Treasury support for net zero in the spotlight

Boris Johnson had his moment in the sun, literally and metaphorically, earlier this month hosting world leaders at the G7 summit.

His next showpiece event, fingers crossed, will be for the COP26 climate change summit, which is due to be held in Glasgow this November, fresh waves of the coronavirus pandemic permitting.

There is clearly a lot of diplomatic spadework on climate change for the government to do during the next five months, but ministers must get their domestic house in order on the issue too.

Here the “to do” list is mounting up, like the traffic jams on the A30, which Johnson avoided by taking an official jet down to Newquay for the G7.

Last December’s energy white paper was littered with deadlines for the documents that would begin to turn its aspirations into concrete policies.

The sharp-eyed reader will not be surprised to learn that many of these have yet to be hit.

By now, we should have known the government’s thinking on a host of issues, including a hydrogen strategy and how to turn into practical policy the ambitious target in last year’s 10-point green industrial revolution plan to roll out 600,000 heat pumps by 2028.

The white paper also promised that by the end of March, we would have a firmer grasp on the shape of the post- price cap retail market, including the framework for introducing opt-in switching (this weekend rumoured to be coming next month).

No 10’s focus on ensuring a successful G7 has been touted as a reason why the government has yet to publish its heat and buildings strategy.

Now the industry’s Whitehall watchers are becoming distinctly jittery about whether the heat strategy, the lynchpin of efforts to decarbonise the nation’s homes, will even appear by the time Parliament disperses for its summer recess on 22 July.

But it’s not just the department for business, energy & industrial strategy (BEIS), which is dragging its feet on this issue.

A crucial piece of the decarbonising homes jigsaw will be the Treasury’s net zero review, which is meant to flesh out how the costs of meeting the government’s ambitious 2050 emissions target will be met.

The interim review, which was published just before Christmas, was widely felt to be a damp squib that was long on analysis without offering clues about how or who the costs of net zero will be paid.

Utility Week has been told by sources close to government that the draft of the review’s final report is still light on policy proposals.

The lack of detail on the way forward means that No 10 Downing has muttered privately that publication of the document should be delayed further rather than go out in its current form. While No 10 can alter the review’s foreword and conclusions of such document, the Treasury controls the substance of the document.

The Committee on Climate Change’s David Joffe warned last week that there is no time to waste publishing the net zero review.

But a man with his eye on No 10 Downing Street, chancellor of the exchequer Rishi Sunak, probably won’t fancy delivering the politically unpalatable message that gas bills may have to rise in order to facilitate the great heat pump switchover.