If you’ve been quoted for an air source heat pump and you’re trying to work out what you’ll actually pay after the government grant, the short answer is: installed cost typically £8,000–£14,000 for an average UK home, minus a flat £7,500 off the top via the Boiler Upgrade Scheme, leaving a net cost roughly comparable to — or sometimes cheaper than — a new gas boiler with modern radiators and cylinder work included. But that headline hides a lot of the detail that actually determines whether an ASHP is a good financial decision for your specific house, and it’s worth being precise about it rather than working from a rounded “£10k, grant covers most of it” assumption that may not survive contact with your actual survey.
This is also one of the most consistently confused numbers in UK renewables content: people search “heat pump cost after grant” and land on pages that quietly conflate the £7,500 Boiler Upgrade Scheme with solar panel funding, or apply it to a ground source install without flagging the different rate. Neither mistake is harmless if you’re budgeting a real project. Here’s what the numbers genuinely look like in 2026, what the grant does and doesn’t cover, and how the running-cost maths compares with gas — including where solar changes the picture.
What an air source heat pump actually costs installed
Air source heat pump (ASHP) pricing depends heavily on house size, existing insulation, radiator or underfloor heating compatibility, and whether you need a new hot water cylinder. As a working range for a typical UK home in 2026:
| System type | Typical installed cost (before grant) | Notes |
|---|---|---|
| Small flat/terrace, well-insulated | £8,000–£10,000 | Smaller unit, may reuse existing radiators |
| Average 3-4 bed semi/detached | £10,000–£14,000 | Most common scenario; often needs some radiator upgrades |
| Larger detached, poor insulation | £14,000–£18,000+ | May need larger unit, full radiator replacement, bigger cylinder |
| Ground source heat pump (for comparison) | £20,000–£35,000 | Higher cost due to ground loop/borehole works; different BUS rate applies |
These figures cover the heat pump unit itself, installation labour, a hot water cylinder (if you don’t already have a suitable one — most gas combi households don’t), and any pipework changes. They don’t automatically include a full radiator replacement across the house, which is often the single biggest variable: heat pumps run at lower flow temperatures than a gas boiler, so undersized radiators sometimes need upsizing to keep rooms warm, and that can add anywhere from a few hundred pounds per radiator to a few thousand pounds across a whole house. A proper installer survey — ideally including a room-by-room heat loss calculation, not a rule-of-thumb estimate — is the only reliable way to know whether your specific radiators need touching. Carbon Legacy, which works across renewables and heat pump installs, is a good example of an installer that will do this survey properly rather than quoting off a floor-plan guess, and YEERS covers heat pump installs alongside solar and battery work across Yorkshire if you’re weighing several renewable upgrades together.
The £7,500 Boiler Upgrade Scheme — what it covers and what it doesn’t
The Boiler Upgrade Scheme (BUS) is a genuine, no-repayment government grant — not a loan, not means-tested — worth £7,500 off an air source heat pump installation (ground source heat pumps also qualify, at the same £7,500 rate in most cases; some biomass boiler installs have historically had a separate lower rate, so check current terms). It’s paid directly to your installer, who deducts it from your quote, so you don’t handle the paperwork or wait for a reimbursement — the price you’re quoted should already have it subtracted if your installer is MCS-certified and BUS-registered, which they need to be to process the grant at all.
Two things trip people up constantly:
It does not cover solar panels or battery storage. This is the single most common mix-up in this space. The BUS is specifically for heat pump (and some biomass boiler) installations under the government’s home decarbonisation push. If you’re planning a heat pump and solar PV as a combined project — which is a genuinely sensible pairing, covered below — budget them as two separate cost lines. The £7,500 only ever touches the heat pump side of the invoice; your solar quote needs to stand on its own, and it will separately benefit from 0% VAT on residential installs (running until 31 March 2027) rather than any BUS-style grant. If you want the detail on what solar actually costs once VAT and other factors are priced in, our cost of solar panels in the UK guide breaks down real 2026 system pricing by size.
