A landlord with an oil-heated rental and no mains gas connection can currently claim up to £9,000 towards an air source heat pump through the Boiler Upgrade Scheme (BUS): £7,500 as standard plus an extra £1,500 available until March 2027. There is no income test on that grant and landlords qualify. Two further schemes, Warm Homes: Local Grant and ECO4, depend on your tenant's income or benefits.
EPCGuide draws on the full domestic EPC register for England and Wales (29.2 million certificates). Oil and LPG boilers score poorly on the EPC, so these are properties where a grant-funded heating change moves the numbers most. This guide covers what is on offer, what your tenant's circumstances do and do not affect, and how to sequence the work.
Which grants can a landlord claim for an oil-heated rental?
Three schemes matter for a tenanted, oil-heated home in England. They work differently, so it helps to see them side by side.
| Scheme | What it pays | Does the tenant's income or benefits matter? |
|---|---|---|
| Boiler Upgrade Scheme | £7,500 towards an air source or ground source heat pump, plus £1,500 for oil or LPG homes without mains gas (until March 2027) | No |
| Warm Homes: Local Grant | Council-arranged measures such as insulation and air source heat pumps | Yes: household income usually £36,000 a year or less, or certain benefits or postcode areas |
| ECO4 | Insulation, boilers and heat pumps funded by energy suppliers | Yes: means-tested benefits or a local authority referral |
The BUS figures come from the GOV.UK Boiler Upgrade Scheme page. The other two are covered in more detail in our ECO4 landlord guide and the Boiler Upgrade Scheme regulations guide.
How much does the Boiler Upgrade Scheme pay for an oil-heated home?
GOV.UK lists £7,500 towards an air source heat pump and £7,500 towards a ground source heat pump. If your property is heated by oil or LPG and has no mains gas connection, you can claim an additional £1,500 until March 2027. That takes an air source heat pump grant to £9,000.
The grant is paid to your MCS-certified installer, who deducts it from the invoice. You do not claim it yourself. Only one grant is available per property, and GOV.UK is explicit that you cannot claim it to replace a system that is already low carbon.
Two details catch landlords out. First, the extra £1,500 needs both conditions: the property is heated by oil or LPG, and it has no mains gas connection. A house on the gas line with an oil backup does not qualify. Second, the £1,500 has an end date. If you are weighing up a heat pump, the March 2027 cut-off is a real reason to get quotes moving this autumn rather than next summer.
Does my tenant's income affect the Boiler Upgrade Scheme?
No. BUS has no means test for the landlord or the tenant. Landlords are eligible on the same terms as owner-occupiers, which makes it the most predictable grant for a rental and the first scheme to check for an off-gas property.
The tenant still has a practical say in how the work runs, because installation means access, disruption and possibly a period without heating. Our heat pump grant guide for landlords covers the tenant side of an installation in more detail.
What is Warm Homes: Local Grant and does a tenanted home qualify?
Warm Homes: Local Grant is the council-run scheme. It is available in England only, and the home must be privately owned, whether by the occupier or the landlord, with an EPC of D, E, F or G. GOV.UK says household income must usually be £36,000 a year or less, although you may still qualify above that if you live in a certain postcode area or someone in the household receives certain benefits.
If the household qualifies and your council has funding, the council arranges a home survey, organises the work and pays for it. Suggested improvements include wall, loft and underfloor insulation, air source heat pumps, smart controls and solar panels. GOV.UK also notes that if you have a landlord, the landlord may need to pay for some of the improvements. So as the landlord, expect to contribute, and ask for the figure in writing before agreeing.
The eligibility turns on the tenant's household, not on you. You will need your tenant to cooperate, since the council needs their income details. If your letting agent manages the tenancy, they are usually the quickest route to that information.
Is ECO4 still worth chasing for an oil-heated rental?
