The government will take a decision on the role of hydrogen in home heating by 2026, BEIS said, as it announced funding of £3.9 billion over the next three years for heat decarbonisation as part of its Heat and Buildings Strategy.
The funding will be split into five streams:
• £1.425 billion for a Public Sector Decarbonisation Scheme
• £950 million for a Home Upgrade Grant scheme
• £800 million for a Social Housing Decarbonisation Fund
• £450 million for a Boiler Upgrade Scheme
• £338 million for a Heat Network Transformation Programme
The Boiler Upgrade Scheme will offer grants of £5,000 from April 2022 to encourage homeowners to install low carbon heating systems like heat pumps. Meanwhile BEIS said it would work with industry to achieve cost reductions in heat pumps of between a quarter and a half by 2025 as the market expands and technology develops.
The government also promised £65 million funding from the £1 billion Net Zero Innovation Portfolio for a Flexibility Innovation Programme of innovation projects that will help manage increased demands on the electricity system. A Heat Network Efficiency Scheme (HNES) demonstrator programme. This programme will help existing heat network projects in England and Wales ensure they are running at optimal levels to maximise carbon savings and heating services provided to households and businesses
Prime Minister Boris Johnson said: “The Heat and Buildings Strategy sets out how we are taking ‘no-regrets’ action now, particularly on heat pumps, whilst supporting ongoing trials and other research and innovation on our future heating systems, including on hydrogen. We will make a decision on the potential role for hydrogen in heating buildings by 2026, by learning from our Hydrogen Village pilot. Heat pump technology will play a key role in all scenarios, so for those who want to install them now, we are supporting them to do so.”
Business and Energy Secretary Kwasi Kwarteng said: “Recent volatile global gas prices have highlighted the need to double down on our efforts to reduce Britain’s reliance on fossil fuels and move away from gas boilers over the coming decade to protect consumers in long term.
“As the technology improves and costs plummet over the next decade, we expect low carbon heating systems will become the obvious, affordable choice for consumers. Through our new grant scheme, we will ensure people are able to choose a more efficient alternative in the meantime.”