Indeed it was dismissed by some industry observers as “window dressing” and “more unwelcome uncertainty” for a sector facing the historic challenge of decarbonisation. If companies could have been granted one wish, it would probably be to see less political theatre around this vital energy question and more substance about actual alternatives.
Not only did Hammond’s line about “mandating the end of fossil fuel heating systems in all new houses from 2025” leave his audience in the dark as to whether he would ultimately ban all new homes from being connected to the gas grid – the preferred approach of the government’s advisory body, the Committee on Climate Change – there was little clarity over what homeowners might use instead of gas boilers under his new Future Homes Standard.
It all feels like a work in progress, with obvious parallels to electric vehicles policy.
Industry contacts I spoke to this week were patently frustrated at what one described as “world-leading rhetoric” on decarbonisation “without any agreed pathway ahead for gas”. Which is a shame, particularly with gas undergoing a renaissance of late.
Many will recall how, at the time of the last price controls, all the talk was about preparing for the decommissioning of gas networks. Things changed thanks to the promise of hydrogen, which would use a repurposed gas grid. But progress on that could be affected if the government opts against connecting future new homes to the grid.
A question mark now sits over what the industry should be trying achieve over the next five years, making it harder to set price controls and reassure investors.
Work has been going on for years on a heat strategy, with gas networks leading the way in developing the technology needed to make biogas and hydrogen a part of the equation. The chancellor’s accompanying commitment in the spring statement to injecting historic levels of green gas into the grid is welcome. But with so much happening in the background, should government not steer clear of piecemeal pledges until it can offer a more comprehensive picture?
The government has been quick to say it must have an evidence base to inform its ministers. But if it hasn’t yet got all that evidence, should ministers be making sweeping announcements?
If it has, then shouldn’t it be sharing it with everybody?
- Utility Week’s Energy Summit ‘Delivering a robust future for UK energy in a post-Brexit landscape’ takes place in London on 13 June. Download details at https://event.utilityweek.co.uk/summit/