The cost factor remains a significant hurdle for households when it comes to adopting low-carbon heating systems. Government subsidies or grants serve as a means to make these new heating installations more financially accessible for a broader range of households.

Various iterations of subsidies have been introduced to provide homeowners with funding for heat pumps. However, the current subsidy, known as the Boiler Upgrade Scheme (BUS), has fallen short of its anticipated uptake. Recent research revealed that in its first year, only 15,768 people applied for the scheme, which is considerably less than the approximately 30,000 grants available.

In this project, we planned to adopt a people-centric approach to redesign a new subsidy scheme. The goal was to enhance its appeal and increase uptake, enabling more households to embrace decarbonised heating solutions.

The primary goal of this project was to provide recommendations for enhancing the attractiveness and feasibility of low-carbon heating funding for households, while also ensuring industry-friendly implementation. Our ultimate objective was to have a significant impact on future policy by making recommendations that increase the number of households benefiting from subsidies and adopting low-carbon heating systems.

A key focus of our sustainable future mission is to increase the affordability, desirability and ease of installing a low-carbon heating system. Yet the current BUS scheme uptake has fallen short of expectations. Our research found that just over half of available grants were used in the first year combined with reports of potential difficulties for some engineers in its implementation.

This is why we explored the options to modify, or completely reinvent, the funding structure, aiming to expand the reach of grant funding and facilitate a smoother process for both homeowners and industry professionals.

This phase of work focused on building an understanding of the boiler upgrade scheme and previous low-carbon heating grants, diagnosing issues that may be preventing uptake, and highlighting any missed opportunities to increase applicability.

We took a people-centred, multidisciplinary approach to ensure that a proposed future subsidy is equitable, accessible and relevant to households, while also working with industry to ensure that any recommendations are deliverable.

This phase built understanding and documented the current shortfalls of the BUS grant from multiple perspectives and built insight into the viewpoints, challenges and goals of the various users and stakeholders.

Our report framed the findings from this phase as a series of problem statements, highlighting the problems and barriers potentially reducing the uptake of low-carbon heat subsidies and outlining opportunities for further work to build new subsidy structures.