Budget uncertainty over the boiler upgrade scheme

The government is understood to be slashing the money available to subsidise heat pumps as it hunts spending savings in Wednesday's budget. The scheme at risk is the boiler upgrade scheme, introduced in 2022 to help decarbonise homes and businesses. It pays upfront grants of up to £9,000 to replace fossil fuel and direct electric heating with low-carbon alternatives such as heat pumps and biomass boilers.

• Introduced in 2022 to decarbonise homes and businesses
• Upfront grants worth up to £9,000 per installation
• Funding cuts understood to be planned ahead of Wednesday's budget

'It's the foundation of the business'

Bill Tuck, operations director at Sustain Homes in Watford, started installing air source heat pumps six years ago, when other heating engineers were skeptical about the technology taking off. He says the conversation has now changed completely and engineers ask him about heat pumps for their own customers.

About 75% of his customers pay using government subsidies, and he does not yet know how he would keep jobs and the business afloat if the grant disappears.

Warnings from the Renewable Heat Incentive's closure

Installers point to what happened when the previous support scheme ended. Adam Killa, who founded Ask Renewables in Burscough, Lancashire, saw his installations collapse after the 2022 closure of the Renewable Heat Incentive, a scheme that paid households for generating clean heat. His installs fell from six to eight a week to zero.

Jim Lacey, who has been installing renewables with his business JLN Plumbing & Heating for 20 years, said he had expected a gradual phase-out of the grant. He warned that manufacturers, deliverers and associated trades would also suffer knock-on effects.

Apprentices, emissions and the UK's low uptake

Installers say cuts to the subsidy would put their apprentices, and the future of the industry, at risk, at a time when the government is pushing to increase the number of young people earning while learning. Tuck warned of a future shortage of installers and repair engineers unless the young generation is brought into the trade.

The wider stakes are high, according to government figures and industry bodies:

• Heat in buildings accounts for approximately nearly a fifth of UK greenhouse gas emissions, per the latest government data
• The Department for Energy Security and Net Zero has called the 2020s a critical decade for decarbonising heat
• The UK lags far behind Europe: Norway, the global leader, has 632 heat pumps installed for every 1,000 households, while the UK has 3.5
• About a third of heat pumps sold in the UK in 2024 were produced domestically, according to the Heat Pump Association

Economist James Meadway, co-director of the green thinktank Verdant, said removing green job money would damage Andy Burnham's mission to reindustrialise Britain.

A government spokesperson said: "We do not comment on budget speculation." It added that it remains committed to bringing down bills while investing in clean homegrown energy and warmer homes, with the budget due on Wednesday.