The Government has upped a cash grant for electric heat pumps for ‘off grid’ households.
Labour is increasing the grants available under the ‘boiler upgrade scheme’ from £7,500 to £9,000 for households currently relying on heating oil and liquified petroleum gas (LPG).
Approximately three million households and business use heating oil and LPG to heat their premises.
Heating oil and LPG falling outside Britain’s energy price cap and are exposed to market volatility.
An air source heat pump costs approximately £11,000 to install on average, but the cost varies on the size of the heat pump, the size and age of the property, and any upgrades such as new radiators that are needed, according to the Energy Saving Trust.
The Department for Energy Security and Net Zero said this month: ‘The crisis in the Middle East has impacted those on heating oil and LPG the hardest.’
Boost: Labour has upped the grants available under the ‘boiler upgrade scheme’ to £9,000 for households relying on heating oil and LPG
It said the higher grant available to heating oil and LPG users would help households and small businesses in England and Wales ‘most impacted’ by rising energy prices, particularly in rural areas.
Labour said the grant and shift to a heat pump, which runs on electricity rather than gas, would help households and firms ‘electrify their heating and provide greater certainty over energy bills’.
Energy Secretary Ed Miliband. said: ‘As we face the second fossil fuel shock in less than five years, the lesson for our country is clear: The era of fossil fuel security is over, and the era of clean energy security must come of age.
‘That’s why we’re doubling down on clean power, to give our country energy security and bring down bills for good.’
Families dependent on heating oil or LPG have faced major cost increases following the start of war across the Middle East.
Heating oil prices, which are not protected by Ofgem’s energy price cap, doubled to unprecedented levels between February and March 2026.
Today’s oil and LPG prices are expected to ease once geopolitical pressures ease.
Chancellor Rachel Reeves, said this month: ‘Hardworking British families and businesses should not bear the brunt of global gas price shocks while electricity generators are making exceptional profits.’
Labour previously committed £53million in targeted support for ‘vulnerable’ heating oil consumers, focusing on ‘those households that are most exposed’.
Simon Francis, co-ordinator of the End Fuel Poverty Coalition, said: ‘Heating oil and LPG customers have been among the hardest hit by the current crisis.’
He added that while the £9,000 grant announcement was ‘very welcome’, it may not comprehensively bridge the gap for those who could not afford the remaining costs or whose homes need significant work to prepare them to use a heat pump.
Mr Francis said: ‘Therefore, the expansion of this scheme must be accompanied by specialist local advice for households, stronger consumer protections during the works, and targeted additional support for those who cannot meet the shortfall.
‘The measure of success is not how many grants are issued, but whether the households most exposed to fossil fuel price shocks are genuinely better off as a result.’
Labour has said it wants to reduce the price of electricity by weakening the link between prices of renewable and gas-generated power.
According to Nesta, a typical detached house can expect to pay approximately £3,600 in upfront installation costs for a heat pump, whilst bungalows, semi-detached and terraced housing can expect to pay about £2,500 in upfront costs.
This is comparable to replacing an oil boiler, which costs between £3,500 and £5,500 for a full installation, experts at Nesta added.
Earlier this month, the Government also said it was driving forward plans to ‘massively expand’ renewables across the Public Estate, including using brownfield land, industrial sites and railway sites to host solar panels and wind turbines.
This month, Labour also vowed to ensure that ‘plug-in’ solar panels were available in supermarkets and other retailers across Britain ‘within months’.
Have you moved from an oil boiler to a heat pump? Let us know your experience: editor@thisismoney.co.uk