A coalition of charities and businesses has called on the government to provide upfront subsidies to low-income households to cover the cost of installing low-carbon heat pumps and to aid in the transition from fossil fuel heating.
The coalition consists of more than 20 companies (including energy suppliers) and environmental and poverty reduction groups. They have proposed a government “fair heat deal” to make the transition of gas boilers easier and fairer.
While a heat pump – which essentially works like an inverted refrigerator – can significantly reduce heating costs, the initial cost of installing a heat pump keeps many households from switching. A single heat pump costs about € 10,000.
The coalition of groups says that, in addition to energy efficiency measures to reduce overall heating demand, switching from fossil fuel boilers to heat pumps will play the biggest role in cutting the sector’s emissions in the next decade. 23 percent of greenhouse gas emissions come from buildings.
It proposes offering subsidies that cover the full cost of heat pumps and insulation for low-income households, while for other people the subsidies should be offered at a level that makes it the same as replacing a conventional gas boiler.
However, the high cost of a heat pump is expected to decrease as emerging technology scales; supporters of the Fair Heat deal said subsidies could be cut if prices fall.
The group made a number of other recommendations to reduce carbon emissions from domestic heating. It wants to see lower running costs for the efficient heat pumps compared to gas water heaters, by eliminating environmental taxes from electricity bills while protecting those at risk of fuel poverty.
It suggested introducing incentives to make green choices when it comes to domestic heating systems, such as a lower stamp duty for buyers of low-carbon, energy-efficient homes and zero VAT on green products and works.
It also said the Fair Heat deal should involve a new “warm houses agency” to oversee programs and provide impartial energy advice, while supporting thousands of jobs through skills and training.
Juliet Phillips, policy advisor at climate think tank E3G said: “Moving from a gas boiler to a heat pump is one of the biggest carbon savings a household can make to combat climate change, but it has to be affordable and we are urging the government to support our fair heat deal to ensure no one is left behind in the green industrial revolution.
” Mike Thornton, CEO of Energy Saving Trust, said heat pumps are a key low-carbon heating technology that will help the UK achieve its goal of reducing climate emissions to zero by 2050:
“A fair heat deal will make heat pumps more attractive to households and help to switch to low-carbon heating.” A government spokesman said further details on the government’s approach to home heating will be provided in the Heat and Buildings Strategy.
“We support lower-income households and vulnerable people to make homes greener and reduce energy bills and will continue to do so through schemes such as the Home Upgrade Grant and the new Clean Heat Grant from April next year,” they said.
The government plans to ban the installation of conventional gas boilers in new-build homes from 2025, in an effort to accelerate decarbonisation in line with its goal of reaching net-zero emissions by 2050.
However, Green campaigners had hoped the new rules would be implemented sooner, and were disappointed when the prime minister rolled back pledges to ban gas boilers for new homes by 2023.