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Clean Heat Grants for Renewable Heating


From March 2022, the government plans to offer grants of up to £4,000 to help UK homeowners and businesses to install renewable heating systems. Here’s what we know about the Clean Heat Grants so far.

The Clean Heat Grants scheme is not yet fully confirmed and will not open until April 2022. The information in this article was last checked on 29th July 2020.

What are Clean Heat Grants?

The government has not yet confirmed details of the Clean Heat Grants scheme, but the initial announcement said that the government will contribute up to £4,000 to the cost of installing eligible renewable heating systems.

The UK is trying to reduce our negative impact on the environment and tackle climate change by reducing carbon emissions to net zero by 2050. In the UK, 40% of carbon emissions come from our commercial and domestic building stock as most rely on fossil fuel heating systems like gas or oil boilers. This means that we need to make big changes to the way we heat our properties.

Why are Clean Heat Grants being introduced?

The Committee on Climate Change has suggested that the UK would require 15 million homes to be fitted with heat pumps or hybrid heat pumps by 2035 in order to reach net zero, but one of the main obstacles is the high cost of switching to renewable heating systems.

The government has tried to encourage homeowners and businesses to install renewable heating systems through the Renewable Heat Incentive (RHI) scheme. The RHI was introduced in April 2014. Under the RHI scheme owners of renewable heating systems are paid a set amount per kWh of the heat energy generated by the system. The payments are made on a quarterly basis over a 7 year period after the system has been installed. The RHI was put in place by the Government as a means to convert 12% of UK homes to renewable heat by the end of 2020.

At the moment, it looks like the UK will fall short of this target reaching only 8-10%. The government claims that the RHI has delivered payments of £2,800 annually to those signed up, as well as saving 5.2 tonnes of carbon annually, but it has been criticised for failing to provide financial value. However, in 2018 the Public Accounts Committee (PAC) concluded that the RHI had failed to provide value for money for the £23bn it was set to cost taxpayers.

The non-domestic RHI scheme (which pays businesses for their renewable heat energy) is due to close to new applications from April 2021, but the domestic RHI (which is open to UK homeowners) will be open to applicants until the end of March 2022.

The ‘Clean Growth: Technologies for meeting the UK’s emissions reduction targets’ 2019 report by the Science and Technology Committee stated that one of the major problems with the government’s net zero strategy was a lack of replacements for the RHI.

The Clean Heat Grant scheme has been announced as the likely replacement for the Renewable Heat Incentive (RHI) scheme.

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How will the Clean Heat Grants scheme work?

The new Clean Heat Grants will replace the RHI scheme and, rather than reimbursing homeowners and businesses for the cost of installing renewable heat over time, will provide up to £4,000 towards the upfront cost. The government has committed funding for the Clean Heat Grant for two years to March 2024.

Details of the scheme and application process are yet to be confirmed, but early proposals suggest that from April 2022 homeowners and businesses will be able to apply for a grant to cover some of the costs (up to £4,000) involved in installing a renewable heating system. Installers of renewable heating systems will probably need to register as an approved installer with the scheme.

The grants will be capped on a quarterly basis to prevent the funding from being depleted too quickly. It is also expected that the Clean Heat Grants will be given as vouchers via a first come, first served basis, but the government has not committed to a process as yet.

Which renewable heating systems are eligible for a Clean Heat Grant?

A renewable heat system is any type of installation which allows a property to generate central heating and water heating from a renewable source of energy like the sun or natural heat in the air or ground.

The government has not yet confirmed which renewable technologies will be eligible for a Clean Heat Grant, but it is expected that heat pumps and biomass boilers will be included in the scheme. Currently heating systems with a capacity of up to 45kW will be eligible for the scheme, but hybrid systems will not.

The government is also proposing a new Green Gas Support Scheme to increase the percentage of biomethane available on the gas grid.

Are you considering installing a renewable heating system?

Heating your home with a renewable heating system such as an air source heat pump, ground source heat pump, biomass boiler or solar thermal can bring many benefits. Using a boiler which is fueled by a fossil fuel like gas, oil or LPG will produce carbon, a greenhouse gas. Greenhouse gases cannot escape our atmosphere, causing global warming and climate change.

Renewable technology provides a cleaner way of heating our homes and there are several types of renewable heating system to consider. Here we have outlined the systems with links to more information on each.

Air source heat pump

An air source heat pump uses a small amount of electricity to run, but produces no carbon during operation. An air source heat pump can extract latent heat from the air outside your home (even in freezing temperatures) and transfer the heat to water or air in your home. Find out more.

Ground source heat pump

Like an air source heat pump, a ground source heat pump uses a small amount of electricity to run, but produces no carbon during operation. A ground source heat pump can extract latent heat from under the ground and transfer the heat to water or air in your home. Find out more.

Biomass boiler

A biomass boiler is fueled by organic material like wood logs, pellets or chips. The heat generated through the burning of this material is transferred to your water supply. Biomass boilers are considered carbon neutral as they only produce as much carbon as the tree took in during its lifetime. Find out more.

Solar thermal panels

Solar thermal panels are installed on a roof where they are exposed to sunlight. They absorb the heat from the sunlight so it can be used to heat a cylinder of water in your home. Find out more.

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