What is the Government's Boiler Upgrade Scheme?

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  • The Government has just launched a Boiler Upgrade Scheme worth £450 million, set to last three years. This is in addition to the 0% VAT on energy-efficient measures, such as heat pumps and solar panels.

    Here, we explain exactly what the scheme is and who qualifies for the grants on offer when the time comes to upgrade your boiler.

    What is the Government’s Boiler Upgrade Scheme?

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    The scheme, launched on May 23rd, will provide £5,000 grants to install low-carbon heat pumps, in place of traditional gas boilers. This will mean the cost of installing a heat pump will be closer to that of installing a traditional gas boiler.

    Homeowners will benefit from the following:

    • £5,000 off the cost and installation of an air source heat pump
    • £5,000 off the cost and installation of a biomass boiler
    • £6,000 off the cost and installation of a ground source heat pump

    As we mentioned, it will run for three years, and it’s part of a wider commitment by the Government to decarbonise our homes and buildings, on the path to the 2050 net-zero target. Since the spring statement earlier this year, there has been lots of discussion around heat pumps vs gas boilers, and this new scheme will make electric heat pumps a much more viable option.

    Commenting on the initiative, Energy Minister Greg Hands says heat pumps using electricity will become the obvious choice for households choosing to replace their fossil fuel boiler. Once installed, a heat pump will improve a home’s energy efficiency, helping people to save energy at home and reduce their energy bills.

    North-south-heating-divide

    Image credit: David Parmiter

    Compared to fossil fuels, heat pumps deliver more than 3 units of heat for every unit of energy input. Traditional gas and oil boilers, in contrast, deliver less than one unit of heat per unit of energy. So switching will have huge long-term benefits for the planet and our pockets.

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    The Government aims to reach a point where heat pumps are no more expensive to buy and run than fossil fuel boilers by 2030 when more households will be looking to make the change.

    Who qualifies for the scheme?

    The initiative opened to homeowners (and small non-domestic properties) in England and Wales on 23rd May 2022. Homeowners and small businesses across England and Wales can now apply for vouchers to get thousands of pounds off replacing their oil and gas boilers with clean heating systems.

    Find out more about the criteria in our dedicated boiler grants guide or on the Government website.

    green panelled bathroom wall with traditional radiator

    Image credit: Future PLC/ David Giles

    ‘We want to make it easier and more cost-effective for homeowners to move away from using expensive fossil fuels for heating,’ comments Business and Energy Minister Lord Callanan.

    ‘This scheme makes it a straightforward process for consumers and installers to access significant funding so that, added to the zero rate of VAT on installations, heat pumps are an attractive proposition when looking to replace a gas or oil boiler,’ says Lord Callanan.

    Changing how we heat our home is a big decision. But the financial help available will give property owners impetus to choose greener options, which will go a long way in cutting bills and future-proofing our homes.