According to the UK government, the main heat pump incentive has not been effective at encouraging low-carbon installations since it began in 2022.
The National Audit Office (NAO) has released new findings that call for a broader rethink of UK heat policy. These findings include the Boiler Upgrade Scheme. The rethink should consider making people more aware of and interested in lower-carbon systems. This should consist of more thorough plans for homes that are harder to decarbonise. This should be part of plans for the future of the current gas network.
The results included several suggestions for dealing with installation numbers. As part of a longer-term plan to get people more involved in lowering carbon pollution from their homes, this included giving Parliament an annual report on progress to decarbonise heat across the country.
Along with more low-carbon heat networks, heat pumps are one of the most important tools that the government is supporting to lower the carbon footprint of homes and other buildings. 18% of the UK’s greenhouse gas emissions came from people heating their homes. Starting in 2028, the government wants to build at least 600,000 heat pumps across the country every year.
By 2035, the government wants to put in up to 1.6 million heat pump units annually.
The study said that the government’s expectations for the supply of heat pumps and the growth of the market “were optimistic.”
Cost Challenge
Cost Challenge
The government has previously committed to rebalancing the differences in the price of electricity and natural gas as one means of incentivising heat pump adoption in the longer term. This work was planned to begin this year. The commitment to review and revise current electricity levies is seen as a vital but challenging component of existing heating plans.
The overall number of applications through the BUS incentive had climbed by almost 40 percent in January 2024 over the same period the previous year. A few months ago, the Prime Minister said all grants awarded through the heat pump incentive would be worth £7,500. This increase happened after that announcement.
Because of these changes, some utility companies are now looking to offer heat pump installations for as little as £500. The audit report said that more information was needed to figure out what the longer-term effects of the changes in grant funding would be and whether the number of heat pump installations would keep going up.
The Future of the Gas Grid
One of the other main points of the report was that plans for the future of gas networks should be made more clear to the HVAC and energy sectors as a whole. The UK government has previously committed to deciding by 2026.
One of the audit report’s recommendations is to bring forward a decision on hydrogen use in homes while also looking at how the existing gas network is modified or partially decommissioned if hydrogen is being used at a regional rather than national level.
The Energy Security and Net Zero Department was now examining the consequences of a predicted decline in gas demand due to a planned move towards alternative heating systems.
The government at the time claimed that an estimated fifth of the existing national housing stock—including off-grid homes—would not be suitable for switching to low-carbon heat without extensive retrofitting or a large electricity connection. These claims contradicted the findings of the government-funded Electrification of Heat research project, which examined the practicalities of installing heat pumps.
The report noted that the department was expecting to launch a consultation on alternative heat sources that could include liquid biofuels in some houses as a replacement for fuels such as kerosene.
It thinks that by 2035, some of these homes will be able to use heat pumps thanks to new developments in heat pump technology and installation methods.
Hence, The department must draw on its experience to date to ensure that its mix of incentives, engagement, and regulations addresses the barriers to progress in its current work program.
