With April fast approaching, this week’s Spring Statement and the Boiler Upgrade Scheme due to open, Technologies and Training Director, Mark Wilkins comments on the latest updates from the Government.
“Following the Chancellor’s spring statement yesterday Vaillant welcomes the VAT cut on heat pumps and looks forward to understanding the detail of this initiative which helps address the consumer barriers to the low carbon technology.
“Consumers are one of the pivotal pieces of the jigsaw puzzle for achieving decarbonisation in the UK so, any mechanism put in place to increase consumer uptake of mass heat pump deployment, is a positive step towards achieving the UK targets.
“However, we are disappointed in the most recent announcement regarding the Boiler Upgrade Scheme (BUS). The scheme was initially announced in the Government’s Heat and Building Strategy in October to help incentivise the installation of heat pumps once the Renewable Heat Incentive (RHI) closes on 31st March. The Government is providing £450 million to fund the BUS over 3 years which will be used to provide grants of up to £6k towards the upfront cost of the heat pump, a significant improvement to the homeowner on the RHI which was a repayment scheme following the install.
“The downside to the BUS is that it complicates the installer process and provides a hiatus of up to 7 weeks, between the RHI closing on the 31st of March and applications for BUS vouchers opening on 23rd May. Whilst installations commissioned on or after the 1st of April may be eligible for the BUS, this almost 2-month delay has the potential to be hugely damaging within the heating industry, especially to our installers, many of which are SMEs who do not have the available cash flow to wait weeks for reimbursement via an issued voucher.
“In the worst case, the delay to the opening of the BUS may stall installers’ work and affect their livelihoods. Additionally, there is no guarantee that the voucher will be retrospectively granted, this could account for up to £6k per job in the 7-week period. If an application is declined it creates an extremely difficult relationship between homeowner and installer. With the power of consumers on social media, this may be hugely damaging to heat pump installer businesses and may damage their prospects of future work.
“We urge Government to review the timeline for the BUS by extending the RHI until the BUS is fully operational, assuring confidence in the scheme and minimising interruption to installers’ work.”