UK Heat Pump Installers Fear Subsidy Cuts Could Cripple a Growing Industry

Heat pump installers across the UK are bracing for cuts to a government subsidy that many say underpins their businesses. The government is understood to be reducing the money available for heat pump grants as it searches for savings ahead of Wednesday's budget.

Bill Tuck began fitting air source heat pumps six years ago, when other heating engineers doubted the technology would catch on. He said attitudes have shifted sharply. Established engineers now approach him on behalf of long-standing customers who are asking about heat pumps. "The whole narrative has changed," he said.

Even so, Tuck, operations director at Sustain Homes in Watford, expects serious damage if the grants are reduced. About 75% of his customers use the government subsidy to pay for their system. He called it "the foundation of the business" and said he was unsure how the company would protect jobs if it disappeared.

The boiler upgrade scheme was introduced in 2022 to help people decarbonise their homes and businesses. It offers upfront grants of up to £9,000 for property owners who replace fossil fuel or direct electric heating with low-carbon options such as heat pumps and biomass boilers.

Government data shows heat in buildings accounts for nearly a fifth of UK greenhouse gas emissions. The Department for Energy Security and Net Zero has called the 2020s a "critical decade for decarbonising heat". The UK still trails other European countries on installations. Norway, the global leader, has 632 heat pumps for every 1,000 households, compared with 3.5 in the UK.

Installers point to past experience as a warning. Adam Killa, founder of Ask Renewables in Burscough, Lancashire, said his business went from six to eight installations a week to none after the Renewable Heat Incentive closed in 2022. Customers told him they could buy a new boiler for £3,000 rather than pay £15,000 for a heat pump. Jim Lacey, who has installed renewables for 20 years with JLN Plumbing & Heating, said the argument that running costs offset a higher upfront price would no longer hold. "No one's going to save the planet if it really hits their pocket," he said.

Installers also fear for apprentices and the wider supply chain. Tuck warned of a shortage of installers, repair engineers and heat pumps unless young people are brought into the trade. According to the Heat Pump Association, about a third of heat pumps sold in the UK in 2024 were made domestically. Lacey said the effects would reach manufacturers, delivery firms and associated trades.

James Meadway, an economist and co-director of the green thinktank Verdant, said removing support from green jobs and manufacturing would undermine Andy Burnham's aim of reindustrialising Britain. He said Burnham's "blank spot on climate is working hard against other things he wants to do".

Lacey said he never expected the grant to last for ever, but had hoped for a gradual withdrawal as the technology spread and production costs fell. Cutting or scrapping it suddenly would be "catastrophic", he said.

A government spokesperson said: "We do not comment on budget speculation." The spokesperson added that the government remains committed to bringing down bills for families now, while investing in clean, homegrown energy and warmer homes to protect households from volatile fossil fuel prices.