Are There Government Grants for Air Source Heat Pumps?

air source heat pump in green garden

Air source heat pumps are taking the world by storm. Despite this, they only account for 5% of the world's heating – although, they have the potential to supply more than 90% of global space and water heating (The International Energy Agency, 2020).

To encourage more people to invest in low-emission heat pumps, the UK government is offering a number of grants to Brits.

Not only will this make eco-friendly heating more affordable for people around the country, but it’ll also help the UK hit its target of net-zero emissions by 2050. However, not every home in the UK is suitable for heat pumps, so make sure to do your research before investing!

Want to hear more about which heat pump grants are on offer, and – more importantly – whether you’ll qualify for them? Scroll down, and we’ll tell you everything you need to know.

air source heat pump in green garden

What government grants are available for heat pumps?

There are currently a number of government grants up for grabs. While most of these schemes provide financial support to cover some of the cost of air source heat pump installation, others cover all of the cost to help low-income households.

So, what schemes are in place to help Brits afford heat pumps? Let’s take a look.

Renewable Heat Incentive (RHI)

Once your heat pump is installed, you can actually get paid for the energy you produce by joining the government’s Renewable Heat Incentive (RHI) scheme.

The scheme covers biomass boilers, solar water heating systems, and certain heat pumps.

 

How does it work?

In a bid to encourage the use of renewable heat technologies, the RHI scheme provides quarterly cash payments for the energy that domestic heat pumps produce.

Payments are made over a period of seven years, through the Domestic RHI scheme, and are based on the amount of renewable heat generated by your system.

 

Who is eligible for the RHI?

You can apply for the RHI scheme if you live in either England, Scotland, or Wales. You’ll also need to:

  • Own your home
  • Be a private or social landlord
  • Get a Microgeneration Certification Scheme (MCS) certificate for your heat pump
  • Have an up-to-date domestic Energy Performance Certificate (EPC)

Generally, new-build properties won’t be eligible for the scheme – unless you’re building your own home.

air source heat pump next to pink wall

Warmer Homes Scotland

The Scottish government’s Warmer Homes Scotland programme offers financial support to low-income households struggling to keep on top of energy bills.

 

How does it work?

Households can access the scheme by calling Home Energy Scotland, which will analyse which home improvements should be made. Any eligible households will then be put in touch with Warmworks, the managing agent of the Warmer Homes grant.

The scheme covers wall insulation, loft insulation, draught-proofing, boilers and heating, and renewable and micro-renewable heating systems.

 

Who’s eligible for Warmer Homes Scotland?

To get a heat pump grant through Warmer Homes Scotland, applicants must:

  • Be a homeowner or the tenant of a private sector landlord
  • Live in the home as their main residence
  • Have lived there for at least 12 months
  • Live in a home that is no bigger than 230 square metres, with an energy rating of 67 or lower
  • Live in a home that meets the tolerable living standard set out in the Housing (Scotland) Act 2006
  • Not have received support for energy efficiency improvements through Warmer Homes Scotland funding in the last five years

 

The individual must also be one of the following:

  • A pensioner with no working heating system, who is also in receipt of a passport benefit
  • Aged 75 or older, and in receipt of a passport benefit
  • Pregnant and/or caring for a child under 16, and in receipt of a passport benefit
  • Someone with a disability, who is also in receipt of any level of Personal Independent Payment (PIP)
  • Someone with a disability, who is also in receipt of high rate Disability Living Allowance (DLA)
  • Someone with a disability, who is also in receipt of low/medium rate Disability Living Allowance (DLA), and in receipt of an income-related benefit
  • A carer in receipt of Carers Allowance
  • Someone who has been injured or disabled serving in the Armed Forces, and is in receipt of Armed Forces Independence Payment/War Disablement Pension
  • Someone who has an injury or disability from an accident or disease caused by work, and is in receipt of Industrial Injuries Disablement Benefit

Nest Wales

Created by the Welsh Government, Nest aims to reduce the impact of fuel poverty in Wales by making low-income homes more energy efficient.

 

How does it work?

If a household is struggling to pay energy bills, they can call Nest’s helpline (run by the Energy Saving Trust), which analyses whether they’re eligible for support.

If the household meets certain criteria, they will be referred to British Gas, which will then conduct a “whole house assessment” – a property survey that analyses which home improvements should be made.

