Off-Gas-Grid Heating Options in 2026: Costs for the UK’s 4 Million Off-Grid Homes

Quick answer: around 4 million UK households are not connected to the gas grid (House of Commons Library, off-gas-grid briefing CBP-9838) — most heat with oil, LPG or electricity. In 2026 the cheapest options to run are heat pumps (roughly 7–9p per kWh of heat at current cap rates), then oil (8–10p), biomass (9–10p), bulk LPG (10–12p), HVO (12–16p) and direct electric heating (about 26p). Grants change the upfront picture dramatically: oil and LPG homes can get £9,000 off a heat pump for applications between 21 July 2026 and 31 March 2027.

The options at a glance

Figures on this page are estimates based on the July–September 2026 Ofgem price cap (electricity 26.11p/kWh) and typical fuel prices in early July 2026. Your costs will vary with your tariff, home and usage — estimates, not guarantees.

Heat pumps: the grant-backed frontrunner

For most off-gas homes an air source heat pump is now the strongest all-round option: the £7,500 standard grant — rising to £9,000 for oil and LPG-heated homes in the 21 July 2026 to 31 March 2027 window — can bring a typical install down to £800–£6,500 net. Running costs at the July–September 2026 cap (electricity 26.11p/kWh) work out around 7.5p per kWh of heat at a seasonal efficiency of 3.5. The catch: your home needs a proper heat-loss survey, and some radiators may need upsizing. Full details in our £9,000 uplift guide and the heat pump cost guide; if you are switching from oil specifically, start with our oil-to-heat-pump guide.

Sticking with oil — or converting it to HVO

Oil remains cheap-ish to run when kerosene prices are low (74p/litre UK average on 2 July 2026 per BoilerJuice), but prices swung by more than 20p/litre over the past year, and a new oil boiler locks in another 15 years of that volatility with no grant support. HVO (hydrotreated vegetable oil) is a renewable drop-in alternative — conversion costs only around £500 — but the fuel itself sells at roughly £1.10–£1.45/litre (Your NRG, Crown Oil), close to double kerosene, and unlike transport use there is currently no government support for HVO home heating. Treat HVO as a watching brief, not a plan.

Biomass: good in the right (rural) home

Pellet boilers attract a separate £5,000 BUS grant, restricted to off-gas-grid rural properties with an emissions certificate. Pellets currently deliver heat at roughly 9–10p/kWh. They suit larger draughty properties that a heat pump would struggle to serve without major upgrades, but need fuel storage space and annual maintenance.

Electric options: storage heaters and infrared

Modern high-heat-retention storage heaters on an off-peak tariff typically land at 15–20p per kWh of heat — better than direct electric at 26p, still roughly double a heat pump. They make sense for small, well-insulated homes and flats where a wet system is impractical. Infrared panels can suit single hard-to-heat rooms rather than whole homes.

Who the 4 million actually are

The off-grid population is not one market. Industry bodies estimate roughly 1.5 million UK homes heat with oil (heavily concentrated in rural England, Wales and most of Northern Ireland) and around 200,000 with LPG; most of the remainder rely on electric heating of some kind, from ageing storage heaters in rural flats to panel heaters in park homes. That composition matters for policy and for you: oil and LPG homes are precisely the group the temporary £9,000 uplift targets, while electrically heated homes — often the highest bills of all at capped rates — get no equivalent boost and should look hardest at heat pumps, insulation and time-of-use tariffs.

Do not skip the boring step: insulation first

Every option in the table above gets cheaper to run in a better-insulated home, and heat pumps in particular can be sized smaller (and quoted cheaper) after loft or cavity work. If your EPC lists outstanding insulation recommendations, price those first — loft top-ups and cavity fill remain among the cheapest kilowatt-hours you will ever buy, and off-grid homes with EPC D–G ratings may qualify for council-run Warm Homes: Local Grant funding for fabric measures. See the insulation cost guide for typical prices.

How to choose

• Oil or LPG today, planning to stay put? Get heat pump quotes in the £9,000 window before 31 March 2027 — the maths may never be this good again
• Boiler died and you need heat this week? A like-for-like swap is fastest — but read our replacement decision guide before signing
• Small well-insulated property, no wet system? Storage heaters on a time-of-use tariff are a legitimate low-capex answer
• Large rural property with outbuildings? Compare biomass (£5,000 grant) against a ground source system

Check what other help you qualify for in our complete UK grants list, then run your own numbers with the free savings calculator. Want quotes when our comparison service launches? Register your interest.