More homes now qualify for grants of up to £7,500 to fit new heat pumps, as the Government expands the Boiler Upgrade Scheme.
Heat pumps gather heat from the air, ground or water, and can replace traditional ways of heating homes using fossil fuels, reducing energy bills in the process.
But the devices cost between £8,000 to £30,000 to buy and fit, with the big price range reflecting which type you buy and what sort of home you have.
Here is everything you need to know about heat pump and boiler tax changes.
Big fan: More homes can now get heat pump discounts under expanded Government scheme
How has the Boiler Upgrade Scheme been expanded?
To encourage homeowners to switch, the Government offers Boiler Upgrade Scheme grants of up to £7,500 for air and ground source heat pumps and up to £5,000 to fit a biomass boiler.
But now the Government has expanded the Boiler Upgrade Scheme to make the devices cheaper to fit, and has also pushed the ‘boiler tax’ on new gas boilers into 2025.
The current Boiler Upgrade Scheme requires homes to be properly insulated to access any grant money.
That can mean fitting expensive cavity wall or loft insulation, with bills as high as £2,500.
Now the Government plans to scrap this requirement, meaning it will be easier and cheaper to access heat pump grants under the scheme.
What boilers qualify for the upgrade scheme?
Air and ground source heat pumps have always been eligible for grants under the Boiler Upgrade scheme. Now, biomass boilers with an inbuilt cooker will soon be able to get them, too.
At the moment, biomass boilers can access the scheme, but those with cooking functions cannot.
Now the Government will add biomass boiler/cookers to the scheme, and homeowners can get grants of up to £5,000 to get them fitted.
However, these must be in homes that are off the gas grid, in a rural area and have an emissions certificate which shows they are minimally polluting.
When will these changes come in?
The Government has not set a date, but plans to change the rules in 2024.
Can I get higher grants if I live off the gas grid?
It may be possible in the future under plans the Government is considering.
Currently, many houses that are not connected to the gas grid heat their homes with smokeless fuel, oil and LPG.
The cost of replacing these systems with heat pumps can be far higher than for more modern houses.
At the moment there is no change to the Boiler Upgrade Scheme grants to reflect this.
But the Government has now said it will consider this, but has not said when.
A Government statement said: ‘Properties off the gas grid tend to fall into the category of being larger, “complex-to-decarbonise” and/or detached and thus have a higher heat demand requiring a larger and more expensive system.
‘Moreover, we recognise that costs can sometimes be higher when replacing high carbon fuels such as coal, oil and LPG compared to gas boilers, thus affecting the costs for rural properties in comparison to urban ones.
‘We therefore intend to introduce specific new differentiated categories in the regulations for off gas grid properties and the replacement of specified fuel types such as coal, oil and LPG.’
Pushed back: The Government said it would fine boiler and heat pump makers from April 2024 if they weren’t fitting enough heat pumps, but that now won’t happen until April 2025
Can I use Boiler Upgrade Scheme in a new build home?
Not yet – but it may be possible from 2025.
The current Boiler Upgrade Scheme does not allow applications from new build homes, unless the property is self-built.
The Government’s rationale is that property developers should foot the bill for fitting heat pumps.
But now the Government has said it could take steps towards allowing new build homes to access cash to fit heat pumps.
A Government statement said it would ‘introduce a differentiated category in the regulations for eligible new builds, with the option to reduce or remove support under [the Boiler Upgrade Scheme]’.
This will take place from 2025, when the Government is set to bring in its Future Homes Standard rules.
These will require that low-carbon heating is fitted in all new build properties.
When does the Boiler Upgrade Scheme end?
The scheme is currently set to end in 2028.
It was initially meant to end in 2025, but the Government extended it in 2023.
What is the boiler tax?
In January the Government announced it would fine boiler and heat pump makers from April 2024 if they were not fitting enough heat pumps.
These manufacturers warned they would likely miss these targets and would have to pass these costs on to consumers in the form of higher boiler costs.
Boiler makers such as Baxi, Ideal, Worcester Bosch and Vaillant have said they will have to pass the cost of these fines on to consumers in the form of higher prices for boiler installations.
Vaillant said its boilers would increase in price by £95, Ideal’s prices by £110 and the cost of Baxi and Worcester Bosch boilers by £120.
When will the boiler tax start?
The Government is now delaying the ‘boiler tax’ of up to £120 for households getting new boilers fitted until 1 April 2025.
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