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Boiler replacement funding: the basics

In this article, we’ll help you understand why the government has introduced boiler replacement funding. After that, we’ll help you work out whether you might qualify for some help. Let’s go!

A new boiler can make a big difference to the energy efficiency of your home, and can drastically reduce your carbon footprint. In other words, upgrading your boiler is great for the environment, but it can also save you hundreds of pounds on your energy bill. Everybody wins!

What kind of savings could replacing your boiler get you? Heating accounts for over half of all household energy costs according to the Energy Saving Trust. You could save as much as £315 per year by upgrading to a more modern boiler.

Your next question might be “how much does a new boiler cost?” This depends on the new boiler you’d be installing, as well as the heating system it’s integrating into. The average gas boiler replacement job will cost around £2,300. This can be even higher if the pipework in your house needs improvement.

So whilst it’s true that lots of households across the UK could benefit from saving £315 every year, £2,300 is a lot of money to spend on something inessential. Fortunately, the government is well aware of this, which is why they launched the Energy Company Obligations (ECO) scheme in 2013.

The scheme works by encouraging the big energy companies to provide funding to poorer households to replace their boilers. It makes the whole process of replacing a boiler much cheaper. In some cases the replacement is even done for free!

Read on to find out more about this type of boiler replacement funding, and whether you’re eligible!

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The boiler replacement funding scheme, ECO

ECO is aimed at improving the energy efficiency of vulnerable homes across the UK through several key measures. These include loft, solid wall and cavity wall insulation and, most crucially of all, gas boiler replacement.

According to Which?, there are 6.5 million households in Great Britain that are eligible for the scheme. The government have set a target of improving the energy-efficiency of 900,000 homes per year until 2022, which is when the current phase of scheme ends.

To hit these numbers, ECO has been made compulsory for all of the so-called “Big Six” energy providers, which are British Gas, EDF Energy, E.ON, Npower, Scottish Hydro and SSE. Furthermore, from 2020 ECO was expanded to be applicable to cover any company with more than 150,000 customers.

Each of those companies has to put a certain amount of capital towards ECO measures every year. This means there is an excellent chance that your particular energy provider will undertake a boiler replacement for you via the ECO scheme. This is provided you meet the relevant criteria – and we’ll get into that below!

Heating companies don’t have to accept every application they receive. You can, though, apply to other companies if your own supplier rejects you.

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The Three Step Test for boiler replacement funding

How do you qualify for boiler replacement funding? The ECO scheme was set up to help vulnerable, disadvantaged or low-income families and households, so if you’re going to qualify for the scheme you’ll need to meet the criteria. The below information is only a guideline, and all cases will be assessed individually!

To keep it simple, the criteria have been split into three sections:

  • Your household.
  • The benefits received by the people in the household.
  • The boiler itself.

1. Your household 

The ECO scheme is only available to those households which have a combined annual income of £16,010 or less.

Furthermore, you must also be the homeowner, or have permission from your landlord if you’re a tenant. Those living in council tenanted buildings or under a social housing scheme are unfortunately not eligible for the grant.

Your home must be connected to the mains gas supply, as this is what your boiler will use.

2. Your benefits

Those who receive Pension Credit or Child Tax Credits will automatically qualify for the ECO scheme and can apply for boiler replacement funding, but it’s not so clear cut for other benefits.

Have a look at the list of main benefits below. You’ll only be eligible if your household is receiving a main benefit plus at least one of the additional criteria on the right:

Income Related Support & Allowance Scheme
Income Based Job Seekers Allowance
Income Support
Receive Higher Rate of Disability Living Allowance
Receive Pension Premium
Receive Employment Support
Have a child under 16 in the household
Have a child under 20 not in higher education in the household
Working Tax CreditsBe over 60 years old
Receive a disabled worker benefit
Receive a severe disability benefit
Have a child under 16 in the household
Have a child under 20 not in higher education in the household
Universal CreditHave a child under 16 in the household
Have a child under 20 not in higher education in the household
Receive Disability Living Allowance (DLA)
Receive a Personal Independent Payment (PIP)
Have limited capability to work or work-related activities
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3. Your boiler

First and foremost, you must already have a boiler in your home to be considered for the ECO grant. As the name suggests, boiler replacement funding is not available for first-time installations!

The main factor, assuming you do have a boiler, will be the efficiency of that boiler. Older boilers are less efficient, as we detail below:

  • 0-5 years old: These boilers will likely have an A or B energy-efficiency rating, which means they won’t qualify.
  • 5-8 years old: These are borderline cases which will probably only qualify if something has gone wrong with them.
  • 8+ years old: Likely to have a low enough efficiency rating to qualify.

The above points are just a guideline though, and whether or not your household is eligible for boiler replacement funding will be decided by an independent inspection. You can usually get this free of charge by contacting the relevant energy company.

You can also find out more information and make your application by contacting Energy Saving Advice Service on 0300 123 1234. If you live in Scotland you need to contact Home Energy Scotland on 0808 808 2282.

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Other things to consider

One thing to consider is that most of the boilers under the ECO scheme are gas boilers, and some households use oil or LPG boilers. That’s not necessarily a problem though, because if you’re connected to the mains gas supply you can still apply. If you aren’t, you can get in touch with a local supplier to have it connected up.

You can alternatively consider other forms of low-carbon home heating such as biomass or heat pumps. The Domestic Renewable Heat Incentive can save you money on this!

Hopefully now you have a good idea on whether you can get funding. As a next step, why not read some of our other blog posts to help inform you on what kind of boiler is best for you?

You can also contact us to put you in touch with a local installer. Our partners will give you a great price on your perfect new boiler!


Charlie is a content writer at HomeSage. Having left Oxford University he joined HomeSage in 2020 to help create the UK's best resource in the home improvement sector. In his spare time he enjoys walking his dog Zeus and playing cricket.