Boiler upgrade scheme failing to deliver

UK: The government’s Boiler Upgrade Scheme (BUS) is failing to deliver on its objectives after seeing a “disappointingly low” take-up of grants, a new parliamentary report states. 

According to Ofgem figures to the end of January, only 9,889 vouchers, worth a total of £49,730,000, had been issued since the scheme was launched last May. By the same date, 7,641 vouchers had been redeemed. 

Based on those figures, the House of Lords environment and climate change committee maintains that the Government’s 2028 target of 600,000 installations per year is very unlikely to be met. 

The government has allocated £150m per year to the three-year scheme which offers a grant of £5,000 towards the cost and installation of an air-source heat pump, £6,000 on a ground-source heat pump and £5,000 on a biomass boiler, when replacing fossil fuel heating systems.

The committee has written to Lord Callanan, parliamentary under secretary of state for energy security and net zero, warning that if the current take-up rate continues, only half of the allocated budget will be used to help households switch to low-carbon heating systems and a healthy market of installers and manufacturers will not be in place in time to implement low-carbon heating policy measures smoothly. 

The committee found that public awareness of low-carbon heating systems was “very limited”, and saw the promotion of the BUS as “inadequate”. It also found a shortage of heat-pump installers and insufficient independent advice for homeowners. 

Despite the availability of the grant, upfront costs were found to be too high for many households. The committee also called for electricity market reform to ensure running costs were affordable.

Meanwhile, hydrogen was dismissed by the committee as “not a serious option” for home heating for the short to medium-term.

The committee has called on the government to provide greater clarity to industry and consumers on feasible options for low-carbon home heating and for the remainder of the BUS first year budget to be rolled over into the second year.

“The government must quickly address the barriers we have identified to a successful take-up of the Boiler Upgrade Scheme in order to help grow the take up of low-carbon heating systems. It is vital they do so if we are going to meet our net zero ambitions,” said environment and climate change committee chair Baroness Parminter.