The Government has today published its’ ‘Heat Pump Investment Roadmap‘, laying out the actions being taken to encourage deployment and attract more investment in heat pump manufacturing in the UK.
Heat pumps are expected to play a key role in the the decarbonisation of heating, in addition to hydrogen and other renewable energy technologies, with Government looking to increase the number of installations from 55,000 a year in 2021 to 600,000 a year by 2028 and 1.9m a year by 2035.
Supportive policy and the ‘right’ regulatory environment need to be in place in order to achieve these ambitious targets, including up to £1bn of manufacturing investment by 2028.
Actions mentioned in today’s strategy document include:
- The introduction of a Future Homes Standard for new build in 2025 and an aim to phase out the installation of new and replacement natural gas boilers by 2035 at the latest, as previously voiced in the 2021 Heat and buildings strategy.
- The launch of a Clean Heat Market Mechanism from 2024, to provide investors with confidence in sustained growth of the UK heat pump market.
- £6.6bn in funding from 2021 to 2025 to support measures such as the Social Housing Decarbonisation Fund, Public Sector Decarbonisation Scheme and Boiler Upgrade Scheme. £6bn has also been committed from 2025 – 2028, plus the Boiler Upgrade Scheme will be extended to “at least 2028”.
- The Heat Pump Investment Accelerator Competition announced in last week’s ‘Powering Up Britain’ paper, designed to leverage private investment for manufacturing.
- Capital allowances, allowing businesses to deduct some or all of the value of eligible plant and machinery from profits before paying tax.
- Innovation grants, including £60m funding for the ‘Heat Pump Ready Programme‘, launched last year to drive innovation in heat pump manufacturing, reduce costs and increase performance.
Government were also keen to highlight that the expected rapid growth of this market offers a significant opportunity to companies currently supplying the fossil fuel boiler sector, as well as established heat pump manufacturers and new entrants to the market.