Gas scrappage schemes: Don't get left in cold

By Andrea Watson
Posted: 2010/02/17

Gas scrappage schemes are a way of helping homeowners but critics warn of hidden costs, as ANDREA WATSON reveals

THERE'S been a large-scale take-up of the Government's boiler scrappage scheme.

Figures released just this week reveal that more than a third of the vouchers available have been snapped up, leaving around 70,000 up for grabs.

The scheme works in a similar way to the new-car-for-old incentive. It allows a limited number of homeowners with "vintage" gas boilers, aged 15 years or more, to apply for a £400 grant towards a new energy saving model.
The £50million initiative will help up to 125,000 homeowners replace their inefficient G-rated boilers with A-rated models, which in turn could cut their energy bills by up to £235 a year.

At the scheme's launch Prime Minister Gordon Brown said it would slash household energy bills and carbon emissions and give a much-needed boost to the heating industry, similar to the fillip the car trade has received from its scheme.

The boiler scheme could earn more than £300m for the sector, which has been hard-hit by the collapse in housebuilding.

Installers will also do well from it as fitting the new generation of condensing boilers is expensive and can represent two-thirds of the cost of a new system.

Eligible households must apply to the Energy Saving Trust for their £400 vouchers and the sooner they do so the likelier it is that they will get them.

British Gas and npower are among companies that have decided to match the Government offer, so if you buy a new boiler from either of them, you will get a total of £800 off. Also, npower has declared that its scrappage grant will apply to boilers with a C-rating which may be fewer than 15 years old.

However, not everyone is thrilled by the initiative.

Friends of the Earth has pointed out that there are more than four million G-rated boilers in the UK, so only a tiny minority of people will benefit from the scheme. Nor has it escaped notice that the Government will make a tidy profit if, as expected, the full funding is taken up. The average price of a new boiler is £2,500, of which £437 represents VAT. That means the net profit to the Inland Revenue would be £4.69m.

A spokesman for the Department of Energy and Climate Change defended the Government's profit. He said:
"VAT would be applicable whether a householder changed their old boiler now through the Government scheme or whether they leave it to break down and then replace it." There are also claims the scheme will help only those well-off enough to afford it in the first place, not the needy.

The £400 can only be spent on top-of-the-range A-rated boilers, the most expensive to buy. Even if you have the estimated extra £1,600 needed to upgrade your boiler, some experts believe it could be a waste of money.

Charlie Mullins, managing director of London-based Pimlico Plumbers, has been a highly vocal critic of the Government scheme.

He said there could be hidden costs as modern condensing boilers are more expensive to fit and repairs and parts are not cheap.

Mr Mullins said there were concerns that thousands of functioning boilers will be replaced with more efficient but less reliable or durable models that in some cases will last just a few years.

He said: "Some of the new condensing models just don't last and when they go wrong they are complicated and expensive to repair. We have been ripping out boilers that have done just three to six years' service and have become uneconomic to repair.

"It is madness to spend around £2,000 to scrap a boiler that's working perfectly well."

His comments are supported by a number of plumbing and DIY websites, which show that some buyers are unhappy with their new condensing boilers. So before you sign up for the deal, make sure that it really will save you money.

GarethKloetofconfused.com said: "Anyone considering taking advantage of the boiler scrappage scheme should resist being bamboozled by the headline offers.

"Instead it's vital to shop around and consider the total cost of both the replacement boiler and associated installation costs."

Pensioners and low-income households have also been warned that applying to the scrap page scheme will invalidate their right to Warm Front funding, which could give them up to £3,500 towards the cost of loft insulation, draught proofing and repairs to an existing heating system, as well as to a new boiler.

INFORMATION:
To apply for a £400 voucher call the Energy Saving Trust on 0800 512 012/ www.energysavingtrust.org.uk
npower: 0800 0722 999/www.npower.com
British Gas: 0800 009 4450/www.britishgas.co.uk/yourboiler

ENCOURAGED by the success of the car scrappage scheme, the Glass & Glazing Federation is petitioning the Government to give a £1,000 grant to householders with old poorly insulated windows which they can put towards the installation of new energy-efficient ones. More than 4,000 people have signed the petition which is open until March 25.

In the meantime, Anglian Home Improvements has introduced a scheme offering customers up to £2,500 to swap poorly insulated windows for new ones.

Next to walls and roofs, poorly fitted and insulated windows are the biggest cause of heat loss in a home.

You can save up to 35 per cent on new windows with Anglian's national scrappage scheme, which includes a range of funding options to help spread the cost.

INFORMATION: 0800 500 600 / www.anglianhome.co.uk