Heat pumps are the UK government's preferred replacement for gas boilers, and with the £7,500 Boiler Upgrade Scheme grant now available, they're more affordable than ever. This guide breaks down exactly what you'll pay for air source and ground source heat pumps, including installation, running costs, and how the BUS grant reduces your upfront cost.
1. Air Source Heat Pump Costs (ASHP)
Air source heat pumps are the most popular type in the UK, accounting for over 85% of installations. They extract heat from outdoor air and are suitable for most homes.
| Property Size | Heat Pump Size | Cost (before grant) | After £7,500 BUS |
|---|---|---|---|
| 1-2 bed flat / small terrace | 5-7 kW | £7,000-£9,000 | £0-£1,500 |
| 3 bed semi Most Common | 8-12 kW | £9,000-£12,000 | £1,500-£4,500 |
| 4-5 bed detached | 12-16 kW | £11,000-£15,000 | £3,500-£7,500 |
2. Ground Source Heat Pump Costs (GSHP)
Ground source heat pumps extract heat from underground via buried pipes. They're more efficient than ASHPs (COP 4.0-4.5 vs 3.0-3.5) but significantly more expensive due to groundwork.
| Ground Loop Type | Garden Needed | Cost Range | After £7,500 BUS |
|---|---|---|---|
| Horizontal trenches | Large garden (~200m²) | £15,000-£22,000 | £7,500-£14,500 |
| Vertical boreholes | Small area (~4m²) | £22,000-£35,000 | £14,500-£27,500 |
Tip: GSHPs have higher upfront costs but lower running costs and longer lifespans (20-25 years vs 15-20 for ASHPs). They're best suited for larger, rural properties with available land. Compare heat pump types →
3. The £7,500 Boiler Upgrade Scheme Grant
£7,500 off your heat pump installation
The Boiler Upgrade Scheme provides £7,500 towards an air source or ground source heat pump. Your MCS-certified installer applies on your behalf - the grant is deducted from your invoice, so you never need to pay the full amount upfront.
BUS Grant eligibility
- Property in England or Wales
- Currently heated by fossil fuel (gas, oil, LPG, electric)
- Valid Energy Performance Certificate (EPC) - no loft/cavity wall recommendations
- MCS-certified installer applies on your behalf
- Scheme extended to at least March 2028
4. Running Costs: Heat Pump vs Gas Boiler
| Heating System | Efficiency | Fuel Cost | Effective Heat Cost | Annual Bill (3 bed) |
|---|---|---|---|---|
| Gas boiler | 92% | 7.5p/kWh | ~8.2p/kWh | £980-£1,200 |
| ASHP (standard tariff) | COP 3.2 | 24p/kWh | ~7.5p/kWh | £750-£950 |
| ASHP (heat pump tariff) | COP 3.2 | 10p/kWh | ~3.1p/kWh | £380-£480 |
| GSHP (standard tariff) | COP 4.0 | 24p/kWh | ~6.0p/kWh | £600-£780 |
5. Additional Costs to Consider
Radiator upgrades - £2,000-£4,000
Heat pumps run at lower flow temperatures (35-45°C vs 65-80°C for boilers). Some radiators may need upsizing - typically 2-4 radiators in older homes. Not always needed if your home is well-insulated.
Hot water cylinder - £500-£1,500
Heat pumps require an unvented hot water cylinder. If you currently have a combi boiler, you'll need one installed. Typically 200-300 litres for a family home.
Electrical upgrade - £300-£800
Some properties may need a consumer unit upgrade or new circuit for the heat pump. Your installer will check during the site survey.
Insulation improvements - varies
Good insulation is essential for heat pump efficiency. If your home has poor insulation, addressing this first will significantly improve performance and comfort. The BUS grant requires adequate loft and cavity wall insulation.