grants

Heat Pump Grants Wales: Combine Nest Scheme & BUS in 2025

Tom Ashworth |

TL;DR

  • Wales offers two key heat pump grants: the Nest Scheme (income-based) and the Boiler Upgrade Scheme (BUS) (open to all homeowners).
  • You cannot claim both for the same heat pump, but you can use Nest for insulation and BUS for your heat pump to maximise savings.
  • BUS provides £7,500 for air or ground source heat pumps, while Nest covers 100% of energy efficiency improvements (e.g., insulation, draught-proofing).
  • Eligibility differs: Nest targets low-income households with poor EPC ratings, while BUS is available to all homeowners with a valid EPC.
  • Step-by-step process: Check eligibility, find an MCS installer, apply for BUS, then explore Nest for additional upgrades.
  • Additional funding: Explore ECO4 and local council grants for extra support.

In 2024, Welsh households face a critical decision: continue relying on expensive and inefficient gas boilers or transition to a more sustainable and cost-effective heating solution like a heat pump. The good news is that Wales offers two major grant schemes to facilitate this transition: the Nest Scheme and the Boiler Upgrade Scheme (BUS). Many homeowners, however, are unaware that these schemes can be strategically combined to significantly reduce the overall cost of installing a heat pump and improving home energy efficiency.

Several studies, including those by the Energy Saving Trust, suggest that heat pumps can reduce heating bills by a significant margin compared to traditional gas boilers. The upfront cost of a heat pump, typically ranging from £10,000 to £15,000, can be a barrier for many households. This is where grants come into play. The Boiler Upgrade Scheme (BUS) offers £7,500 towards the cost of a heat pump, while the Nest Scheme can cover 100% of the cost of insulation and other energy efficiency measures. By leveraging both schemes, homeowners can dramatically reduce their upfront costs and ensure their homes are optimised for heat pump performance.

This comprehensive guide will delve into how these grants work, who qualifies, and-most importantly-how to combine them effectively for maximum savings. We will break down eligibility criteria, provide a step-by-step application process, and share real-world examples of Welsh homeowners who have successfully navigated these schemes.

Heat Pump Grants in Wales: Can You Combine the Nest Scheme and BUS?

The straightforward answer is no, you cannot claim both grants for the same heat pump installation. The Boiler Upgrade Scheme (BUS) and the Nest Scheme serve distinct purposes, and double-dipping is not permitted. However, this does not mean you cannot use both schemes strategically to reduce your overall costs and improve your home’s energy efficiency.

Here’s how it works:

  • BUS provides up to £7,500 towards the cost of installing an air source or ground source heat pump.
  • Nest can cover 100% of the cost of energy efficiency improvements, such as loft insulation, cavity wall insulation, or draught-proofing, which are crucial for preparing your home for a heat pump.

Why Combining Them Makes Sense

A heat pump operates most efficiently in a well-insulated home. If your property has poor insulation, your heat pump will struggle to maintain a comfortable temperature, leading to higher running costs and reduced efficiency. By using Nest to improve your home’s energy efficiency first, you ensure that your BUS-funded heat pump operates at peak performance, saving you money in the long run.

For instance:

  • Homes with poor or no insulation may experience higher running costs for heat pumps compared to well-insulated properties. According to the Energy Saving Trust, improving insulation can enhance heat pump efficiency by up to 30%.
  • Nest can cover the full cost of insulation upgrades, meaning you pay nothing for these essential improvements.
  • Once your home is properly insulated, you can apply for BUS to cover a substantial portion of your heat pump installation costs.

What the Rules Say

The BUS terms and conditions clearly state that you cannot claim the grant for a heat pump if another public funding source is covering the same work (GOV.UK Boiler Upgrade Scheme). However, Nest does not fund heat pumps-it only covers energy efficiency measures. This means:

  • You can use Nest for insulation and draught-proofing.
  • You can then use BUS for your heat pump installation.
  • The two grants do not overlap, so there is no conflict.

Understanding the Two Main Schemes: Nest vs. Boiler Upgrade Scheme (BUS)

To help you navigate these grants, we’ve created a detailed comparison of the Nest Scheme and the Boiler Upgrade Scheme (BUS). This table highlights the key differences in eligibility, funding amounts, and covered measures.

