Government issues £288m clean heat fund

The UK Government is calling on households and businesses to apply for up to £288m in funding for green solutions such as heat pumps, solar and geothermal energy, through the Green Heat Network Fund.

Government issues £288m clean heat fund

Suggested strategies involve requiring pension schemes to invest in research and development

With the energy crisis continuing to increase costs for households and businesses, the Government has opened the next phase of funding for its Green Heat Network Fund, which will last for the next three years.

The Government is enabling households and businesses to access £288m for clean heating solutions, with applications opening from 14 March 2022.

The funding is expected to fund the delivery of an estimated 9.7 million tonnes of carbon savings by 2050.

Energy Minister Lord Callanan said: “Heating in buildings forms a significant part of the UK’s carbon footprint, so changing how we warm our homes and workspaces is vital to meeting our world-leading climate change commitments.

“Heat networks are an effective way of reducing carbon emissions and this fund will enable us to accelerate the roll-out of these cutting-edge and green technologies.”

The Green Heat Network Fund is the successor to the government’s Heat Networks Investment Project (HNIP). The Project has provided more than £250m since 2018.

Gas crisis

According to the Climate Change Committee (CCC), heat networks currently provide just 2% of the UK’s heat demand. By 2050, this proportion will need to be around 20%.

The UK Government’s Heat and Buildings Strategy, published in October 2021, notably contains a commitment to bring heat pump costs – both upfront and operational – in line with gas boilers by 2030. This should pave the way for the elimination of gas boilers in most properties by 2035. At present, homes account for around one-fifth of the UK’s annual national emissions, largely because of fossil-fuelled heating and energy inefficiency.

However, wholesale gas prices in the UK are currently around four times as high as they were this time last year, largely due to discrepancies in international supply and demand.

At the start of the year, the UK Government appointed Ofgem as the nation’s heat network regulator and Citizens Advice as the consumer advocacy body for heat networks. It simultaneously unveiled a £19.1m investment round from its £320m Heat Networks Investment Project (HNIP).

The investment will support the installation of five heat networks – two in Bristol and one each in Liverpool, London and Worthing.

Responding to the latest funding, the Association for Decentralised Energy’s chief executive Lily Frencham said: “We’re delighted that the government is invigorating the transition to zero-carbon heating across the UK that uses good old-fashioned pipes and water to transport heat from green energy centres to homes and businesses.

“Heat networks offer the most cost-effective tried and tested way of decarbonising our towns and cities and it is great to see government’s continued support for the sector through the launch of the Green Heat Network Fund. Heat networks have a critical role to play in the UK’s net zero future – and 2022 will be a crucial year for the heat networks sector.”

Matt Mace

Comments (3)

  1. Kim Warren says:

    So at 5,000 per home, that’s under 60,000 homes out of 20 million – great! And that’s saving 9.7m tons of carbon ‘by 2050’ … so just 0.3m tons/year -v- total UK-driven emissions of 700m tons/year – great! And that sounds optimistic, being 5 tons per house per year [if I’ve done the numbers right?]
    Pathetically inadequate.

  2. Fred Pratt says:

    Hmm, not quite a call for households to be involved. Here’s what’s in the Overview … "Please Note: Individuals, households and sole traders cannot apply to the fund

  3. Kim Warren says:

    Ah – thanks Fred. So the scheme is not what the article suggests then? But I guess the numbers work out to be just as trivially minuscule for the business sector too?
    Govt should stop wasting everyone’s time and effort [including its own] on complicated, pointless special micro-schemes, and instead develop system-level policies to accelerate the whole effort, like scrapping VAT on all energy-saving goods and services (or even some negative-VAT mechanism?). Or allowing 100% year-1 write-off for all energy-saving capital spend against corporation tax. Or …

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