Funding

Heat Pump Funding

The Government has demonstrated its commitment to decarbonising heat and buildings through policy and billions of pounds of funding.
Homeowners

Funding for homeowners

  • Boiler Upgrade Scheme (BUS)

    Opened in April 2022 in England and Wales, the Government’s Boiler Upgrade Scheme (BUS), offers households capital grants to replace fossil fuel heating systems with more efficient low-carbon heat pumps. Homes retrofitting ground source heat pumps will receive £7,500 when the system is commissioned. As this is a domestic scheme, there is a 45kW heat pump size limit per property. Social landlords and new buildings (except custom-built) are not eligible. The Government has announced a further £1.5 billion of funding for the BUS, which covers the spending review period from 2025 to 2028. Calculations by the Heat Pump Association suggest this will fund 206,000 heat pump installations.
  • Scottish Funding

    Homeowners can apply for grant funding of up to £7,500 for energy efficiency improvements (up to 75% of the combined cost) through a Home Energy Scotland grant or loan. A rural uplift is also available to support rural and island homes, taking the total grant amount up to £9,000. Another £7,500 may be accessed through an optional interest-free loan (there is an administration fee of 1.5% of the total loan, a maximum of £150).
Social landlords

Funding for social landlords

  • Warm Homes: Social Housing Fund

    The government committed to the Social Housing Decarbonisation Fund (SHDF) in 2019, with a proposed £3.8bn available over a 10-year period. The SHDF will upgrade a significant amount of social housing stock to an Energy Performance Certificate rating of C through insulation measures or retrofitting inefficient heating, improving energy performance and lowering bills.
  • The Energy Company Obligation (ECO)

    The ECO is a Government grant for retrofitting ground source heat pumps into social housing properties. It legally obliges larger energy suppliers to fund efficiency measures for domestic energy users.
  • ECO4

    The government’s response to ECO4 consultation sets out the policy of the scheme from April 2022 until March 2026. Please click on the link below to find out more about ECO4.
Local authorities

Funding for local authorities

  • Public Sector Decarbonisation Scheme (PSDS)

    The Public Sector Decarbonisation Scheme (PSDS) is a £1 billion fund dedicated to heat decarbonisation and capital energy efficiency projects in non-domestic public sector buildings across England. Covering up to 88% of ground source heat pump installation costs, the scheme’s objective is to achieve significant carbon savings within the sector.
Developers

Funding for developers

  • Green Heat Network Fund (GHNF)

    The Green Heat Network Fund intends to help new and existing heat networks transition to low—and zero-carbon technologies. It is anticipated to run from April 2022 to November 2024. Aimed at developers and investors in low-carbon heat networks, such as Shared Ground Loop Arrays, the objectives are to achieve carbon savings, increase the amount of low-carbon heat utilisation in heat networks and help prepare the market for low-carbon regulation.
Kensa Funding

Heat pump funding through Kensa

  • Ground Array Funding

    Ground array funding covers the cost of the groundwork for ground source heat pumps. Through this scheme, arranged by Kensa Utilities, an investor funds the network – known as Shared Ground Loop Arrays – to cover the most expensive aspect of the project. In return, the investor can charge connection fees if they wish. Meanwhile, the developer or property owner benefits from a cheaper project, with all the efficient advantages of ground source over air source.
  • ZERO

    ZERO enables social housing providers and local authorities with a housing stock of 3,000+ homes to access whole stock retrofit with no upfront costs. Kensa will manage the delivery of this, including the installation of heat pumps, PV and batteries for a diverse range of building types.