Homeowners with oil boilers can access several grant schemes to switch to a heat pump, significantly reducing or eliminating the upfront cost.
The BUS provides £7,500 towards an air source heat pump. There is no means testing and the grant is applied for by your MCS-certified installer through Ofgem. The scheme has been extended to run until March 2028.
ECO4 offers fully funded heating replacements for qualifying households. You may be eligible if you receive certain benefits (Universal Credit, Pension Credit, Child Tax Credit) or if your property has an EPC rating of D to G. Under ECO4, the entire cost of removing your oil boiler and installing a heat pump can be covered.
Scottish homeowners can apply for interest-free loans up to £7,500 plus cashback grants of £7,500 to £9,000 through Home Energy Scotland, making heat pump installations extremely affordable north of the border.
Replacing an oil boiler with a heat pump delivers substantial annual savings on heating bills.
| Cost Factor | Oil Boiler | Air Source Heat Pump |
|---|---|---|
| Annual fuel usage | 1,500–2,000 litres | 3,500–5,000 kWh electricity |
| Annual fuel cost | £1,200–£1,800 | £600–£900 |
| Annual saving | — | £600–£900 |
| Additional savings | — | No tank maintenance, no fuel delivery charges |
Heat pumps are approximately three times more efficient than oil boilers, delivering 3kW of heat for every 1kW of electricity consumed. This means significant long-term savings even as energy prices fluctuate.
Yes. Through the ECO4 scheme, qualifying households can receive a fully funded oil boiler replacement with an air source heat pump at no cost. Eligibility depends on your income, benefits, and property EPC rating.
After the £7,500 BUS grant, the remaining cost for a typical air source heat pump installation ranges from £500 to £6,500, depending on system size and any additional work required such as radiator upgrades or pipework modifications.
Yes. The Boiler Upgrade Scheme has been extended and will continue to run until March 2028, providing £7,500 towards heat pump installations for eligible homeowners in England and Wales.
Removing the oil tank is recommended but not required. Professional oil tank removal typically costs £300 to £800 depending on the tank size and location. Decommissioning ensures no future environmental liability from leaks.