Government Spent £140 Million on Heat Pump Grants

An expert said the scheme benefits wealthier homeowners, channelling taxpayers’ funds towards those who are already financially capable of upgrading.
Government Spent £140 Million on Heat Pump Grants
An engineer checks the installation of a Daikin 7KW heat pump on a model house within the Octopus Energy training facility in Slough, England, on Nov. 2, 2021. (Leon Neal/Getty Images)
Owen Evans
5/14/2024
Updated:
5/14/2024
0:00

The government has spent nearly £140 million on grants designed to cover half of the costs of heat pumps, some of which cost £13,500 to buy and install.

In a written question for Parliament on Tuesday to the secretary of state for energy security and net zero, Conservative MP Selaine Saxby asked how much has been spent on the Boiler Upgrade Scheme and how many heat pumps have been installed.

The Boiler Upgrade Scheme, launched in April 2022, provides grants to encourage property owners to replace existing fossil fuel heating with heat pumps, which run on electricity and work like a fridge in reverse to extract energy from the air or ground.

A total of £7,500 is made available towards the devices.

The mean cost of an air source heat pump is £13,333, £26,000 for a ground source heat pump, £27,355 for a shared ground loop ground source heat pump, and £16,000 for a wood-fuelled biomass boiler.

The government said that as of the end of March, the total value of grants paid through the Boiler Upgrade Scheme was £138.9 million. It has paid out to 23,871 grant applications, mostly for air source heat pumps.

Net Zero

Heat pumps are part of the government’s strategy to reach net zero carbon emissions by 2050, with a target of 600,000 heat pumps installations by 2028.

The UK has signed into law a policy to achieve net zero by 2050 with the Conservative government setting out a strategy called “Build Back Greener” to decarbonise all sectors of the UK economy.

An expert criticised the scheme as it rewards those people who’ve already the means to buy them with taxpayers’ cash.

Mike Foster, CEO of the industry body representing gas heating specialists The Energy and Utilities Alliance, told The Epoch Times the problem with the scheme is that it does not cover the full cost of installing a pump.

“The subsidy is limited to £7,500 pounds and under the scheme and administration, the average cost is £13,300. So the other £5,800 pounds has to be met by the homeowner,” he said.

He said, however, that by that definition, only those people who can afford that amount of money can access the subsidy.

“My challenge to the scheme is that it’s rewarding those people who’ve already got substantial cash deposits at their disposal. And it’s paid for by and out of general taxation,” he said.

“So we are all paying for those who are well off to effectively making lifestyle choices and at a time when people are struggling to pay their bills,” he said.

Not Doing It to Save Money

Mr. Foster said that a heat pump is more expensive to run than a gas boiler, on average.

“The people who were making the choice are mindful of that, they’re not doing it to save money. They’re doing it to reduce their carbon emissions, which is worthy, and that’s the purpose of these different technologies,” he said.

“But when people are struggling to pay their bills, they’re not going to opt for a technology that puts heating bills up,” he added.

He noted that there are five million homes without loft insulation and urged the government to focus on these first.

“You are making that home more energy efficient and you are therefore saving on heating bills for the homeowner, reducing carbon and saving the planet. And because it doesn’t cost as much to insulate a property compared to a £7,500 subsidy for a heatpump, it’s benefiting far more people,” he added.

Cost of £115 Billion

According to its Heat Pump Investment Roadmap strategy, released in April last year, reducing the UK’s carbon emissions to Net Zero by 2050 means it must decarbonise the heating of over 30 million homes across the UK in a little over 25 years.

The UK’s Climate Change Committee projects that by 2050 all heating in British homes will be provided by low-carbon sources, of which 52 percent will be heatpumps.

If it is extended to cover all 23 million homes currently using a gas boiler, the scheme could cost £115 billion, according to a study conducted by the TaxPayers’ Alliance (TPA), a UK pressure group campaigning for a low-tax society.

The Epoch Times contacted the Department for Energy Security and Net Zero for comment.

Owen Evans is a UK-based journalist covering a wide range of national stories, with a particular interest in civil liberties and free speech.