Only if your tenant qualifies and you can move fast. ECO4 closes on 31 December 2026, and installations must be completed and lodged by then, not just applied for. Your tenant needs to be on qualifying means-tested benefits or come through a local authority referral, and the property needs an EPC of D to G.
If the tenant is not on benefits, ECO4 is probably not your route. For the timeline and how the Warm Homes Plan replaces it from 2027, see our ECO4 landlord guide.
How much will a heat pump lift the EPC on an oil-heated home?
Replacing an oil or LPG boiler with an air source heat pump can add 10 to 25 SAP points according to our E to C upgrade guide, depending on the boiler being replaced, the property size and the insulation level. The same guide notes that for an oil-heated band E property, a BUS-funded heat pump can move the rating into mid-band C or above in a single step.
That gain comes from how SAP scores heat pumps against fossil fuel boilers. Our heat pump vs boiler comparison explains the mechanics. The practical point is that a heat pump is the one measure that can move an oil-heated E to a C without a long list of smaller upgrades.
Every property differs, though, and a heat pump works best when the fabric is reasonably insulated. Before you commit, run the address through the EPC predictor to see the likely rating after each measure.
Why does the EPC band matter for a band E landlord right now?
Band E meets today's minimum standard for rentals. The rules are moving, though. The government has proposed that from 1 October 2030 every private rental in scope must reach EPC band C, alongside a proposed £10,000 cost cap per property. Our landlord heating requirements guide sets out the proposal and its status.
One point from that guide is relevant to grants: third-party funding, such as a BUS grant, does not count towards the MEES cost cap. So a grant-funded heat pump does not use up your spending allowance. Oil-heated homes are among those most likely to need work if the band C target goes ahead, which makes a grant-funded upgrade now cheaper than a forced one later.
In what order should a landlord approach this?
This is the order we would follow for a tenanted, oil-heated, off-gas property.
- Confirm the facts. Check the current EPC on the national register, confirm the fuel type and confirm there is no mains gas connection. Small errors in a form or an EPC change which grant applies.
- Ask about the tenant's household. Income and benefit status decide Warm Homes: Local Grant and ECO4. They are irrelevant to BUS.
- Register interest with your council early. Council funding is limited and some councils report waiting lists.
- Get MCS installer quotes for a heat pump. The grant only flows through an MCS-certified installer. Ask them to show the £1,500 oil uplift on the quote.
- Check whether you can combine funding. Do not assume grants stack. Ask the council and your installer in writing whether a council-funded heat pump is also eligible for BUS before you sign anything.
Use the EPCGuide grant checker to see which schemes fit your postcode and property type before you make any calls.
Frequently Asked Questions
Can I get the extra £1,500 if my rental is on LPG rather than oil?
Yes. GOV.UK says the additional £1,500 applies where the property is heated by oil or LPG and has no mains gas connection. It is available until March 2027 and applies to air source and ground source heat pumps.
Do I need my tenant's permission for a Boiler Upgrade Scheme heat pump?
The grant itself does not depend on the tenant's income or benefits. In practice you need access to the property, and the installation disrupts the tenant's heating for a time, so agree dates with them. Our BUS regulations guide covers the notification rules for tenanted homes.
My tenant is not on benefits. Which grant should I look at first?
The Boiler Upgrade Scheme, because it has no income or benefits test. Then ask your council about Warm Homes: Local Grant, which turns on household income, usually £36,000 a year or less. ECO4 is unlikely to apply without qualifying benefits.
Does my EPC band affect Boiler Upgrade Scheme eligibility?
Not any more. A valid EPC must be lodged for the property, but according to our BUS regulations guide, the April 2026 amendment removed the EPC rating requirement, so the band itself neither qualifies nor disqualifies you.
Will a heat pump get my oil-heated band E rental to band C?
Often, but not always. An air source heat pump replacing an oil boiler can add 10 to 25 SAP points, depending on the property and its insulation. Model your own address with the EPC predictor before committing.