Homes and small businesses can now benefit from increased government grants to make heat pump installations more affordable.

The Boiler Upgrade Scheme is now offering £7,500 towards the cost of heat pump installations.

This move represents a 50% increase in support for air source models.

The typical cost of purchasing and installing a gas boiler ranges between £2,500 and £3,000.

With the new grants and additional discounts from energy suppliers, starting prices for heat pumps can now compete with or even undercut the cost of a gas boiler for certain households.

To further support innovation in the heat pump sector and reduce installation costs, the government has allocated £10 million through the Heat Pump Ready programme.

Additionally, a new campaign, “Welcome Home to Energy Efficiency,” has been launched to assist families in enhancing the energy efficiency of their homes, particularly during the winter months.

Energy Security Secretary Claire Coutinho said:  ”From today, for some households starting prices for heat pumps could now be below the average gas boiler, as we have increased the cash grant by 50 per cent to £7,500 – making our scheme one of the most generous in Europe.”

Greg Jackson, Founder of Octopus Energy, said: “We see enormous demand for heat pumps as they’re three or four times more energy efficient than gas boilers, and with these government grants they’re affordable to install too.”

Gráinne Regan, Head of Heat, OVO said: “With home heating accounting for 17% of the UK’s total carbon emissions, it’s clear as a nation we need to switch from gas boilers to heat pumps which are more efficient and powered by cleaner electricity.”