heat-policy

These are the notes behind my short address at the Policy Connect roundtable on next steps for UK heat policy at 1 Great George Street, London. 22/1/20

5 minutes of heat policy – simplify, empower, enable and protect

Beyond simplicity which I won’t define,

Empowerment is about engagement, discussion and devolution of power.

Enabling is about providing supportive finance and regulation.

Protection is looking out for the most vulnerable.

First on timing – let’s be clear – this is a transformation – we may already be too late for net-zero 2050 – as colleagues have pointed out, heat transitions take decades. We need to start talking about this transformation and real people need to be involved. These discussions need to get out of rooms like this.

What have we learnt from the past decade. Well firstly, there has been little political will to make this happen. If there was will, zero carbon homes would have happened, energy efficiency wouldn’t have been cut and the RHI would have been reformed more quickly and there would be a follow on in place.  I have no idea if political will may increase but fear of disruption to voters may be a clear block.

The RHI has failed in delivering a sizeable and sustainable market and in many ways we’ve gone backwards with more boilers being installed that heat pumps. We certainly haven’t learnt much about clean heating.

What should replace the RHI? As the Committee on Climate Change point out, grants are international best practice for decarbonising households. These are a key enabling policy measure. But unless we are happy with everyone getting a grant, we need to eventually redesign the market to deliver at scale.

How should heat networks be supported? Local Authorities need to be empowered to allow them to fully finance and run heat networks. Scalable and joined up heat networks are not deliverable without local authorities. Local authorities also need to be required to produce local heat plans as part of their empowerment.

For off-gas areas where electrification is clearly the optimal outcome, finance such as grants and loans and combinations are key. Bear in mind, many off gas grid buildings which have solid walls, will require an energy efficiency retrofit as well as a new heating system. A whole house approach is key.

The future homes standard has become a fudge of EU policy and UK building industry wants. It combines odd metrics, removes simple measures and allows weak air tightness levels. The policy for this should be simple, particularly now we are leaving the EU. Ban fossil fuels, set good air tightness, a measure of air quality and set a thermal demand level. Existing standards exist.

Immediate priorities:

Energy efficiency deployment – 25% of domestic energy can be saved cost effectively. This needs state involvement and has huge micro and macro economic benefits.

Policy must support deployment of known heat techs i.e heat pumps and district heating at scale immediately.

Finance needs to be enabled. Look at Scotland and Germany. Loans can have a role, as can grants. They can empower people to act.

Make it easy. You currently need to really want to remove fossil fuels from your house. Finance will  help with this but, consumer protection and engagement is important and people need to know what they should do. Also, give grants for heat pumps.

Demonstrations – hydrogen needs to be demonstrated at town scale across the whole supply chain including ccs. We rapidly need to know whether it does have value or it is simply a costly distraction. Meanwhile, we should convert an entire town to district heating and electricity. This would be a hugely important and timely, practical test – I’m sure there are areas which would be keen e.g. Bristol and Leeds.

We must ‘hope for the best and plan for the worst’. We simply don’t have any time for delay. If hydrogen proves to be viable, we can then re-visit the electrification approach to heating.

But for short term policy, overall, I’d suggest that policy makers, deliver known technologies that work for heat decarbonisation for those who want it. That’s energy efficiency, heat pumps and heat networks. This can be done through simple policy changes, including grants for heat pumps, the provision of government backed loans and a simplified future homes standard. This needs to happen alongside a ramping up of energy efficiency delivery through supplier obligations and a devolution of power to local authorities.

It should go without saying, that the most vulnerable will need specific support.