Report: UK's domestic heat 'extremely unlikely' to reach net-zero without policy overhaul
Some 10 million homes will need to have their fossil fuel heating systems replaced by 2035 if the UK is to meet its net-zero target - but the rate of government-supported upgrades is just one-fifth of this level, a new policy briefing has concluded.
Produced by experts at the UK Energy Research Centre (UKERC), the briefing paper warns that “significant” changes to the nations domestic heat policy framework will need to be made in the early 2020s, if the sector is to align with the long-term net-zero target.
It outlines how a record 1.67 million gas boilers were installed in British homes during 2019, with installation rates up almost 2% year-on-year. The Future Homes Standard will prohibit housebuilders from fitting properties with gas infrastructure from 2025. But the Conservative government has promised to ensure that 300,000 new homes are created each year – meaning that, if this commitment is met, 1.5 million new homes will be locked into the gas grid.
The Government’s current solution for decarbonising domestic heating is its Clean Heat Grant – the replacement scheme for the Renewable Heating Incentive (RHI). But the policy briefing outlines how, in its current form, the Grant will only support 12,500 homes per year to switch to low-carbon heating. This falls far short of the level needed, stated as a little under one million homes per year.
While noting that the Green Homes Grant is not included in its forecast and praising BEIS and The Treasury for launching the scheme, the UKERC concludes that tackling emissions from domestic heat will require more than a one-off investment.
“Whilst £2bn to be spent over six months sounds like a lot, the heat and buildings sector will need £10bn every year to keep on course to meet net-zero,” the briefing states.
With low-carbon sources accounting for just 5% of the UK’s annual domestic heat demand, the sector is a key challenge on the road to net-zero.
The Committee on Climate Change (CCC) has suggested that the UK would require 15 million homes to be fitted with heat pumps or hybrid heat pumps by 2035 if it is to meet its 2050 net-zero target. It has also posited stamp duty and winter fuel payment reforms and a targeted skills programme for low-carbon heat and retrofitting.
UKERC uses its briefing to outline a multi-pronged approach to tackling the problem. It recommends a longer-term scheme to help improve home energy efficiency, beyond the Conservative Party’s commitment to spend £9.2bn in this space during this parliament, as a starting point.
Measures should also be taken to incentivise homeowners not to fit new gas boilers, and housebuilders to design gas-free projects. Shifting the cost of the energy transition from electricity bills to heating bills should have this effect, the briefing states.
The briefing also acknowledges that sweeping national policy changes will need to be complemented with context-specific measures to help the low-carbon heat transition at local level. It states that local authorities, universities and businesses should work together to pilot innovative technologies and ensure a skilled workforce - and should receive financial support from the government to do so.
“The past decade has been dominated by expert discussions, but now we urgently need to switch to delivery if we are to stand a chance of fully decarbonising our homes by 2050,” report co-author Dr Jan Rosenow said.
The recommendations are being made shortly ahead of the publication of the Heat Strategy. It is due this autumn, following multiple delays, along with the Buildings Strategy and Energy White Paper.