An initiative to encourage London’s SMEs to replace their old, inefficient boilers with modern, energy-efficient models has been welcomed by the Builders Merchants’ Federation.

The Mayor of London, Sadiq Khan, has launched his £10 million Cleaner Heat Cashback scheme to help London’s smaller companies save money on their energy bills and improve the capital’s air quality.

The BMF was involved in discussions prior to the announcement with City Hall staff and other heating industry partners to consider working arrangements such as eligibility and practicalities.

Shirley Rodrigues, London Deputy Mayor for Environment and Energy, said: “Businesses could save hundreds of pounds a year on energy bills by switching from an older, inefficient boiler or heating system - and this is exactly the kind of initiative that will help us achieve the Mayor’s ambition of making London a zero-carbon city by 2050”.

“Tackling London’s filthy air is one of the Mayor’s top priorities and this is just the latest in a package of measures that he has introduced to improve the quality of the air we breathe.”

John Newcomb, BMF Chief Executive, said: “We welcome and support this announcement that builds on earlier residential schemes by successive Mayors.

“The fact that Cleaner Heat is now aimed at commercial premises signals not only a political determination to tackle poor air quality, but seeks to change the thinking of SME owners towards their day-to-day running costs”.

“Significant savings can be made in business costs by upgrading to a modern heating system that BMF members make and supply. The 30% rate is generous and ought to entice companies to act.

“Although his offer is confined to the capital, the Mayor has moved to help London firms to cut bills, reduce emissions, improve air quality and encourage further investment”.

The offer is for SMEs based in London with old, inefficient heating system to apply for between 30% to 40% cashback towards a modern, cleaner heating system. It is a first-come, first-serve offer available to building owners, tenants responsible for property maintenance, or tenants who receive permission from landlords to change heating systems. Cleaner Heat Cashback will run until 31 March 2020 - or the £10 million has been allocated - whichever comes first.

Mr Newcomb noted that in an ideal world, it would be better to have a coherent, fabric-first approach to improve the thermal and energy performance of homes and workplaces. However, in the absence of proper, long-term national policy, it is not surprising that cities like London decide to use the powers available to them to improve air quality and reduce carbon emissions.

This Cleaner Heat Cashback offer follows:

 the current Mayor’s Better Boilers scheme which replaced and repaired inefficient and broken boilers in nearly 500 fuel-poor households

 the previous Mayor’s Boiler Cashback Scheme that succeeded because nearly 40% of owner-occupiers and private residential landlords heard of the offer via their installer which was the single most effective communication route.

The BMF has campaigned for boiler scrappage as part of the solution to air pollution. In recent years, central and local government have failed to bring down air pollution to within legal limits. Diesel emissions from transport are the main cause but emissions from home heating are also involved.

In all its representations to Whitehall and the city councils affected, the BMF has persistently made the case for boiler scrappage scheme(s). They could be city-wide schemes - such as in London - or better still, a fully-financed national scheme from Whitehall.