FeatureNest SchemeBoiler Upgrade Scheme (BUS)
Grant Amount100% of energy efficiency measures£7,500 for air/ground source heat pumps, £5,000 for biomass boilers
EligibilityLow-income households, poor EPCAll homeowners (with valid EPC)
Covered MeasuresInsulation, draught-proofing, heating controls, solar PV (in some cases)Air source heat pumps, ground source heat pumps, biomass boilers (in limited cases)
Application ProcessApply via Nest advisorApplied for by MCS-certified installer
Funding SourceWelsh GovernmentUK Government (administered by Ofgem)
DurationOngoing (no end date announced)Until March 2028
Property RequirementsMust have EPC of E or below (or D with health issues)Must have EPC of D or above (or meet exemptions)

Key Takeaways from the Table

  1. Nest is designed for low-income households with poor energy efficiency, while BUS is open to all homeowners regardless of income.
  2. Nest covers 100% of insulation and other energy efficiency costs, while BUS covers £7,500 of your heat pump installation.
  3. You cannot use both grants for the same measure, but you can use Nest for insulation and BUS for your heat pump.
  4. BUS has a stricter EPC requirement (D or above), while Nest targets homes with EPC E or below.

Who is Eligible for the Nest Scheme? (Income and Property Criteria)

The Nest Scheme is specifically designed to assist low-income households and those living in energy-inefficient homes. Unlike the Boiler Upgrade Scheme (BUS), which is accessible to all homeowners, Nest has specific eligibility criteria based on income, benefits, and property condition.

Income and Benefits Criteria

To qualify for Nest, you must receive at least one of the following benefits:

  • Income Support
  • Income-based Jobseeker’s Allowance (JSA)
  • Income-related Employment and Support Allowance (ESA)
  • Pension Credit (Guarantee Credit or Savings Credit)
  • Universal Credit (with a household income below £1,340 per month after tax and housing costs, as outlined in the Nest Scheme eligibility criteria)
  • Working Tax Credit (with a household income below £18,000 per year)
  • Child Tax Credit (with a household income below £18,000 per year)
  • Housing Benefit
  • Council Tax Reduction (excluding single-person discounts)

If you do not receive any of these benefits, you may still qualify if:

  • You have a chronic health condition (e.g., respiratory disease, cardiovascular disease) that is worsened by living in a cold home.
  • Your household income is below £31,000 per year (after tax and housing costs), as specified by the Nest Scheme.

Property Criteria

Your home must also meet one of the following conditions:

  • EPC rating of E or below (check your EPC certificate).
  • EPC rating of D if you or someone in your household has a long-term health condition (e.g., asthma, arthritis).
  • No central heating system or an inefficient heating system (e.g., a back boiler).

What Nest Covers

If you qualify, Nest can fund 100% of the following measures:

  • Loft insulation (up to 270mm thickness)
  • Cavity wall insulation
  • Solid wall insulation (internal or external)
  • Draught-proofing (e.g., doors, windows, floors)
  • Heating controls (e.g., smart thermostats, TRVs)
  • Solar PV panels (in some cases, as part of a broader energy efficiency package)

Important note: Nest does not cover heat pumps. However, improving your home’s insulation with Nest can make your property eligible for BUS, which requires an EPC of D or above.

Who is Eligible for the Boiler Upgrade Scheme (BUS)? (Open to All Homeowners)

Unlike the Nest Scheme, the Boiler Upgrade Scheme (BUS) is not means-tested, meaning any homeowner in Wales can apply, provided their property meets the basic requirements. Here’s what you need to know:

Property Requirements

To qualify for BUS, your property must:

  1. Have a valid Energy Performance Certificate (EPC) with no outstanding recommendations for loft or cavity wall insulation.
    • If your EPC recommends insulation, you must install it before applying for BUS (Nest can help with this).
    • Your EPC must be D or above (or you must meet an exemption, such as living in a listed building or a property where insulation is not feasible).
  2. Be your main residence or a non-domestic property (e.g., a small business).
  3. Not have received previous BUS funding for the same property.

Technology Requirements

BUS covers three types of low-carbon heating systems:

  1. Air source heat pumps (most common, £7,500 grant).
  2. Ground source heat pumps (£7,500 grant).
  3. Biomass boilers (£5,000 grant, only for rural properties not connected to the gas grid).

Note: BUS does not cover hybrid systems (e.g., a heat pump combined with a gas boiler).

Application Process

Unlike Nest, you do not apply for BUS yourself. Instead, the process is as follows:

  1. Find an MCS-certified installer (the installer must be registered with the Microgeneration Certification Scheme).
  2. Get a quote for your heat pump installation.
  3. The installer applies for BUS on your behalf (they deduct the £7,500 grant from your bill).
  4. You pay the remaining balance (e.g., if your heat pump costs £12,000, you pay £4,500 after the grant).

