What the Boiler Upgrade Scheme Does to a Heat Pump Installer's Cash Flow

The Boiler Upgrade Scheme is designed to feel invisible to the homeowner. They see a reduced price, the installer handles the Ofgem paperwork, and the grant flows in the background. From the customer's side, it reads like a straightforward price reduction. From the installer's side, it is more complicated. Every BUS job generates two payment streams on two different timelines: the customer's share arrives on completion, and Ofgem's share arrives weeks later. At low installation volumes this is easy to absorb. As a business scales its heat pump operations, that lag becomes a cash flow structure worth understanding clearly.

How the BUS Grant Payment Actually Flows

The Ofgem installer rules are specific on one point: the full £7,500 grant value must appear as an upfront discount on both the quote and the final invoice. Installers cannot ask the customer to pay it, and cannot accept that payment if offered. The customer pays the net amount - typically somewhere between £500 and £6,500 on a standard air source heat pump installation, once the grant is deducted from a gross project cost of £8,000 to £14,000 for a 3-bed semi.

After installation is complete and the system commissioned, the installer generates the MCS installation certificate and applies to Ofgem to redeem the voucher. Ofgem then conducts final eligibility checks. Once approved, payment is processed at the next scheduled weekly payment run. Ofgem's own guidance notes that "there may occasionally be short delays, and to plan accordingly."

The voucher approval stage alone takes 2 to 4 weeks in normal conditions. The full sequence - commissioning, MCS certificate, redemption application, eligibility check, weekly payment run - means the £7,500 typically arrives 2 to 4 weeks after job completion, sometimes longer. The money is not at risk. It is simply not available yet.

What This Looks Like When the Calendar Fills Up

One job with a 2-to-4-week lag is a minor administrative inconvenience. The problem is that the lag does not shrink as volume grows - it compounds.

An installer completing eight air source heat pump jobs in a month has, at any given point in that month, £60,000 in pending BUS grant receivables moving through Ofgem's system at different stages. Jobs commissioned in week one are awaiting a payment run. Jobs commissioned in week three are still in redemption processing. Jobs commissioned in week four may not even have the MCS certificate filed yet. None of that money is in the account, and none of it shows up as income until it clears.

Those numbers are illustrative - based on eight jobs at the current standard £7,500 grant value. An individual installer's actual exposure depends on their job rate and how quickly they submit redemption applications after commissioning. But the arithmetic is straightforward: multiply monthly installation volume by £7,500, and that is the approximate sum sitting with Ofgem at any given time, assuming an average two-to-four-week lag. For an installer growing from four jobs a month to twelve, the Ofgem receivables balance roughly triples before a single extra invoice has been disputed or paid late.

BUS voucher applications grew roughly 40% year-on-year in 2025, with national retrofit heat pump installations reaching 51,886 units that year. Installers taking on more of that work are, by definition, taking on a larger float.

Three Things That Extend the Gap

Not every delay is structural. Some are operational, and the operational ones are entirely preventable.

MCS certificate not filed immediately after commissioning. The voucher redemption clock does not start until the application is submitted, and the application cannot go in until the MCS installation certificate exists. An installer who commissions a system on a Friday and logs the certificate the following week has introduced a week's delay before the 2-to-4-week processing window even starts. On a job where the customer has already paid and the grant is sitting outstanding, that week matters.

EPC issues on the property. If the property's Energy Performance Certificate is out of date, missing, or has outstanding insulation recommendations that haven't been addressed or exempted, the application may stall while the documentation is resolved. The customer owns the EPC, but the installer absorbs the cash flow delay while it is sorted out. Confirming EPC status before scheduling the installation - not after - removes this risk entirely.

Voucher timing. Air source heat pump vouchers are valid for three months from issue. An installer who takes on a job with a voucher close to expiry and then runs into programme delays may find the voucher expires before commissioning is complete. The application restarts from scratch. Building voucher expiry dates into job scheduling, and flagging them with at least a month's lead time, prevents what is otherwise an avoidable delay of several additional weeks.

Tracking It as a Receivable Category

The BUS grant is, in practical terms, an Ofgem receivable from the moment a system commissions. It is not a bad debt risk. The eligibility checks are compliance-focused, not credit-risk-focused: if the installation is correctly done, correctly certified, and correctly documented, the payment follows. What it is, is a timing delay that grows with volume.

The installers who manage this well treat the Ofgem receivable as a distinct category on their books - separate from customer invoices, tracked from commissioning date, and aged in the same way a debtor days calculation would age a customer invoice. They can tell you at any point: how many jobs have been commissioned this month, how many redemption applications are pending, and which payment runs are expected.

Installers who keep jobs in a spreadsheet or manage everything through email typically cannot answer any of those questions cleanly. They know the customer has paid their share. They know Ofgem should pay the rest. But they cannot tell you how much is pending or when it will clear - and when cash feels tighter than the order book suggests it should be, the answer is often sitting in that untracked pile.

A job management system that links commissioning status to invoicing and payment tracking gives visibility into both streams: what the customer has paid, and what Ofgem owes at what stage in the redemption process. That distinction becomes especially important during growth phases, when the Ofgem receivables balance can be growing faster than the bank balance that follows it.

For a detailed look at the full installation workflow from survey to MCS certificate, see our guide to running a heat pump installation from survey to MCS certificate. For more on how heat pump businesses manage their operations, visit the heat pumps industry page.

The BUS scheme is well-funded, well-structured, and a genuine driver of heat pump volumes across England and Wales. For installers, it adds a layer of financial structure worth mapping explicitly - not to complain about it, but to manage it. The grant is earned money. It just needs to be tracked like it.

Sources

• Boiler Upgrade Scheme (BUS) - InstallersOfgem · accessed 2026-08-17
• Boiler Upgrade Scheme (BUS) - Property OwnersOfgem · accessed 2026-08-17
• Heat Pump Grant 2026: Is the BUS Still Available? (UK)BestBuilders · accessed 2026-08-17
• Boiler Upgrade Scheme 2026 - Manchester Application GuideGreentech Renewables · accessed 2026-08-17
• BUS GrantHeat Pump Central · accessed 2026-08-17

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