News that discounts will now include air-to-air heat pumps has been broadly welcomed, but pre-budget concerns prevail.
The existing Boiler Upgrade Scheme offers grants of up to £7,500 off the cost of installing an air source or ground source heat pump. This significantly reduces the carbon footprint of keeping homes warm during the winter.
This week, the Department for Energy Security and Net Zero announced this provision would be expanded. This means households are now entitled to £2,500 off the price of air-to-air heat pumps, which can provided both winter warmth and cooling benefits during summer.
An additional £2,500 can also be claimed to cover the price of specialised batteries, which can store heat overnight. Currently, the average cost of an air-to-air pump is £4,500.
This comes after successive warnings that Britain’s housing stock is vulnerable to increasingly high temperatures during hotter months. Recent years have seen thermometers break records but hitting close to, or exceeding, the 40C mark.
‘Air-to-air heat pumps offer the best of both worlds – keeping you warm in winter while cooling you down when summer comes along,’ said Minister for Energy Consumers, Martin McCluskey.
‘With heat pumps more popular than ever, we want to make sure as many people as possible can benefit, especially those in flats or small homes without central heating, so they have greater choice when upgrading their property,’ he continued. ‘We are also offering discounts for heat batteries and consulting on the role innovative, clean heating solutions can play, including thermal storage, infrared panels and renewable fuels.’
The news should ease some concerns about the potential reduction or removal of heat pump subsidies in next week’s budget, which will be revealed on 26th November. UK Chancellor Rachel Reeves u-turned on a rumoured income tax hike last week following revised forecasting by the Office of Budget Responsibility, resulting in around £10billion in additional ‘headroom’ within the public finances.
Nevertheless, major cuts and reducing borrowing are likely to dominate the autumn statement in order to tackle the country’s financial deficit. Many analysts predict this will impact environmental and energy policies and initiatives. Meanwhile, the cost to consumer of running electricity-only domestic heating systems also remains a cause for concern due to high prices.
A recent poll showed home owners would consider switching to heat pumps if they could guarantee a minimum annual saving of £500. Since the energy crisis began, critics have accused Downing Street of failing to respond to affordability challenges.
‘If we want real momentum, we still have to tackle the UK’s energy pricing,’ said Russell Dean, Residential Product Group Director at Mitsubishi Electric.
‘In recent research we found that a third of homeowners would consider moving to a heat pump if running costs are reduced by removing levies from electricity,’ he continued. ‘As long as electricity remains far more expensive than gas, many homeowners will continue to hesitate, no matter how attractive the upfront incentives are.’
Earlier this month, a new energy software category was launched. This aims to give electricity suppliers more accurate forecasting capabilities in bid to plug ‘margin leaks’, which unnecessarily contribute to higher costs at the point of sale.
Image: Mike Hindle / Unsplash
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