If your home runs on heating oil or LPG, the Boiler Upgrade Scheme just got more generous. From 21 July 2026, properties currently heated by oil or liquid petroleum gas qualify for a £9,000 grant toward the cost of an air-source or ground-source heat pump — up from the standard £7,500. Homes on mains gas stay at £7,500.

The increase came into effect this week, and the timing matters. Oil prices have been volatile following tensions in the Middle East, and rural households on heating oil have been disproportionately hit. The government put the additional £50+ million into the scheme specifically to make the economics work for people who have no access to gas and whose fuel bills have been particularly unpredictable over the past eighteen months.

Who Qualifies for the Higher Grant

The rule is straightforward: if your current primary heating system uses heating oil or LPG (bottled gas or a tank), your Boiler Upgrade Scheme voucher will be worth £9,000 rather than £7,500. You need to be the homeowner or landlord, the property needs to have a valid EPC (Energy Performance Certificate) with no outstanding recommendations to improve loft or cavity wall insulation, and the installation must be carried out by an MCS-certified heat pump installer.

What doesn’t change: the scheme is still first-come, first-served on vouchers, you still apply through your installer rather than directly, and the grant is applied as a discount on your installation invoice rather than arriving as a cheque. The installer claims it back from the government on your behalf.

The £9,000 uplift is available until 31 March 2027, which is when the current Boiler Upgrade Scheme funding round ends. Whether it continues at that level after March 2027 depends on the next funding settlement — though the government has committed £2.39 billion to the scheme through to 2029/30 as part of the Warm Homes Plan, so the scheme itself isn’t going anywhere.

What the Costs Actually Look Like

Let’s put some numbers on this. The average heat pump installation cost for a rural property in the UK in 2026 is around £13,000 to £16,000 for an air-source system, depending on the size of your home and what work is needed on the distribution system (radiators, underfloor heating, pipework).

With a £9,000 grant, your out-of-pocket cost on a £14,000 installation is £5,000. Compare that to replacing a standard oil boiler, which typically costs £2,500 to £4,500 for the unit and installation — but leaves you still buying heating oil, which is currently around 70-80p per litre and highly volatile.

The running cost calculation is the honest conversation. A heat pump running on an efficient tariff — Octopus Cosy, Go, or similar off-peak electricity rates — should deliver heating costs that are lower than oil in most cases, but this depends heavily on your current oil consumption, your home’s insulation, and the heat pump’s real-world COP in your specific house. Getting a proper heat loss calculation from a qualified installer before committing is essential. Don’t rely on rule-of-thumb estimates.

Ground-source heat pumps attract the same £9,000 grant for oil/LPG properties and typically cost more to install — £18,000 to £25,000 — but run at higher efficiency. For properties with land and favourable ground conditions, GSHP can make financial sense over a longer payback period.

The MCS Requirement

The grant only applies to installations by MCS-certified installers. MCS (Microgeneration Certification Scheme) is the industry quality standard for heat pump installers and is what distinguishes properly trained, quality-assured contractors from those who haven’t completed the training. You can find certified installers at mcscertified.com.

MCS certification matters beyond just grant eligibility. An MCS install comes with an installation certificate that’s required for grid connection and that serves as documentation if you sell your house. It’s also what your home insurer and any finance provider will ask for.

If You’re on Heating Oil: the Window is Now

Here’s the practical point. The Warm Homes Plan, the Future Homes Standard taking effect in March 2027, and the direction of travel on oil heating all point the same way: if you’re planning to replace your oil boiler eventually, you’re going to be doing it. The question is whether you do it now with a £9,000 grant and your choice of MCS installer, or later when the grant structure may have changed.

Nobody can tell you the grant will definitely continue at £9,000 after March 2027. What we know is that it’s available now, the scheme is funded through to 2029/30, and the government has been increasing rather than reducing support for oil-heated properties.

Getting a heat loss survey from two or three MCS installers costs nothing and will tell you what size system your property actually needs, what your distribution system needs to be heat-pump ready, and what your realistic running costs look like. That’s the right starting point before any other decision about timing.

One thing that catches people out: the EPC outstanding recommendations requirement. If your EPC flags uninsulated cavity walls or a loft that needs topping up, you’ll need to sort those first — they’re prerequisites for the grant. Check your property’s current EPC at the government portal before booking installer surveys. If it flags insulation issues, a few hundred pounds of loft insulation now unblocks £9,000 of grant funding, which is a fairly easy call.