Heat pump grant in Scotland: Home Energy Scotland grant, loan and steps
In Scotland, Home Energy Scotland offers homeowners a grant of up to £7,500 towards a heat pump and an optional interest-free loan. You apply yourself and need a written offer before any work starts: here is who qualifies, what it covers and each step to the payment.
In Scotland, the Home Energy Scotland Grant and Loan gives homeowners a heat pump grant of up to £7,500 for an air, ground or water source system, plus £1,500 in eligible remote rural, island and off-gas rural areas, and an optional interest-free loan of up to £7,500 on top. Unlike the Boiler Upgrade Scheme in England and Wales, you apply yourself, and you must hold a written funding offer before any work starts. The money is paid to you, not your installer, usually after the installation (you can ask in writing to draw up to 60% early for materials, and Home Energy Scotland decides), and you then pay your installer.
At a glance
- Amounts. In Scotland, a grant of up to £7,500 for a heat pump, £1,500 more in eligible rural and island areas, and an optional interest-free loan of up to £7,500; together they fund up to the quoted installation cost.
- Who. Owners of an existing Scottish home that is their only or main residence; no benefits needed.
- Order. Advice, application with your installer's quote, written offer, signed agreement within 14 days, then the work, finished and claimed within 9 months.
- Heat pump. It must provide all your heating and hot water, fitted by an MCS-certified installer; hybrids and air-to-air units are excluded.
- Budget. First come, first served each financial year; funding is reserved only once the written offer is issued.
Home Energy Scotland heat pump grant: how much you can get
The scheme is funded by the Scottish Government and reached through Home Energy Scotland, its free advice service. It funds up to the quoted installation cost, never more than the maximum for each improvement. For a heat pump that maximum is split between grant and loan:
| Funding | Standard | Eligible rural or island home |
|---|---|---|
| Grant | up to £7,500 | up to £7,500 + £1,500 |
| Interest-free loan | up to £7,500 | up to £7,500 |
| Grant and loan together | up to £15,000 | up to £16,500 |
| Replacing an existing heat pump | loan only, up to £7,500 | loan only, up to £7,500 |
If the funding you ask for is no more than the grant limit, all of it is grant; anything above that can be taken as the loan. The smallest application is £500. The rural uplift covers homes in remote rural and island areas and in off-gas accessible rural areas, as the Scottish Government's Urban Rural Classification defines them; your adviser confirms whether your home is in one.
What the funding covers. The heat pump and any ground loops, the groundworks, a replacement hot-water cylinder, the electrical connection, the connection to your heating system and upgrades to that system where they are needed for the heat pump to work effectively, plus VAT you can't recover. It doesn't cover extended warranties beyond the one-year warranty that certified installers must give free, or new radiators that aren't needed for the system to run efficiently. VAT on a heat pump supplied and installed in your home is 0% until 31 March 2027, then 5%, as elsewhere in the UK.
The loan. It is interest-free, and you can repay early at any time without a fee. Home Energy Scotland runs credit and affordability checks, and charges an admin fee of 1.5% of the loan, capped at £150, which is covered by your monthly repayments rather than paid upfront. You choose the term, up to a maximum set by the loan size:
| Loan amount | Longest repayment term |
|---|---|
| under £5,000 | 5 years |
| £5,000 to £9,999 | 10 years |
| £10,000 or more | 12 years |
Repayments start after the first payment that includes loan money. Whether borrowing suits you depends on your own finances; Home Energy Scotland's advisers or an independent adviser can talk it through.
Who can get a Home Energy Scotland heat pump grant?
You must own or jointly own the home as a private individual, not through a business, and it must be your only or main residence, registered for domestic council tax. Holiday homes, second homes, let properties you don't live in and self-builds are excluded. You don't need to be on benefits.
The heat pump has to meet these conditions:
| Condition | What it means |
|---|---|
| Whole-house system | the heat pump provides all your heating and hot water; only one whole-house system per application |
| Excluded types | hybrid heat pumps, air-to-air and exhaust-air heat pumps |
| Certification | MCS-certified installer and an MCS or Solar Keymark certified product |
| Permissions | any planning permission, building warrant (Scotland's building-standards approval) and network operator consent in place before work starts |
| Ownership | with a loan, you own the equipment and the home when the loan is paid out |
A heat pump with a boiler kept as back-up doesn't qualify, which hybrid heat pumps explains. For planning permission in Scotland, see heat pump planning permission.
EPC and insulation. You can apply for a heat pump without an Energy Performance Certificate. Before you are paid, though, you need a post-installation EPC. Home Energy Scotland releases funding only if that EPC doesn't recommend loft or cavity wall insulation, so if your current one does, you need to fit it first or include a qualified assessor's evidence with your application that it isn't suitable, so Home Energy Scotland can decide on an exemption. The loan can pay for a pre- or post-installation EPC, up to £150 each.
