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19 October 2021

Is the government’s heat pump plan a load of hot air?

The aim is that a £5,000 subsidy will entice homeowners to replace their old gas boilers with low carbon heat pumps. Is it enough?

By Ailbhe Rea

Homeowners in England and Wales will be offered subsidies of £5,000 from next April to help them replace old gas boilers with low-carbon heat pumps, the government has announced this morning (19 October), as it unveils its Heat and Building Strategy – which aims to address the challenge of cutting carbon emissions related to heating the UK’s buildings on the path to net zero.

Gas boilers have long posed a challenge for the government: their presence in so many households across the UK is incompatible with its carbon-cutting targets, but the cost of their replacement has become a bug-bear of some Conservative MPs and the right-wing tabloid press. Concerns were bubbling away at Conservative Party conference about the cost of net zero (often a thinly veiled way of expressing climate scepticism), and particularly at the idea that customers will be forced by government to replace gas boilers at their own expense. Steve Baker, the Conservative MP for Wycombe, warned in the Sun in May that “the poorest will pay the highest price for these carbon neutral fantasies”.

The solution unveiled today has all the hallmarks of Kwasi Kwarteng, the new Business, Energy and Industrial Strategy Secretary, who is a free marketeer. He has stepped back from banning gas boilers by a certain date, but has also stepped back from a comprehensive government scheme to pay for their replacement. Instead, he hopes that the grants of £5,000 will be enough of an incentive for people to choose a heat pump over a gas boiler when they replace their existing boiler – because that sum roughly represents the difference in costs, currently, between gas and the climate-friendly alternative. With government plugging that gap for the time being, Kwarteng hopes the market will do the rest: that new technology, and the grants themselves, will see the costs of heat pumps fall for everyone.

The “hope” is that no new gas boilers will be sold after 2035. But the £450m being allocated for the subsidies over three years will cover a maximum of 90,000 pumps – with critics saying that it means the UK would not meet its aim of installing 600,000 heat pumps a year by 2028.  

The charitable view of these proposals is that they go some way to addressing all concerns: they make provision for replacing gas boilers without forcing customers to pay to replace them. But another way of looking at it is that the problem hasn’t, ultimately, been fixed. Gas boilers aren’t certain to have been replaced by the “hoped for” date of 2035, while those who do replace their boilers in that time are still likely to be shouldering most of the cost themselves.  

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