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Heat pump scheme risks selling out

UK: Based on current heat pump installation figures, the government’s Boiler Upgrade Scheme (BUS) risks running out of vouchers, months ahead of the scheme’s end date. 

According to the Energy and Climate Intelligence Unit (ECIU), an independent UK advisory organisation, the number of homes installing a heat pump using the scheme has grown by around 10% month-on-month. If these rates continue, as many as around 150,000 heat pumps could be installed over the first three years of the scheme, meaning that the 90,000 vouchers available could be over-subscribed by more than 50%.

The £450m scheme, providing a £5,000 or £6,000 grant for air or ground source heat pumps respectively, was meant to come to an end in March 2025, but was recently extended for another three years until March 2028. If the level of funding is kept the same, with 90,000 vouchers available over the three-year extension, then these extra vouchers could also be spent well ahead of schedule, potentially selling out as early as mid-2025.

Jess Ralston, energy analyst at ECIU, said: “The gas industry has said that the North Sea will continue to decline in the coming years so unless we start to rapidly shift away from gas boilers now, we’ll become even more dependent on foreign gas imports.

“It’s still relatively early days for the scheme, but if demand continues to grow as it has, government will need to choose between boosting the scheme so that it reaches its full potential, or not – which could leave us more dependent on gas imports.”

ECIU maintains that improving public awareness of heat pump technology and the funding available, as well as supporting new and existing installers to train and upskill could help to keep up the current pace of installations and avoid a cliff edge for industry. 

If that is achieved, the ECIU claims that, based on MCS data, the UK’s target of 600,000 heat pump installations per year could be met as early as mid-2025, with total installations surpassing 1 million in total by 2026 if the momentum is maintained.

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