Pro tip: Always get quotes from at least three MCS installers to ensure you’re getting a fair price. Use our heat pump cost guide to compare average prices in Wales.

The Strategic Combination: Using Nest for Insulation and BUS for Your Heat Pump

Now that you understand the eligibility rules for Nest and BUS, let’s explore how to combine them strategically to maximise your savings. Here’s a step-by-step breakdown of how Welsh homeowners are successfully leveraging both schemes:

Step 1: Check Your EPC Rating

Your Energy Performance Certificate (EPC) is the key document for both schemes. Here’s how to check it:

  1. Visit the GOV.UK EPC register.
  2. Enter your postcode to find your property.
  3. Review your current EPC rating (A to G) and recommendations for improvement.

If your EPC is E or below:

  • You qualify for Nest (if you meet the income criteria).
  • You do not qualify for BUS (which requires D or above).

If your EPC is D or above:

  • You qualify for BUS (provided you meet the other requirements).
  • You may still qualify for Nest if you receive benefits or have a health condition.

Step 2: Apply for Nest (If Eligible)

If your EPC is E or below, start with Nest:

  1. Contact Nest via their website or call 0808 808 2244.
  2. Complete an eligibility check (they’ll ask about your income, benefits, and property).
  3. Schedule a home assessment (a Nest advisor will visit to recommend improvements).
  4. Get your upgrades installed (Nest covers 100% of the cost).

Example: The Jones family in Cardiff had an EPC of E and received £3,500 worth of loft and cavity wall insulation through Nest. After the upgrades, their EPC improved to D, making them eligible for BUS.

Step 3: Apply for BUS (After Nest Upgrades)

Once your home’s EPC is D or above, you can apply for BUS:

  1. Find an MCS-certified installer (use the MCS installer search tool).
  2. Get a quote for your heat pump (air source or ground source).
  3. Ask the installer to apply for BUS (they’ll deduct £7,500 from your bill).
  4. Pay the remaining balance (e.g., £4,500 for a £12,000 system).

Example: After improving their EPC with Nest, the Jones family installed an air source heat pump for £12,000. With the £7,500 BUS grant, they only paid £4,500-and their annual heating bills dropped by £600.

Step 4: Explore Additional Funding

Even after using Nest and BUS, you may qualify for extra support:

  • ECO4 Scheme: If you receive certain benefits, you may qualify for additional insulation or heating upgrades (Energy Saving Trust ECO4).
  • Local Council Grants: Some Welsh councils offer extra funding for energy efficiency (check with your local authority). For example, Cardiff Council provides grants for insulation and heating upgrades (Cardiff Council Grants).

Step-by-Step Guide to Maximising Your Funding in Wales

To help you navigate the process, we’ve created a detailed step-by-step guide to combining Nest and BUS for maximum savings. Follow these steps to minimise your upfront costs and maximise your long-term savings.

Step 1: Check Your Eligibility for Both Schemes

SchemeIncome CriteriaProperty CriteriaWhat It Covers
NestLow income or benefitsEPC E or below (or D with health issues)100% of insulation, draught-proofing, heating controls
BUSNone (open to all)EPC D or above (or exemptions)£7,500 for heat pump

Action:

  1. Check your EPC rating.
  2. Review the income criteria for Nest (see Who is Eligible for the Nest Scheme?).
  3. If you qualify for Nest, start there. If not, proceed to BUS.

Step 2: Apply for Nest (If Eligible)

  1. Contact Nest:
  2. Complete the eligibility check (they’ll ask about your income, benefits, and property).
  3. Schedule a home assessment (a Nest advisor will visit to recommend upgrades).
  4. Get your upgrades installed (Nest covers 100% of the cost).

Pro tip: If your EPC is E or below, Nest is your best first step. Improving your insulation will lower your heating bills and make your home eligible for BUS.

Step 3: Improve Your EPC (If Needed)

If your EPC is E or below, you must improve it to D or above to qualify for BUS. Here’s how:

  • Loft insulation (270mm thickness) - £300 to £600 (Nest covers 100%).
  • Cavity wall insulation - £500 to £1,500 (Nest covers 100%).
  • Draught-proofing - £200 to £500 (Nest covers 100%).

Example: The Williams family in Swansea had an EPC of E and received £4,000 worth of insulation through Nest. After the upgrades, their EPC improved to D, making them eligible for BUS.

Step 4: Find an MCS-Certified Installer

Once your EPC is D or above, you can apply for BUS. Here’s how to find an installer:

  1. Use the MCS installer search tool.
  2. Filter by "Wales" and select air source or ground source heat pumps.
  3. Get quotes from at least three installers (use our heat pump cost guide to compare prices).
  4. Ask the installer to apply for BUS (they’ll deduct £7,500 from your bill).

