Storage tanks were once promoted as a practical solution for homes without gas central heating, particularly during the 1970s and 1980s. They allowed users to store heat overnight on cheaper electricity tariffs (such as Economy 7) and release it during the day. However, most current models are outdated, inefficient, and expensive to operate. With rising energy prices and climate targets driving the transition to low-carbon heating, the UK government and local authorities offer several grant-funded programs to help homeowners and tenants replace their old storage tanks with modern systems.
This article explores those plans in depth, explains how to qualify, and guides you through the process of upgrading to more efficient heating technology.
1. Storage Heaters and Why They’re Obsolete
1.1 What Are Storage Heaters?
Heat accumulators are electric heating devices that use ceramic bricks to store heat generated at night, when electricity is cheaper. The heat is gradually released throughout the day.
1.2 Types of Storage Heaters
- Manual storage heaters: Basic, low-control models with manual vents
- Automatic storage heaters: Feature thermostats and charge control
- High heat retention (HHR) heaters: The most modern and efficient type, often approved for grant-funded replacements
1.3 Drawbacks of Traditional Storage Heaters
- Inefficient heat retention – Older units often lose stored heat too early in the day
- Lack of responsive control – Can’t quickly adjust heat output
- High running costs – Electric heating is generally more expensive than gas or heat pumps
- No integration with smart home systems – No compatibility with demand-response systems or smart meters
The average running cost of older storage heaters can be £500–£1,000 higher per year compared to heat pumps or efficient gas boilers.
2. Overview of Government Grant Schemes
2.1 Main Schemes That Support Heater Replacement
| Scheme | Available To | Covers Replacement? | Covers Full Cost? |
|---|---|---|---|
| ECO4 | Low-income households | Yes | Often 100% |
| Home Upgrade Grant (HUG2) | Off-gas-grid homes | Yes | Up to 100% |
| Boiler Upgrade Scheme (BUS) | Owner-occupiers in England & Wales | Indirectly | Partially (£7,500 cap) |
| Local Council Grants | Varies by area | Sometimes | Partial or full |
| Warmer Homes Scotland | Scottish households | Yes | Often full |
| Nest Wales | Welsh households | Yes | Partial or full |
3: Detailed Breakdown of Each Scheme
3.1 ECO4 – Energy Company Obligation (2022–2026)
Administered by: Ofgem, funded by major UK energy companies
Scope: England, Scotland, Wales
Purpose: Reduce carbon emissions and fuel poverty by improving household energy efficiency
Key Features:
- Replaces broken or inefficient storage heaters with:
- High heat retention storage heaters
- Electric panel heaters (in some cases)
- First-time central heating systems (electric, gas, or renewable)
- Air source or ground source heat pumps
- Often includes insulation upgrades (loft, cavity wall, underfloor)
- Tenants can apply with landlord permission
- Delivered through ECO-accredited installers
Eligibility:
- Income below £31,000/year (gross), or
- Receiving means-tested benefits (Universal Credit, Pension Credit, etc.)
- EPC rating of D–G (owner-occupied) or E–G (rented)
- Proof of heating type (photos or system description required)
How to apply:
Find a certified ECO installer near you. They’ll do a free survey, submit paperwork, and manage the grant claim.
3.2 Home Upgrade Grant Phase 2 (HUG2)
Administered by: Local authorities, funded by the Department for Energy Security and Net Zero
Scope: England only
Funding period: April 2023 – March 2025
Total budget: £630 million (shared between local councils)
Purpose:
Target low-income, off-gas-grid households with poor EPC ratings and support transition to low-carbon heating.
Covers:
- Replacement of electric storage heaters with:
- Air source heat pumps
- Biomass boilers (in limited rural applications)
- Solar PV systems (optional)
- Includes insulation measures and smart controls
Eligibility:
- Household income under £36,000/year or in fuel poverty
- EPC rating of D–G
- Property must be off the gas grid (no gas boiler)
- Available to owner-occupiers and private renters
Note: Some councils prioritize vulnerable groups (e.g., disabled, elderly, single-parent households)
How to apply:
Check with your local council to see if HUG2 is active in your area. Applications are often handled through third-party delivery partners.
