Top UK Heat Pump Grants and Funding Schemes for 2025 Revealed

Introduction to 2025 Heat Pump Funding

If you’re looking to slash your carbon footprint and tame those rising energy bills, 2025 heat pump funding is your key. This year brings more support than ever before—from the Boiler Upgrade Scheme to ECO4, Warm Homes Local Grant, and beyond. Whether you’re in a cosy cottage or a modern flat, there’s a grant or rebate to match your needs.

Megawave’s R290 heat pump systems pair cutting-edge zero-carbon refrigerant technology with expert installation and maintenance. They’re designed to maximise efficiency, cut emissions and fit smoothly into existing setups. To see how you could benefit from 2025 heat pump funding and Megawave’s specialist support, check out Megawave: Eco-Friendly Heating Revolution for 2025 heat pump funding.

In this guide, we’ll break down the leading schemes, eligibility criteria, application tips and even how to sidestep scams. Ready to dive in? Let’s explore the top UK heat pump grants and find the right bolt-on for your home.

Overview of 2025 Heat Pump Funding Schemes

Across England, Scotland and Wales, homeowners can tap into several major schemes:

• Boiler Upgrade Scheme (BUS): £7,500 off air or ground source heat pump installation.
• ECO4: Support for low-income households needing heating and insulation upgrades.
• Warm Homes Local Grant: Up to £30,000 per home via local authorities in England.
• Home Energy Scotland Grant & Loan: Up to £7,500 for heat pumps plus extra support.
• Nest Wales: Whole-home energy efficiency improvements, including heat pumps.
• 0% VAT: Temporary zero-rate VAT on relevant heat pump installations.

These schemes can cut costs by up to 60% or more—sometimes covering every penny if you meet the right criteria. Let’s unpack each.

The Boiler Upgrade Scheme: A 2025 Heat Pump Funding Staple

The Boiler Upgrade Scheme (BUS) is often the first stop for 2025 heat pump funding in England and Wales. It offers:

• A flat £7,500 grant towards installing an air source or ground source heat pump.
• Or £5,000 towards a biomass boiler.

How the BUS Works

1. Find an MCS-certified installer.
2. They apply for BUS on your behalf via Ofgem.
3. Ofgem approves and deducts the grant from your final invoice.

Results? A typical installation that once cost £10,000 might now be around £2,500. Fact: the BUS drove a 63% uplift in heat pump sales in 2024.

Eligibility Requirements

• You own the property (including second homes or rentals you let out).
• You’re replacing a fossil-fuel system (gas, oil, LPG, electric).
• You have a valid EPC.
• NEW: No longer mandatory to install wall or loft insulation first.

New builds generally aren’t eligible—unless it’s a true self-build. Social housing and properties already funded under another scheme also miss out.

Pros and Cons

Pros:
– Simple flat rate.
– Wide availability until Dec 2027.
– Works for domestic and non-domestic properties.

Cons:
– Doesn’t cover full costs—upfront payment still required.
– Not for social housing or repeat applicants.
– Grant amount fixed regardless of system size.

ECO4: A Core 2025 Heat Pump Funding Route

ECO4 is the government’s fourth phase of the Energy Company Obligation, aimed at low-income or vulnerable households. It covers:

• Heat pumps as a low-carbon heating option.
• Insulation and solar PV if needed alongside the pump.

How ECO4 Works

Your energy supplier-led application includes:
– Telephone assessment: benefits, income, EPC rating.
– Home survey to confirm eligibility.
– Funding tailored to your needs—amount varies by system size and any extra measures.

Eligibility

• EPC D or below.
• Existing electric heating.
• Private homeowner or tenant (with landlord permission).
• Receipt of certain benefits (e.g., Universal Credit, JSA, Pension Credit).

Your supplier decides the final grant level; you may need a small personal contribution.

Applying

Head to the Gov.uk portal or contact an obligated supplier:
– British Gas, E.ON, Octopus Energy, Scottish Power, etc.
– Fill out the straightforward online form.
– Wait for your survey and approval.

