The draft Boiler Upgrade Scheme (England and Wales) Regulations 2022 were laid before the House on 25 February 2022, the minister moving them told the Lords Grand Committee on 4 April 20221. The scheme provides capital grants towards the installation of heat pumps and, in limited circumstances, biomass boilers in homes and small non-domestic buildings in England and Wales1.
The scheme has a budget of £450 million over three years, as confirmed at the 2021 spending review1. Grants of £5,000 are provided towards the installation and capital costs of air source heat pumps and biomass boilers, with grants of £6,000 for ground source heat pumps1. Biomass boilers are eligible only in rural properties not connected to the gas grid, to minimise impacts on air quality1. The grant model provides an upfront discount to costs paid by the consumer, closing the gap between the cost of low-carbon heating and conventional boilers1.
The scheme follows the domestic renewable heat incentive, which closed to new applicants on 31 March this year1. Eligible low-carbon heating systems commissioned on or after 1 April this year are entitled to support under the scheme1. Installers will be able to register their details on the Ofgem website from 11 April, and it will start processing grant payments from 23 May1. The application process is led by the installer and has two stages: applying for, and then redeeming, a voucher1. All participating installers must be certified by the microgeneration certification scheme or an equivalent, and must confirm membership of a consumer code1.
The scheme is expected to support up to 30,000 installations in year 1, contributing 2.6 megatonnes of CO2 equivalent of carbon savings and supporting 2,100 direct full-time equivalent and 1,800 indirect full-time equivalent jobs per year over its lifetime1. The instrument allows the Secretary of State to review grant levels and adjust them in response to market changes1.
"these draft regulations were laid before the House on 25 February 2022"
Why it matters for households
For a household in England or Wales, the regulations set the terms on which a heat pump installation can attract public money, and the amounts are fixed in the instrument: £5,000 for air source and biomass, £6,000 for ground source1. The grant is paid as an upfront discount rather than a reimbursement, so the reduction appears in the price quoted by the installer1. Because the application is installer-led, the consumer's route into the scheme runs through a certified business, and consent is sought from the consumer before any application is made on their behalf1. The eligibility rules restrict biomass support to rural homes off the gas grid, so most gas-heated homes would be looking at a heat pump rather than a biomass boiler1. The scheme replaces the domestic renewable heat incentive, which closed to new applicants on 31 March 2022, so homes commissioning a system on or after 1 April 2022 fall under the new arrangements rather than the old ones1.
What happens next
Installers can register their details on the Ofgem website from 11 April 2022, and Ofgem is expected to start processing grant payments from 23 May 20221. The regulations were expected to come into force and grant applications to open by 23 May1. The instrument also allows grant levels to be reviewed and adjusted in response to market changes over the three years1.
Sources1 cited
- Boiler Upgrade Scheme (England and Wales) Regulations - Hansard - UK Parliament, hansard.parliament.uk