New green heat goals should mean no more ‘wait and see’

The government’s new targets around the decarbonisation of heat have been welcomed by industry figures, who said ministers should avoid taking a strategy of “wait and see”.

Speaking to Utility Week, they said the broad ambitions listed in its 10-point plan for a “green industrial revolution” must now be backed up with the right policies, regulations and funding.

The plan, launched by Boris Johnson last week, included targets to install 600,000 heat pumps per year by 2028 and build 5GW of hydrogen production capacity as well as the UK’s first hydrogen town by 2030.

“For heat pumps, that’s a pretty ambitious target for 2028,” said Jan Rosenow, director for European programmes at the Regulatory Assistance Project.

“It’s probably not quite enough. It’s not in line with what the Climate Change Committee believes we need. They are modelling that more than 900,000 will be needed. But it’s pretty close and it’s certainly a massive step up from the 30,000 that we have right now.”

Rosenow, who is also an honorary research associate at the University of Oxford’s Environmental Change Institute, said: “What’s still missing is the detail as to how they’re going to achieve that. My understanding is that will be set out later this year in the heat and buildings strategy that BEIS (the Department for Business, Energy and Industrial Strategy) is currently finalising.”

There was confusion on the day of the launch after the document initially included a commitment to bring forward the ban on fossil fuel heating in new homes by two years to 2023 which did not appear in later publications. The government said the bullet point was listed by mistake but it does still intend to advance the timeline.

Rosenow said it is difficult to predict what impact this earlier cut off date would have on heat pump installations as the target of building 300,000 new homes per year has been “missed consistently” but added: “It’s certainly not going to be small.”

He expects the government to introduce similar regulations for off-gas-grid properties – the other obvious area for focus – as well as some additional funding for households on the gas network that decide they want to switch too.

Hydrogen Towns

Despite being sceptical of the potential for widespread use of hydrogen for domestic heating, Rosenow also supports the target to create the UK’s first hydrogen neighbourhood and then town by 2030.

“We’re not going to make any progress unless we try these things in reality so we will need to have trials – real trials – not just in a lab but with real people and real homes to see what the costs are and what the technological challenges are. We need to get a handle on that to get a better evidence base.”

He said it is critical these trials use hydrogen produced in a way that is compatible with the government’s net zero target, ideally green hydrogen electrolysed from water using renewable power. There are also plans in the industry to produce so-called blue hydrogen by reforming methane and capturing and storing the carbon emissions from the process.

Rosenow believes the residual emissions from blue hydrogen production and the energy losses that come with green hydrogen production will mean electrification emerges as the most cost-effective option for decarbonisation in most places given the ability of heat pumps to provide on average around three times more heat energy than they require in electrical energy.

“There may well be areas where you have a very modest amount of hydrogen heating so you can envision a heavily industrialised region where you have a lot of demand already for hydrogen and maybe localised production because you have a lot of renewables,” he added.

But he continued: “I have seen some people say: ‘Oh, the government shouldn’t even be testing hydrogen because it’s such a bad idea in principle’.

“I actually think unless it gets tested and there is real evidence, the debate between the proponents and opponents of hydrogen will simply continue and the risk is that we have inaction from government because they hear conflicting views.

“And they clearly want to do the right thing because this could be hugely disruptive for people if you go down one route that’s a lot more expensive, a lot more difficult, but you have an alternative that is easier or cheaper.”

The speed question

Kit Dixon, regulatory affairs officer for Good Energy, agreed that the potential of hydrogen should be explored through these kinds of trials but said they should not prevent the rollout of heat pumps in the meantime.

“There’s no problem in spending money on demonstration projects of hydrogen for heat, but what I often hear voices from the gas/hydrogen lobby advocating for will hold back our electrification of heat in the hope that hydrogen is going to come and save us later when we finally get it mobilised.

“It comes down the speed question again. We need to be deploying low-carbon solutions as quickly as possible. We know we can already do that with heat pumps so why not be getting on with it.”

He said the size of the targets suggest this message has gotten through to ministers and demonstrates the confidence they have in heat pumps as a solution: “The bottom line is the government obviously feels 600,000 heat pumps per year by 2028 is a feasible goal, and that tens of thousands of homes heated by hydrogen by 2030 is the equivalent ambition”.

Maxine Frerk, director of Grid Edge Policy and a former partner at Ofgem, cautioned against reading too much into their relative scale as: “Hydrogen is just decades behind in terms of the technologies but that’s as fast you can go on hydrogen because you’ve got to start with developing the appliances, which they’ve only done in the last couple of years.”

But for the same reason she also believes it is important to begin rolling out heat pumps in larger numbers: “Given all the safety testing you’ve got to do that seems to me an ambitious timeline and I wouldn’t want people to be sitting on their hands and saying let’s wait and see whether that works and we’ll go all hydrogen. Everybody knows we’re going to have a mix of technologies.”

Gas networks have warned that full electrification will require huge investments in the power grid to meet peak demand during colds periods when heat pumps become less efficient and argued that it therefore makes sense to repurpose the UK’s existing gas infrastructure to take some of the load. They have also argued converting the gas grid to run on hydrogen will be less disruptive to consumers who will be able to continue using gas appliances and boilers.

Rosenow said it is now essential that the government goes further on energy efficiency – the weak link in the chain and one which will be vital for the cost-effective decarbonisation of heat, whichever path Britain ultimately chooses to follow.

Whilst welcoming the one-year extension and £1 billion of extra funding for the Green Homes Grant voucher scheme, he also lamented that “it’s disappointing to see so little ambition”.

“It’s only a short-term extension,” he explained. “It’s not a long-term ambitious forward-looking scheme that will give the market the certainty it needs and the clarity it needs.

“My view has always been it’s never going to be enough to get to the scale that’s needed if you rely simply on subsidising people to undertake those measures.”

He continued: “I think of what we’ve done in the private rented sector with modest minimum energy efficiency performance standards that require landlords to insulate buildings before they can rent them out. Something like that can be replicated for all buildings and in fact has been replicated in other countries.

“This is also something Scotland is currently in the process of implementing. That would be the kind of complementary measure that can really drive demand that I was hoping for in the 10-point plan that wasn’t in there.”