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Heat. The decarbonisation nightmare. All conversations I have on climate in the UK inevitably lead back to buildings. Normally followed by a short period of banging head against a (badly-insulated) wall....
One thing is very obvious, if we don't get the market incentives right, low carbon heating, particularly heat pumps, will remain too close to a cottage industry in the UK. 30,000 a year vs what we need, 30,000 a week.
Here is @danialsturge's brilliant chart on how bad the incentives are for low carbon heating. Not quite as bad as aviation or agriculture, bad not too far off.
That is why this report from the excellent folk @PublicFirst_PF (including @racheljanetwolf) is a really important contribution. How might you practically address the heat pump disincentive.
http://www.publicfirst.co.uk/wp-content/uploads/2021/04/OptionsEnergyBillMaster.pdf
http://www.publicfirst.co.uk/wp-content/uploads/2021/04/OptionsEnergyBillMaster.pdf
The report tries to navigate the Scylla and Charybdis of heat incentives. Economically, it is obvious that piling costs on electricity for renewables/nuclear innovation is counter to what you want on heat (or ideal innovation policy, for that matter).
But Government is reluctant to take the £10bn a year cost directly, thanks very much.
Economically, it is obvious that subsidising pollution from gas-fired boilers is a bad idea. The pollution should be taxed. Strangely, the consumer groups not joyous about that prospect.
Economically, it is obvious that subsidising pollution from gas-fired boilers is a bad idea. The pollution should be taxed. Strangely, the consumer groups not joyous about that prospect.
So we are trapped between a Treasury that seems unlikely to swallow the cost (maybe I am wrong) and a political fight on carbon taxes. The report explores the options to navigate this narrow passage, recommending a bit of both.
Of course, as the report makes clear, incentives are not the only thing that matters. Most important is consumer experience (although upfront cost also a factor). You can find out how we think about it here, based on a huge amount of research/hard knocks. https://es.catapult.org.uk/brochures/decarbonisation-heat/
And as for the wider policy environment for heating, any moves on incentives need to be part of a bigger package. We (led by @georgeday27) set out our preferred approach here: https://es.catapult.org.uk/news/six-steps-to-zero-carbon-buildings/
We, and the innovators we work with, are much more attracted to a long-dated decarb obligation on building owners that phases in over time. Rewards those who go first, but also gives people plenty of time to adapt (helping with the politics).
Creates an environment where people who are thinking about upskilling or investing in low carbon heat businesses see a real, long-term market, not one driven by short-term subsidies or tax choices.
Also more likely to endure politically than carbon taxes (at least in my view)...
Also more likely to endure politically than carbon taxes (at least in my view)...
Anyway, I am sure the upcoming Heat and Buildings Strategy will sort all of this out, so I can stop banging my head against that wall...
I should say there are loads and loads of exciting companies in this space trying to come up with great consumer offerings ( @parityprojects @SunampLtd @power_evergreen @PassivSystemsHQ etc etc), as well as some of the established players behind the report....
.... but they will not flourish unless the incentives are right.
Some more considered thoughts on heat here: https://guynewey.medium.com/five-steps-to-net-zero-levels-of-innovation-fa12ee0a3bbf
Some more considered thoughts on heat here: https://guynewey.medium.com/five-steps-to-net-zero-levels-of-innovation-fa12ee0a3bbf
Those interested in more.
