• Industry leaders are calling to expand salary sacrifice to include heat pumps, solar panels, and other clean technologies.
  • This expansion could create 50,000 jobs and add £8 billion to UK GDP by 2030.
  • It would also support UK climate goals, including Clean Power 2030 and installing 600,000 heat pumps annually by 2028.

Industry leaders join forces in open letter to UK government for expanded salary sacrifice scheme

A coalition of over 30 industry leaders is calling on the UK government to expand the salary sacrifice scheme. Led by the REA (Renewable Energy Association) and supported by companies like The Electric Car Scheme, SUEZ, OVO, BAXI, and Duracell Energy, the group has written an open letter to key government figures. They want the scheme, which currently supports EVs, to include clean technologies such as heat pumps, solar panels, and other energy-saving products.

The letter, addressed to Rachel Reeves, Ed Miliband, and Miatta Fahnbulleh, highlights the success of salary sacrifice for EV adoption. Today, 1.4 million EVs are on UK roads, largely thanks to this policy. The scheme allows employees to spread the upfront cost of EVs over monthly salary deductions, making them more affordable. Industry leaders argue that applying the same principle to clean home technologies could have a transformative impact.

The proposal suggests using the upcoming Warm Homes Plan to expand the scheme

The goal is to make sustainable home improvements, like solar PV and heat pumps, financially accessible. The coalition argues that this expansion could help the UK meet its Clean Power 2030 targets. It would also support the government’s goal of installing 600,000 heat pumps annually by 2028.

Industry data supports this idea. People with access to salary sacrifice are nearly four times more likely to choose an EV than those without. If extended to clean technologies, it could result in around 230,000 home solar installations and 600,000 heat pump installations by 2030. This would not only reduce energy costs for households but also create jobs—up to 50,000 by the end of the decade.

The salary sacrifice should complement, not replace, existing support schemes like the Boiler Upgrade Scheme. They believe the expansion would reduce energy poverty and increase the UK’s energy security.

The coalition urges the government to act swiftly. They are ready to discuss the proposal in more detail and are hopeful that policymakers will see the potential benefits.