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Cautious welcome for GHG, but does it go far enough?

There has been further positive, but cautious, industry reaction to the details of the government's £2bn Green Homes Grant (GHG) designed to improve energy efficiency of homes.

Homeowners who apply for the the Green Homes Grant voucher will receive up to £5,000 to install a range of energy efficiency and low carbon heating technologies.

To qualify for the scheme, homeowners must install a primary measure, which includes the installation of air source heat pumps, which deliver renewable heating to residential properties. The new scheme comes as the Government looks to rejuvenate the economy after the impact of COVID-19, while also taking steps towards its 2050 net zero carbon emissions goal.

Mitsubishi Electric welcomed the voucher scheme as a necessary step on the road to net zero. Max Halliwell, communications manager said: 'The scheme is a very welcome adrenaline shot for the sustainable heating market. As it stands, the domestic heating sector accounts for a third of all UK emissions – so incentivising the uptake of low carbon heating options is an important step on the path to cutting carbon emissions.

“Having to install an air source heat pump as one of the primary requirement for grant acceptance also means that the industry is going to grow, delivering more job opportunities for installers across the country. “This is also great news for homeowners who make the switch. Not only will they benefit from cost savings on fuel, the grant also helps cover the upfront fee of buying a heat pump. In turn, this will deliver the green credentials that many are increasingly looking for in their homes. In short, this scheme delivers benefits to all stakeholders across the value chain – and not least the environment”.

As part of the Government’s £2bn investment in the Green Homes Grant, £500m will be delivered through local authorities to reduce fuel poverty and support the installation of low carbon heating. Those in lower income households can receive double the grant limit, up to £10,000 for their property, helping to move away from a reliance on costly fossil-fuel heating systems, especially in the winter which can lead to many households experiencing fuel poverty.

Iain Bevan, commercial manager – heating & renewables at Daikin, said: “Confirmation that the Green Homes Grants will include heat pumps is extremely positive news and an important step in helping improve the energy efficiency of the UK’s homes, alongside creating more green job opportunities.

“Heat pumps offer some of the biggest energy efficiency and cost savings for consumers, however awareness of these benefits is generally lower than other technologies, such as insulation or solar panels.

“There’s a clear role for our industry in educating consumers to help them make the right decisions for their homes, while ensuring our network of tradespeople can take advantage of the opportunities arising from the scheme.

“As part of our Energy for Change campaign, which aims to increase understanding of the benefits of heat pumps, we recently launched the Sustainable Home Network. As well as providing training and support for installers as the UK shifts to eco-friendly heating, this network will be vital in helping homeowners find MSC certified providers.”

After examining the details of the scheme Jeff House, head of external affairs at Baxi Heating said: 'Given that the UK has the least energy efficient housing stock in Europe it makes absolute sense to prioritise action with a “fabric first” approach; the cleanest kWh of heat is that which is not required.

'We welcome the inclusion of heat pumps as an eligible measure as there is a clear need to grow the UK supply chain and skills base to support a wider role for this technology group as we transition towards net-zero. However, the scope of heating measures should be wider to better support consumer needs and include other key components such as hot water storage cylinders.

'What is clear is that more concerted action is needed and further funding will be required to enable a sustainable and equitable transition for the whole of the UK housing stock. With this in mind, we see the Green Homes Grant scheme as an interesting start and await the publication of the BEIS Heat and Buildings Strategy, together with the outcome of the current Government spending review with interest.'

Mark Wilkins, head of training and external affairs at Vaillant, said: “We welcome the Government’s announcement on the details of the £2 billion Green Homes Grant (GHG) and are heartened by the inclusion of air and ground source heat pumps as part of the available measures. 

“Although it is already possible to claim annual payments for installing a heat pump with the Renewable Heat Incentive (RHI), the initial outlay of purchasing the equipment has always been a barrier to entry within the heat pump market. With the new GHG, homeowners in England will be able to claim vouchers of up to £5,000 towards the cost of fitting a new heat pump, including parts and labour. Households on low income can receive vouchers covering 100% of the cost of the improvements, up to a maximum of £10,000. 

“What’s more, these beneficiaries will also be able to apply for RHI funding giving them annual payments over a period of seven years. The only caveat is that the cost of the GHG will be deducted from this, reducing the total RHI amount that households can claim. 

“Despite these positives, we are disappointed that the grant does not cover the installation of energy efficient condensing boilers. While growing the heat pump market is essential to decarbonising heat, many homes still have standard efficiency boilers; replacing these could have been a quick win solution for both climate and economic recovery.

“The Government may have also missed a trick by not including hot water cylinders in the scheme; systems with a heat pump and/or solar thermal require an appropriately sized cylinder to meet hot water demand. This may discourage homeowners from having a low carbon system fitted and cause difficulties for installers when quoting and receiving payment for jobs.

“What also remains to be seen is whether this funding alone will be able to support the installation of a significant number heat pumps to make progress towards the UK’s net zero target. 

“A rise in demand needs to be matched by an increase in the number of installers with the right skills to design and install low carbon heating solutions to a high standard. The Government needs to do more to encourage people to upskill and support the training initiatives undertaken by Vaillant and others in the industry. Otherwise, the ability to roll out heat pumps and other low-carbon heating technologies in sufficient quantities will be limited by the shortage of designers and installers on the ground.”

“As the GHG scheme is only valid until March 2021, we would question whether there is enough time for this to happen. To fit heat pumps using the GHG, installers must be MCS accredited and the process of gaining accreditation can take several months. 

“Nevertheless, we’ve always advocated improvements to the fabric of our buildings to minimise the amount of heat needed in the first place, whatever heating system is employed. Therefore, it is encouraging to see insulation and other measures included in the scheme. Once energy demand is reduced through good insulation, we are confident that heat pumps can provide a low carbon and cost effective solution across many different applications. 

“Overall, the GHG is a step in the right direction, but it doesn’t go far enough. Decarbonising heat is a monumental task and without enough skilled professionals in the workforce, six months is not enough time to make significant progress. We need clarity on long-term funding and training schemes to develop a sustainable heat pump industry and build consumer confidence.”

 

10 August 2020

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