Renewable

What is the Boiler Upgrade Scheme?

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Understanding the Boiler Upgrade Scheme (BUS)

In Spring 2022, after the Domestic RHI closed, a new Government funding programme opened to help homeowners make the switch from a fossil fuel boiler to a renewable heating source, such as an air source heat pump. The Boiler Upgrade Scheme (formerly known as the Clean Heat Grant) is open to applicants who can claim £7,500 towards the installation of an air source heat pump to replace their existing boiler. To be eligible, installations need to fulfil the Scheme criteria which we take a closer look at in this blog.

To help homeowners understand this scheme, we have put together a series of Q&As relating to the Boiler Upgrade Scheme here. The answers given below are correct at the time of publication.

[This blog was originally published on 14th January 2022 and is regularly reviewed & updated with BUS updates. The content was most recently updated on 20th October 2023]

Important: BUS applications submitted on or after 23rd October 2023 are eligible to claim £7,500 towards their new air source heat pump, an increase from £5,000 which was previously available through BUS.

Why has the Boiler Upgrade Scheme been introduced?

When the Government announced its Heat and Buildings Strategy in the Autumn of 2021, emphasis was placed on air source heat pumps as a low carbon heating solution which could significantly help reduce the carbon footprint of household heating. A lot of homes today are currently kept warm by a traditional fossil fuel boiler, such as a gas or oil boiler, but as the country moves towards achieving Net Zero, many homes will need to turn to renewable energy to reduce their dependency on high carbon fuels. This is where air source heat pumps, such as the Aerona³ heat pump from Grant, can step in.

Air source heat pumps, which utilise the heat energy in the air and transfer it into useable energy within a heating system, are already helping thousands of UK homes with their heating and hot water. Installing an air source heat pump is not the same as installing a boiler so the installation costs can be higher. This is one of the reasons why the Government introduced the Boiler Upgrade Scheme (BUS) to provide consumers with financial support to assist their transition to low carbon heating.

What funding is available through the Boiler Upgrade Scheme?

The Boiler Upgrade Scheme (BUS) provides eligible applicants with a capital grant to support their installation of a low carbon heating system. Through the BUS, grants of £7,500 are available towards the installation and capital costs of air source heat pumps and, in some limited circumstances biomass boilers, with grants of £7,500 available for ground source and water source heat pumps.

Through BUS, £450 million of funding has been made available between 2022 and 2025.

Who is eligible for the Boiler Upgrade Scheme?

The BUS is open to applicants in England and Wales. The grants are available to domestic and non-domestic buildings, supporting systems up to a capacity of 45kWth. Social housing and new builds are not eligible however, domestic, custom new/self-builds can apply.

Air source heat pumps and ground source heat pumps are eligible provided they are being installed to replace an existing fossil fuel system or direct electric heating system. The only exception to this is with custom new builds whereby a heat pump installation would be eligible for a grant.

In limited circumstances, biomass boilers can be eligible for a grant in rural areas when they are replacing an existing fossil fuel system which is not fueled by mains gas or direct electric systems.

Please be advised the fossil fuel hybrid systems or systems used for process heating are not eligible.

Why should I switch to a renewable energy heating system?

Besides the financial incentive offered through the Boiler Upgrade Scheme, switching to a more sustainable heating solution, such as an air source heat pump, has a whole range of benefits. One benefit is the more positive impact that a renewable heat source has on the environment. Air source heat pumps are low carbon sources of heat, utilising the heat energy in the air and using this to heat your home and running on electricity, rather than fossil fuels.

Another benefit is efficiency. When designed and installer properly, heat pumps can heat your home incredibly efficiently - for example, the Aerona³ R32 6kW heat pump has an exception SCOP of 4.62 which means that for every kilowatt of energy used to run the heat pump, over 4kW of energy is being given to the heating system in return. 

Furthermore, air source heat pumps are very low maintenance and, if looked after properly, will last for many years of reliable operation. 

How do you apply for the Boiler Upgrade Scheme?

Ofgem are administering the Scheme and vouchers are provided as part of the grant application and redemption process, a process which is led by the installer.

The installer will need to submit two applications – a BUS voucher application and a redemption application. Provided the BUS voucher application meets the eligibility criteria and consent from the property owner is received, Ofgem will then issue a BUS voucher. This BUS voucher can then be redeemed once the new heating system has been installed and commissioned. The grant will be paid to the installer, thus reducing the invoicing cost for the homeowner.

What are the key BUS requirements?

It is important that both the installing engineer and homeowner are aware of the full list of eligibility requirements for the Scheme. The heat pump unit that is selected will need to meet certain performance and efficiency thresholds, for example the heat pump installed must have a minimum SCOP of 2.8. The installer who completes the installation will also need to meet certain requirements. Alongside being a competent heat pump engineer, all installers participating in the Scheme will need to be MCS certified and members of a Consumer Code that will ensure that customers are protected by a Trading Standards Institute Approved Code of Practice.

What are the key dates?

The BUS opened to eligible installations commissioned and MCS certified after 1st April 2022. In September 2023, the Department for Energy Security and Net Zero issued a change notice to increase the BUS grant level for air source heat pumps and ground source heat pumps. From 23rd October 2023, installers can apply for the newly increased grant amounts.

For the latest information and further details about the procedures to apply for the Boiler Upgrade Scheme, please refer to www.ofgem.gov.uk/environmental-and-social-schemes/boiler-upgrade-scheme-bus. The Department for Business, Energy and Industrial Strategy have also published a useful guide about the Boiler Upgrade Scheme which you can download here

To learn more about air source heat pumps, and other sustainable heating solutions, contact the team at Grant today.

Helen Rishworth
Content & Communications Manager at Grant UK
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