The Boiler Scrappage Scheme has four main aims: (1) upgrade household heating systems; (2) cut carbon emissions; (3) reduce fuel bills; and (4) sustain work for the heating industry.
Under the Scheme, up to 125,000 households in England with working "G-rated" boilers can apply through the Energy Saving Trust for a voucher that will entitle them to £400 off the price of a new "A-rated" boiler or a renewable heating system (e.g., a biomass boiler or a heat pump).
The Scheme has already triggered some companies to complement, and in some cases match, the £400 Government subsidy - and it is expected others will follow suit - this could provide consumers with savings of up to £800 on the price of a new heating system.
Note: According to the Heating and Hot Water Industry Council, the trade association for the Heating industry, the average cost of a boiler and installation is around £2500. Consumers are advised to shop around to find the best deal.
Announcing the Scheme today, Energy and Climate Change Secretary Ed Miliband said:
"The Boiler Scrappage Scheme will cut energy bills by between £200-235 per year for each household that enrols. In total, this will reduce carbon emissions by around 140,000tCO2 per year - the carbon equivalent to taking around 45,000 cars off the road."
Prime Minister Gordon Brown added:
"The Scheme will also provide an important boost for the British heating industry, helping to secure 250,000 jobs across tens of thousands of small and medium businesses involved in boiler manufacture, sales and installation."
And Fraser Winterbottom, Chief Operating Officer of the Energy Saving Trust said:
"We know that people will act on larger energy efficiency measures like replacing boilers when they are both good for the environment and cost effective for them.
"They also need to be able to trust the claims that are made around energy efficiency measures. The Energy Saving Trust is impartial and can provide this assurance, plus information to help people assess whether their boilers are eligible.
"If you have access to the internet you can visit the Energy Saving Trust website to check whether your boiler is "G-rated" or if you prefer, our expert nationwide advice centre staff are also available to advise you over the phone. We are here to help."
Roger Webb from the Heating and Hot Water Industry Council said:
"We're delighted the government's giving the green light to help householders replace old inefficient boilers with new energy efficient models.
"The Scheme's good on many levels: householders should see a large reduction in their energy bills; the environment will benefit from reduced carbon emissions; and UK industry and employment will receive a boost since most boilers installed in this country are manufactured here too."
To learn more about the Boiler Scrappage Scheme and to register, visit the Energy Saving Trust website and/or call their advice line on 0800 512 012.