Good Energy to Introduce First Home Heat Pump Tariff in the UK

Good Energy, the Chippenham-based 100% renewable power company has set out plans to launch a new flexible tariff for heat pumps in the Autumn. The idea behind the new tariff is to help customers make the most of the government’s recently announced £2bn Green Homes Grant scheme. The new Green Homes Grant is being introduced in September to support energy efficiency improvements across England. The new tariff will be offered to customers to coincide with when the government begins accepting applications for the grant and will be ideal for those homeowners planning to use the grant to electrify their home heating system.

The Chancellor, Rishi Sunak, has said that homeowners can claim up to £5,000 or in some cases up to £10,000 towards green home improvements. Homeowners may be able to receive help with the cost of installing an air source heat pump which is a greener electrified heating system and an excellent alternative to gas central heating. Cost has long been seen as a major barrier to installing energy efficiency upgrades and technologies such as heat pumps both in upfront installation costs and the electricity used to run them.

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The government’s £2bn green support package for homeowners has been welcomed by the renewable energy industry, climate change activists and environmentalists.

Air source heat pumps absorb heat from the air and can even extract heat when temperatures are as low as -15°C. The heat is absorbed at low temperature into a fluid. This fluid passes through a compressor, increasing the temperature and transfers that higher temperature heat to the heating and hot water circuits of the house.

The number of homes with heat pumps had already been predicted to double by 2025 even before the government’s announcement.

The new offering from Good Energy, claims to be ‘UK’s first-ever heat pump tariff’ and is set to offer cheaper rates at certain periods during the day, while the national electricity grid is greener and experiencing lower demand. Good Energy describe their new tariff as ‘competitive’ which could mean that homeowners will significantly reduce the cost involved in operating a heat pump system.

Good Energy’s heat pump tariff will offer homeowners two key features:

  • Competitive unit rates to benefit heat pump users with higher electricity consumption
  • Cheaper unit rates at specific times of the day, allowing customers to use their heat pumps more cost effectively during key periods

At the moment most homes in the UK are kept warm with fossil fuels in the form of gas. Julia Davenport, founder and chief executive of Good Energy believes that the UK is faced with a massive task in decarbonising the UK. She thinks that the innovative heat pump tariff would help the Green Homes Grant go even further towards delivering its aim of weaning the UK’s homes off gas powered boilers and lowering carbon emissions.

Julia Davenport said:

“This tariff will be designed to make it as easy and affordable as possible for people to get rid of dirty gas heating their home and start using clean electricity from renewables.”

Heat pump technology is also eligible for subsidies under the Renewable Heat Incentive (RHI), a government scheme which provides financial support to homeowners who install renewable heating systems, for seven years.

heat pump

However, it is currently unclear whether heat pumps installed as part of the Green Homes Grant will be eligible for the RHI. 

The UK’s housing stock is currently responsible for more than a fifth of the country’s emissions and there is increasing pressure on the government to make further investments that go beyond their £3bn energy efficiency package to decarbonise homes.

The Confederation of British Industry has asked the government to ban conventional gas fired boilers by 2025 in order to expedite the uptake of green heating alternatives such as heat pumps and hydrogen ready boilers.

There is no doubt that there is some progress being made in bringing about a green recovery after the pandemic but is enough being done to fulfil the UK’s goal of net-zero carbon emissions by 2050?