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Heat & Buildings Strategy – The Industry Reacts

Heat & Buildings Strategy – The Industry Reacts
20 October 2021 | Updated 21 October 2021
 

Following the Heat & Buildings Strategy publication, here are the latest reactions from the building services industry.

The government is set to drive down the cost of low carbon heating solutions, such as heat pumps, providing households with a £5,000 grant to help with installation costs.

The strategy’s publication has been met with mixed reception – here’s some of the latest thoughts:

 

"As with any new initiative, I also urge people to proceed cautiously because of the very real risk of new market entrants possessing subgrade kit. We see this happen in other markets and with a long lead time for heat pump kits, homeowners might be wrongly swayed by those installing replacements that may not be as economical in the long-term."

–Steve McGregor

Group MD, DMA Group

 

More Details Needed on Skills Needed to Retrofit Ageing Building Stock

 

Gillian Charlesworth, CEO of the Building Research Establishment (BRE), sees the strategy as a good start, but feels that it doesn’t provide the full set of policies we need to get the built environment on track for net-zero:

“Moving away from gas for home heating is crucial if the UK is to meet its net-zero targets, and we are pleased to see clear recognition that heat pumps are the technology most likely to get us there, as well as new investment to support low carbon improvements in public sector buildings and social housing. 

“However, there are still billions of pounds missing from the government’s manifesto commitment of £9.2 billion for decarbonising the built environment. 

 

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Picture: a photograph of Gillian Charlesworth

 

“We had hoped for a replacement to the Green Homes Grant voucher scheme to provide private home owner-occupiers with support for fabric first measures like insulation. Privately owned homes are the least energy-efficient part of the UK housing stock and we would like to see fiscal incentives through council tax or VAT to encourage decarbonisation. These incentives, along with changes to business rates, will be equally vital for small businesses, who will also need a clear plan and support to transition to net zero. 

“The success of the strategy will depend on its implementation, and we need more detail on how the government will support industry to train and retrain the hundreds of thousands of workers needed to retrofit Britain’s ageing housing stock, who will make a vital contribution to levelling up. The government has another opportunity to outline its plans to address these challenges in next week’s Budget, which we will be watching keenly.” 

 

 

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“Insufficient for the Scale of the Challenge we Face”

 

The Heat and Building Strategy has come under fire from Mike Foster, CEO of the Energy and Utilities Alliance:

“The grant hardly sets the world alight and is insufficient to the scale of the challenge we face in terms of reaching net-zero.”

“It subsidises 30,000 heat pumps being installed each year and is well short of the support needed to get to 600,000 heat pumps installed each year by 2028. My suspicion is that the Chancellor is putting the brakes on the Prime Minister’s flight of green fantasy.”

 

“The £5,000 grant only pays half the cost of a heat pump, so those in fuel poverty will see no warmth from the government’s generosity; instead, it is middle-class bung for people who were probably going to fit a heat pump anyway.”

–Mike Foster

CEO, Energy and Utlities Alliance

 

“I suspect hydrogen-ready boiler installations will be far greater than that number by 2028, suggesting that consumers have made their choice. But that choice, between heat pumps or hydrogen-ready boilers, is one they should have.”

Mike is also concerned with the plight of those in fuel poverty. “For the 4.5 million households currently in fuel poverty, faced with rocketing bills and cuts to their universal credit, they must wonder what they have done wrong.

“The £5,000 grant only pays half the cost of a heat pump, so those in fuel poverty will see no warmth from the government’s generosity; instead, it is middle-class bung for people who were probably going to fit a heat pump anyway.

“For the same amount of money, £150 million a year, half a million homes could have loft insulation fitted, saving each household £135 a year, and removing 290,000 tonnes of carbon emissions each year. Instead, removing 45,000 gas boilers, replacing them with subsidised heat pumps will remove only 71,000 tonnes of carbon each year. This is hardly the COP figure the Prime Minister wants to read.”

 

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Picture: a photograph of Mike Foster

 

Recognition for Heat Pumps as Key Net-Zero Technology

 

Karen Boswell OBE, Managing Director at Baxi Heating says the industry must support the strategy:

“We welcome today’s publication of the Heat and Buildings Strategy from the Department for Business, Energy & Industrial Strategy (BEIS). This important document details a roadmap for the decarbonisation of heat which the industry can, and must, support.

“We firmly believe that all viable technologies have a place, including electrification, hydrogen, and deployment of low carbon heat networks. BEIS is wise to leave these options open as it is abundantly clear that no single solution will deliver net-zero.

“One key part of the strategy is the Boiler Upgrade Scheme, designed to encourage the uptake of heat pumps. In our recently published white paper on this subject we highlighted that the £4,000 per installation grant originally consulted upon may not be sufficient to close the affordability gap. Therefore, we are pleased to see a higher grant level of £5,000 grant taken forward in the Strategy.

“Last, but by no means least, we must collectively deliver a just energy transition, ensuring no households are left behind. Running cost is a critical consideration and fuel poverty has no place in one of the world’s leading economies. 

“As such, we have concerns over the proposals to reallocate the levy cost aspect of electricity bills onto gas bills over time. This is a sensitive topic which needs to be  carefully considered.”

 

Insulation Must Also be Considered

 

Steve McGregor, Group MD at Property Services Specialist, DMA Group is of the view that the scheme does not go far enough to bridge the cost gap for homeowners:

“Whilst we welcome any announcement that provides funding for householders to install low carbon heating, I’m afraid this scheme doesn’t go far enough. A proposed £5,000 installation grant isn’t sufficient to bridge the cost gap between gas boilers and heat pumps. We clearly need to fulfil the ambition of reducing our reliance on fossil fuels, and part of that is improving heating systems in homes and other buildings.

"What is important to remember is that homeowners will also need to significantly upgrade their insulation as heat pumps aren’t as instantaneous as boilers when it comes to heating homes. For older houses insulation standards will also need to be materially improved to support heat pump performance."  

 

The Danger of Substandard Heat Pumps

 

Steve continued:

"As with any new initiative, I also urge people to proceed cautiously because of the very real risk of new market entrants possessing subgrade kit. We see this happen in other markets and with a long lead time for heat pump kits, homeowners might be wrongly swayed by those installing replacements that may not be as economical in the long-term.

"We are clearly paving the way for a second green industrial revolution in the UK, and I hope the government also considers other initiatives, such as green technology loans for businesses or further backing for green banks to create a truly greener, safer environment for generations to come.”

Picture: a photograph of a wall-mounted heating control point

Article written by Ella Tansley | Published 20 October 2021

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