Boiler Upgrade Scheme Applicants Increase In January

The number of applicants for the Boiler Upgrade Scheme increased by almost 40% in January 2024, compared to January 2023, according to the latest government data.

With the Boiler Upgrade Scheme, homeowners and small business owners in England and Wales can get £7,500 towards the cost of a boiler replacement system, which includes air source heat pumps, ground source heat pumps, and biomass boilers.

Since the scheme started in May 2022, the government has received a total of 33,424 applications, 96% of which have been for air source heat pumps, 3% for ground source heat pumps.

This is hardly surprising, given that more homes are suited to air source heat pumps than ground source ones, which require properties to have a substantial amount of land around them to house their underground piping system.

Additionally, air source heat pumps cost less than ground source heat pumps – £10,000 on average compared to £24,000 – which means that the £7,500 grant from the Boiler Upgrade Scheme can make a sizable dent in their cost.

According to the latest statistics, 47% of the grants that have been awarded were used to replace gas boilers, and 20% to replace oil boilers, despite the fact that only around 3% of households in England and Wales are heated by an oil boiler.

This is probably because oil boilers are one of the least energy efficient ways of heating a home, and can significantly lower a property’s Energy Performance Certificate (EPC) ranking, giving homeowners who have one much more of an incentive to switch.

Jess Ralston, energy analyst at the Energy and Climate Intelligence Unit (ECIU), had this to say on the latest figures:

“Heat pump sales have surged in the US, where they are dubbed ‘freedom pumps’ and Europe since the Russian invasion of Ukraine, and are starting to gain momentum in the UK. This comes despite the gas industry pushing ‘campaigns of misinformation’ around the technology, as one Government Minister put it, and confusion from the Government on its Clean Heat Market Mechanism that aims to boost heat pump sales.”

Despite heat pump sales slumping slightly in 2023 in several European countries, they actually increased by 4% in the UK, according to the European Heat Pump Association (EHPA).

However, change might not be happening fast enough for the government to reach its goal of having 600,000 heat pump installations a year by 2028.

Annual heat pump installations are hovering around 40,000, according to the latest Microgeneration Certification Scheme (MCS) data, and the £450 million allocated to the Boiler Upgrade Scheme will only benefit a maximum of 60,000 homes, out of the UK’s 28 million.

Given that heat pumps are around five to 10 times more expensive than gas boilers, more government support will likely be needed to make installing a heat pump a viable option for the majority of UK households.