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Heat pumps in demand as grant applications soar by 75%

New figures show the Government’s Net Zero plan is on track – with a significant surge in demand for heat pumps – fuelled by a 50 per cent increase in Government grants.

Energy Security Secretary, Claire Coutinho

Ahead of the two-year anniversary of the launch of the Boiler Upgrade Scheme on 1 April, figures for February show applications soared by 75% compared to the same month in 2023.

This marks the fourth month that there have been more than 2,000 applications since grants for air source and ground source heat pumps increased to £7,500 – making the Boiler Upgrade Scheme one of the most generous in Europe.

It means the monthly average for applications received between November 2023 and February 2024 is 45% higher than the monthly average before the grant uplift.

Energy Security Secretary, Claire Coutinho, said: “No family should be forced to make changes that aren’t right for them. With the right support – like the 50% increase in heat pump grants – families can make their homes warmer and cut their emissions without breaking the bank.

“Figures out today show that our plan is working with applications up by 75% from last year.”

Lord Callanan, Minister for Energy Efficiency and Green Finance, said: “Demand for heat pumps is soaring, as we make it easier than ever to make the switch to electric heating without big upfront costs.

'Our boosted £7,500 grants are helping people create a warm home and lower their emissions. And with applications up 75%, it’s clear our approach is hugely popular with many families.”

Up to the end of February, there have now been 35,741 applications and the scheme has paid out close to £127 million in vouchers to customers. The increase in heat pump grants, coupled with the tax cuts that the Chancellor delivered in the Spring Budget, demonstrate the government’s drive to support families.

The figures come alongside the government’s Welcome Home to Energy Efficiency campaign, which continues to promote the Boiler Upgrade Scheme as well as highlighting the wider efficiency measures that can work together to help save money on bills.

They also follow changes to the Boiler Upgrade Scheme criteria, which will make heat pumps cheaper and easier to install.

Families will no longer have to install cavity wall or loft insulation to use the scheme, giving them greater choice on how they improve their home and potentially reducing the costs associated with installing a heat pump on a semi-detached property by around £2,500.

Properties should still be well-insulated so families can heat their homes for less and save money on their bills, but by removing mandatory cavity wall and loft insulation, households will be able to spread out the cost of changes at a pace that works for them.

Homeowners can also get support to improve their energy efficiency through the Great British Insulation Scheme and Energy Company Obligation (ECO), which are set to help up to 700,000 families install home improvements such as insulation by March 2026.

The government has also published a guide for potential heat pump owners, where industry experts answer frequently asked questions on heat pumps and their installation. The guide can be found on GOV.UK here.

Charlotte Lee, chief executive of the Heat Pump Association said: 'It’s great to see the sustained increase and interest in the Boiler Upgrade Scheme since the grant uplift in October 2023, alongside the publication of a government guide for potential heat pump owners which will help to increase the awareness of heat pumps, from a trusted source.

“Heat pumps provide a very efficient, effective solution to decarbonising home heating and enhance the UK’s energy security, and it wonderful to see interest and awareness from consumers increasing.”

Greg Jackson, founder of Octopus Energy said: 'Heat pumps are about four times more efficient than old fashioned gas boilers but the UK is way behind other countries.

'Now, thanks to the government scheme, they can be cheaper than boilers and more and more customers are joining the queue to get one. And with Octopus smart tariffs, they're cheaper to run too.

'As we ramp up the scale of the industry, costs will continue to fall.'

28 March 2024


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