A trade association report has scolded the UK’s policy of incentivising heat pumps for homes after it was revealed that the Boiler Upgrade System has seen very low uptake.

The Energy and Utilities Alliance (EUA) trade body branded the government’s Boiler Upgrade Scheme an “embarrassment”. The £150m ($188m) scheme was introduced 10 months ago, offering a £5000 ($6254) voucher to households installing a heat pump in addition to VAT exception.

The UK’s Office of Gas and Electricity Markets (Ofgem) revealed this week that under 10,000 homes received a voucher, compared to the 30,000 budgeted for in the scheme. This leaves the scheme with a £90m ($113m) first year balance which will be returned to the UK Treasury.

Mike Foster, the chief executive of the EUA, told The Times: “It takes a certain type of genius to fail to give away £150 million of taxpayers’ money and this wretched scheme looks like it has done just that. When will the government actually listen to the people, the majority of whom simply cannot afford a heat pump, subsidised or not”.

An air source pump can cost between £7,000 ($8,747) and £14,000 ($17,493) to buy and install, while a ground source pump costs between £15,000 ($18,742) and £35,000 ($43,733).

Adoption of heat pump technology in the UK

The UK government has set a target to ban the installation of gas boilers in homes by the year 2025, instead promoting lower carbon alternatives. UK ministers have set a target of 600,000 heat pumps to be installed annually for the next five years.

Ground source heat pumps draw water from underground, heated through geothermal processes, to heat homes.

Beyond the UK, Europe saw a 41% increase in the adoption of heat pumps during 2022, according to the International Energy Agency.

According to Hybrid Heating Europe, the use of electric heat pumps over fossil fuel powered boilers can reduce final energy consumption in buildings by 66% and bring CO2 emissions associated with heating down by 60%.

The EU has set a target of one third of gas boiler installations to be replaced with heat pumps. In the US last year heat pump purchases exceeded gas furnaces, with air to water models proving the most popular.

The EUA however, claimed that heat pumps should not be the priority for UK government subsidies. Mike Foster went on: “People are still hurting with high energy bills, insulating the homes of those most in need should be the priority, not giving hard-earned taxpayers’ cash to those who were going to buy a heat pump anyway. It’s utterly wasteful”.