Heating Oil for New Builds in the United Kingdom

Designing a new home is one of the most exciting projects you’ll ever take on. Every decision—from layout to insulation to heating—shapes how comfortable, affordable, and sustainable your property will be for decades.

For many rural and semi-rural developments across the UK, mains gas simply isn’t an option. That’s where heating oil continues to play an important role. Despite the growing interest in heat pumps and renewables, oil heating remains a dependable, high-output solution for thousands of new builds each year—especially in off-grid locations.

With over 20 years of experience in property and energy content, this guide cuts through the noise to give you a clear, real-world look at heating oil for new builds—what it is, how it works, costs, design considerations, and whether it’s right for your project.

What Is Heating Oil—and Why Is It Still Used in New Builds?

Heating oil (also known as kerosene) is a liquid fuel stored on your property in a dedicated tank. It feeds an oil boiler, which provides central heating and hot water, much like a gas system.

So why do developers and self-builders still choose oil?

• Ideal for off-grid homes where gas isn’t available

• High heat output, perfect for larger or detached properties

• Modern oil boilers are highly efficient, often exceeding 90%

• Lower installation cost compared to many renewable systems

• Proven, familiar technology with wide installer availability

In short, oil heating offers reliability and performance—two things every new homeowner values.

How Heating Oil Systems Work in New Build Homes

A typical oil-heated new build includes:

1. Oil Storage Tank

Installed above ground (usually in the garden or side of the property) or occasionally underground. Modern builds almost always use bunded tanks—double-skinned units that protect against leaks.

2. Oil Boiler

Located in a utility room, garage, or external housing. Today’s condensing oil boilers are compact, quiet, and extremely efficient.

3. Central Heating System

Radiators or underfloor heating distribute warmth throughout the home, while a hot water cylinder supplies bathrooms and kitchens.

Fuel is delivered by tanker directly to your property—no monthly bills or standing charges. You buy oil when prices suit you.

Designing Your New Build Around Oil Heating

One of the biggest advantages of installing oil in a new build is design freedom. You’re not retrofitting—you’re building smart from day one.

Here’s what experienced developers plan early:

Tank Positioning

Allow clear access for delivery vehicles and keep required distances from boundaries and buildings. Good placement also improves visual appeal.

Boiler Location

Utility rooms are popular, but external boilers free up internal space.

Heat Distribution

Many new builds pair oil boilers with underfloor heating, creating even warmth and improving overall efficiency.

Insulation First

A well-insulated home dramatically reduces oil consumption. High-performance walls, roofs, and glazing make a bigger difference than any boiler upgrade.

Future Flexibility

Some homeowners install oil now but design the system so renewables (like solar thermal) can be added later.

Costs: What Should You Budget?

Installation (Typical Range)

• Oil boiler: £2,000–£4,000

• Storage tank: £900–£2,000

• Pipework & controls: £1,000–£2,000

Total system cost: usually £4,000–£8,000+

Running costs depend on oil prices and how energy-efficient your home is. Because you buy fuel in bulk, many homeowners appreciate the ability to shop around and purchase when prices dip.

Unlike gas, there are no standing charges—just pay for what you use.

Regulations and Environmental Considerations

UK building standards increasingly focus on carbon reduction. New homes must meet strict efficiency targets, and oil systems are expected to be paired with excellent insulation and smart controls.

While heating oil is a fossil fuel, modern boilers burn far cleaner than older models. There’s also growing interest in renewable liquid fuels, which could allow existing oil systems to transition to lower-carbon alternatives in the future.

Energy policy and guidance are overseen by organisations such as Ofgem, but for self-builders the key takeaway is simple: plan for efficiency from the ground up.

A well-designed oil-heated new build can feel just as future-ready as many alternative systems.

Is Heating Oil Right for Your New Build?

Heating oil is particularly well-suited if:

• Your plot is off the gas grid

• You’re building a detached or rural home

• You want strong heating performance

• You prefer lower upfront costs

• You value fuel-buying flexibility

It may be less suitable for compact urban homes or developments focused exclusively on ultra-low-carbon technologies.

Ultimately, the “best” system depends on location, budget, lifestyle, and long-term plans.

Smart Tips From 20 Years in the Industry

• Oversize insulation, not the boiler. Heat loss matters more than boiler power.

• Choose a bunded tank. It’s safer, longer-lasting, and often required.

• Install smart controls. Zoned heating and programmable thermostats save oil every year.

• Plan delivery access early. Tanker access is often forgotten during site layout.

• Future-proof your design. Leave space for solar or hybrid upgrades later.

These small decisions add up to major comfort and cost savings.

Frequently Asked Questions (FAQ)

Is heating oil allowed in UK new builds?

Yes. Oil heating is still permitted, particularly for off-grid properties, provided your home meets current energy-efficiency standards.

How efficient are modern oil boilers?

Most new condensing oil boilers operate at over 90% efficiency—far better than older models.

Can oil heating work with underfloor heating?

Absolutely. Oil boilers pair very well with underfloor systems, especially in new builds.

How often do I need oil deliveries?

Typically 2–4 times per year, depending on tank size, home insulation, and usage.

Is heating oil expensive to run?

Costs vary with market prices, but well-insulated new builds often find oil competitive with other heating options.

Can I switch to renewables later?

Yes. Many homeowners design oil systems so they can integrate solar thermal or hybrid solutions in the future.

How long does an oil boiler last?

With regular servicing, expect 15–20 years of reliable operation.

Final Thoughts

Heating oil remains a practical, powerful, and proven option for UK new builds—especially beyond the gas grid. When combined with excellent insulation, modern controls, and thoughtful design, it delivers comfortable living with manageable running costs.

If you’re planning a new home and weighing your heating options, oil deserves serious consideration—not as yesterday’s technology, but as a dependable foundation you can build upon for years to come.