What to look for in the Government’s buildings decarbonisation plan

Next up in the Government’s long-awaited set of sectoral decarbonisation plans is climate-proofing our homes. Expected in May 2021, the Heat and Buildings Strategy should bring a route to emission-free housing.

With heat and buildings responsible for a hefty 40% of the UK’s CO₂ emissions, and a greater impact on everyday life than virtually any other emissions source, it is vital that the Government gets this one right first time.

Here’s a quick run through of what we can expect.

Fixing up

The Government’s Green Homes Grant scheme was, to put it mildly, a flop. Now scrapped despite soaring demand, addressing the policy shortfall to insulate millions of homes will be top of the list.

Stable decisions, clear deadlines and learning from the Green Homes Grant’s backwards application system is crucial for a successful replacement. With the North and Midlands set to benefit most – popularity was highest here once weighted for population – an effective energy efficiency scheme also ticks the levelling-up box.

The successor could also support the army of installers that saw little benefit in expensive training for such a short-lived scheme. Longer timeframes that warrant the investment could be accompanied by action on skilling up, building on the Skills for Jobs White Paper and upcoming Green Jobs Taskforce report to create a new generation of engineers, assessors and technicians.

So far the Government has outlined just £2.9 billion of the £9.2 billion efficiency spend pledged in the 2019 Manifesto. The recent Energy White Paper hints that plans for the rest of this cash will be forthcoming in the Heat and Buildings strategy, but a proper plan to carbon free homes will have eyes beyond this parliamentary term.

Central to upgrading Britain’s homes is bringing down the cost of doing so. Therefore, an acceleration of the Government’s Buildings Mission would bring forward anticipated reductions in upgrade costs.

But grants are not the only way of incentivising home upgrades. Green mortgages, stamp duty rebates, zero interest loans, reducing VAT on energy efficiency, optional salary sacrifices, council tax flexing and minimum standards backed by sufficient support all have a place in solving this puzzle. Any strategy worth its salt will lean on as many as possible.

Phasing out

Likely to be one of the most headline-grabbing aspects of the strategy, an end date for the sales of fossil fuel boilers is crucial to hitting net zero. Fossil fuel heating has no place in a net zero home.

From media reports one could assume that calling time on the humble gas boiler represents a political battleground, however findings from Parliament’s recent Climate Assembly show it to be an overwhelmingly popular move to curb carbon, backed by 86% of assembly members.

An end date, however, needs to be accompanied by a plan to get there. Measures to ramp up heat pump installations, building on potential in new homes in the Future Homes Standard and the Prime Minister’s pledge to fit 600,000 per year by 2028, should be accompanied by increased public engagement, extolling the benefits that clean heat brings.

It would also be a mistake to shy away from the fact that, as it stands, heat pumps are significantly more expensive than boilers; something that will be an instant turn off to the vast majority of Brits.

Therefore, we can expect a beefed-up Clean Heat Grant scheme to bring forward short-term demand, coupled with policies reminiscent of those that supported solar and wind a decade ago to kickstart a domestic heat pump sector and bring about R&D that will see costs plummet.

Similarly, as recommended by climate advisors and academics, the costs of environmental and social levies on energy bills – which bizarrely fall mostly on cleaner electricity at the moment, rather than fossil gas – could be re-distributed to encourage the move to clean heat.

Bringing the nation along with decarbonised heating presents one of net zero’s biggest headaches. With a plan to end boiler sales odds-on for inclusion, the next big test is that it is accompanied by a suite of plans, policies and pledges to make the alternative more appealing.

Hydrogen

Hydrogen’s role in the future of buildings is currently uncertain. Proponents point to an easier transition; opponents highlight supply concerns and production emissions.

The Government has been keeping its cards close to its chest, although some clues have slipped out. One of the biggest came recently when the BEIS Secretary of State said that in ‘7 to 8 years [there] could be hydrogen distributed through the gas network’.

This statement raises more questions than it answers – will it be national? 100% hydrogen or a blend? Can we generate enough green hydrogen? However, it does suggest that the route to decarbonised heat will likely be regional.

Experts warn that waiting for hydrogen technology to come to the fore may reduce action on emissions in the short term and prove a bad bet in the long run. Some also suggest that its role may be more limited to decarbonise industry and transport and that well-established electrification is the optimum in homes.