A total of £173million in possible grants towards heat pumps has gone unclaimed
Britons appear to be shunning heat pumps with £173million in possible grants going unclaimed, according to Ofgem figures. Now nearing its second anniversary, the Boiler Upgrade Scheme has so far issued £127m in grants from a £300m pot of funding.
The scheme covers some of the cost of replacing fossil fuel heating systems, including oil and gas, with a low carbon alternative such as a heat pump or biomass boiler.
It was introduced in May 2022 as part of measures aimed at cutting the 68 million tonnes of CO2 emitted every year from heating our homes. Ofgem says 22,307 households were given the grants in the 23 months to March. This compares to a 55,000 target.
Mike Foster, Chief Executive of the Energy and Utilities Alliance, told Express.co.uk the problem lies with the scheme’s design. He said: “The scheme’s design is flawed, with only the wealthy capable of applying for the subsidy. The average cost of installing a heat pump, under the scheme, is £13,300 so with the subsidy of £7,500 the applicant still needs to find £5,800 themselves.
“I’m sure the average taxpayer, struggling to pay their own energy bills, is far from happy to be subsidising the well-off to make a lifestyle choice.”
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The scheme aims to fit homes with low-carbon heating systems such as air or ground source heat pumps. These work by extracting heat from the environment.
The Department for Energy Security and Net Zero (DESNZ) is responsible for the scheme which had offered householders £5,000 grants to switch.
Heat pump installations cost from £10,000 to £15,000, much more than the £2,000 to £4,000 cost of replacing gas boilers costs £2,000 to £4,000. It has meant that, even with the grants, heat pumps have remained expensive and uptake has been stubbornly low.
A total of 18,900 heat pumps were installed between May 2022 and December 2023 under the scheme, according to the Telegraph.
The figures is less than half the 50,000 installations expected, the same publication reports. The installation figure compares to about 1.5 million new gas-fired boiler installations.
It comes as a think tank reported that households with insulation and clean tech such as heat pumps and electric cars are more “energy patriotic” as they rely far less on imported fuels.
The Boiler Upgrade Scheme has issued £127m in grants from a £300m pot of funding
Analysis from the Energy and Climate Intelligence Unit (ECIU) found homes using heat pumps, insulation and electric vehicles make more use of British energy and use less than half the imported fuel of a household reliant on gas and petrol.
ECIU suggested people who want to be “energy patriotic” should be buying British by switching from gas boilers and petrol cars to cleaner alternatives that run on electricity increasingly powered by domestic wind and solar energy.
The think tank said the Government should help those who cannot afford to invest in new technology by agreeing to more contracts for new UK wind farms, ensuring homes can buy British for more of the power they use for appliances and lighting.
ECIU analysis found a typical household with a gas boiler, petrol car and average electricity demand relies on imports of energy, mostly gas and oil, for nearly 70 percent of its total needs, around 17 megawatt hours (MWh) a year.
A house with “good” levels of insulation, using a heat pump and an electric car will use less than half that level of energy imports (45 percent), at around 7.5 MWh a year, from gas used in electricity generation.
Homes with solar panels as well would use just over a third (36 percent) of the fuel imports of a typical home, at just 6MWh a year, according to the analysis.
ECIU looked at the use of oil and gas imports alone, rather than “net imports” which balances the amount of energy the UK brings in against the amount produced and exported, to give what it said was a more detailed view of the country’s reliance on imported fuels.
Ofgem says 22,307 households were given the grants in the 23 months to March
Jess Ralston, energy analyst at the ECIU, said: “Those who want to be ‘energy patriotic’ and buy British homegrown energy should be switching from gas boilers and petrol cars to electric heat pumps and EVs that increasingly run on British wind and solar energy.
“As North Sea oil and gas output continues its inevitable decline, the dependence on foreign imports for households using boilers and internal combustion cars will only become more stark.
“Generating more British renewable energy and using it to power heat pumps and electric cars would get households, and the UK as a whole, off energy imports and remove the risk of the kind of price volatility we’ve seen in recent years.
“The Government has increased the grant for heat pumps, but then cut other policy under intense lobbying pressure from gas boiler manufacturers which likely means fewer heat pumps sold, leaving households and the UK more dependent on foreign gas.”
A Department for Energy Security and Net Zero spokesperson said: “Nearly half of all homes in England now have an EPC rating of C or above, up from just 14 percent in 2010, and we’re supporting families make the switch to heat pumps, rather than forcing them, with our £7,500 heat pump grant – one of the most generous schemes in Europe.
“At the same time, we’re taking the common sense approach to reduce our reliance on imports by backing domestic gas production, which is four times cleaner than liquefied natural gas imports from abroad.”
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