15. Before we decide if we should conduct a detailed investigation of a complaint, we look at whether there are signs the organisation has got something wrong. We do this by comparing what should have happened with what did happen. We have done this and have not found any indications that something has gone wrong.
Refusal of the BUS application in October 2024
16. Mr C says Ofgem refused his application for a BUS on 15 October 2024 on grounds his property had already received a grant towards a biomass boiler. Mr C says he was not the owner of the property at the time. He says there was no evidence of the boiler when he purchased it.
17. As a result, Mr C says he already paid for and installed the GSHP at a considerable cost. He says not receiving the £7,500 grant means he needs to find the money elsewhere and will be delayed moving into the property and finishing the project. During our call, he told us he was upset to be denied funding, as he had tried to do the right thing by installing the system.
18. In this case, we consider the Guidance and the Boiler Upgrade Scheme Regulations 2022 relevant to this complaint. Ofgem referred to these guidelines in its correspondence with Mr C. It also confirmed to us that these are the guidelines it follows when making decisions on BUS applications.
19. The Guidance is for property owners who are looking to benefit from the BUS. It explains the administration of the BUS, including eligibility requirements, what is required from property owners, and how to apply for the voucher. Grants of £7,500 are available for GSHP. It provides an application process overview, which includes a two-stage process.
20. At the first stage of the application process, the installer submits a voucher application. Ofgem assesses the application and seeks confirmation of the property owner’s consent. Ofgem issues a BUS voucher. At the second stage, the installer submits a voucher redemption application. Following commissioning of the plant and within the voucher validity period, the installer receives payment.
21. Section 1.16 of the Guidance outlines it is the responsibility of each applicant (the installer) to understand the requirements of the BUS regulations. The installer is responsible for ensuring the installation is eligible and the information on the BUS application is correct.
22. Similarly, section 4.39 says Ofgem ‘strongly encourage installers to wait until a voucher application has been made and the voucher issued before commissioning the eligible system at a property’. On occasions where commissioning occurs prior to submitting a voucher application, property owners should seek confirmation from their installer that they can still successfully apply for BUS.
23. Section 4 of the Guidance outlines the eligibility requirements. Section 4.62 says ‘there are restrictions on previous grant funding. An application is not eligible for BUS where there has been a previous grant from public funds for a heat pump or biomass boiler installed at the same address’.
24. Section 5 outlines the application process for the BUS. It is an installer-led two stage application process. Section 5.8 says ‘installers may apply for a voucher retrospectively after the installation has been commissioned. However, please note that if a system is installed and commissioned before applying for a voucher, the property owner and the installer will be doing so at additional risk.’
25. The Boiler Upgrade Scheme Regulations 2022 says:
‘5 Eligible properties (1) For the purposes of these Regulations, a property is an eligible property where – (c) if it has had any heating system installed, and was, or will be, first occupied or used before ethe date on which the relevant eligible plant is commissioned – (iii) there has not been a previous grant from public funds for a heat pump or biomass boiler at the same address.’
‘14 Grant applications (2) The Conditions in this paragraph are that – (a) the owner of the property – (v) has not received a previous grant from public funds for a heat pump or a biomass boiler installed at the same address.’
26. To see whether Ofgem had acted in line with the above Guidance and Regulations 2022, we reviewed the relevant complaint file.
27. Ofgem also issues guidance for installers which sets out the installer’s role in the application process. This says that, ahead of making a voucher application, the installer should advise the property owner on whether a proposed installation is eligible for a grant and agree with them a quote for the project. As with the guidance to property owners, the guidance to installers makes clear that if an installed completes the work before a voucher is issued, they are doing so at additional risk.
28. On 27 September 2024, Mr C applied for a BUS voucher for installation of a GSHP.
29. On 1 October, Ofgem flagged the application for compliance checks. It emailed Mr C’s installer on 2 October to advise the EPC provided indicates the property had a biomass boiler installed as its main heating source. It requested further information about the boiler.
30. On 8 October, Mr C provided additional information around the purchase and restoration of the property. He explained there was no evidence of a biomass boiler on the property at the time of purchase. He supplied an email trail. This indicates the biomass boiler was removed prior to December 2021 and the previous property owners had not been provided with any information or documentation relating to it.
31. On 15 October, Ofgem rejected Mr C’s BUS application. It explained this was because a previous renewable heat scheme application had been found on the property for a biomass boiler. It noted this had been commissioned on 23 May 2014. Ofgem quoted Regulations 5(1)(c)(iii) and 14(2)(a)(v), which are cited above.
32. We consider Ofgem acted in line with Regulations 5(1)(c)(iii), as well as section 4.62 of the Guidance, by refusing Mr C’s application. Both outline restrictions on grant funding. Specifically, an application is ineligible for funding if there has been a previous grant from public funds for a biomass boiler at the same address. Whilst we acknowledge Mr C had not been the recipient of this funding, a grant had still been awarded at the same address and so the application failed to fulfil the eligibility requirements.
33. On 24 October, Mr C requested Ofgem reconsider his application decision. We can see from the internal case review summary Ofgem’s evidence for the biomass boiler included an EPC dated 8 September 2024 and an MCS certificate for the boiler at the property linked to a Domestic Renewable Heat Incentive (DRHI) application. MCS stands for Microdegeneration Certification Scheme and is the UK’s quality mark for small scale renewable energy technologies. DRHI is a scheme paying property owners for using renewable hearing systems.
34. Ofgem also noted the original property, which had DRHI installation, had been joined to the neighbouring building. Planning permission for the properties verified the address as the same one which received DRHI payments.
35. On 29 January 2025, Ofgem wrote to Mr C to advise its original decision was correct. We consider this is in line with the Regulation 5 and section 4.62 of the Guidance. In its response, Ofgem apologised for incorrectly citing Regulation 14(2)(a)(v). It acknowledged this did not apply as Mr C was not the property owner who received previous grant funding.
36. Having reviewed the evidence provided to us, we consider Ofgem was appropriate to refuse Mr C’s application in October 2024 and during reconsideration in January 2025. By doing so, Ofgem acted in line with Regulation 5(1)(c)(iii) and section 4.62 of the Guidance.
37. We also note the Guidance issued to both property owners and installers strongly discourages applicants from retrospectively applying for a BUS voucher following installation. Doing so is at their own risk, although we can understand Mr C’s obvious frustration at having paid a significant amount of money towards a project he may now have greater difficulty to complete.
38. Overall, we do consider we need to take any further action on Mr C’s complaint. We appreciate this may be disappointing. We hope he is reassured by our explanation.