The Clean Heat Grant : A Definitive Guide

With the Renewable Heat Incentive (RHI) due to end in March 2022, Alice looks ahead to the newly announced Clean Heat Grant.

What is The Clean Heat Grant?

The Clean Heat Grant is a government-proposed scheme to provide homeowners with up to £4000 of up-front funding towards installing low-carbon renewable heating systems.

The new scheme launches in April 2022 and runs until March 2024. It will replace the current Domestic Renewable Heat Incentive (RHI) which is due to end on the 31st of March 2022. Much like the recent Green Homes Grant, funding will be available through a voucher scheme and will be a flat-rate payment.

The full details of the funding will be unveiled later this year, however here’s what we know so far…

Why is it being introduced

In June 2019, the UK Government was the first major economy to enshrine its 2050 carbon neutrality pledge into law. The Clean Heat Grant forms a major part of the governments 10 Point Plan to help the UK go Net Zero Carbon by 2050. Through the support and promotion of schemes such as The Clean Homes Grant, the government hopes to increase the adoption of Air Source Heat Pump technologies from 30,000 installations per year up to 600,000 by 2028.

“The UK will be home to pioneering businesses, new technologies and green innovation as we make progress to net zero emissions, laying the foundations for decades of economic growth in a way that creates thousands of jobs” – Boris Johnson

Ultimately, introducing the scheme will make renewable technologies more accessible to everyone and will help to phase out the use of fossil fuels in homes whilst keeping homes off the gas grid.

Who is the scheme for?

The Clean Heat Grant has been specifically put in place to help homeowners and owners of small non-domestic buildings across the UK with the upfront costs of installing renewable heating systems.

The UK government has also confirmed that custom and self-build homes will also be eligible.

What technologies does it cover?

· Ground Source Heat Pumps

· Air Source Heat Pumps

· Water Source Heat Pumps

· Biomass (only for properties deemed not suitable for a heat pump.)

Which technologies or systems will not be covered?

It is expected that the Clean Heat Grant will exclude the following types of systems:

· Heat Networks

· Solar thermal

· Biogas (Hydrogen)

· Hybrid Heat Pump Systems (systems where heat pumps work in tandem with a gas boiler)

What do I need to be eligible?

Whilst the full eligibility criteria is yet to be confirmed, households who are applying for the Clean Heat Grant will likely need to show a high performing level of insulation has been installed on their property. All applicants must also have a valid Energy Performance Certificate (EPC.) It is likely that this EPC must be recent, and also an up-to-date reflection of their home (e.g. if the property has been extended this must be included on the EPC.)

How does it work?

The Clean Heat Grant will function in a similar way to the Green Homes Grant. It is proposed that the government will contribute £4,000 towards the cost of a new renewable heating system (such as an air source heat pump,) with the homeowner covering the rest of the installation cost.

A capping system has been proposed, on a quarterly basis which the Department of Business, Energy and Industry (BEIS) explains will reduce the risk of the budget being depleted quicker than planned. This in practice means that the funding may not be available to all if the up-take for the Clean Energy Grant is high.

The difference between RHI and The Clean Heat Grant

The new scheme looks to move away from the current tariff-based system used with the RHI scheme or quarterly payments over a over a 7-year period and instead turn the scheme into a flat rate of £4000 on a first come, first served basis – as proposed by the Department of Business, Energy and Industry (BEIS).

The new Clean Heat Grant will also not support systems which are currently included in the Renewable Heat Incentive such as Solar Thermal and Hybrid Heat Pump systems.