The UK is likely to need c1.5m heat pumps a year by early 2030s to meet climate targets. But at the moment the economics don’t work – this report from @PublicFirst_PF out today has important recommendations on how we solve that problem.
A big part of the challenge is that we place almost all “policy costs” - largely for early renewables projects - onto electricity, not gas. That made some sense when the system was set up in 2012, but doesn't now that electricity is *much* cleaner.
The report argues that moving policy costs to taxation and putting a carbon price on gas means we can reduce the running costs of heat pumps below gas boilers and avoid significantly increasing costs for those still on gas. A vital step in driving heat pump take-up in a fair way.
Still lots more to do on the wider policy package, supply chain capability, cutting capital costs, and providing support to those who need it – but could be a really important step towards making the business case for heat pumps stack up.