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May 19, 2023

£450m boiler upgrade scheme for England and Wales is failing to deliver

Only a third of low-carbon heating scheme’s annual budget has been used since

Only a third of low-carbon heating scheme's annual budget has been used since launch in May 2022

A scheme to encourage households in England and Wales to upgrade their gas boilers to heat pumps and other low-carbon alternatives is failing to deliver after suffering a "disappointingly low" take-up, a parliamentary report has said.

Members of the House of Lords environment and climate change committee have written to ministers urging them to boost the profile of the £450m boiler upgrade scheme, after discovering just a third of its annual budget had been used since its launch last May.

The committee said that, by the end of January, £49.7m in vouchers had been issued, equating to 7,641 installations, according to Ofgem figures. The scheme has been allocated £150m a year in funds for three years.

Ministers first unveiled plans for £5,000 grants to allow people to install home heat pumps and other low-carbon boiler replacements in 2021 as part of a wider heat and buildings strategy design to help Britain meet its net zero goals.

The committee said that public awareness of low-carbon heating systems was "very limited" and promotion of the scheme had been "inadequate". It also blamed a shortage of heat pump installers and "insufficient independent advice for homeowners" for the lack of take-up.

The committee claimed that efforts to present hydrogen as a solution for home heating were to blame. "Hydrogen is not a serious option for home heating for the short to medium-term and misleading messages, including from the government, are negatively affecting take-up of established low-carbon home heating technologies like heat pumps," they said.

Proponents for hydrogen technologies have been lobbying government to boost its use across industry and in the home, while a proposed pilot using hydrogen in homes near Ellesmere Port has drawn opposition from locals who fear life as "lab rats".

When the boiler upgrade scheme was announced in 2021, Labour also condemned the plans as "more of Boris Johnson's hot air", without sufficient substance.

In a letter sent to the net zero secretary, Lord Callanan, the committee warned that if the current take-up rate continues just half of the allocated budget will be used. It said a government target of hitting 600,000 installations a year was "very unlikely" to be met.

Lady Parminter, chair of the environment and climate change committee, said: "The transition to low-carbon heat is fundamental in the path to net zero, given that 17% of the UK's greenhouse gas emissions come from our homes.

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"The government must quickly address the barriers we have identified to a successful take-up of the boiler upgrade scheme in order to help grow the take up of low-carbon heating systems. It is vital they do so if we are going to meet our net zero ambitions."

If the boiler upgrade scheme fails to succeed, it would represent the latest roadblock on Britain's stop-start transition to net zero, with policies such as the effective ban on onshore wind and cuts to solar power incentives drawing criticism.

This article was amended on 22 February 2023 to clarify in the text and headline that the scheme referred to applies in England and Wales only, not the whole of the UK.