How to apply for the Home Energy Scotland grant, step by step
The order is the whole point: Home Energy Scotland funds nothing retrospectively, and in the application form you confirm that no installation work will start before the written offer.
Advice. Call the free Home Energy Scotland advice line on 0808 808 2282 or use its contact form. An adviser checks your options and refers you, usually by email within two working days.
Quotes. Get an itemised quote from an MCS-certified installer; the scheme recommends comparing several installers and needs only the quote you choose.
Application. Register on the customer portal and submit the form with the quote. The aim is a decision within 10 working days; if successful, you get a written funding offer.
Agreement. Sign the funding agreement online within 14 days of the offer. Only then can the work start.
Installation. You have 9 months from signing to finish the work and send your final claim. You can ask in writing to draw up to 60% of the funding early for materials; Home Energy Scotland decides.
Claim and payment. Send the invoice, the post-installation EPC and the MCS certificate. Claims are aimed to be processed within 10 working days, the bank transfer takes 3 to 5 working days, and you then pay your installer.
Don't let the installer start any work until the written offer has arrived and you have signed the funding agreement. Funding is reserved for you only when the offer is issued, not when you apply, and the budget is allocated first come, first served each financial year. After the payment reaches you, you pay the installer and send proof of payment, such as a bank statement, within 10 working days.
This is the reverse of the Boiler Upgrade Scheme, where the installer applies and takes the grant off your bill. Your contract with the installer should say when each payment is due, so that the final one matches the date Home Energy Scotland pays you. To check a quote and the installer's payment terms, see choosing an MCS installer.
Example: a dated timeline with grant and loan
The Boiler Upgrade Scheme statistics cover England and Wales only, so this example borrows the £12,826 median for an air source heat pump in England and Wales (grants paid July to September 2026, price before any grant) as an illustrative quote. The dates are assumed. The scheme funds up to the quoted cost, so the grant covers £7,500 and, if you want it, the loan covers the rest:
loan = quote − grant = £12,826 − £7,500 = £5,326
admin fee = 1.5% × £5,326 = £79.89 (below the £150 cap)
total to repay = £5,326 + £79.89 = £5,405.89, over up to 10 years, because the loan falls in the £5,000 to £9,999 band.
| Date | Step | Working |
|---|---|---|
| 2 November 2026 | Call to the advice line | referral email usually within two working days |
| 16 November 2026 | Application sent with the chosen quote | decision aimed within 10 working days |
| 30 November 2026 | Written funding offer | sign by 30 November + 14 days = 14 December 2026 |
| 3 December 2026 | Funding agreement signed; work can start | finish and claim by 3 December 2026 + 9 months = 3 September 2027 |
| 1–5 February 2027 | Heat pump fitted and commissioned; post-installation EPC | – |
| 10 February 2027 | Claim sent: invoice, EPC, MCS certificate | processing aimed within 10 working days, then 3 to 5 working days for the transfer |
| early March 2027 | £12,826 paid to you; you pay the installer | proof of payment within 10 working days; loan repayments begin |
In an eligible rural or island home the grant rises by £1,500, so the same quote needs a loan of £12,826 − £7,500 − £1,500 = £3,826. The admin fee is then 1.5% × £3,826 = £57.39, the total to repay £3,883.39, and the longest term 5 years, because the loan is under £5,000.
If you would rather pay the £5,326 balance yourself, you take no loan and no fee; the grant is still paid to you after your claim. With the loan, the funding covers the whole quote, and you repay it, without interest, over the term you choose. What drives heat pump prices, and what a quote should include, is explained in heat pump cost.
Common mistakes that delay or cost the funding
Most problems come from the order of steps or from paperwork at the claim:
| Mistake | What happens | How to avoid it |
|---|---|---|
| Work started before the written offer | no grant or loan for that work | book the installation after you have signed the agreement |
| Hybrid or air-to-air system quoted | not eligible | ask for a heat pump that provides all heating and hot water |
| Post-installation EPC recommends loft or cavity insulation | funding isn't released | fit the insulation first, or send an assessor's evidence with your application and ask for an exemption |
| Documents missing from the application or claim | up to three reminders, then the application expires | reply through the portal messages promptly |
| Home is a second home or let | not eligible | only your own main residence qualifies |
| Installer expects full payment before you are paid | you may have to fund the gap yourself | agree a payment schedule that matches the claim |
If anything in your application changes, such as the installer, the quote or your circumstances, tell Home Energy Scotland as soon as possible: it may amend or withdraw the offer. You can also ask in writing for part payments, up to two per improvement.
