Calculate boiler replacement cost and payback
Use this calculator to compare an installation quote with any grant, then estimate whether lower running costs or servicing savings could pay back the upfront cost over time.
Net replacement cost of £3,500 with estimated annual saving of £200.
Boiler Upgrade Scheme grant presets
GOV.UK says the Boiler Upgrade Scheme can help cover part of the cost of replacing fossil-fuel heating systems with a heat pump or biomass boiler. This calculator includes grant presets so you can model the effect on upfront cost.
Common grant value for eligible installations.
Includes eligible ground source and water source heat pumps.
Available for residential properties where eligibility is met.
Available in limited eligible circumstances.
The calculator does not check eligibility. Always confirm current rules with GOV.UK, Ofgem or an MCS-certified installer before relying on a grant amount.
Boiler replacement payback formula
Payback compares the net replacement cost with the estimated annual saving. If the new system costs more to run, the calculator shows that there is no simple payback.
net replacement cost = installation quote - grant amount
annual saving = current annual heating cost - new annual heating cost + servicing difference
payback years = net replacement cost ÷ annual saving
10-year position = annual saving × 10 - net replacement cost
What to include in the replacement cost
A boiler or heating upgrade quote can include more than the appliance itself. For a useful estimate, include the full installed cost where possible.
Supply and fit
Boiler, heat pump, cylinder, controls, labour and commissioning.
Required works
Flue, pipework, radiators, electrics, scaffolding or making good.
Annual comparison
Compare realistic current and new heating costs, not just the quote.
Boiler efficiency and running costs
Boiler efficiency affects how much useful heat you get from the fuel you pay for. A newer, more efficient system can reduce waste, but actual savings depend on heating demand, controls, insulation, tariff and usage.
Estimate your energy bill first
Use gas and electricity usage, unit rates and standing charges to understand your current household bill.
Boiler vs heat pump modelling
A heat pump can have a higher installation cost than a straightforward gas boiler replacement, but grants and running-cost differences may change the comparison.
To model a heat pump, use the heat pump replacement type, enter the full quote, apply any grant, then compare your current heating cost with the expected new annual cost.
Should insulation come before heating upgrades?
A home that loses less heat may need less energy to stay warm. Before replacing a heating system, it can be worth checking loft insulation, draught-proofing, controls and the property’s EPC rating.
Estimate insulation payback
Compare loft insulation cost with estimated annual heating savings.
Paying for a boiler or heating upgrade
If you are financing a replacement, compare the payback result with any borrowing cost. A system can save money annually but still cost more overall if finance charges are high.
Compare borrowing cost
Estimate monthly repayments and total interest if you plan to finance the upgrade.
Boiler replacement cost calculator FAQs
How do I calculate boiler replacement payback?
Subtract any grant from the quote, then divide the net cost by the estimated annual saving.
Can I use this for a heat pump?
Yes. Enter the heat pump quote, model any grant, and compare current and expected annual heating costs.
Does the calculator check Boiler Upgrade Scheme eligibility?
No. It only models grant amounts. Check eligibility with GOV.UK, Ofgem or an MCS-certified installer.
Why might there be no payback?
If the annual saving is zero or negative, the upfront cost is not recovered through lower running costs in this simple calculation.