.

Combined with the BUS, these programmes aim to ensure that no household is left behind in the shift to cleaner energy.

How to Apply

Applying for a boiler grant through the BUS is straightforward, but it’s essential to follow the correct steps:

1. Contact an MCS-certified installer who can assess your home and recommend the best system.

2. The installer will apply for the grant on your behalf via Ofgem, the scheme’s administrator.

3. Once approved, the grant is deducted from your installation cost.

You don't apply directly as a homeowner—the installer handles the application and confirmation process. Make sure you choose an experienced installer who understands the scheme well.

Final Thoughts

The updates to boiler grants in 2025 mark a decisive shift towards a more inclusive, better-funded, and user-friendly system. With bigger grants, fewer restrictions, and more heating options, the government is clearly pushing for mass adoption of low-carbon technologies to meet its climate targets.

Whether you're already considering replacing your old boiler or you're just starting to explore your options, 2025 is shaping up to be one of the best years yet to make the switch. Not only will you lower your carbon footprint, but you could also reduce your energy bills in the long run—and take full advantage of the generous support now on offer.