A new government grant offering £9,000 towards the installation of a heat pump is set to launch next week, specifically targeting homes that currently rely on heating oil or Liquid Petroleum Gas (LPG). From 21 July 2026, eligible homeowners in England and Wales will be able to apply for the enhanced funding, which aims to support the transition to more sustainable and potentially cheaper heating solutions.
The initiative comes as heating oil prices have seen significant volatility, with kerosene averaging over £1 per litre in June 2026 – a peak observed over the past eight years. Heat pumps, which operate by drawing heat from the air or ground to warm homes and provide hot water, offer an alternative that could shield households from future fossil fuel price surges and reduce carbon emissions. Combining a heat pump with a smart electricity tariff could further optimise running costs.
To qualify for the £9,000 grant, applicants must own their property, whether it's their primary residence or a rental, and importantly, must be situated off the main gas grid. Furthermore, the grant is specifically for those replacing an existing heating system that utilises heating oil or LPG, and the property must possess a valid Energy Performance Certificate (EPC). This new grant offers a more substantial sum than the existing Boiler Upgrade Scheme, which provides up to £7,500 for replacing other fossil fuel systems, such as gas, with heat pumps or biomass boilers.
The application process involves obtaining quotes from installers registered with the Microgeneration Certification Scheme (MCS), ensuring adherence to strict installation standards for renewable technologies. Homeowners can locate qualified installers via the MCS website, Which? Trusted Traders, or by contacting an energy supplier. Once an eligible installer is chosen, they will apply for the grant on the homeowner's behalf through the energy regulator Ofgem, with the grant amount directly deducted from the installation cost.
While many homes are suitable for heat pumps, potential applicants are encouraged to assess whether the technology aligns with their specific property and lifestyle. Factors such as the home's size, type, and location, as well as the potential need for larger radiators or additional insulation to maximise efficiency, should be considered. For those in Scotland, similar support is available through Home Energy Scotland, while Northern Ireland residents may find financial assistance via the Northern Ireland Sustainable Energy Programme.