Air Source Heat Pump Cost Factors and Financing Options
The factors that shape an air source heat pump quote, how the grant and the Warm Homes Loan Scheme help and how to compare quotes.
Read the guideLast checked: 30 October 2026
Heat Pump Finance Solutions for Eco-conscious Families
How to fund a heat pump, what drives the cost and how the grant and the Warm Homes Loan Scheme work together.
Overview
We help UK homeowners understand how to pay for a heat pump. This page covers the Boiler Upgrade Scheme grant, the Warm Homes Loan Scheme and the factors that shape your quote. We use published sources from GOV.UK, the Energy Saving Trust, MCS and MoneySavingExpert. Each guide below covers one topic in more detail.
We do not quote heat pump prices, running costs or savings. These depend on your home, and they change often. The most reliable figure is a written quote from an MCS-certified installer after a full survey. We show you what to look for, so you can compare quotes fairly.
Independent guide. We are not a lender or a government body. Always check current scheme rules with the official provider.
The Boiler Upgrade Scheme grant
The Boiler Upgrade Scheme gives a grant towards a heat pump or biomass boiler in England and Wales. New grant values took effect on 21 July 2026. Your MCS-certified installer applies for the grant and takes it off your bill. The table below lists every published grant value.
| Measure | Grant value |
|---|---|
| Air-to-water heat pump | £7,500 (£9,000 if replacing oil or LPG in an off-gas-grid home) |
| Ground source heat pump | £7,500 (£9,000 if replacing oil or LPG in an off-gas-grid home) |
| Air-to-air heat pump | £2,500 |
| Biomass boiler | £5,000 (off-gas-grid homes only) |
The Boiler Upgrade Scheme covers England and Wales only. Homeowners in Scotland should check official advice from Home Energy Scotland. Homeowners in Northern Ireland should check official advice from the Energy Saving Trust.
Borrowing with the Warm Homes Loan Scheme
The Warm Homes Loan Scheme sets a maximum loan for each heating measure. The maximum is £20,000 for an air-to-water heat pump and £10,000 for an air-to-air heat pump. It is £35,000 for a ground source heat pump and £20,000 for a biomass boiler. Your actual loan depends on your quote and the lender's checks.
You can combine the loan with the Boiler Upgrade Scheme grant. The grant comes off the price first, so you borrow less. A smaller loan lowers your total cost of credit. Three details are not yet confirmed. The Government has not published the eligibility rules. It has not confirmed how or when you apply. Each lender has not yet published its rates.
What shapes the cost of a heat pump
Every heat pump quote combines the same core parts. The mix of those parts explains most of the difference between quotes. Ask each installer to price every item separately. The list below explains each driver in plain terms.
- Heat pump type and size, set by a heat-loss survey of your home.
- Radiator or pipework upgrades, so your rooms heat evenly.
- A hot water cylinder, if your home needs a new one.
- Insulation work that reduces the heat your home loses.
- Electrical work to supply the new system safely.
- Outdoor space and siting for the outdoor unit.
- Installation by an MCS-certified installer, which the grant requires.
Get two or three written quotes from MCS-certified installers. Compare each item, the warranty terms and the total price after the grant.
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Frequently asked questions
How much is the Boiler Upgrade Scheme grant?
The grant is £7,500 for an air-to-water or ground source heat pump, or £9,000 when you replace oil or LPG in an off-gas-grid home. It is £2,500 for an air-to-air heat pump.
Can I get the grant in Scotland or Northern Ireland?
No. The Boiler Upgrade Scheme covers England and Wales only. Check official advice from Home Energy Scotland or the Energy Saving Trust.
How much can I borrow for a heat pump?
The Warm Homes Loan Scheme maximum is £20,000 for air-to-water, £10,000 for air-to-air and £35,000 for ground source.
Can I use the grant and the loan together?
Yes. The grant lowers the price, so you borrow less through the loan.
Why do you not show heat pump prices?
Prices depend on your home and change often. A written quote after a survey gives you an accurate figure.
Does my installer need to be MCS-certified?
Yes, for the grant. Check the installer's certification through the MCS installer search.
References
- GOV.UK – Notice of approved grant categories and values for the Boiler Upgrade Scheme (opens in a new tab)
- Energy Saving Trust – Boiler Upgrade Scheme (opens in a new tab)
- MoneySavingExpert – Warm Homes Loan Scheme news (October 2026) (opens in a new tab)
- Financial Conduct Authority – Financial Services Register (opens in a new tab)
- MCS – Find an installer (opens in a new tab)
- Home Energy Scotland – Grants and loans (opens in a new tab)