The first scheme will provide low cost air source heat pumps to households, which the lender said would support the decarbonization and encourage the retrofit of existing UK properties.
The pilot has been launched through the Halifax brand as part of its green living reward scheme. Customers using mortgage borrowing to fund the air source heat pump will get £1,000 cashback on completion of the installation.
Halifax will also provide borrowers with a referral link to arrange an installation with Octopus Energy.
If the scheme is used together with the government’s boiler upgrade scheme, which offers a £5,000 cashback, this brings the cost of installing a heat pump to £2,000. This means heat pumps for some homes will cost less than gas boilers.
Lloyds Banking Group said that around 40 per cent of UK homes are suitable for a switch to a heat pump, and four million would become suitable if additional measures are taken such as installing loft insulation.
‘Heat pumps are greener and can be cheaper’
Rebecca Dibb-Simkin, chief product officer at Octopus Energy, said: “We’re always looking for ways to help people save money while accelerating the shift to a clean energy future. The pilot with Lloyds Banking Group comes at a crucial time for consumers facing a dual climate and cost of living crisis.
“It no longer needs to be a question of prioritising one over the other: heat pumps are greener than gas boilers, and thanks to Octopus, the government and Lloyds Banking Group they can be cheaper too.”
Jas Singh, CEO of consumer lending, Lloyds Banking Group, added: “Our partnership with Octopus adds another element supporting our strategy to help Britain live in better, warmer, greener homes and move the country towards its net zero target.
“Lots of homeowners who need to replace, or want to upgrade, a gas boiler may have considered the switch to a heat pump but see the cost as a barrier. This extension to our green living reward scheme will make switching from a gas boiler to a new, more efficient, cheaper-to-run heat pump easier and more affordable than ever before.”
He continued: “We won’t stop here. We are committed to playing our part in reaching net zero by continuing to support and encourage our customers to make greener choices for their homes. This pilot is just the first from our partnership with Octopus Energy; we will continue to innovate, we will continue to help make Britain’s homes better for their owners and better for the environment.”