It’s a flat amount, not a percentage. £7,500 off a £9,000 install is a much bigger proportional saving than £7,500 off a £16,000 install on a larger, harder-to-heat property. That’s worth factoring into an early decision on scale and scope — sometimes it’s more cost-effective to combine the heat pump with some fabric improvements (loft insulation, cavity wall insulation) to reduce the required heat pump size and running cost, rather than oversizing the unit to compensate for a leaky building. heatpumpinstallationgrants.co.uk is a useful dedicated resource for the current BUS rules, eligibility criteria (you generally need to be replacing a fossil fuel heating system, and the property needs to have loft/cavity insulation where applicable, or a plan to install it) and how the application and installer-registration process actually works in practice.
So, worked example: a typical 3-4 bed semi quoted at £12,000 installed, minus the £7,500 grant, comes out at roughly £4,500 net — genuinely competitive with, or cheaper than, a new gas boiler and cylinder once you account for the fact that a heat pump install often bundles in a hot water cylinder and some pipework that a like-for-like boiler swap wouldn’t need anyway.
Running costs: heat pump vs gas boiler
This is where the “is it actually worth it” question gets answered, and it depends on three things: your electricity price, your gas price, and your heat pump’s efficiency (its Coefficient of Performance, or CoP).
A well-installed, correctly-sized ASHP typically achieves a seasonal CoP of around 2.5–3.5 in UK conditions — meaning for every 1 kWh of electricity it consumes, it delivers 2.5–3.5 kWh of heat. A modern gas boiler, by contrast, is close to 90-94% efficient — for every 1 kWh of gas burned, you get roughly 0.9 kWh of heat, because gas boilers don’t have the CoP “multiplier” effect a heat pump gets from extracting ambient heat from the air.
With typical UK price caps of roughly 25p/kWh for electricity and around 6-7p/kWh for gas (both vary with the Ofgem price cap and your specific tariff), the effective running cost per kWh of heat delivered looks like this:
- Gas boiler: ~6.5p ÷ 0.92 efficiency ≈ 7.1p per kWh of heat
- Heat pump at CoP 3.0: 25p ÷ 3.0 ≈ 8.3p per kWh of heat
- Heat pump at CoP 3.5 (well-optimised system): 25p ÷ 3.5 ≈ 7.1p per kWh of heat
At current UK price cap ratios, a heat pump running at a genuinely good CoP is roughly cost-parity with gas, not dramatically cheaper — and a poorly-sized or poorly-installed system running at CoP 2.5 or below can end up costing more to run than gas did. This is precisely why installer quality and correct sizing matter more for heat pumps than for a boiler swap: a badly commissioned heat pump doesn’t just underperform, it can make your bills worse, which is the opposite of what most homeowners are trying to achieve. It’s worth asking any installer for their expected seasonal CoP for your specific property and getting it in writing, not just a headline “up to 4x efficient” marketing figure.
None of this accounts for the wider decarbonisation case — a heat pump run on grid electricity that’s increasingly wind and solar-generated has a much lower carbon footprint than gas, even before you add your own solar — but on pure running-cost economics, the gap between gas and heat pump has narrowed considerably from where it stood a few years ago, largely because the electricity-to-gas price ratio in the UK remains stubbornly high compared with most of Europe.
Where solar changes the maths
This is the genuinely compelling combination, and it’s worth being specific about why. A heat pump run purely on grid electricity at 25p/kWh is competing with gas on fairly even terms, as above. But a heat pump that can draw a meaningful share of its electricity from your own solar panels — even accounting for the fact that UK heating demand peaks in winter, when solar generation is lowest — changes the economics materially, because self-generated solar electricity effectively costs nothing per kWh once the system’s paid for itself.
