Alto Energy's Outlook On Heat Pumps in 2022
After another busy year in 2021, we’re looking forward to what the next 12 months have in store for the heat pump industry. It is sure to be an exciting time; below you will find our thoughts and comments on some very significant events for our industry.
Recap on 2021
Last year proved to be an extremely busy one! Despite the ongoing impacts of the pandemic, Brexit, and not to mention global supply chain shortages, demand for heat pumps was at an unprecedented level. Despite these challenges, through the efforts of our brilliant staff, we have been able to navigate these problems and deliver our best ever year, with more housebuilders, heating installers and homeowners buying heat pumps from us than ever before.
Speaking of staff, we had 4 new joiners in 2021:
Tris, who joined our sales team
Bazeley, who joined our business support team
Chelsea, who joined our technical support team
Arman, who joined our finance team
Furthermore, this week we welcome two more recruits:
James, who joins our engineering team
Aneta, who joins our business support team
Our people are our most important asset, and welcoming these new faces is both a consequence of the significant increase in demand for our services over the past 12 months, as well as our preparation for continued growth of the business through 2022 and onwards.
We would like to thank all of our customers - both new and repeat customers - for their support over the past 12 months. We are extremely grateful for your custom, and at times given the supply chain issues we’re facing, your patience!
Outlook for 2022
We believe that 2022 will be a landmark year for heat pumps. The last 12 months have seen the introduction of swathes of Government policy aimed at promoting heat pumps. These policies were all part of the Government’s Heat & Buildings Strategy, announced in October. These policies will be put into place throughout 2022 and beyond, and represent the Government’s plan to grow the heat pump market ten-fold, to 600,000 units per annum by 2028:
New Boiler Upgrade Scheme grant
New Building Regulations to promote heat pumps for new build homes
New mechanism for green levies, switching levies to gas bills instead of electricity bills over the next decade
Proposed ban on new oil and LPG boilers in off-gas grid locations from 2026
March 2022 - Goodbye RHI Scheme
Before any of that, the Renewable Heat Incentive (“RHI”) scheme will finally finish on 31st March 2022. The scheme was originally due to finish in March 2021, however as a result of the pandemic the Government decided to extend the scheme by a further 12 months. The scheme has been a generous mechanism to support the heat pump industry, however due to the lack of upfront capital support, the scheme hasn’t quite generated the level of uptake that we would perhaps have liked.
We have been repeatedly writing about the closure of the Domestic Renewable Heat Incentive (“RHI”) scheme on March 31st 2022. If you have already had your heat pump system installed and it was commissioned on or after 1st March 2019, and you meet the eligibility criteria and have not yet claimed the RHI, then you have until 31st March 2022 to apply or you will miss out on thousands of pounds in RHI payments.
You can find out more by reading our dedicated blog about the RHI scheme closure:
April 2022 - Hello Boiler Upgrade Scheme
The Boiler Upgrade Scheme is a new Government scheme to encourage homeowners and business owners to replace their fossil fuel boilers and install low carbon heating systems, like air source heat pumps and ground source heat pumps. The scheme is scheduled to start from 1st April 2022.
“Air Source Heat Pump Grant - £5,000
Ground Source Heat Pump Grant - £6,000”
Homeowners or business will receive a grant of £5,000 for installing an air source heat pump, or £6,000 for installing a ground source heat pump. As an MCS accredited installer, Alto Energy will administer the grant with Ofgem on your behalf, and deduct the full grant amount from your quotation. In this way, the amount you pay upfront for your heat pump will be much closer to the amount you would pay for a traditional fossil fuel system, making it easier for you to access the significant carbon savings and running cost savings.
You can find out more about the new Boiler Upgrade Scheme on our dedicated webpage:
June 2022 - New Part L Building Regulations
This is something we’ve been waiting on for quite some time - an update to the Building Regulations to more accurately reflect, on paper, the carbon savings delivered by heat pump systems.
The update to building regulations will come into effect in June 2022, and will see new homes need to cut carbon dioxide emissions by 30% compared with current regulations. However the key change from the perspective of the heat pump industry is the emission factors for each fuel.
The emissions factor is the amount of carbon dioxide produced by each unit of a given fuel, e.g. each unit of electricity or each unit of gas. Over the last decade, the carbon emissions of a unit of electricity have dropped significantly, due to the increasing contribution of renewable electricity on the UK electricity grid. However, this increase has not been reflection in the calculations, the figures for which have not been updated since 2012. Until now...
The new emission factor for electricity is just 136 grams of carbon dioxide for each unit. For a heat pump, this means that the typical emissions per unit of heat delivered is under 50 grams. By comparison, gas boilers produce over 250 grams of carbon dioxide for each unit of heat delivered. This means that heat pumps will save over 80% on the heating and hot water compared with a gas boiler in the building regulations calculations. Given that heating and hot water are by far the biggest source of emissions in the property, this will make heat pumps the obvious choice for new build properties.
If you’re building any houses in 2022, please do get in touch and we can provide you with a quotation simply from your building plans.
All Year Round - Even More Heat Pump Training
If you’re a heating installer, chances are someone will ask you about heat pumps this year. The heat pump market is expected to double year-on-year, every year for the next four years at least! The direction of travel for the heating industry is definitely in the direction of heat pumps. If you’re a heating installer looking at getting into heat pumps, Alto Energy are your perfect partner:
Key Services Provided
We handle all the design work and MCS accreditation paperwork, so you don’t have to
Full schematics and unlimited telephone support to enable you to complete the installation
Fixed, package price for design, supply and commissioning of a heat pump system
Handover pack with the necessary certificates for your customer to claim Government grants
Our MCS Umbrella
Alto Energy’s MCS umbrella scheme is designed to enable you to provide your customers with a fully MCS accredited installation, without all the hassle of maintaining the accreditation and compiling all of the paperwork yourself. We carry out all of the MCS design work, we specify and supply the heat pump equipment that you need, and one of our regionally-based engineers will inspect and commission the installation once you’ve completed it. We then issue a suite of certificates for the end user, which they will need to claim any Government grants that they might be eligible for.
Become a Partner Installer
Become an Alto Energy Partner Installer and you will receive referrals for projects with end users in your area. Becoming a Partner Installer is simple: you need to attend one of our free heating installer training courses, and then complete your first project with a customer of your own. Once this is done, you’ll be added to our Partner Installer map, and you will receive referrals from end user customers who enquire with us directly about installing a heat pump system in their home. We’ll also share your installation photos to our Instagram account, for our thousands of followers to see!
Free Training
We offer free heat pump training to heating installers looking at installing heat pumps. We have added even more training dates this year than ever before. The course is designed to give a qualified heating installer everything they need to start installing heat pumps. Book on today!