The government’s Boiler Upgrade Scheme has been deemed a failure, as full-year figures reveal that it fell short of its target for replacing boilers with taxpayer-subsidised heat pumps.

The scheme had a budget of £150 million for funding 30,000 heat pump installations, but less than 10,000 households received their £5,000 subsidy voucher in the first year.

The unspent budget will now be returned to the Treasury.

Mike Foster, Chief Executive Officer of trade body the Energy and Utilities Alliance, criticised the scheme’s failure, stating that it does not benefit those who need it most and is an “embarrassment of a policy”.

He added that investment in insulation measures could save more carbon, keep bills down, and provide a sound economic investment for the Treasury.

Foster also noted that the scheme was a taxpayer handout to those who don’t need it and called for the government to prioritise insulating the homes of those most in need rather than giving away hard-earned taxpayers’ cash to those who were going to buy a heat pump anyway.

He criticised the fact that more taxpayer-subsidised heat pumps have been fitted in Cornish holiday homes than in Birmingham and called the situation shameful.

A Department of Energy Security and Net Zero spokesperson told ELN: “We are determined to upgrade heating systems across the UK, expecting uptake to rise and fully confident our target of 600,000 heat pumps installations by 2028 will be met.

“Heat pumps are a proven, scalable option for decarbonising heat. The action we’re taking to power up Britain, increasing our energy security and independence, will reduce the cost of heat pumps, making them a more attractive option.

“Our Boiler Upgrade Scheme will continue to provide grants of up to £6,000 towards the upfront cost of installing a heat pump, and will be extended with new, additional funding in each year until 2028.”