Heat Pumps Only Available to the ‘Affluent,’ Warns Committee

A heat pump stands outside a property as part of a green housing project retrofitted by Kirklees Council, in Huddersfield, England, on March 16, 2022. Ian Forsyth/Getty Images

An influential committee has raised concerns that most households benefiting from heat pump subsidies are from affluent groups.

On Monday, a government report warned the Department for Energy Security and Net Zero (DESNZ) that its current process for households looking to decarbonise their homes was “complex and confusing.”

The House of Commons Committee of Public Accounts (PAC), which scrutinises government expenditure and taxpayer money, said that government net zero home grants are likely only being used by the wealthy.

Realistic

“We are concerned that most households receiving the Government’s £7,500 Boiler Upgrade Scheme grant might be from more affluent groups, as they are more likely to be able to afford the additional costs and may have installed a heat pump even without the grant,” the PAC report said.

“We are not yet convinced that progress to date matches its ambitions. Consumers still face too much complexity and confusion to make informed decisions about installing a heat pump,” it added.

“It needs to be realistic about levels of consumer demand, raise public awareness of heat pumps and work with industry to make heat pumps more affordable,” it said.

The UK has signed into law a policy to achieve net zero by 2050 with the Conservative government setting out a strategy called “Build Back Greener” to decarbonise all sectors of the UK economy. Heat pumps are part of the government’s strategy to reach net zero carbon emissions by 2050, with a target of 600,000 heat pumps installations by 2028.

The Boiler Upgrade Scheme, launched in April 2022, provides £7,500 grants to encourage property owners to replace existing fossil fuel heating with heat pumps, which run on electricity and work like a fridge in reverse to extract energy from the air or ground.

An average heat pump is currently four times more expensive than a gas boiler, and electricity prices mean that heat pumps can be more expensive to run.

The mean cost of an air source heat pump is £13,333, £26,000 for a ground source heat pump, £27,355 for a shared ground loop ground source heat pump, and £16,000 for a wood-fuelled biomass boiler.

The government said that as of the end of March, the total value of grants paid through the Boiler Upgrade Scheme was £138.9 million. It has paid out to 23,871 grant applications, mostly for air source heat pumps.

33,700 Needed

The PAC highlighted a major gap in skills and noted that the government faces a “substantial challenge” to increase the number of trained heat pump installers to support an eleven-fold increase in heat pump installations.

So far, 7,000 heat pump installers have been trained, with DESNZ reporting it is on track to meet its target of 12,000 trained by 2025. However, The Heat Pump Association estimates that 33,700 trained heat pump installers will be needed by 2028 to meet DESNZ’s overall installation target.

DESNZ acknowledged that a key challenge will be to retrain around 110,000 existing gas heating engineers to install heat pumps.

The commitee found that DESNZ does not have a single measure of the number of heat pumps that have been installed. Instead, it relies on data on the number of grants provided through government schemes and heat pump sales data. Some 55,000 heat pumps were sold in 2022.

Cost of £115 Billion

According to its Heat Pump Investment Roadmap strategy, released in April last year, reducing the UK’s carbon emissions to net zero by 2050 means it must decarbonise the heating of over 30 million homes across the UK in a little over 25 years.

The UK’s Climate Change Committee projects that by 2050 all heating in British homes will be provided by low-carbon sources, of which 52 percent will be heatpumps.

If it is extended to cover all 23 million homes currently using a gas boiler, the scheme could cost £115 billion, according to a study conducted by the TaxPayers’ Alliance, a UK pressure group campaigning for a low-tax society.