The government is promising an extra £1.5 billion for heat pumps to replace gas boilers

  • The Boiler Upgrade Scheme is once again getting a big dose of government money
  • The program is intended to encourage households to ditch their gas boilers

More homes will have access to cheaper heat pumps as the Government has committed a further £1.5 billion to the Boiler Upgrade Scheme.

The Boiler Upgrade Scheme provides government grants of up to £7,500 for the installation of air and ground source heat pumps and up to £5,000 for biomass boilers.

The idea is to move England and Wales away from its reliance on gas central heating, which is used by three-quarters of homes, and switch to greener heat pumps.

In October, the government announced that subsidies for air and ground source heat pumps would increase from £6,000 to £7,500.

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This led to a 57 per cent increase in applications for the Boiler Upgrade Scheme, the Government said today.

In response, the Government today confirmed it would put an additional £1.5 billion into the Boiler Upgrade Scheme between 2025 and 2028, enough for up to 200,000 heat pump grants.

The money for the new Boiler Upgrade Scheme comes from a £6 billion pot unveiled by the Government last year and used today.

The rest of the £6 billion will also be spent on energy, heating and helping the government cut household carbon emissions.

For example, the government has put a further £1.25 billion into the Social Housing Decarbonisation Fund.

This is a pot of money that housing associations and municipalities can use to improve the energy performance of social housing.

A £400 million energy efficiency grant will also be available, starting in 2025, for households in England to make improvements such as bigger radiators and better insulation.

Local councils will also receive £500 million to help 60,000 low-income and cold homes, including those off mains, with measures such as better insulation.

How do heat pumps work?

There are three types of heat pumps.

Air to water heat pumps convert air from outside into water that heats your home via radiators or underfloor heating.

Groundwater heat pumps extract heat from the ground outside to heat your home.

Of the two, in-ground air pumps are the most expensive to install and require more outdoor space.

Finally, water heat pumps collect heat from open water and use it to heat homes, but are much rarer.

Meanwhile, the Green Heat Network Fund will receive an additional £485 million to help up to 60,000 homes and buildings access cheap, green energy through heat networks.

What are the advantages of heat pumps?

Experts say they can save up to 25 percent on your energy bill because the appliances require less power to run, which also makes them more environmentally friendly than water heaters.

They can also last longer than boilers: up to 20 years.

How much do heat pumps cost?

Having one of the devices fitted can cost £15,000 or more.

But several companies, including Octopus Energy, British Gas and Ovo, are competing to drive down the cost of installing a heat pump.

Now Octopus Energy says the 'Cosy Octopus' heat pump can even be fitted for free, or for just £500.

However, for that to happen, the homeowner must receive the full £7,500 Boiler Upgrade Scheme grant.

They must also be the owner of a building that does not require any renovation work to make it suitable for a heat pump.

What are the disadvantages of heat pumps?

Getting the most out of a heat pump can entail additional costs. Poorly insulated homes may not get the maximum benefit from a heat pump because the units operate at lower temperatures than boilers.

This means that homeowners installing a heat pump should first consider proper wall and attic insulation, as well as double glazing.

You may also need larger radiators to get the most heat from a heat pump.

That's because the appliances don't heat water as hot as boilers, so larger surface area radiators may be needed to maximize heat.

In addition, your home must be suitable for having a heat pump installed.

A ground source heat pump also needs space outside to bury the pipes needed to generate heat.

Both ground and air source heat pumps require the installation of a hot water cylinder, which may not be suitable for smaller apartments.