The practical caveat: solar generation and heat pump demand are largely out of phase in the UK. You generate most in summer (when you need little to no heating) and need most heating in winter (when you generate least). A rooftop solar array typically only offsets a modest share of a heat pump’s annual electricity use directly — but adding a home battery captures more of the daytime summer/shoulder-season surplus for use in the evening, and if you’re also running the heat pump’s hot water cycle during sunny daytime hours (many systems let you schedule this), you can meaningfully increase self-consumption even outside peak summer. Some installers also combine a heat pump with a diverter that redirects surplus solar generation into hot water heating before anything else, which is a genuinely low-cost way to capture more value from panels you already have.
For a realistic combined budget: a 4kW solar system typically runs £6,000–£8,000 installed (before any heat pump costs), a home battery adds £4,000–£8,000 more (or £8,500-£10,500 for a higher-capacity option like a Tesla Powerwall 3), and the heat pump itself is the £8,000-£14,000 discussed above, less the £7,500 BUS grant. That’s a meaningful project total even before batteries — which is exactly why it’s worth phasing (heat pump first if the boiler’s failing and the grant window matters, solar second, or vice versa if your roof’s south-facing and unshaded and you want to bank a few years of bill savings before adding heating load) rather than assuming it all has to happen in one build. Our solar battery storage costs guide has the fuller breakdown on battery pricing and payback if you’re weighing that stage separately, and solarweekly.co.uk tracks the wider UK solar installation market if you want context on where 2026 pricing sits versus previous years.
If you’re specifically looking for installers who handle both sides of this properly rather than treating heat pump and solar as separate unconnected quotes, ecoaim.co.uk in Central Scotland and Hazell Electrical in West Kent both work across renewable heating and solar, which matters when you want one survey to size the whole system coherently rather than two installers each assuming the other’s kit doesn’t exist.
Commercial and larger-scale heat pumps
Everything above is domestic-scale. Commercial premises — offices, care homes, schools, warehouses with office space — face a different cost structure entirely: larger air-to-water or air-to-air systems, three-phase supply considerations, and a heat pump sized against a much more variable occupancy and heat-loss profile than a single house. The Boiler Upgrade Scheme’s domestic £7,500 rate doesn’t apply to commercial-scale installs; commercial heat pump funding runs through different mechanisms (capital allowances, the Public Sector Decarbonisation Scheme for public buildings, or straightforward ROI against a business’s existing gas or oil heating costs). commercialheatpumpinstallers.co.uk is a dedicated resource for that side of the market if you’re costing a non-domestic install, and heatpumpsforbusinesses.co.uk covers the funding routes and payback maths specific to commercial buildings, which behave quite differently from a domestic semi in terms of both heat loss and the electricity tariffs typically available.
What to check before you commit
A few practical points that affect whether the numbers above hold for your actual house:
- Get an MCS-certified installer, registered for BUS. This isn’t optional — it’s the only way the £7,500 gets applied, and it’s also required if you ever want to pair the project with solar and claim Smart Export Guarantee income on that side.
- Ask for a room-by-room heat loss calculation, not a rule-of-thumb “your house is X square metres so you need a Y kW unit” estimate. Undersizing leads to a system that struggles in cold snaps and runs inefficiently; oversizing wastes money upfront and can also hurt efficiency through excessive cycling.
- Query whether radiators need upgrading. This is the most common source of quotes coming in higher than the headline “£8k-£14k” range — a whole-house radiator upgrade can add several thousand pounds, and it’s better to know that before signing than after the first cold week.
- Confirm your seasonal CoP estimate in writing, not just an “up to 4x” marketing claim, and ask what design flow temperature the system’s been sized around — lower flow temperatures generally mean better real-world efficiency.
- Separate your solar and heat pump budgets clearly if doing both, since the BUS grant only ever applies to the heating side, and combining them into one number in your head is the easiest way to end up short of cash partway through a project.
The short version: after the £7,500 grant, a typical UK air source heat pump lands somewhere around £4,500-£10,000 net depending on house size and radiator work, running costs sit close to gas parity at a good CoP (and can beat it with a well-designed system), and pairing it with solar and a battery — even accounting for the winter/summer mismatch — is where the real long-term saving shows up, provided the two systems are sized together rather than bolted on separately.