What it is and how it works

An air source heat pump takes heat out of the outside air and puts it into your building. It does not burn anything. A refrigerant circuit and a compressor lift the temperature of that collected heat to a level that is useful, and the result goes into radiators, underfloor pipework, fan coils or a hot water cylinder.

Because it moves heat instead of making it, a heat pump delivers several units of heat for each unit of electricity it draws. The ratio depends on how cold it is outside and how hot you ask the water to be. That second part is the one that matters in a commercial building: the lower the flow temperature you can design for, the better it performs, and flow temperature is decided by the size of the emitters.

Air-to-air heat pumps, which deliver heat as warm air rather than hot water, are the same technology in a different form. They are what a commercial air conditioning system does when it runs in reverse.

The Boiler Upgrade Scheme for a business property

The scheme is not domestic only, which surprises most people who ask.

Which properties. A home or a building used for your business, in England and Wales. You have to own it, including where it is a second home or one you let to tenants.
What it replaces. A fossil fuel heating system: oil, gas, electric or LPG.
What it pays. £7,500 for an air source heat pump, £7,500 for a ground source heat pump, £5,000 for a biomass boiler, £2,500 for an air-to-air heat pump. An extra £1,500 where the property runs on oil or LPG with no mains gas connection, until March 2027.
What is excluded. Most new builds still under construction, social housing, and properties already receiving government support for a heat pump or biomass boiler.
How it is claimed. An MCS certified installer applies for the grant and takes it off the installed price. The installation has to be completed within 120 days of the application.

The grant is a fixed sum per property. On a small commercial building it is a meaningful share of the cost. On a large one it is a contribution, and the case has to stand on the running cost instead. We are straight about which of those your project is.

Figures reviewed 20 September 2026.

What we check before we quote

Heat loss. Room by room, from the fabric, not scaled off the old boiler. Boilers in commercial buildings are routinely oversized, so copying the old output is how you buy a heat pump twice as big as you need.

Emitters and pipework. Lower flow temperature means larger emitters. We list what has to change and price it in, rather than discovering it during the installation.

The electrical supply. A heat pump is electrical load, and on some sites the incoming supply is the real limit on what is possible.

Space and noise. Outdoor units need air around them and a position that does not make the neighbours an issue. Whether an external unit on your building needs planning permission depends on the building, its use and whether it is listed or in a conservation area. We give you that position at the survey, before the quote is signed.

Heat pumps with the rest of the building

A heat pump turns your heating bill into an electricity bill, which is what makes commercial solar and a battery worth considering in the same conversation. Where the building needs cooling as much as heating, commercial air conditioning does both from one set of equipment. If you are weighing those against each other, our design and consultancy work compares them on your own figures before anything is bought.

Pros and cons

Pros

The Boiler Upgrade Scheme covers a building used for your business, not only homes, in England and Wales
£7,500 towards an air source heat pump and £2,500 towards an air-to-air system, taken off the installed price
A further £1,500 where the property is heated by oil or LPG with no mains gas connection, until March 2027
Moves heat rather than burning fuel, so it takes a building off gas or oil entirely
Runs well on power from a solar roof, and better still with storage behind it
Removes the flue, the fuel store and the combustion servicing that go with a boiler

Cons

The grant is a fixed amount per property, so on a large building it covers a small share of the cost
A heat pump works at lower flow temperatures, so existing radiators or pipework often have to change
Poorly insulated commercial buildings need fabric work first, or the running cost disappoints
The standard rate of VAT applies to commercial premises
Outdoor units take space and make noise, which can be the binding constraint on a tight site
New builds still under construction, social housing and properties already receiving heat pump support are outside the scheme

Who it suits

Offices, village halls, surgeries and small commercial buildings currently on oil or LPG
Care homes and schools with a steady heat and hot water demand through the day
Buildings being refurbished, where the emitters and pipework are coming out anyway
Owners replacing a fossil fuel system that is near the end of its life
Sites with solar already on the roof looking for a use for the generation

What is included in a Bespoke installation

A heat loss calculation for the building, room by room, rather than a figure taken off the old boiler
An assessment of the existing emitters and pipework, and what has to change to run at a lower flow temperature
A survey of the incoming electrical supply and the spare capacity
The Boiler Upgrade Scheme eligibility position in writing before you commit
Supply and installation of the heat pump, cylinder, controls, pipework and electrical connection
Commissioning, the controls explained, and the handover and maintenance pack

Frequently asked questions

Can a business get the Boiler Upgrade Scheme grant?

Yes. The scheme covers replacing a heating system in your home or in a building used for your business, in England and Wales. You must own the property, including where it is a second home or one you let to tenants, and you must be replacing a fossil fuel system such as oil, gas, electric or LPG.

How much is the grant worth?

£7,500 towards an air source heat pump, £7,500 towards a ground source heat pump, £5,000 towards a biomass boiler and £2,500 towards an air-to-air heat pump. There is an extra £1,500 where the property is heated by oil or LPG and has no mains gas connection, available until March 2027. The amounts are per property, not per kilowatt, so the share of the cost they cover falls as the building gets bigger.

What is excluded from the scheme?

Most new build properties still under construction, social housing, and properties already receiving government support for a heat pump or biomass boiler. A finished new build with a fossil fuel boiler can qualify, and so can a self build where the property was built by its owner and never owned by a business. Biomass carries extra conditions. The property has to be off grid, rural, and hold an emissions certificate.

Will our existing radiators work?

Often not without change. A heat pump delivers heat at a lower flow temperature than a boiler, so the emitters have to be larger to give out the same heat. We calculate the heat loss room by room and tell you which emitters have to change. Skipping that step is the main reason heat pump projects disappoint.

Is our building suitable?

The honest answer comes from the survey. A draughty, uninsulated commercial building will cost a great deal to heat with anything, and a heat pump will not hide that. Where fabric work has to come first, we say so rather than sell you the wrong system.