The 2026 Grant Landscape at a Glance
The UK government and energy suppliers fund several schemes to cut the cost of switching to low-carbon heating and generation. Here is every incentive available in 2026, who qualifies, and how they stack.
| Scheme | What it covers | Amount | Who qualifies | Ends |
|---|---|---|---|---|
| Boiler Upgrade Scheme (BUS) | Air/ground source heat pump | £7,500 (£9,000 off-gas) | Any home replacing fossil-fuel heating, EPC required | Funded to Mar 2028 |
| 0% VAT | Heat pump, solar, battery install | ~20% saving | All domestic installs | 31 Mar 2027 |
| Smart Export Guarantee (SEG) | Exported solar electricity | 3–15p/kWh ongoing | Any MCS-certified solar install with smart meter | Ongoing |
| ECO4 | Insulation, heating upgrades | Varies (often fully funded) | Lower-income / vulnerable households | 31 Dec 2026 |
| Warm Homes: Local Grant | Insulation, heating, solar | Up to £15,000 | Low-income / EPC D–G households (council-run) | Varies by LA |
The Boiler Upgrade Scheme (BUS) in Detail
The BUS is the main incentive for heat pumps. Key rules in 2026:
- Standard grant: £7,500 towards an air source heat pump.
- Enhanced grant: £9,000 for homes genuinely off the mains-gas grid (oil, LPG, electric storage heaters), applications 21 July 2026 – 31 March 2027.
- Eligibility: property in England or Wales with a valid EPC, replacing an existing fossil-fuel heating system. The old insulation prerequisite was removed in 2026.
- How it works: the grant is deducted from your quote at source — you never pay it and reclaim it. As an MCS-certified installer we handle the application.
0% VAT on Heat Pumps, Solar and Batteries
Since April 2022, domestic installations of heat pumps, solar panels and batteries attract 0% VAT — saving roughly 20% on the total cost. This applies automatically (you do not need to claim it separately) and runs until 31 March 2027.
This stacks with every other scheme: you get the BUS grant AND 0% VAT AND SEG payments.
The Smart Export Guarantee (SEG)
The SEG pays you for every unit of solar electricity exported to the grid. Unlike the old Feed-in Tariff, the rate is set by your supplier, not the government — so it pays to compare. Typical 2026 rates run from 3p to 15p/kWh, with most in the 5–12p band.
You need an MCS certificate and a smart meter to claim — both of which we handle as part of a solar installation.
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ECO4 and the Warm Homes: Local Grant
These are income-based schemes that can fully fund insulation, heating upgrades and sometimes solar for eligible households. ECO4 runs to 31 December 2026; the Warm Homes: Local Grant is council-administered and can provide up to £15,000.
If you think you may qualify, we can check eligibility as part of the survey process.
How the Grants Stack Together
The most powerful approach in 2026 is stacking multiple incentives on a single project:
- Heat pump: £7,500–£9,000 BUS grant + 0% VAT = a £12,000–£14,500 install netting down to roughly £4,000–£6,000.
- Add solar: 0% VAT + ongoing SEG payments on top.
- Add a battery: 0% VAT (even when retrofitted separately).
- Lower-income households: ECO4 or Warm Homes can fund insulation and sometimes the heat pump itself.
Done as a coordinated whole-home project, the combined savings can be transformative.
→ Whole-home energy retrofit guide → How to reduce energy bills UK → Solar panel grants UK 2026
How We Handle the Paperwork
As an MCS-certified, RECC-member installer, we manage the entire grant process:
- BUS application submitted on your behalf — the grant is deducted before you pay.
- MCS certificate registered on completion — required for the grant and SEG.
- 0% VAT applied automatically on your invoice.
- SEG registration guided as part of the solar handover.
You get the money without the admin.
Frequently asked questions
The main grant is the Boiler Upgrade Scheme (BUS): £7,500 for air source heat pumps, or £9,000 for off-gas-grid homes (21 July 2026 – 31 March 2027). All installations also attract 0% VAT until March 2027. Lower-income households may qualify for ECO4 or the Warm Homes: Local Grant.
There is no upfront solar grant for most households, but solar attracts 0% VAT (saving ~20%), the Smart Export Guarantee pays you for exported electricity (3–15p/kWh), and income-based schemes like ECO4 can fund solar for eligible homes.
Yes. The BUS heat pump grant, 0% VAT on solar and batteries, and SEG all stack. Many customers install a heat pump and solar together in a single project.
Not any more. The old rule requiring loft/cavity insulation improvements before claiming the BUS grant was removed in 2026. Insulation is still strongly recommended for performance, but it is no longer a barrier to the grant.
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