In a letter to Ministers today, the charity criticises the Government for leaving “large gaps” in policies surrounding the regulation of low-carbon technologies like heat networks.
The Committee on Climate Change (CCC) has consistently claimed that heat networks could deliver up to 18% of UK heating demand by 2030. Taking notice of this, the Government has recently launched a £320m scheme to help accelerate the adoption of low-carbon heat networks across the UK’s public, private and domestic sectors and an Energy Systems Catapult centre to assist small and medium-sized businesses (SMEs) with decarbonising their heat systems.
While welcoming this progress, Citizens Advice is arguing that policy is not currently sufficient to protect consumers during the decarbonisation of heat and is likely to result in customer confusion, infrequent and inaccurate billing, and, therefore, overpayment. The charity is voicing concerns that, as most of the costs related to the decarbonisation of the energy system are currently paid for through energy bills, those on low incomes could end up paying a disproportionate share of that cost.
The organisation’s key recommendation for preventing this is the establishment of an independent commission on a “just” transition to low-carbon energy, including heat. It is additionally calling for a consultation on the Government’s upcoming Energy White Paper, to be made open to industry and the general public, as well as legislation to extend Ofgem’s regulation powers to cover heat networks.
Citizens Advice’s chief executive Gillian Guy has claimed that these moves need to be undertaken as soon as possible “to prevent the bad practice of today becoming the standard practice of tomorrow”.
“The way we heat our homes needs to undergo a major transformation, and how we manage that process and fairly distribute the costs needs the urgent attention of Government,” Guy said.
“An independent commission is the only way to make sure the pathway to net-zero is assessed in a rigorous, transparent and timely way.”
Industry progress
The UK currently plays host to around 14,000 heat networks, which collectively serve more than half a million customers – both business and domestic.
However, much more will need to be done in this space if the UK is going to meet its new 2050 target of a net-zero carbon economy, the CCC has claimed. Heating and hot water account for around 15% of the UK’s overall carbon footprint, with the nation currently off-track to meet a key target of ensuring 12% of heat is generated using renewables by 2020.
Responding to Citizens Advice’s report, the Association of Decentralised Energy’s (ADE) head of operations Lily Frencham said: “Citizens Advice are right that there is a need for a credible plan from the Government, working with industry and other key interests, to decarbonise heat if net-zero is to be delivered.
“The building of more heat networks is widely acknowledged to be a key component to any future plans. They are key in urban areas, allowing towns and cities up to capture otherwise wasted heat and deliver it to homes and offices driving down emissions. Appropriate regulation of heat networks is necessary, to provide customers with confidence and protection around issues such as billing, while giving businesses and local authorities confidence to make the necessary investment in the new heat networks that will be needed.”
Sarah George