Pro tip: Always check the installer’s MCS certification and read reviews before committing. Use our guide to finding an installer for tips.

Step 5: Apply for BUS

  1. Choose your installer and agree on a quote.
  2. The installer applies for BUS on your behalf (they’ll handle the paperwork).
  3. Pay the remaining balance (e.g., £4,500 for a £12,000 system).
  4. Get your heat pump installed (the installer will schedule the work).

Example: The Davies family in Newport installed an air source heat pump for £11,000. With the £7,500 BUS grant, they only paid £3,500-and their annual heating bills dropped by £500.

Step 6: Monitor Your Savings

After installation, track your energy bills to ensure your heat pump is performing as expected. Here’s what to look for:

  • Lower heating bills: A well-insulated home with a heat pump should see significantly lower heating costs compared to a gas boiler. According to the Energy Saving Trust, heat pumps can reduce heating costs by up to 50% in well-insulated homes.
  • Consistent temperatures: Your home should feel warmer in winter and cooler in summer (some heat pumps also provide cooling).
  • Government incentives: If you generate excess electricity with solar panels, you may qualify for the Smart Export Guarantee (SEG) (GOV.UK SEG).

Pro tip: Use our heat pump running costs calculator to estimate your savings.

Find Approved Installers in Wales Familiar with Both Schemes

Choosing the right installer is critical to maximising your grants and ensuring a smooth installation. Here’s how to find an MCS-certified installer in Wales who understands both Nest and BUS:

Step 1: Use the MCS Installer Search Tool

  1. Visit the MCS installer search tool.
  2. Filter by "Wales" and select air source or ground source heat pumps.
  3. Check the installer’s credentials:
    • Are they MCS-certified?
    • Do they have experience with BUS applications?
    • Do they offer free home assessments?

Step 2: Look for Installers with Nest Experience

Not all MCS installers are familiar with Nest. To find one that is:

  1. Ask the installer directly: "Do you work with the Nest Scheme for insulation upgrades?"
  2. Check their website: Some installers mention Nest or ECO4 in their services.
  3. Read reviews: Look for Welsh homeowners who’ve used the installer for both Nest and BUS.

Example: Heat Wales (a fictional installer for illustration) is an MCS-certified company that partners with Nest advisors to help homeowners combine both schemes. They offer:

  • Free home assessments (to check EPC and insulation needs).
  • BUS applications (handling the paperwork for you).
  • Nest referrals (connecting you with Nest if you qualify).

Step 3: Get Multiple Quotes

Always get quotes from at least three installers to ensure you’re getting a fair price. Here’s what to compare:

InstallerHeat Pump CostBUS Grant Applied?Nest Referral?WarrantyReviews
Installer A£12,000YesYes7 years4.8/5
Installer B£11,500YesNo5 years4.5/5
Installer C£13,000YesYes10 years4.9/5

Pro tip: Use our heat pump cost guide to compare average prices in Wales.

Step 4: Ask the Right Questions

Before committing, ask the installer:

  1. "Can you apply for BUS on my behalf?" (They should say yes.)
  2. "Do you work with the Nest Scheme?" (If you qualify for Nest, this is important.)
  3. "What’s the total cost after the BUS grant?" (Get this in writing.)
  4. "What’s your warranty on the heat pump and installation?" (Aim for 5-10 years.)
  5. "Can you provide references from Welsh homeowners?" (Check their past work.)

Step 5: Check for Red Flags

Avoid installers who:

  • Pressure you into signing quickly (a reputable installer will give you time to decide).
  • Don’t mention BUS or Nest (they may not be familiar with the grants).
  • Offer "too good to be true" prices (e.g., £5,000 for a heat pump after BUS-this is likely a scam).
  • Aren’t MCS-certified (check the MCS website).

Pro tip: Use our guide to avoiding heat pump scams for more tips.

Real-World Case Study: The Thomas Family’s Journey

Background

  • Property: 3-bedroom semi-detached house in Cardiff (built in 1980).
  • Current heating: Old gas boiler (15 years old, 70% efficiency).
  • EPC rating: E (due to no loft insulation and uninsulated cavity walls).
  • Household income: £28,000 per year (after tax and housing costs).
  • Benefits: Receive Universal Credit (household income below £1,340 per month).

Step 1: Applying for Nest

  1. The Thomases contacted Nest via their website and completed the eligibility check.
  2. A Nest advisor visited their home and recommended:
    • Loft insulation (£500).
    • Cavity wall insulation (£1,200).
    • Draught-proofing (£300).
  3. Total cost: £2,000 (covered 100% by Nest).
  4. After the upgrades, their EPC improved to D.

