Heat Pumps Will Be Cheaper And Easier To Install

15th March 2024

Changes to the government grant scheme for heat pumps will make them cheaper and easier for families to install.

Families could save around £2,500 off upfront costs, with insulation no longer required to access heat pump grants
government calls for the Competition and Markets Authority to review competition in the home heating market
implementation of the Clean Heat Market Mechanism has been scrapped until April 2025
Heat pumps will be cheaper and easier for families to install as part of changes to the government's Boiler Upgrade Scheme.

Homeowners will have more choice in how they improve their home and will no longer have to install cavity wall or loft insulation to use the scheme, which offers grants of £7,500 off the cost of heat pump installation.

Removing mandatory cavity wall and loft insulation could reduce the costs associated with installing a heat pump on a semi-detached property by around £2,500, making it easier for homeowners to switch from gas boilers in a way that works for them, while still cutting emissions.

This comes as the Energy Security Secretary stands up against recent price rises by boiler manufacturers. She has called on the Competition and Markets Authority (CMA) to review the industry - which has 4 companies dominating 90% of the market - to consider whether it is working as well as it should and delivering the best outcomes for customers.

This follows on from government proposals to introduce the Clean Heat Market Mechanism (CHMM) - a market incentive that aims to introduce more heat pumps: a clean energy source that provides more efficient, cleaner home heating. The Energy Secretary has delayed the implementation of CHMM until April 2025 in order to protect consumers.

Energy Security Secretary, Claire Coutinho, said:

We've already supported families by making our Boiler Upgrade Scheme one of the most generous in Europe and now we're making heat pumps even cheaper and easier to install.

This is all part of our wider plan to ensure we cut our emissions and make homes more energy efficient without burdening families with high costs.

The move to improve the Boiler Upgrade Scheme follows the sustained surge in applications after heat pump grants were increased by 50% last autumn. The average monthly number of applications from November 2023 to January 2024, has been 39% higher than the monthly average before the uplift.

Properties should still be appropriately insulated so families can heat their homes for less and save money on their bills. Removing the mandatory requirement will mean households can spread changes out at a pace that works for them, so families aren’t hit with one large bill.

This is part of the government’s pragmatic approach to net zero that helps families make changes and doesn’t price them out from cutting their carbon footprint.

They can also get government support with 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.

This comes on top off new rules on gas boiler standards which will support families not yet ready to switch to a heat pump, helping them cut their bills and emissions.

As part of the government’s pragmatic approach to net zero, the changes to boiler efficiency standards will save households around £450 on their energy bills over the 15-year lifetime of their boiler. They could also save 21 million tonnes of CO2 by 2050, the equivalent of taking nearly 9 million cars off the road for a year.

The updated boiler standard will mean that from 2026, gas boilers have improved heating controls. And, from 2028, combi boilers will use less energy - increasing efficiency, while reducing wear and tear by preventing them from working harder than they need to.

a full list of policy changes to the Boiler Upgrade Scheme
https://www.gov.uk/government/consultations/proposed-amendments-to-the-boiler-upgrade-scheme-regulations