If your home runs on heating oil or LPG, the government will now pay £9,000 towards replacing your boiler with a heat pump. The increased Boiler Upgrade Scheme grant took effect on 21 July 2026 and runs until 31 March 2027, up from the previous flat rate of £7,500. It is the largest single uplift the scheme has offered since launch.
The Department for Energy Security and Net Zero (DESNZ) confirmed the change, which targets the roughly 1.7 million UK households not connected to mains gas. Homes heated by mains gas remain eligible for the standard £7,500.
Why off-gas-grid homes get more
The logic is straightforward: oil and LPG are among the most expensive and carbon-intensive ways to heat a home, and the households using them are disproportionately rural, older housing stock. These are also the homes where a heat pump swap makes the strongest financial case, since the running-cost gap between an air source heat pump and an oil boiler is wider than against mains gas.
If you are already thinking about energy independence, this grant closes a large chunk of the capital gap. The average heat pump installation cost in Q1 2026 was £13,100, so an oil-heated home claiming the full £9,000 faces a net outlay of around £4,100. Pair that with the 0% VAT rate on energy-saving materials, which runs until 31 March 2027, and the numbers are the best they have ever been.
An eligibility barrier has been removed
There is a second change worth as much attention as the headline figure. Properties no longer need to have completed the insulation recommendations on their EPC before applying. That requirement previously ruled out or delayed thousands of rural applicants whose solid-wall or hard-to-treat homes carried expensive EPC recommendations. You can now claim the grant first and tackle insulation on your own schedule, though insulating before you size the heat pump remains the sensible order if you can manage it, because a better-insulated house needs a smaller, cheaper unit.
DESNZ has committed £2.39 billion to the scheme through to 2029/30 as part of the Warm Homes Plan announced in January, so funding is not expected to run dry mid-year the way earlier rounds threatened to.
How to claim
You do not apply directly. An MCS-certified installer applies on your behalf and deducts the grant from your quote, so your first step is getting two or three quotes from certified installers and confirming they will handle the paperwork. The grant covers air source heat pumps, ground source heat pumps and, at a lower rate of £5,000, biomass boilers in eligible rural properties.
Check what fuel your property is registered as using: the £9,000 rate applies to homes currently heated by oil or LPG, and your installer will need evidence of the existing system. The window matters too. The uplift runs to 31 March 2027, and installer capacity in rural areas tightens every autumn, so if you want the work done before the next heating season, start the quote process now rather than in October.
For the 1.7 million households still burning oil or LPG, this is the clearest signal yet: the government wants you off expensive imported fuels, and for the next eight months it is paying most of the bill to get you there.
Photo by alpha innotec via Unsplash.
