Customers, communities and the tools to decarbonise their homes

Expected ‘imminently’, the Government’s Heat and Buildings Strategy is already sparking conversations across Westminster and the energy industry. I recently joined the BEIS Select Committee’s hearing on decarbonising heat in homes for one such conversation where across both sessions, there were two clear takeaways.

1. We need to bring customers along the journey, making sure that they are engaged and informed, and don’t end up viewing their heat decarbonisation as a costly imposition.
2. Energy efficiency must be a priority, without that customers and industry cannot pursue the decarbonised heating option that works best for that property or region.

What’s more, research published by Public First and YouGov last week has proven the importance of making sure that decarbonised heat be accessible, affordable, and convenient as many of the customers surveyed were hostile to the changes coming. It is also clear that energy efficiency is not a top priority for customers in their new homes, despite it being compulsory to provide an EPC at the point of purchase.

One panellist’s suggestion at the BEIS Committee was to mandate EPC-C or above in all property sales and deliver this through mortgage providers. Equally, the Government could focus their grants on energy efficiency, driving this as the foundation for Net Zero properties. Even this drive for efficiency must be cognoscent of a future where there are multiple options for heating.

This optionality is central to decarbonising heat and hitting Net Zero. With technologies like heat-pumps, hydrogen boilers, hybrids of both, and district heating all on the table, the best approach is clearly a local one. The diversity of this new heat market will not only make the energy system more resilient, but it will give customers the power to choose the solution that works for them.

Markets for heat-pumps need scaling up if we are to meet the Government’s target of 600k heat pumps being installed per year by 2028, and markets for hydrogen need kickstarting.  However, there are clear, low-hanging fruit for both areas. Targeting new builds, off gas-grid regions and the homes most easily electrified (i.e. via heat-pumps) will drive a cost reduction and greater understanding of them as, whilst popular in other countries, they are still somewhat of an unknown in the UK.

Equally, hydrogen can be safely blended into the existing network up to 20%. Doing this would not only deliver a lot of decarbonisation up-front, but it could create a market for hydrogen producers to invest in. Another simple solution would be for the Government to mandate that all gas boilers be hydrogen-ready from 2025. We heard last Tuesday that the Heating and Hotwater Industry Council’s members can deliver this.  

So, whilst the toolbox is filling up, we need to know which tools are best used where, and which whole systems solutions are lowest cost to current and future customers. There needs to be a regional focus as different areas are better aligned to different technologies, due to a range of factors. We cannot commit to single technologies or pick individual winners as we will need a combination of green gas and electrification to decarbonise the whole energy system.

An important consideration for these different technologies is the local energy networks. The networks have different capacities and conditions in different areas. Funding is required from Ofgem to invest in the network infrastructure required to deliver Net Zero across all sectors, including the electrification of heat and transport.

Decarbonising heat and more broadly achieving Net Zero isn’t a case of either electrification or hydrogen, it’s a case of everything. All technologies will need to be considered within the context of local circumstances, with customer choice and lowest cost solutions dictating what’s adopted where.