Warm Homes Local Grant: Tailored 2025 Heat Pump Funding

Rolling out from April 2025 across 270 English local authorities, the Warm Homes Local Grant is a £500 million fund for:

• Energy efficiency improvements (loft, walls, glazing).
• Low-carbon heating systems, including heat pumps.
• Up to £15,000 per home for heating, plus £15,000 for efficiency measures.

Eligibility & Application

Three pathways to qualify:
1. Eligible postcode in Income Deciles 1 or 2.
2. Receipt of means-tested benefits.
3. Gross household income below £36,000 (or AHC threshold).

Your EPC must be band D–G. Local councils handle assessments and installations. Check your local authority’s website or call their grant team to register interest.

Home Energy Scotland: 2025 Heat Pump Funding in Scotland

Scotland’s Home Energy Scotland programme offers grants and interest-free loans:

• Up to £7,500 grant for heat pumps.
• Up to £1,500 extra for rural properties.
• Interest-free loans cover remaining costs.

Who Can Apply?

• Homeowners (not private landlords or developers).
• Homes in rural areas get bonus grants.
• Applicants must not have used the scheme since Oct 2023.

Contact Home Energy Scotland at 0808 808 2282 or via their online form to start.

Nest Wales: Targeted 2025 Heat Pump Funding

The Welsh Government’s Nest scheme tackles fuel poverty through whole-house upgrades:

• Central heating replacements (heat pumps included).
• Insulation, controls and renewables.

Who’s Eligible?

• Owner-occupiers or private tenants.
• Means-tested benefits or certain health conditions.
• Energy-inefficient homes (surveyed by British Gas).

Call the Energy Saving Trust helpline or apply online for an initial assessment and referral to British Gas.

0% VAT: Extra 2025 Heat Pump Funding Boost

From May 2023 to March 2027, you pay zero VAT on:
– Installation labour and equipment for ground and water source heat pumps.
– Eligible energy-saving materials.

It’s an automatic discount—just make sure your installer applies the VAT relief when invoicing.

Alternative Routes to 2025 Heat Pump Funding

If you don’t qualify for grants, you can still spread the cost:

• Flexible finance: Personal loans or green mortgages.
• Supplier partnerships: Octopus Energy & Lloyds Bank offer cashback and bill credits.
• Smart tariffs: Aira and others provide green energy deals that reward heat pump owners.

Choosing an MCS-certified installer like Megawave ensures you avoid hidden fees, data headaches and pushy sales tactics. Discover Megawave’s 2025 heat pump funding support and see how our R290 systems fit your budget.

Expired Grants Affecting 2025 Heat Pump Funding

Some past schemes have closed or merged, including:
– Home Upgrade Grant (now replaced by Warm Homes Local Grant).
– Renewable Heat Incentive (superseded by BUS).
– Green Homes Grant (cancelled early in 2021).

Knowing what’s off-the-table saves time and confusion.

Avoiding Scams in Your 2025 Heat Pump Funding Quest

Scammers love big grants. Stay safe by:
– Verifying MCS certification via the official registry.
– Ignoring cold calls promising “free” grants.
– Checking gov.uk or Ofgem sites for scheme details.
– Asking installers for proof of accreditation.

A genuine grant gets paid to the installer, not you directly. Keep receipts and contract terms clear.

Next Steps for 2025 Heat Pump Funding Success

Grants and funding can feel like a maze. Here’s a simple plan:
1. Check your eligibility (EPC, benefits, location).
2. Shortlist schemes that fit your profile.
3. Contact MCS-certified installers for quotes.
4. Compare costs, finance options and installer reviews.
5. Apply through official channels.

Ready to make the switch? Start your 2025 heat pump funding journey with Megawave and let our team handle the paperwork, installation and long-term support. With R290 technology, expert service and flexible finance, your low-carbon home is within reach.