In September 2023 the government announced that some homes may be exempt from the planned phase-out of new fossil fuel boilers in 20351. The Committee of Public Accounts, in a report published on 26 May 2024, put the share of homes potentially affected at an estimated 20 per cent2. The exemption covers homes that would need energy efficiency upgrades or that lack the space to install a heat pump, including densely populated urban areas and blocks of flats2.
The 2035 phase-out was set out in the October 2021 Heat and Buildings Strategy, which stated the government's ambition to end the installation of new fossil fuel boilers by 20352. The same strategy committed to growing the heat pump supply chain to a minimum market capacity of 600,000 installations a year by 2028, and to developing the evidence base for strategic decisions in 2026 on the future role of hydrogen in home heating2. Heating the UK's 28 million homes accounted for 18 per cent of all UK greenhouse gas emissions in 20212.
The committee said the Department for Energy Security and Net Zero (DESNZ) had not yet worked out how it will support households to decarbonise where a heat pump is not a practical solution2. It said DESNZ intends to consult this year on how it can help people decarbonise their homes where a heat pump might not be the most appropriate solution, considers heat networks the next major alternative technology for these areas, and intends to invest some £868 million in heat networks up to 20282. The committee also said connecting customers to heat networks through DESNZ's heat network zoning could increase running costs for residents relative to the gas systems they replace2.
"DESNZ should, by end-December 2024, outline which types of properties and regions it does not expect to be suitable for a heat pump and what alternative low-carbon technologies are available to them, to make sure that no one is left behind or unfairly penalised in the transition to low-carbon heating."
On costs, the committee reported that an average heat pump cost around £11,600, four times more expensive than a gas boiler, with a new gas boiler typically £2,500 to £3,0001. Installation costs fell by up to 6 per cent between 2021 and 2023, to £11,2871. The Boiler Upgrade Scheme, which provides households in England and Wales with an up-front grant of £7,500 towards replacing fossil fuel heating with a heat pump or biomass boiler, funded nearly 18,900 heat pump installations between May 2022 and December 2023, less than 40 per cent of the 50,000 expected, and DESNZ underspent by £100 million in the first year1. The grant rose from £5,000 to £6,000 between May 2022 and September 2023, and was increased to £7,500 in October 20231.
| Item | Figure |
|---|---|
| Homes potentially exempt from the 2035 phase-out | Estimated 20 per cent2 |
| Average heat pump cost | Around £11,6001 |
| Typical new gas boiler cost | £2,500 to £3,0001 |
| Boiler Upgrade Scheme grant | £7,5001 |
| Heat pumps funded, May 2022 to December 2023 | Nearly 18,9001 |
Why it matters for households
The exemption means the 2035 date will not apply to every home, and the committee's estimate that around a fifth of households could fall outside it indicates the scale of the properties for which no route has yet been settled2. For a household in a flat or a dense urban area, the practical question is which low-carbon technology replaces a gas boiler, and the committee states that DESNZ has not yet worked this out2. Heat networks are named as the intended alternative for these areas, but the committee warns that zoning could raise running costs relative to the gas systems being replaced2. For homes that are not exempt, the reported cost gap between a heat pump and a gas boiler, and the higher running costs of heat pumps because electricity is priced above gas, are the figures the committee identifies as the main barrier to take-up1. The committee also notes that DESNZ is removing the requirement for loft and cavity wall insulation as a condition of a Boiler Upgrade Scheme grant, leaving it as a household choice without additional evidence on how that choice affects energy bills2. The grant is available to all households irrespective of income1.
What happens next
DESNZ is to consult this year on support for homes where a heat pump may not be the most appropriate solution2. The committee asked DESNZ to outline by end-December 2024 which types of properties and regions it does not expect to be suitable for a heat pump, and what alternatives are available2. It also asked DESNZ to set out by end-June 2025 how it will undertake any required decommissioning of the gas networks2. The government has two months from publication of the report to respond2.
Sources2 cited
- Decarbonising home heating, committees.parliament.uk
- Decarbonising home heating - Committee of Public Accounts, publications.parliament.uk