Heating Systems

Heat pump grants for oil heating homes — can you switch?

Last updated: March 2026 · 6 min read

If your home is heated by an oil boiler, you may be paying more for your heating than homeowners on the gas network — and you are also in a particularly strong position to benefit from the government's heat pump grant. Homes heated by oil are among the most commonly cited candidates for the Boiler Upgrade Scheme, and for good reason. This article explains why, what the process looks like, and what to check before speaking to an installer.

Check if your oil-heated home may qualify for the £7,500 heat pump grant using our free 2-minute eligibility checker.

Start the eligibility check

Quick answer

Yes — homes with oil boilers are explicitly eligible for the Boiler Upgrade Scheme and qualify for the full grant of up to £7,500 towards the cost of an air source heat pump installation. The standard eligibility conditions apply: the property must be in England or Wales, you must own it, it must have a valid EPC with no outstanding loft or cavity wall insulation recommendations, and the installation must be carried out by an MCS-certified installer.

Important: This article provides general guidance only. Final eligibility for the Boiler Upgrade Scheme must be confirmed by an MCS-certified installer who can assess your specific property in person.

Why oil-heated homes are strong candidates

There are several reasons why homeowners on oil heating tend to be well-placed to benefit from switching to a heat pump.

Oil is expensive and volatile

Heating oil prices are not capped in the same way as gas and electricity under the Energy Price Cap. They are linked to global commodity markets and can fluctuate significantly from year to year and even season to season. Homeowners on oil have experienced periods of very high fuel costs in recent years. Switching to a heat pump removes this exposure to oil price volatility and replaces it with electricity, which — while currently more expensive per unit — is subject to the price cap and is expected to become relatively cheaper over time as the energy system decarbonises.

Rural properties tend to be well suited

Oil heating is most common in rural areas, where properties are not connected to the gas network. Rural properties tend to have several characteristics that make them good heat pump candidates: larger gardens with plenty of space for the outdoor unit, detached or semi-detached construction with no party wall complications, and in many cases reasonable insulation levels already in place from previous improvement work.

The running cost case is often stronger for oil

Because oil is more expensive per unit of heat than gas, the running cost comparison between a heat pump and an oil boiler is often more favourable than the comparison with a gas boiler. A well-installed heat pump in a suitable property can deliver meaningful savings compared to oil heating, particularly as electricity tariffs for heat pumps improve and oil prices remain unpredictable.

What the eligibility process looks like for oil-heated homes

The eligibility conditions for the Boiler Upgrade Scheme are the same regardless of your current fuel type. For oil-heated homes the process typically looks like this.

Check your EPC

Your property must have a valid EPC — one issued within the last ten years — that does not contain outstanding recommendations for loft insulation or cavity wall insulation. You can find your current EPC free of charge at find-energy-certificate.service.gov.uk. Many rural properties already have reasonable insulation in place, but it is worth checking your specific certificate for any open recommendations.

Confirm ownership

The Boiler Upgrade Scheme is available to property owners, not renters. If you own your home outright or with a mortgage, you meet this condition.

Speak to an MCS-certified installer

The installer will carry out a survey, assess the property's heat loss, check the EPC status, and confirm whether the heat pump can be designed to meet your heating demand efficiently. For oil-heated homes, the installer will also consider the existing distribution system — whether the property uses radiators or underfloor heating — and whether any upgrades are needed.

Practical considerations for oil-heated homes

Removing the oil tank

Once the heat pump is installed and operational, the oil tank will no longer be needed. Some homeowners arrange for the tank to be decommissioned and removed as part of the overall project. This is not a requirement of the grant scheme but is worth planning for. An oil tank removal specialist can drain and safely dispose of any remaining oil and remove the tank. The space freed up can then be repurposed.

Hot water cylinder

Many oil-heated properties already have a hot water cylinder as part of their existing system — oil boilers typically heat stored hot water rather than providing it on demand as a combi boiler does. This can simplify the heat pump installation because the cylinder infrastructure is already in place, though the installer may recommend replacing an older cylinder with one better suited to heat pump operation.

Radiator sizing

Oil boilers typically run at higher flow temperatures than heat pumps work at most efficiently. This means the existing radiators in an oil-heated home may need to be assessed and in some cases upgraded to work effectively with a heat pump's lower flow temperatures. An experienced installer will check radiator sizing as part of the survey and advise on what changes, if any, are needed.

Electrical supply

Rural properties sometimes have single-phase electricity supplies that may need checking before a heat pump installation. Most standard domestic heat pumps work on a single-phase supply, but it is worth confirming with the installer during the survey stage.

Practical examples

1980s detached rural property, oil boiler, good insulation

This is one of the most common scenarios for oil-to-heat-pump conversions. A well-insulated 1980s detached house with an existing hot water cylinder, a reasonable garden, and no outstanding EPC recommendations is a strong candidate. The installer would assess heat loss, check radiator sizing, and design a system to meet the property's demand. The hot water cylinder infrastructure already being in place simplifies the installation.

1960s farmhouse, oil boiler, older insulation

An older rural property may have higher heat loss and older insulation. The installer's survey would determine whether improvements are needed before or alongside the heat pump installation, and whether the system can be sized to heat the property efficiently. Many older rural properties have been successfully upgraded — it requires more careful assessment and system design but is not out of reach.

New-build rural property off the gas grid, oil heating

A newer property off the gas network with good insulation and modern radiators is typically a strong heat pump candidate. The main consideration is whether the current oil boiler setup includes a cylinder or whether one needs to be added — which the installer will confirm during the survey.

The financial case for oil-to-heat-pump conversions

The combination of the £7,500 Boiler Upgrade Scheme grant and the potential running cost savings compared to oil makes the financial case for switching worth examining carefully. The upfront cost of a heat pump installation is typically between £10,000 and £15,000 before the grant. After the grant, this reduces to roughly £2,500 to £7,500 depending on the scope of work.

Running cost savings compared to oil depend heavily on current oil prices, the efficiency of the heat pump installation, and your electricity tariff. An installer can provide indicative running cost estimates based on your specific property during the quotation stage. The removal of oil price volatility is also a financial benefit that is harder to quantify but meaningful for longer-term budgeting.

Next steps

If your home is heated by an oil boiler, is in England or Wales, and you own the property, the Boiler Upgrade Scheme is well worth exploring. Start by checking your EPC for any outstanding insulation recommendations, then use our eligibility checker to get an initial indication, and speak to a local MCS-certified installer for a no-obligation property assessment.

Find out whether your oil-heated home may qualify for the £7,500 heat pump grant. Our free 2-minute checker gives you an initial indication with no obligation to continue.

Check my eligibility

Summary

Oil-heated homes are among the strongest candidates for the Boiler Upgrade Scheme heat pump grant. The full £7,500 grant is available, the running cost case for switching is often more compelling than for gas-heated homes, and rural properties typically have the space and property characteristics that suit heat pump installations well. The standard eligibility conditions — valid EPC, no outstanding insulation recommendations, ownership, and an MCS-certified installer — apply equally to oil-heated homes.

Final eligibility must always be confirmed by an MCS-certified installer who can assess your specific property.