Boiler Upgrade Scheme: Eligibility and Process

The Boiler Upgrade Scheme is usable on rentals and pays a big chunk of a heat pump, but it will not magic you a free system. You still need to stump up GBP 2,500-7,500 per property in most cases.

What the Boiler Upgrade Scheme offers

Current grants in England and Wales (2026 rules):

• GBP 7,500 for an air source heat pump (ASHP, air-to-water).
• GBP 7,500 for a ground or water source heat pump (including shared ground loops).
• GBP 5,000 for a biomass boiler (only in rural, off-gas areas).

From late 2026, a separate GBP 2,500 grant for air-to-air heat pumps and heat batteries is due to launch, sitting alongside BUS but not replacing it.

One grant per property, paid as an upfront capital grant direct to your MCS installer and deducted from your quote. You never see the money.

Eligibility in 2026: landlords included

Core conditions from Ofgem's Boiler Upgrade Scheme Regulations and property-owner guidance:

• The property must be in England or Wales and be an existing building (most new builds are excluded).
• The grant must replace fossil fuel heating (gas, oil, LPG, direct electric). No grants for hybrid systems.
• You must be the property owner. That includes:
• Private landlords.
• Owner-occupiers.
• Second homes and some small non-domestic buildings.

EPC requirement:

• You must have a valid EPC less than 10 years old.
• Since 8 May 2024, there is no requirement to complete loft and cavity insulation first; that minimum-insulation rule has been removed, though it is still recommended.

One BUS voucher per property. No previous BUS voucher for the same property.

For landlords specifically: Ofgem guidance explicitly references situations "where a property owner is a landlord", requiring you to confirm you have told your tenant about the impacts and to give consent to the installer's voucher application.

There is no rule banning grants on rented property. Forums that say "homeowners only" are wrong.

How the application works in practice

Steps, stripped of fluff:

1. You pick an MCS-certified installer (check via MCS register or BUS "find an installer" tools).
2. Installer surveys the property, designs the system, prices the job, and confirms BUS eligibility.
3. Installer applies to Ofgem for a BUS voucher on your behalf, using your details as property owner.
4. Ofgem checks there is a valid EPC and that previous vouchers have not been used for that address, then issues a voucher to the installer.
5. Installer gives you a quote net of the grant (e.g. "Total GBP 12,000 minus GBP 7,500 BUS = you pay GBP 4,500").
6. After installation and commissioning, the installer redeems the voucher from Ofgem.

There is no landlord-only portal; your role is to pick the installer, sign consent and pay the balance.

Cost vs grant: what you actually pay

Current market ranges for ASHPs, before BUS:

• Air source heat pump installation: GBP 8,000-15,000 depending on size, emitters and cylinder.
• Ground source heat pump: typically GBP 18,000-25,000+ including ground works.

BUS deducts GBP 7,500, so your real outlay on an ASHP is usually:

• Low end: GBP 8,000 - 7,500 = GBP 500 (rare, small well-insulated homes).
• Typical BTL: GBP 10,000-13,000 - 7,500 = GBP 2,500-5,500.
• High end: GBP 15,000 - 7,500 = GBP 7,500.

Compare to a gas boiler swap: GBP 2,500-3,500 installed. You are often paying similar or more for a heat pump even after grant, but you get:

• Better EPC score.
• Future-proofing against gas regulation and price risk.

EPC uplift and property value

EPC-wise, heat pumps are powerful because they hit both carbon and running-cost assumptions.

On a typical 2-3 bed gas-heated D/F-rated house with poor boiler and controls, a heat pump, if sized correctly and combined with basic insulation, can jump you 2 bands (for example from E 40 to C 70).

The actual uplift will depend on:

• Whether you also upgrade fabric.
• Whether you add smart controls and, ideally, solar.

Valuation evidence is still thin, but ONS and lender studies show:

• Properties at EPC C or above sell at a small premium (2-5%) compared with D/E, especially in London and the South East.
• For rentals, Trust for London and TMW data suggest C-rated PRS units void less and attract more applications, which feeds through into achievable rent and lower void-loss, rather than a simple "GBP X price premium".

So you should treat BUS as:

• A tool to hit EPC C without doing ludicrous wall insulation on some stock.
• A way to keep the property mortgageable if lenders tighten EPC rules.

Running costs: heat pump vs gas boiler

At 2025-26 price caps, heat pumps can be similar cost to gas for many standard houses, slightly worse for small, low-demand homes, and better than direct electric and oil.

Indicative annual running costs at typical 2025 tariffs:

2-3 bed house (12,000 kWh heat demand):

• ASHP: ~GBP 1,205/year.
• Gas boiler: ~GBP 1,130/year.

4+ bed (17,000 kWh):

• ASHP: ~GBP 1,700/year.
• Gas: ~GBP 1,615/year.

So heat pumps are currently slightly more expensive than gas on bills in many cases, but:

• Much cheaper than direct electric or oil (often GBP 2,000+).
• Likely to look better if carbon pricing pushes gas up relative to electricity.

For you as a landlord: Heat pump will not yet save most tenants hundreds a year over gas like some marketing claims, but it does make a big difference vs panel heaters and old oil.

Practical issues for rentals

You need to think like a landlord, not a heat-pump evangelist.

1. Tenant disruption

Install usually means:

• A day or more on site.
• New cylinder cupboard, bigger radiators, new pipe runs.
• You will likely need access to every room and to shut heating/hot water off temporarily.

This is easier between tenancies than in a full AST.

2. Space and noise

External unit needs:

• Clear airflow and compliant siting under planning rules.
• Enough distance from neighbours to avoid noise complaints.
• Flats with no private outdoor space are harder; freeholders and managing agents can block you.

3. Maintenance and call-outs

Heat pumps are reliable but more complex than a combi; you must budget for annual servicing and make sure your contractors know what they are doing.

You are still on the hook for breakdowns and response times under fitness-for-habitation and HHSRS.

4. Tenant expectations

Heat emitters often run warm all the time rather than blazing hot intermittently.

If tenants are used to "on full blast for an hour", you need to explain controls, or they will crank settings and complain about bills.

What forums get wrong about BUS for landlords

Myth 1: "Landlords cannot use BUS, it is only for owner-occupiers."

Reality: Ofgem's property-owner guidance explicitly includes landlords as eligible property owners; the only extra requirement is that you inform tenants and give consent for the voucher.

Myth 2: "The grant covers the full cost of a heat pump."

Reality: Typical installs are GBP 10,000-15,000; BUS gives GBP 7,500, leaving GBP 2,500-7,500 for you to pay.

Myth 3: "You still need to fully insulate the property before BUS will pay out."

Reality: Since 8 May 2024, the "no loft/cavity recommendations on EPC" rule has gone. There are no minimum insulation requirements for properly-made applications after that date, although insulation is still recommended.

Myth 4: "Heat pumps always slash bills compared to gas."

Reality: At current tariffs, heat pumps are often roughly level with gas for typical houses, sometimes slightly worse on pure bill cost, and much better than direct electric/oil. You are mainly buying EPC uplift and future-proofing, not instant savings on every property.

Myth 5: "Ground source gets the same GBP 7,500, so it is always better value than air source."

Reality: GSHP installs regularly cost GBP 20k+, so even with GBP 7,500 grant, you are often GBP 12-15k out of pocket. ASHP is the realistic BUS route for most rentals.

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