Home Energy Scotland and the Boiler Upgrade Scheme compared
The Boiler Upgrade Scheme does not apply in Scotland. If you have read about it elsewhere, these are the differences that change what you do:
| Point | Home Energy Scotland (Scotland) | Boiler Upgrade Scheme (England and Wales) |
|---|---|---|
| Who applies | you | your installer |
| Loan | optional interest-free loan | none in the scheme |
| Who receives the money | you, usually after your claim | your installer, as a discount |
| Before work | written offer and signed agreement | voucher issued (advised) |
| EPC | post-installation EPC needed for payment | not required |
| Landlords and second homes | excluded | eligible |
For England and Wales, and for support in Northern Ireland, see heat pump grants. The Warm Homes Loan Scheme, which works through participating private lenders, covers homes across the UK and is described there too.
Checklist: before any work starts
Work through these in order; the first four come before you sign anything with an installer.
- Residence. The home is your only or main residence, registered for domestic council tax.
- Insulation. Your current EPC, if you have one, recommends no loft or cavity wall insulation, or you plan to fit it first.
- Installer. MCS certification for the installer and the heat pump, and a heat pump that will provide all your heating and hot water.
- Quote. Itemised, with the payment schedule written in and the final payment due after Home Energy Scotland pays you.
- Offer. Written offer received and agreement signed within 14 days, before the work starts.
- Permissions. Planning, building warrant and network operator permissions in place where needed.
- Deadline. The date 9 months after signing, by which the work is finished and the claim sent.
- Claim. Invoice, post-installation EPC and MCS certificate ready, then proof of payment within 10 working days.
Figures that change
| What | Value | Applies |
|---|---|---|
| Heat pump grant | up to £7,500 | Scotland, Home Energy Scotland Grant and Loan, 2026/27, budget-limited |
| Rural and island uplift | £1,500 | Scotland, eligible areas under the Urban Rural Classification |
| Interest-free loan | up to £7,500; grant and loan together up to £15,000 (£16,500 with the uplift) | Scotland |
| Loan admin fee | 1.5% of the loan, capped at £150 | Scotland |
| Deadlines | sign within 14 days of the offer; finish and claim within 9 months of signing | Scotland |
| Illustrative quote | £12,826 | England and Wales air source median, grants paid July–September 2026, before any grant |
| VAT on installed heat pumps | 0%, then 5% | UK, 0% until 31 March 2027 |
How we worked this out
The example uses the England and Wales median for grants paid July to September 2026 as an illustrative quote, because the Boiler Upgrade Scheme statistics cover England and Wales only, with assumed dates and the Home Energy Scotland terms; it leaves out running costs and any work outside the quote. More in our editorial method.
Frequently asked questions
Can I get a Home Energy Scotland grant after the heat pump is installed?
No. Home Energy Scotland doesn't fund work retrospectively in Scotland: the written offer has to arrive, and you have to sign the funding agreement, before any installation work starts. A heat pump fitted first gets neither grant nor loan.
Does Home Energy Scotland pay the installer directly?
No. Home Energy Scotland pays you by bank transfer, usually once your claim is approved after the installation; you can ask in writing to draw up to 60% early for materials, and Home Energy Scotland decides. You pay the installer, then send proof of payment within 10 working days. Ask for a payment schedule that fits that order before you sign the installer's contract.
Can I get the Boiler Upgrade Scheme in Scotland?
No, the Boiler Upgrade Scheme covers only England and Wales. In Scotland the equivalent is the Home Energy Scotland Grant and Loan, with a grant of up to £7,500 for a heat pump if you are eligible, and you apply yourself rather than through your installer.
Do I need an EPC for a heat pump grant in Scotland?
Not to apply, but Home Energy Scotland needs a post-installation EPC with your claim. It releases funding only if that EPC doesn't recommend loft or cavity wall insulation, unless it grants an exemption on a qualified assessor's evidence, sent with your application, that the insulation isn't suitable. The interest-free loan can pay for the EPC.
Can landlords or second-home owners get the grant in Scotland?
No. The Scottish grant and loan are only for an existing home that is the owner's only or main residence, registered for domestic council tax. Holiday homes, second homes and homes owned by a business are excluded.
Does the Home Energy Scotland loan charge interest?
No interest, but there is an admin fee: 1.5% of the loan, capped at £150, which your monthly repayments cover rather than an upfront payment. On a £5,326 loan that is £79.89, so you repay £5,405.89 over up to 10 years. You can repay early at any time without a fee, and Home Energy Scotland runs credit and affordability checks before it lends.
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