Boiler Upgrade Scheme is under delivering
The UK government's flagship green heating scheme, the Boiler Upgrade Scheme, which offers households £5,000 to switch from a gas boiler to a low-carbon heat pump, has been described as "seriously failing" by a Lords inquiry. The Lords Climate Change Committee stated on Wednesday that the low take-up of grants means that the national target for green heating is "very unlikely to be met." The government has responded by saying that it will launch a marketing campaign to make people more aware of the scheme.
The government wants to install 600,000 low-carbon heat pumps annually within five years to meet the UK's climate change targets. However, currently, only 50,000 are installed each year. The Boiler Upgrade Scheme was introduced to kick-start the heat pump industry in England and Wales and reduce the installation costs for homeowners. But Baroness Parminter, chair of the Lords Committee, heavily criticised ministers in her letter to the government for not doing more to raise awareness of the scheme, which is on track to issue just half of the allocated grants.
Heating in UK homes is responsible for nearly 17% of the country's greenhouse gas emissions, which contribute to climate change. Heat pumps use electricity to run and are three times more efficient than a gas boiler, so as the country switches to renewable electricity, homes will be cheaper to heat and produce fewer emissions. However, the government's research from Autumn 2022 shows that 80% of people in the UK did not know what a heat pump was, let alone were aware of the scheme.
Anthony Hibbs, who got a heat pump installed in his new-build home in Newcastle-under-Lyme through the scheme last year, said his new heating system was "absolutely brilliant." However, he said finding information on installers and the scheme was difficult: "I had to look online and do a lot of research. It wasn't easy at first, and I have never seen the scheme advertised as such."
John Taylor, another recipient of the BUS voucher, also said that the government needed to make it clearer which installers to use: "I searched online and found cowboys out there. There is not a lot of guidance leading you to decent people - you are on your own." There are an estimated 3,000 heat pump installers in the UK compared to 130,000 registered gas heating engineers.
The committee said that the government is funding some training places for installers but needs to give more certainty to engineers that it is worth investing their time in getting retrained. The problems with the scheme are reminiscent of the government's previous Green Homes Grant, which was meant to support households with energy efficiency measures like insulation but was scrapped after less than a year in 2021 for a lack of installers.
Rebecca Dibb-Simkin, Chief Product and Marketing Officer at Octopus Energy, which was praised by the Committee for its investment in heat pump design and training, said that the scheme had boosted confidence in the industry, and Octopus Energy has 50,000 people on its waiting list for a heat pump. She said, "Government and business need to work together on this, we hope the grant will continue. We know we can generate demand, and the grant would help people with the cost… it's kind of a perfect relationship."
The committee has said that for lower- and middle-income households, the grant is not enough, and they are being put off by the higher upfront costs of installing a heat pump compared to a gas boiler.