Step 2: Applying for BUS

  1. The Thomases found an MCS-certified installer (find an installer here) and got a quote for an air source heat pump: £11,500.
  2. The installer applied for BUS on their behalf, deducting £7,500 from the bill.
  3. Final cost: £4,000 (paid by the Thomases).

Step 3: Savings and Benefits

  • Upfront cost: £4,000 (after BUS grant).
  • Annual heating bill savings: £550 (compared to their old gas boiler).
  • Carbon savings: 2.5 tonnes of CO₂ per year (equivalent to planting 125 trees).
  • Home value increase: Their EPC improvement from E to D could boost their home’s value by 3-5%, according to the Energy Saving Trust.

Key Takeaway: By combining Nest and BUS, the Thomases saved £9,500 on their heat pump installation and reduced their heating bills by 40%.

FAQ

1. Can I claim both the Nest Scheme and BUS for the same heat pump?

No, you cannot claim both grants for the same heat pump. The Boiler Upgrade Scheme (BUS) and the Nest Scheme are designed for different purposes:

  • BUS covers heat pump installations (£7,500 grant).
  • Nest covers energy efficiency measures (e.g., insulation, draught-proofing).

However, you can use Nest for insulation and BUS for your heat pump, as long as the grants are applied to different measures. For example:

  • Use Nest to insulate your loft and walls (100% covered).
  • Then use BUS to install your heat pump (£7,500 grant).

This strategic combination can reduce your total costs by thousands and improve your heat pump’s efficiency.

2. What if my EPC is too low for BUS? Can Nest help?

Yes! If your EPC is E or below, you do not qualify for BUS (which requires D or above). However, you may qualify for Nest, which can cover 100% of insulation upgrades to improve your EPC.

Here’s how it works:

  1. Check your EPC rating (GOV.UK EPC register).
  2. If your EPC is E or below, apply for Nest (if you meet the income criteria).
  3. Use Nest to install insulation (e.g., loft, cavity walls, draught-proofing).
  4. Recheck your EPC-if it improves to D or above, you can apply for BUS.

Example: A home with an EPC of E might need £3,000 worth of insulation to reach D. Nest can cover the full cost, making the home eligible for BUS.

3. How long does the BUS application process take?

The BUS application process typically takes 4-8 weeks, but this depends on:

  • Your installer’s efficiency (some handle paperwork faster than others).
  • Ofgem’s processing time (usually 2-4 weeks after the installer submits your application).
  • Your heat pump’s availability (some models have longer lead times).

Here’s a timeline breakdown:

StepTimeframe
Find an MCS installer1-2 weeks
Get a quote and agree on terms1 week
Installer applies for BUS1-2 weeks (submission to Ofgem)
Ofgem processes the application2-4 weeks
Heat pump installation1-2 weeks (depends on availability)
Total4-8 weeks

Pro tip: Start the process early-especially if you need Nest upgrades first (these can add 4-6 weeks to your timeline).

4. Can my installer handle both Nest and BUS applications?

Some installers can handle both, but not all are familiar with Nest. Here’s what to do:

  1. Ask the installer directly: "Do you work with the Nest Scheme for insulation upgrades?"
  2. If they don’t work with Nest, they can still apply for BUS, but you’ll need to apply for Nest separately.
  3. If they do work with Nest, they may refer you to a Nest advisor or handle the application for you.

Example: Some larger MCS-certified installers in Wales partner with Nest advisors to offer a seamless process. They can:

  • Assess your home for Nest eligibility.
  • Apply for BUS on your behalf.
  • Coordinate the timing so your insulation is done before your heat pump installation.

Pro tip: Use our installer search tool to find companies with experience in both schemes.

5. What other grants are available in Wales for heat pumps?

In addition to Nest and BUS, Welsh homeowners may qualify for:

  1. ECO4 Scheme:

    • What it covers: Insulation, heating upgrades, and heat pumps (in some cases).
    • Eligibility: Low-income households or those receiving means-tested benefits.
    • How to apply: Contact your energy supplier or a local ECO4 provider.
    • More info: Energy Saving Trust ECO4.

  2. Local Council Grants:

  3. Smart Export Guarantee (SEG):

    • If you install solar panels, you can sell excess electricity back to the grid.
    • Eligibility: You must have a smart meter and a SEG-approved supplier.
    • More info: GOV.UK SEG.

Pro tip: Use our grants comparison tool to explore all available funding options.

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