The Solar Trade Association has responded to the Policy Exchange report published today, saying it highlights "how extensively government needs to act" to meet its carbon targets.

The Solar Trade Association (STA) welcomed recommendations in the report including higher building standards for new build homes and refocusing of resources to fuel poor households.

However, it disagreed that the Renewable Heat Incentive (RHI) should be technologically neutral – arguing that fossil fuels should not be included.

STA head of external affairs Leonie Greene said: “We’re pleased Policy Exchange recognise the role of solar thermal in helping to decarbonise our homes. But we disagree with any notion of dropping the UK’s renewables energy targets. The targets are there for good reason; the UK performs particularly badly on renewable heat as the Energy and Climate Change Committee highlighted only today.

“Just as government has done with the renewable power sector, focussed investment is needed to pump-prime technologies that will enable everyone to use clean heat in their homes affordably in future. This is a vital investment for the long term.”

The association added that analysis by IRENA revealed that solar thermal technologies could technically provide nearly half of heat demand in the industrial sector, displacing large amounts of carbon. However the report does not cover non-domestic applications of solar thermal.

The report comes as the solar thermal industry awaits the final government decision on its proposed reforms to the Renewable Heat Incentive. The consultation proposes the removal of the technology.