Over 20 businesses, energy suppliers, green and anti-poverty groups have called for the government to back a 'Fair Heat Deal' to ensure a smooth transition from fossil fuel boilers.

The group wants the government to ensure it is affordable for every household to install and run a heat pump, as well as provide free heat pumps for low-income households.

The UK’s scientific advisors, the Climate Change Committee, say heat pumps will play the largest role in decarbonising Britain’s heat supply.

The coalition says a Fair Heat Deal would stimulate the heat pump market, helping to accelerate a reduction in technology and installation costs as economies of scale are achieved. This means the costs of subsidising the programme could rapidly fall over time.

By boosting economic activity, the Fair Heat Deal could generate as much growth as any infrastructure programme but would have the extra benefits of creating good jobs in every part of the UK while slashing energy bills, the organisations involved say.

The group is urging government to provide comprehensive support for households moving to heat pumps. The Fair Heat Deal would include:

  • Moving environmental levies off electricity bills to ensure it is always cheaper to run a heat pump than a boiler
  • Free heat pumps and insulation for fuel poor and low-income households
  • Grants for everyone else to equalise the cost of a new heat pump with a fossil gas boiler
  • Financial incentives including zero VAT on green home products and installation and green Stamp Duty to reduce the cost of low carbon homes
  • Strong consumer protections
  • A Warm Homes Agency to train installers, create quality green jobs in every part of the country and maintain high standards.

Signatories to the Fair Heat Deal include:

CPRE – The Countryside Charity, End Fuel Poverty Coalition, E.ON, E3G, Federation of Master Builders, Energy Saving Trust, Energy UK, Friends of the Earth, Good Energy, Green Alliance, Green Finance Institute, Greenpeace UK, Heat Pump Federation, Kensa Contracting, MCS Foundation, New Economics Foundation, OVO, Possible, The Association for Decentralised Energy, UK Green Buildings Council, and WWF.

Energy Saving Trust Chief Executive Mike Thornton said: “With the climate emergency upon us, there is no time to waste and we need to take positive action. We have to make our homes more energy efficient and move away from reliance on fossil fuels for heating.

"Heat pumps are an important low carbon heating technology that will help us meet net-zero. A Fair Heat Deal will make heat pumps more attractive to householders and help them to switch over to low carbon heating. For the UK to reach its net zero targets, we need real pace and scale in rolling out heat pumps. A Fair Heat Deal will provide the confidence, clarity and certainty which will unlock the investment required for this.”

Ian Rippin, Chief Executive at MCS, said: “How we heat our homes is one of the highest contributors to our carbon footprints. Installing renewable technology can play a significant role in helping to make our homes greener for a more sustainable future. However, we must not shy away from the fact that, this technology is significantly more expensive than gas boilers as things stand, placing them out of reach to the average homeowner, unless financial support is given.

"MCS is calling for a reduction in VAT, new tax incentives, and long-term grants to bring heat pump costs in line with typical boiler costs today. Without meaningful, well-informed plans and long-term policies to decarbonise the nation’s homes, the grasp on the government’s net-zero targets will diminish.”