As the Boiler Upgrade Scheme marks its second anniversary, demand for heat pumps has surged with applications up 93% in April (2,138), compared to the same month in 2023 (1,233). Grants for heat pumps increased by 50% last October.

However, if this level of interest was confirmed, this would place the number of applications at around 25,000 a year; still a long way off the stated government ambition of 600,000 installations a year by 2028.

Data released by Ofgem also shows that there have been more than 40,000 applications in total, with the scheme having paid out over 25,000 grants, with more than £148 million issued.

Industry is taking steps to make heat pumps a more affordable and attractive option.

In some cases, Boiler Upgrade Scheme funding means suppliers can offer heat pump installations at a similar price to a gas boiler, with Octopus Energy and British Gas both offering complete heat pump installations from £500. 

More is being done to bring down running costs, through electricity tariffs designed specifically to work with heat pumps. For example, the Octopus Cozy electricity tariff can save heat pump users £96 compared with a standard flexible tariff.

And Ovo’s Heat Pump Plus tariff allows customers access to a reduced electricity rate (15p/kWh) for any electricity used by a heat pump. 

Industry is also innovating and pushing forward the uptake of low-carbon heating, with the creation of smaller heat pumps, hybrid heat pumps, which can be installed alongside an existing gas boiler, and high temperature heat pumps, which could provide an option for less efficient homes and reduce the need for new radiators and extra insulation. 

To support the increasing demand for heat pump installations, government has already put in place the £5 million Heat Training Grant.  

So far this has funded training for around 3,000 heat pump installers since July 2023 and will provide around 10,000 opportunities before April 2025 for heat pump and heat network professionals.

Energy Security Secretary Claire Coutinho said: "The latest numbers from our Boiler Upgrade Scheme show that for more and more families, the switch to a heat pump is starting to make financial sense. 

"Our plan is to give families a helping hand, rather than forcing them to make expensive changes before they are ready.  

"That’s why we increased the support available through the scheme to £7,500 – making it one of the most generous in Europe."

Minister for Energy Efficiency and Green Finance Lord Callanan added: "A 93% increase in applications year-on-year in April shows our decision to increase grants for heat pumps was the right one, making it easier for households to switch to cleaner heating."

Daniel Särefjord, CEO of Aira UK, reacted to the figures: “Without doubt one of the key drivers behind heat pump sales doubling was the government’s decision to introduce a £7,500 grant, helping families to scrap their polluting gas boiler and replace it with an environmentally friendly heat pump.

"After the election, I hope the new government will prioritise this transition and work closely with the British heat pump sector to meet our climate commitments, decarbonise homes and secure a fair deal for UK residents.

"In the next parliament, our much-needed energy transition will depend on MPs scrapping planning policy red tape, rebalancing the taxes and levies on electricity and gas, as well as continuing and progressing the nation's subsidy offering.”