Environment, sustainability and housing minister Jane Davidson said that the scheme will come into force on April 1st 2010, with £2.5m allocated to the scheme allowing up to 5,000 homes to benefit.

The scheme will reward households with a £500 voucher towards the cost of a new A-rated boiler when they replace their old G-Rated one. The switch can also save households up to £235 a year in energy costs as well as reducing greenhouse gas emissions.

Consumer watchdogs have claimed that the scheme would not help the long term sick, young families and the disabled, but Ms Davidson also announced “an additional £1.4 million to tackle fuel poverty through our Home Energy Efficiency Scheme during the next financial year.

“This additional funding underlines the Assembly Government’s ongoing commitment to tackling fuel poverty and reducing greenhouse gas emissions in Wales.”

Vale of Clwyd Labour AM Ann Jones said: “This boiler scrappage scheme will save hundreds of pounds for many householders who are currently suffering from fuel poverty.”

CBI Director-General, Richard Lambert believes both businesses and homeowners alike require the relevant energy-efficiency education and incentives in order to implement energy saving measures so to create a national ’sea change’ in the usage of energy. Lambert continued “… we need easy-to-access support and incentives to encourage improved insulation in homes and offices, a switch to more fuel-efficient cars, and other energy savings steps.”

The recently announced Boiler Scrappage Scheme is one incentive initiative, providing homeowners in England and Wales the opportunity to scrap and replace their old G-rated boilers for new energy efficient boilers.

Following on from nPower, British Gas have also announced their own Boiler Scrappage Scheme by offering additional savings on new A-rated energy-efficient boilers, which includes 1 year’s free HomeCare 200™ -
British Gas’s emergency breakdown service covering existing radiators and pipework.