Mayor of London Cleaner Heat Cashback (CHC) Scheme

Kiwa Gastec worked with the Energy Saving Trust to deliver the Cleaner Heat Cashback Scheme on behalf of the Greater London Authority (GLA).

Why did the Cleaner Heat Cashback project happen?

This scheme was a world first; using public finance to incentivise commercial organisations within the greater London area to replace older, dirty and inefficient heating systems with more efficient greener and less polluting ones.

What is the Cleaner Heat Cashback project?

As London makes progress in tackling NOx and particulate emissions from transport the proportion of total emissions from the combustion of fossil fuels by commercial organisations is expected to grow. Additionally, London has committed to Net Zero by 2050.

Many businesses in the capital still use old, inefficient and polluting boilers for heating and hot water and replacing these with modern boilers or renewable heating systems has the potential to make significant NOX and CO2 savings, thereby helping to improve air quality and helping the City realise its Net Zero ambitions.

Due to the nature of the building type in London, many old boilers are located in difficult to reach plant rooms, in heavily populated areas of the city where building works are traditionally expensive.  The high cost of labour acts as a barrier for replacement.

The Cleaner Heat Cashback Scheme was conceived to help incentivize SMES to undertake boiler replacement projects by sharing the cost with the operator of the system of up to 40% in air quality priority areas. Prior to the CHC scheme, no such mechanism existed for commercial organisations.

What was the project outcome?

The scheme ran from August 2018 until March 2020.

In total, over 30 applications passed initial screening by the EST and were reviewed by Kiwa with an approval rate over 70%, some applications were withdrawn during assessment. In total annual savings of around 750kg NOX and 163 tonnes CO2 were made.

The role of Kiwa Gastec

The project was split into 2 phases. During phase 1 of the project Kiwa was involved with stakeholder engagement and definitions of the scheme rules.

Kiwa worked with the Federation of Small Businesses, Local London Authorities and utilised its network of installers and appliance manufacturers to identify key stakeholders. A series of meetings and workshops were organised to understand the appetite for such a scheme and the outcomes it would have to deliver to each stakeholder group.

Scheme rules were then defined that would both meet the expectations of the stakeholders as well as simultaneously addressing priorities areas of the GLA. Key aspects of the scheme that had to be considered included:

  • Which type of businesses should be supported by the scheme
  • How to set the appropriate level of funding
  • What technologies and associated works should be funded by the scheme
  • Which replacement technologies should be supported as well as minimum performance levels

Extensive modelling and scenario testing were carried out to demonstrate that the desired levels of saving could be achievable within the available fund. Kiwa was able to draw on inhouse knowledge of historic boiler efficiency and pollutant emissions as well as using publicly available datasets on gas connections, heat networks and numbers of businesses to support this analysis.

Phase 2 of the project saw Kiwa acting as technical reviewer of applications made to the scheme. After an initial screening by the EST, each application was assessed for eligibility, technical feasibility, quality and value for money. Based on the information provided, an estimation was made as to the quantity of NOx and CO2 that might be saved through carrying out the replacement project. Recommendations were then made to the GLA on whether not the project should be funded by the scheme.

  • Managed stakeholder engagement
  • Conducted data modelling
  • Conducted technical review
  • Site audits