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Heat pump firms rue lack of budget support

UK: Heat pump manufacturers have expressed disappointment at the chancellor’s lack of support in today’s spring budget.

Both Daikin and Mitsubishi Electric regretted Jeremy Hunt’s failure to decouple electricity from gas.

“While the price of electricity is pegged to the cost of gas, dependent upon its demand and supply, or potential for weaponisation as with the war in Ukraine, it will remain at risk of continued price hikes,” commented Mitsubishi Electric’s residential product group director Russell Dean.

Daikin UK’s strategic business manager, heating & renewables, Henk van Den Berg, agreed: “A heat pump will typically save 5-10% in annual running costs compared to a gas boiler, but the prospect of further savings is being strangled by what’s basically an outdated tax on the electricity that powers them.”

Van Den Berg insists that more needs to be done to prevent the UK from falling behind other countries in the global green race: “While financial support from the government is still in place, the benefits of heat pumps versus fossil fuel systems need to be properly communicated to encourage better uptake of the Boiler Upgrade Scheme, bringing forward a ban on installing gas boilers in new homes, and clearer training support for installers.”

“While today’s Budget will continue to build the foundation for achieving net zero, it could have gone further and build upon a commitment for the environment and to reach the target by 2050,” said Russell Dean.

He welcomed some of the new measures announced, including the extension of the Climate Change Agreement scheme and plans to invest in more domestic sources of energy. 

 “However more long-term viable solutions for reaching net zero would have been welcomed in today’s statement,” he said.

“As many businesses plan to remove gas from their buildings over the next few years, and heat pumps are recognised as the future of both commercial and home heating in Britain, it is also vital the government supports wider adoption of the technology. To encourage this, we would have liked to have seen a commitment to roll over unspent money from the Boiler Upgrade Scheme for families to insulate their homes and install the technology.”

Paul Wrighton, director of sustainable infrastructure at Johnson Controls, felt that what was missing from the budget was a bold fresh programme promoting heat pump uptake and other energy efficiency opportunities. “Heat pumps especially are a no brainer for cost, efficiency and sustainability compared with old gas boilers,” he said.

“The current boiler upgrade scheme has a budget of £150m each year for three years and aims to issue 30,000 vouchers annually. But in the first eight months of operation, only 9,888 grants were awarded. There’s a huge opportunity to put tension on the matter with a real nationwide programme to accelerate the change.”

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