As the two-year anniversary of the grant approaches, applications for the Boiler Upgrade Scheme (BUS) increased by 93% in April 2024 compared to the same month last year, as shown by Department for Energy Security and Net Zero (DESNZ) statistics.
The rise is thought to be due to energy supplier offers that make some heat pump installations cost the equivalent of fitting a gas boiler.
The introduction of cheaper electricity tariffs, reducing running costs, has also contributed to the increase, with April’s YoY increase also double that seen in March (46%). Heat pumps are three times more efficient than gas boilers and reduce household emissions.
Grants for heat pumps were raised by 50% last October, somewhat softening the blow of what the government called a “pragmatic approach” to net zero when the ban on internal combustion engine vehicles was delayed until 2035.
Since grants were increased, average monthly BUS applications went up by 49% to 2,136, compared to the monthly average before November 2023, which was 1,435. This news follows recent statistics showing the UK is halfway to net zero, having over-delivered on its carbon budgets.
Energy security secretary Claire Coutinho said: “The latest numbers from our Boiler Upgrade Scheme show that for more and more families, the switch to a heat pump is starting to make financial sense.
“Our plan is to give families a helping hand rather than forcing them to make expensive changes before they are ready. That’s why we increased the support available through the scheme to £7,500 – making it one of the most generous in Europe.”
Ofgem data shows that there have been over 40,000 BUS applications in total. The scheme has paid out over 25,000 grants, with over £418 million issued.
The industry is taking steps to make heat pumps more affordable. At the beginning of May, it was announced that Nusku, a startup aiming to build heat pumps that are cheaper and faster to install, secured just under £1 million in funding. The total investment included over £700,000 from the government.
In some cases, BUS funding means suppliers can offer heat pump installations at a similar price to a gas boiler. Octopus Energy and British Gas both offer complete heat pump installations from £500.
Minister for energy efficiency and green finance Lord Callanan said: “A 93% increase in applications year-on-year in April shows our decision to increase grants for heat pumps was the right one, making it easier for households to switch to cleaner heating.
“Heat pumps are three times more efficient than gas boilers, and more and more people are enjoying the benefits, without large upfront costs.”
