The proposed ban on fossil fuel heating in new homes is desperately needed to “kick start” the market for heat pumps and achieve the government’s new target of raising annual installations to 600,000 by 2028, the Environmental Audit Committee has been told.
Jan Rosenow, director of European programmes at the Regulatory Assistance Project, said that with installations currently languishing at around 30,000 per year, continuing to rely on subsidies “is not going to solve this problem quickly enough.”
The Environmental Audit Committee (EAC) was examining the target announced last week as part of the prime minister’s 10-point plan for a “green industrial revolution”.
The plan initially featured a commitment to bring forward the introduction of the Future Homes Standard, which will include a ban on fossil fuel heating in new homes, by two years to 2023. However, this was removed from later versions of the document. When questioned over the omission, the government said the line was added by mistake but that it does still intend to introduce the standard earlier than originally planned.
Speaking at a virtual meeting held this afternoon (25 November), BEAMA chief executive Howard Porter reassured the committee that accelerating the introduction of new heating and energy efficiency requirements would not lead to rising house prices as: “New builders can build houses energy efficiently as cheaply as inefficient ones if they’re given enough time and the stick is big enough… They’ll get deals with heat pump manufacturers. They’ll get deals with underfloor heating manufacturers.”
Howard added that “in some cases, those new build houses might not even need a heat pump because if they’re built in such an energy efficient manner, the actual space heating load is very little.” He said their main requirement would instead be for hot water which could be provided by other means.
Given that around a quarter of a million of new homes were built over the last year for which there is data, Rosenow said the new rules provide a huge boost to the heat pump market as “even if only a relatively small portion of those have a heat pump, you suddenly get a doubling or a maybe even a quadrupling of the market for heat pumps very, very quickly.
“I think it would have a significant impact in the next few years. Going forward of course, new build is a smaller bit. The existing stock, that’s where most of the potential lies for heat pumps.
“But to kick start the market, new build is essential. And also, it’s the easier bit to do. We can learn a lot from that and then do the more difficult properties a little bit later or when we’ve ramped up the market and installation rate.”
Rosenow noted that the Renewable Heat Incentive (RHI), which has been in place since 2014, was intended to subsidise around half a million households to switch from fossil fuel heating to cleaner alternatives but is only expected to achieve around a fifth of that target in the end.
He said the Clean Heat Grant scheme being introduced as part of the replacement of the RHI is not anticipated to support any more installations and is “basically supporting the market as it already exists.”
“And what that suggests to me is we can’t purely rely on a demand-led scheme here,” he added. “There were subsidies available – fairly generous actually when you look at the RHI – but people have simply not come forward.”
“Simply providing more subsidy is not going to solve this problem quickly enough.”