Lack of demand shows need for additional heat pump finance schemes

Almost half (41%) of heat pump engineers cite a lack of customer demand as the biggest barrier to the UK hitting its installation targets.

Innovation charity Nesta – which carried out the survey – claims this suggests that even with increased government-funded grants, “additional finance schemes for heat pump installations are needed”.

The survey adds that heat pump engineers who cited a lack of customer demand as an issue believe customers aren’t choosing to progress with installations either because of the general cost of heat pump installations, or because they’ve received a cheaper quote from other companies.

Prime minister Rishi Sunak increased the size of heat pump grants last year in a bid to increase uptake of the technology.

However, less than two-thirds of the £150 million annual budget was used up last year, due to lack of customer demand.

The slow uptake means the UK is at risk of missing its target of installing 600,000 heat pumps a year by 2028.

A survey of 107 MPs by YouGov for the MCS Foundation shows that just 24% are confident that the government’s current package of policies is sufficient to meet the target set by Boris Johnson’s government in 2021.

Nesta’s survey also reveals concerns about a lack of skilled engineers to carry out heat pump installations.

It found that one third (30%) of heat pump businesses struggle to find suitable staff to expand.

Recruitment is an even bigger issue for larger heat pump businesses. For heat pump businesses with six or more staff, 41% said that finding additional staff is the biggest roadblock.

This barrier in recruitment is a particular challenge as many heat pump companies reported that they were looking to expand, with a large majority of respondents (81%) from firms with six or more staff reporting that they were likely or very likely to employ new staff in the next 12 months.

Nesta’s previous research has suggested that around 37,000 installers may be needed by 2030 to deliver on the UK’s net zero commitments.

Oliver Zanetti, mission manager of sustainable future at Nesta, said: “Heat pump installers in Britain are getting on with the job of helping people decarbonise their homes. While political uncertainty has caused some disruption in the heat pump market, the UK has a committed and expert core heat pump installer workforce.

“Any policymaker that wants the UK to meet its net zero targets should be listening to what installers are actually saying,  and helping to grow the industry.”

He added:  “It’s clear that staff recruitment continues to be an issue for an industry that needs to expand to meet future demand. To recruit the next generation of installers, colleges and industry must work together to improve apprenticeship courses.”

Emma Bohan, managing director of IMS Heat Pumps, added: “The survey results show an existing, dedicated workforce able to install more heat pumps now, if the awareness amongst the general public was raised.

“To be able to grow the existing installer base, the call is loud and clear – support better access to training channels that can deliver apprentices and upskilled engineers with quality hands-on experience.

“These two key learnings, combined with a request for staff and digital tools to assist with administration and a reduction in the overall burden of paperwork for installers,” he said, “and we will see a heating industry that is fully equipped to help people move from fossil fuel heating to heat pumps.”