• How Window Scrappage Works

    How Window Scrappage Works

    Energy efficiency has become a popular topic in the United Kingdom in recent years. Since 2009, the government and many companies have been initiating scrappage schemes and assistance programs. These schemes aim to provide home or business owners with an incentive to replace inefficient appliances and make buildings overall more energy efficient. Windows are one […]

  • How Boiler Scrappage Works
  • How car scrappage works

What are scrappage schemes, and how do they work in the UK?

 

    Environmental concerns have been on the rise for a few decades. Scrappage schemes are plans put in motion by a country’s government or any company with environmental concerns that function by providing incentives to trade in old equipment. For example, old refrigerators are extremely inefficient when it comes to energy conservation; a scrappage scheme might provide extra money to dispose of the unit, or a discount towards a newer and more efficient one.

 

Scrappage Schemes in General

 

    Most schemes follow the same basic principles. The customer must first present the old unit to determine if it is eligible for a trade-in. If it meets the criteria (usually only the age of the model) the company will provide a fixed amount of money in the form of a discount on the purchase of a newer and more efficient model. If the scheme is government-backed, the government will match most or all of this amount. Ownership of the item is then transferred to the company, which is then required to destroy or repurpose the unit.

 

The Energy Companies Obligation

 

    Highly influential energy companies are required by law to abide by the ECO, or Energy Companies Obligation. This program is an all-encompassing measure that pushes energy companies to help their customers become more energy efficient. Every two years, each company is required to hit a specific assistance quota or goal; the current period ends in March 2015.

 

    There are three obligations for energy companies, the most important of which is the last: the home heating cost reduction obligation. Under this requirement, many energy companies offer scrappage programs for old utilities such as boilers, air conditioners, refrigerators, and more. Offering a discount in return for an old unit also ensures that the outdated appliance will be recycled in some way. Some companies offer repurposed (or sometimes brand new) units for free in order to fulfill this requirement, although only to those who qualify (thus also fulfilling their second obligation to aid low-income areas).

 

Car Scrappage Scheme

 

    The United Kingdom’s car scrappage scheme was arguably one of the most popular and successful schemes to-date. This scheme began in 2009 and ended on March 31st, 2010, when the budget limit of £300 million was reached. Under this program, any scrapped vehicle that was at least 10 years old would take a minimum of £2,000 off the price of a newer energy efficient vehicle. Many manufacturers have decided to provide an even higher incentive, but the government would only provide £1,000. This policy was meant to spread the benefit to as many people as possible while still providing a significant amount of money.

 

    Since vehicles didn’t actually have to be manufactured by British companies, it is arguable that it helped the automotive industry as a whole. This scheme was immensely popular amongst consumers, and many have expressed the desire of its return. The government has not made any comment expressing intent to bring it back, but has instead initiated new programs focused on the purchase and usage of electric cars.