Heat pump grants in England and Wales are being reset. A new Statutory Instrument (S.I. 2026/390), signed on 19 March and laid on 1 April, overhauls the Boiler Upgrade Scheme from 28 April 2026. The package adds air-to-air heat pumps, tightens installer certification, changes how vouchers are handled and keeps BUS running to 2030.

Whitehall has also clarified the record: S.I. 2026/390 replaces S.I. 2026/368, which did not reflect the version actually signed and has been withdrawn from legislation.gov.uk. For installers finalising April jobs and homeowners weighing quotes, this is the operative text.

Who can do the work now matters. The definition of an installer is narrowed to those certified by the Microgeneration Certification Scheme (MCS), or a later MCS version approved by the Secretary of State, according to the Department for Energy Security and Net Zero. References to any 'equivalent scheme' are removed, pointing SMEs firmly toward MCS accreditation or subcontracting to those who have it.

What qualifies also broadens. Air-to-air heat pumps become eligible technology under BUS, sitting alongside air-to-water and ground-source systems. The regulations then draw a clear line: air-to-air is not eligible in non-residential buildings such as offices, schools, places of worship or premises used for a trade or profession; its use under BUS is essentially for homes.

Design standards are sharpened. The heat pump must be capable of meeting the property's full space-heating demand on its own, with hot water covered by the system or by supplementary heaters that are not biomass boilers. For air-to-water and ground-source units, the seasonal coefficient of performance must be at least 2.8. Capacity limits are clarified too: up to 45 kWth per installation, up to 70 kWth when combining multiple heat pumps, and up to 300 kWth for shared ground-loop systems.

Hybrid set-ups get formal guardrails. Any supplementary appliance installed in an eligible property cannot be fuelled by fossil fuel, and if used alongside a BUS installation it cannot be a biomass boiler either. That effectively steers back-up towards electric options while keeping the heat pump as the primary source.

Admin friction eases on Energy Performance Certificates. A valid EPC is no longer a condition for property eligibility. Where a property has one, the unique reference must be supplied; where it does not, applicants may be asked to provide details of any expired certificate and other evidence the Authority requests. Expect faster starts for older homes that would otherwise pause for paperwork.

The definition of 'urban area' now references the Office for National Statistics' 2021 rural-urban classification. That data refresh may shift a handful of borderline postcodes between urban and rural categories, which matters wherever BUS applies different tests by area.

Cashflow mechanics for SMEs change in a material way. Installers must deduct the BUS voucher value from the total amount quoted to the property owner and are prohibited from requesting or accepting that deducted amount unless the application is refused or a voucher is revoked. The grant portion therefore sits on the installer's balance sheet until redemption, increasing the value of overdrafts, supplier credit and tight scheduling.

Case study: a five-van installer in the North West updates its quoting template so the grant is clearly netted off and restructures stage payments so customer invoices track only the non-grant share. To bridge the period between commissioning and grant payment, the firm opens a small working-capital line and coordinates deliveries to site to limit stock days. The upside is clearer pricing for customers and fewer disputes over who holds the grant risk.

Case study: a Cardiff flat with an expired EPC opts for an air-to-air system. The MCS-certified installer sizes the unit to meet full space-heating demand, lists the voucher deduction on the quote and submits the application with the expired EPC reference and any additional evidence requested. The resident gets a quicker start date without waiting for a new certificate.

Timing and planning remain central. The instrument was made on 19 March 2026, laid on 1 April and comes into force on 28 April. Applications properly made before commencement continue under the previous rules. For SMEs, the priority is to confirm MCS status, revise quotes and CRM templates, validate sizing against the 'full demand' test and ring-fence working capital for the grant bridge. For households, the key checks are installer certification, technology fit for the property and the net price after the voucher.