Industry expertise vital to creating future proof heat decarbonisation policy
Paul Rose, OFTEC CEO comments:
The current gap between government’s climate policy ambitions and the low carbon heat and energy efficiency schemes needed to deliver on these is huge.
Crucial lessons must be learned from the failure of the Green Homes Grant (GHG) scheme to ensure any follow on schemes are fully fit to tackle one of the UK’s toughest decarbonisation challenges.
The intentions behind the GHG were strong but the short term scheme was poorly executed, and not nearly generous enough to support the level of change required, especially for those consumers living in the hardest to treat homes.
These properties include 765,000 (65%) oil heated homes across Great Britain that fall into the lowest EPC Bands E-G. These properties would have to undergo very expensive, disruptive retrofits to bring them up to an acceptable standard for effective heat pump use – government’s preferred low carbon heat solution for off-grid homes.
BEIS’ own figures suggest the cost to achieve this would be in the region of £12,000 to £18,000¹ per property - and that’s without the additional cost to install an air source heat pump which would see the actual figures rise to between £22,000 and almost £30,000.
Independent research of more than 1,000 rural home owners indicates the majority would be unwilling or unable to fund this level of improvement, even with the help of the former £5,000 GHG grants, suggesting a fresh policy approach is urgently required.
However, any level of support to improve the insulation of UK homes is a positive step to help consumers reduce heat demand, cut energy bills and improve comfort levels. So, with the proposed Clean Heat Grants (CHG) to support the take up of low carbon heating technologies from April 2022 when the RHI ends, it makes sense for any further schemes to focus on home upgrades.
Alongside this, OFTEC recommends that the parameters of schemes such as the CHG are expanded to support a wider range of low carbon heating solutions. This ‘technology neutral’ approach should include replacing oil boilers with high efficiency ‘biofuel ready’ models to support the deployment of renewable liquid fuels.
These boilers cost around £3,000 to install compared to almost £11,000² for an average air source heat pump and do not require extensive, costly home retrofits for effective heat performance, minimising two of the main barriers to heat decarbonisation that currently exist – capital cost and disruption.
A renewable liquid fuel called Hydrotreated Vegetable Oil (HVO) is already widely available and currently being trialled in homes across the UK with encouraging success. Transitioning oil heated homes to HVO would save significantly more carbon emissions in the short to medium term than switching these properties to heat pumps or biomass boilers. Rural households need to be offered this choice in any future domestic heat policy.
In all areas, decarbonisation policy must now be upscaled, heating businesses encouraged to invest and consumers incentivised to take action. And to successfully achieve this, government must collaborate with all sections of the heating industry.
OFTEC and its wider industry partners have an in-depth understanding of the rural heating sector and the unique decarbonisation challenges off-grid housing present. This expertise should not be wasted in helping to create a credible and practical policy framework that will transition the UK towards the net zero vision it aspires to in the much reduced timescales just announced.
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