Ministers are preparing to reduce the level of financial support available for heat pumps and related boiler upgrade schemes as they look for ways to free up funds for increased defence spending, sources have told the Guardian.
Energy secretary Miatta Fahnbulleh has been tasked with finding in excess of £2 billion of savings from her department's budget to help meet defence investment requirements set out in a plan drawn up by the previous government, according to the sources. Some of those savings are expected to come from cuts to a boiler upgrade programme and other household low-carbon heating subsidies.
The potential move would reallocate money aimed at supporting the transition to low-carbon domestic heating towards meeting national defence commitments. Officials are reported to be reviewing where reductions could be made within the energy budget to achieve the necessary savings.
No final decisions have been announced and ministers are understood to be still considering options. Further details, including the scale and timing of any cuts to support schemes, have not been made public, and it is not yet clear how any changes would affect existing beneficiaries or the wider strategy for home heating decarbonisation.
The discussion reflects the ongoing challenge of balancing departmental budgets against competing policy priorities set out by the previous administration. Officials say the review is part of a cross-government effort to identify savings to meet the defence funding targets without immediately increasing the overall fiscal burden.
Sources provided the information to the Guardian and officials have not released an official statement detailing the proposed measures or timelines for implementation.