Labour is facing a backlash from Britain’s heating industry over reported plans to cut funding for a flagship heat pump subsidy scheme, with installers warning that thousands of jobs and millions of pounds in investment could be put at risk.
The government is reportedly considering reducing the £2.7bn five-year budget for the Boiler Upgrade Scheme to help fund its defence spending ambitions, raising fears that a policy designed to accelerate the transition to low-carbon heating could be undermined just as demand begins to grow.
The scheme offers grants of up to £7,500 for eligible heat pump installations, rising to £9,000 for certain properties, helping households and small businesses meet the upfront cost of replacing conventional heating systems. Since its launch in 2022, it has supported nearly 80,000 heat pump installations.
Franco Miceli, director of Octopus Trusted Partners Network, accused the government of risking “pulling the rug out from under” businesses that had invested in the sector and recruited workers in anticipation of sustained demand.
James Lacey, director of Coventry-based JLN Plumbing & Heating, said heat pumps now accounted for 30–40 per cent of his network’s installations. Cutting the subsidy, he warned, could put “jobs at risk overnight”.
The potential impact extends to training and future capacity. Adam Killa, director of Ask Renewables in Lancashire, said his company had invested more than £200,000 in heat pumps and cylinders in the past month and taken on additional apprentices because the scheme was expected to continue until 2029.
“ If you haven’t got the Boiler Upgrade Scheme, you can’t pay the apprentices because you don’t get as much work,” he said, warning that removing support could destabilise the business model underpinning expansion.
The dispute exposes a difficult trade-off for ministers: strengthening national security while maintaining the incentives needed to build Britain’s low-carbon industries.
A spokesperson for the Department for Energy Security and Net Zero said savings for the defence investment plan represented a small part of the department’s overall budget, adding that details of how essential national security investment would be funded would be set out in the autumn.
Leave a Comment