Innovation agency Nesta is urging the Government to keep the Boiler Upgrade Scheme (BUS) under national control, warning that devolving heat pump subsidies to local authorities could disrupt installations and create uncertainty in the heating industry.
The intervention follows Energy Secretary Miatta Fahnbulleh’s announcement at the Labour Party Conference that the Warm Homes Plan will be devolved to mayors and strategic authorities.
Nesta says that giving local government greater responsibility for home energy upgrades is essential as it argues those authorities are more able to understand local housing needs, fuel poverty and supply chains.
However, the organisation says the BUS should remain a nationally administered programme alongside devolved, area-based schemes. The scheme provides grants to households replacing boilers with heat pumps and can also support local authority projects.
Nesta warns that replacing the national scheme with multiple local subsidy programmes could lead to uneven funding, with some areas running out of money while others underspend.
Different application processes and eligibility requirements could also make it harder for households and installers to access support.
The organisation argues that uncertainty over funding could threaten heat pump businesses, particularly smaller installers, and slow the transition away from gas heating.
It also points to Scotland’s Home Energy Scotland Grant and Loan scheme, which it says has seen lower take-up than the BUS on a population-adjusted basis.
Instead, Nesta is calling for the national scheme to be adapted to support neighbourhood-wide projects. This could include allowing local authorities to submit grouped applications for multiple heat pump installations.
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