3.3 Boiler Upgrade Scheme (BUS)
Scope: England and Wales
Budget: £450 million over three years
Purpose: Encourage heat pump installation by offsetting high upfront cost
Grant Value:
- £7,500 for air source or ground source heat pumps
- £5,000 for biomass boilers (in off-gas rural areas)
Limitations:
- Does not apply to high heat retention storage heaters or electric panel heaters
- Does not cover insulation
- You must install through an MCS-accredited contractor
How to apply: Your installer applies on your behalf. The grant is deducted from your invoice after work is complete.
3.4 Local Council Grants and Pilots
Councils sometimes offer standalone programs or partner with companies to deliver extra support. Examples include:
- Greater London Authority retrofit programs
- West Midlands Combined Authority energy transition projects
- Devon, Cornwall, and Somerset schemes for rural off-grid homes
- Nottingham and Leeds offering first-time central heating installations
Funding levels, eligibility, and heating types supported vary widely. Some councils will co-fund BUS or HUG upgrades.
3.5 Country-Specific Programs
Warmer Homes Scotland:
- Provides funding for storage heater replacement, insulation, and renewables
- Managed by Warmworks Scotland
- Available to homeowners and private tenants
- Income or health-based eligibility
Nest Wales:
- Free home energy improvements for low-income households
- Supports replacing electric heating with efficient systems
- Applications made via the Welsh Government Nest portal
4: Eligible Heating System Upgrades
Here’s what you can typically replace old storage heaters with under grant schemes:
| Replacement System | Description | Suitable For | Grant Eligible? |
|---|---|---|---|
| High Heat Retention Storage Heaters | Modern, smart-controlled units | Flats, small homes | Yes (ECO4) |
| Air Source Heat Pumps | Extract heat from outside air | Most homes | Yes (ECO4, HUG2, BUS) |
| Electric Panel Heaters | Simple, responsive electric heaters | Small properties | Sometimes (ECO4) |
| Infrared Heaters | Radiant heating panels | Room-by-room upgrades | Rare |
| Gas Central Heating | Traditional radiators + boiler | If gas is available | Yes (ECO4, limited) |
| Biomass Boilers | Wood-pellet fuelled | Rural areas | Yes (BUS, HUG2) |
| District Heating | Piped heating from central plant | Flats, new builds | Rare but emerging |
Note: Heat pumps require insulation and space for outdoor units. Not all properties are suitable.
5: Step-by-Step Application Process
Step 1: Confirm Your Eligibility
Use Ofgem’s or gov.uk’s online eligibility checkers for ECO and HUG schemes. Gather the following:
- Income or benefit documentation
- EPC rating (can be found online)
- Property type and heating system details
Step 2: Find a Certified Installer
Only approved installers can process applications and claim the grants. Use:
- TrustMark
- MCS Certified for heat pumps
- Local council websites
Step 3: Get a Free Survey
The installer will assess:
- Current heating system
- Insulation levels
- Grant eligibility
They will then prepare a proposal and submit paperwork.
Step 4: Installation
- For ECO4 and HUG2: the installer completes the work with little or no upfront cost
- For BUS: you may need to pay part of the cost after the grant is deducted
Step 5: Post-Installation Support
You should receive:
- A warranty (typically 2–5 years)
- Operation manuals and guidance on using smart controls
- Optional follow-up survey (to confirm energy savings)
6: Common Challenges and How to Overcome Them
| Challenge | Solution |
|---|---|
| EPC rating too high | Consider improving insulation first, then reapplying |
| Rental property | Get written permission from landlord |
| No active HUG in your council | Ask if they’ll join future funding rounds |
| Long waiting list | Apply early and explore multiple schemes simultaneously |
7: Final Thoughts
Replacing old storage heaters is a smart decision, both economically and environmentally. The UK government recognizes that low-income, off-grid households need help transitioning to better heating. With full funding available in many cases, there’s no reason to delay.
Modern electric heating is more economical, offers better control, and can, in the future, be combined with solar power and storage batteries.
Grants for Replace Storage Heaters
- Apply for Lindsey Nicole Henry Scholarship 2025 - April 21, 2025
- Government Grants to Replace Storage Heaters in the UK 2025 - April 20, 2025
- Churches That Help With Financial Assistance - April 9, 2025