Landlords and homeowners are paying an average of £5,787 to buy and fit a heat pump after deducting the £7,500 government grant.

The latest Boiler Upgrade Scheme (BUS) data from the Department for Energy Security and Net Zero shows that the mean cost of an air source heat pump since the start of the scheme was £13,287 including the grant value.

The Energy Savings Trust reckons that air source heat pumps cost between £14,000 and £19,000 to install – although this can be as low as £7,000 depending on the size of the house and type of heat pump.

In May, 2,987 people received the full grant - 109% higher than in May 2023 (1,432). There was also a 26% increase in applications from the previous month. May was the first month of BUS applications since the government removed a conditional cavity wall or loft insulation clause, helping to reduce the upfront cost of installation by up to £2,500.

Grants paid

Of the total number of grants paid, the largest number were for installations at properties in the South East (20%), followed by the South West (19%) while the fewest number of grants were in the North East (3%). Earlier this week, heat pump manufacturer Aira opened its first factory, a £250 million plant in Poland, with a plan to roll out full capacity of 500,000 units per year as European demand rises.

Daniel Särefjord (pictured), CEO of Aira UK, says: “The £7,500 Boiler Upgrade Scheme grant is putting heat pumps within reach of working British people. To speed up installations further, I would strongly urge the next government to scrap planning red tape for heat pump installations and urgently consider reforming electricity taxation.”