Grants of £5,000 will be available from April 2022 to encourage homeowners to replace old boilers with more efficient and cleaner heating systems.

The Boiler Upgrade Scheme is part of over £3.9bn of new funding being announced today for decarbonising heat and buildings over the next three years, which will be allocated to government schemes as follows:

• £1.425bn through the Public Sector Decarbonisation Scheme
• £950m for the Home Upgrade Grant Scheme
• £800m for the Social Housing Decarbonisation Fund
• £450m for the Boiler Upgrade Scheme
• £338m for the Heat Network Transformation Programme

To help grow the electric heat pump market and expand British manufacturing, a new £60m Heat Pump Ready innovation programme was also announced — part of the £1bn Net Zero Innovation Portfolio — which will provide funding to drive technological innovation in order to make the systems smaller, easier to install and cheaper to run over the coming years.

Prime Minister Boris Johnson said: “As we clean up the way we heat our homes over the next decade, we are backing our brilliant innovators to make clean technology like heat pumps as cheap to buy and run as gas boilers, supporting thousands of green jobs.

“Our new grants will help homeowners make the switch sooner, without costing them extra, so that going green is the better choice when their boiler needs an upgrade.”

Business and energy secretary Kwasi Kwarteng added: “Recent volatile global gas prices have highlighted the need to double down on our efforts to reduce Britain’s reliance on fossil fuels and move away from gas boilers over the coming decade to protect consumers in long term.

“As the technology improves and costs plummet over the next decade, we expect low carbon heating systems will become the obvious, affordable choice for consumers. 

“Through our new grant scheme, we will ensure people are able to choose a more efficient alternative in the meantime.”

While the recently announced scheme and funding were welcomed by the industry, many experts claimed this is not enough, stating that the government must be more ambitious in its goal to decarbonise the UK’s housing stock.

“The initiative of these efforts to future proof homes is a step in the right direction for the government; however, a concise roadmap to phase out new boilers out by 2035, with significant funding would have been much more effective,” said Ross Counsell, director at GoodMove.

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“Although this may sound promising, I believe these sums of money are not sufficient to solve this crisis and could actually run the risk of causing further issues for homeowners; you just have to look at the poorly thought-out Green Homes Grant, which left administration costs of over £1,000 for some homeowners according to the National Audit Office (NAO).”

Brian Berry, chief executive at the FMB, added: “The government appears to be only listening to one half of the story.

“Incentives are also needed to make our existing homes better insulated; if there is no detail in the strategy on how we can address the megatonnes of carbon lost through the leaky walls and roofs of our homes, it will have failed and the benefits of installing heat pumps risk being lost.

“Without a long-term national retrofit strategy, including a proper skills plan and communications campaign, regular consumers won’t know what action they need to take, nor feel it’s within their grasp, and industry won’t take the long-term investment decisions needed to be ready to deliver.”

Some property industry experts added that the government must also address the new build sector and do more to encourage the adoption of modern methods of construction.

Dean Clifford, co-founder of Great Marlborough Estates, said: “By focusing on existing housing, the strategy presents some missed opportunities for the new build sector.  

“With recent developments crucial for making up the shortfall on the government’s annual housing targets, we need to ensure that the highest decarbonisation standards are enshrined for all buildings, which means incentivising developers to build greener, cleaner houses.”

Jo Cowen, CEO at Jo Cowen Architects, added: “Meeting net zero means thinking bigger than how the homes of today are heated; many of the places that people will live and work in have yet to be built and how they are built will determine whether we are serious about decarbonisation.

"The reality is that too many buildings in the UK are delivered using traditional construction techniques that are inefficient and wasteful and this feeds into a building's long-term performance. 

“Embracing innovation, using new technologies and materials, and fundamentally making construction more like high-end manufacturing, will be key to creating a built environment that is greener, cleaner and better.”

Asif Din, sustainability director at Perkins & Will, said: "The focus on decreasing the UK's housing stock's emissions through energy-efficient heat pumps is welcome; however, a drive towards a net-zero future should not just rest on the shoulders of homeowners.

"To hit the net-zero embodied carbon targets, the government must incentivise businesses and supply chains to ensure projects are designed using sustainable resources and re-used materials, which can be disassembled at the end of its lifespan in line with circular economy principles."