Heat pump installers in the United Kingdom are expressing concern over potential cuts to government subsidies supporting the adoption of low-carbon heating systems, ahead of the government's budget announcement scheduled for Wednesday. The reductions could significantly impact businesses specializing in installing renewable heating technologies, which have seen growing demand in recent years.
Since its introduction in 2022, the boiler upgrade scheme (BUS) has provided upfront grants of up to £9,000 for homeowners and businesses to replace fossil fuel or electric heating systems with more sustainable alternatives such as air source heat pumps and biomass boilers. This initiative aims to reduce the nearly 20% share of the UK’s greenhouse gas emissions attributable to heating buildings. However, installers warn that proposals to lower or remove these subsidies risk undermining the sector’s growth and jeopardizing future progress in decarbonising heat.
Bill Tuck, operations director at Sustain Homes in Watford, said about 75% of his customers currently rely on government subsidies to afford heat pump installations. "It’s the foundation of the business. If that’s to go, it’s extremely damaging," he said. Tuck also highlighted concerns about the effect subsidy cuts would have on apprenticeships and the pipeline of skilled workers needed to support the industry’s expansion.
Other industry professionals echoed these worries. Jim Lacey, who operates JLN Plumbing & Heating and has worked in renewables for two decades, noted that without subsidies, the cost advantage of heat pumps over conventional boilers diminishes, dampening consumer interest. Adam Killa, founder of Ask Renewables in Lancashire, referenced the decline in installations following the 2022 closure of the Renewable Heat Incentive, a previous government scheme that paid households for producing clean heat. "We went from doing six, seven, eight installs a week down to zero," he recalled.
The UK’s heat pump market also trails behind many European nations. While Norway leads globally with 632 heat pump installations per 1,000 households, the UK has only about 3.5 per 1,000, underscoring the scale of the challenge in increasing uptake.
Manufacturers and associated trades could also be affected by subsidy reductions. The Heat Pump Association reported that roughly a third of heat pumps sold in the UK in 2024 were domestically produced, supporting jobs beyond installers. Lacey warned of widespread "knock-on effects" throughout the supply chain if the financial incentives were rolled back.
Economist James Meadway, co-director of the green think tank Verdant, linked the potential subsidy cuts to broader economic and environmental objectives. He suggested that reducing support for green jobs and manufacturing could hinder efforts to rebuild British industry and achieve climate goals.
The government has not confirmed any policy changes ahead of the budget. A spokesperson reiterated the administration’s commitment to lowering energy bills while investing in clean energy and home heating solutions to shield households from volatile fossil fuel prices. However, installers remain apprehensive that subsidy reductions could stall progress at a critical time for decarbonising the UK’s heating sector.