The benefits available under the Nest scheme include:

  • A new central heating system
  • A new energy-efficient boiler
  • Cavity wall insulation
  • External wall insulation
  • Internal wall insulation
  • Loft insulation
  • Room thermostats and heating controls
  • Water tank and pipe insulation
  • Air source heat pump
  • Ground source heat pump
  • Draught-proofing

 

Who’s eligible for Nest?

If you’d like to get support from Nest, you must:

  • Own or privately rent your home (not from a local authority or housing association)
  • Have an energy inefficient home that is expensive to heat
  • Receive a means-tested benefit, or have a chronic respiratory, circulatory, or mental health condition

The means-tested benefits that qualify are:

  • Child Tax Credit (with an income below £16,105 a year)
  • Council Tax Reduction
  • Housing Benefit
  • Income-based Jobseeker’s Allowance
  • Income-related Employment and Support Allowance
  • Income Support
  • Pension Credit
  • Universal Credit
  • Working Tax Credit (with an income below £16,105 a year)

Clean Heat Grant (CHG)

Although this grant hasn’t been released yet, it’s definitely worth keeping an eye out for.

The government’s Clean Heat Grant (CHG) is set to begin in April 2022, and will subsidise the installation of eco-friendly heating systems in UK homes, in a bid to replace gas boilers.

The £400 million scheme will give households £7,000 each to replace old polluting boilers with low-emission alternatives – including heat pumps.

The plans could help incentivise the installation of nearly 60,000 heat pumps over three years.

 

How does it work?

We’ll be honest – it’s not crystal clear yet. It was previously outlined that vouchers would be delivered through an upfront payment of £4,000, and delivery would be issued on a first-come, first-served basis.

However, new reports suggest that the government is planning to increase the grant to £7,000, but there has been no confirmation on whether it’s still first come, first served.

The government has also said it plans to review the grant in response to future market changes – or “if uptake falls substantially outside the expected range”.

 

Who’s eligible for the CHG?

Existing households and small non-domestic buildings across the UK will be eligible to apply – but again, the full list of eligibility criteria isn’t yet set in stone.

Air source heat pump in the snow

How much do heat pumps cost without grants?

According to the Energy Saving Trust, installing a typical heat pump system costs around £7,000 – £13,000.

This sounds like a lot, but when you consider that heat pumps typically last for 20 years – twice as long as the average gas boiler – you’ll be saving money for years to come.

Running costs will vary depending on a number of factors, including the size of your home, how well insulated it is, and what room temperatures you are aiming to achieve.

How much money can you save with heat pumps?

The amount of money you’ll save with heat pumps will depend on what energy system they’re replacing.

To give you a better idea, we’ve outlined how much money you could save by switching to heat pumps from different systems in the chart below. These figures are based on the installation of a standard air source heat pump in an average four-bedroom detached home in England, Scotland, or Wales.

Data from the Energy Saving Trust, June 2021

How much can you reduce your carbon footprint with heat pumps?

Similar to annual savings, the amount of CO2 you’ll reduce by using heat pumps will depend on what system you use now. But, as you can see in the chart below, you can reduce your emissions drastically by switching from every system – whether old or new.

Data from the Energy Saving Trust, June 2021

To put this into perspective, let’s compare these CO2 reductions to an everyday task – like driving a car.

On average, a new diesel car will emit 127 grams of CO2 per kilometre.

If we apply this to the smallest CO2 reduction of 2,350kg (swapping from a new electric storage heater), that’s the equivalent of driving 18,503km every year with a new diesel car. As for the largest saving of 11,300kg of CO2 a year (swapping from coal), that’s the same as driving 88,976km.

Since the average person drives 11,900 km a year, that means swapping coal for a heat pump is the same as taking 7.4 cars off the road each year.

Next steps

For a lot of people, the Clean Heat Grant is the main scheme that will help them afford heat pumps.

But if you simply can’t wait until April 2022, why not get a head start on your research? It’s a good idea to figure out what heat pumps actually are, how to find the best models, and how to get the most affordable options.

Luckily, we’ve got everything you need to know waiting for you on our pages below:

Beth Howell Writer

Beth has a real passion for green living. She’s been absorbed in eco research for over three years, and has become quite the expert. Whether you’re after a new set of solar panels, a home energy improvement, or you want to catch the latest eco news, she’s got your back.

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