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How will the UK’s green revolution be delivered?
The government’s Energy White Paper sets out the policies and commitments that will put the UK on course to achieve net-zero carbon by 2050. Registered Gas Engineer reports on what this means for the heating industry.
Aflurry of energy reports came out at the end of 2020, revealing ambitious netzero targets and key milestones for the coming decades as the UK transitions to a low-carbon economy.
The 10-Point Plan and Sixth Carbon Budget set out the government’s goal of achieving net-zero carbon emissions by 2050, but were light on detail on exactly how this can be achieved.
The Energy White Paper: Powering our Net Zero Future, published in December 2020, delves into the changes that will be needed to achieve these targets. It sets out plans for an entirely new clean energy infrastructure, with the ultimate goal to cut emissions by 230 million tonnes by 2032. More than half of this reduction is expected to come from changes to buildings and people’s energy habits (Figure 1.6).
Consumer energy habits
Smart technology and an increasingly digital world are changing how we use energy in the home, and the government expects electricity to become a significant proportion of domestic energy consumption over the next 30 years.
The White Paper sets out regulatory reforms to protect consumer interests and keep energy bills low by increasing competition in the energy market, and upgrading domestic energy efficiency levels.
Expanded schemes, including the Energy Company Obligation (ECO), Warm Home Discount and Green Homes Grant, will help those in fuel poverty, the White Paper says, by providing at least £6.7 billion of financial support over the next six years.
The national roll-out of smart meters will continue to deliver more accurate energy bills, and a new smart meter obligation for energy suppliers is due to begin in July 2021. This, the government says, will encourage take-up of smart tariffs that reward consumers financially for using less electricity at peak times.
One of the key goals set out in the White Paper is to ensure that moving the UK to a low-carbon economy does not result in higher energy bills. Figure 2.1 shows that although electricity prices have gone up in the past decade, and gas prices have fluctuated, consumers have been using less energy, which has mostly balanced out the increased costs.
Projections by the Department for Business, Energy & Industrial Strategy (BEIS) estimate that bills will stay largely the same over the next decade, as increased costs continue to be offset by lower energy demand. However, the
cost of possible heat pump deployment policies has not been included in these calculations.
The White Paper says: “Over the next 10 years, increases in network costs, along with funding for clean energy and supporting vulnerable households, could push gas and electricity prices up. Households who install energy saving measures will see significant savings and can offset the costs.”
The government says it will put fairness at the heart of its approach to energy, to make sure that everyone pays a fair share of the costs of the net-zero transition. The Treasury has launched a review of how the transition will be funded and where the costs will fall, with an interim report expected in the spring.
Decarbonising the UK power grid
The UK has already taken significant steps towards decarbonising the power sector. More than 50 per cent of our power now comes from lowcarbon technologies, and renewables capacity has grown five-fold since 2010, driven by the deployment of wind, solar and biomass.
The government plans to publish a consultation to phase
out coal in the electricity mix by 2024, to continue this trend. Modelling suggests that overall energy demand could double by 2050 because of the electrification of cars and vans, and the increased use of clean electricity for heating, rather than gas. This could require a four-fold increase in clean electricity generation (Figure 3.4), as well as increased energy storage.
The role of natural gas
Gas represents 30 per cent of final energy consumption, and 40 per cent of electricity generation. This means natural gas will continue to be a key part of the energy grid for many years, even as carbon emissions are eliminated.
Britain’s gas network connects 23 million users through 284,000km of pipelines, and it will take time to transition these users to low-carbon energy sources such as hydrogen, solar and clean electricity. The government has pledged to enable continued investment in the gas grid during the transition, while also promoting the use of low-carbon options where possible. This, it says, will help build the infrastructure needed to support new technologies such as hydrogen and carbon capture, use and storage.
Achieving net-zero emissions requires a complete transition away from traditional natural gas boilers. By the mid-2030s, the government expects all newly installed heating systems to be either low carbon or appliances that can be converted to clean fuels. The White Paper expects these low-carbon technologies to be a mixture of heat pumps, hydrogen, green gas and shared heat networks.
There will be a consultation on whether it is appropriate to end gas-grid connections to new homes, but the government says it will use natural trigger points such as the replacement cycle for existing heating systems for this change, to minimise disruption to consumers.
Its 10-Point Plan set out a goal to achieve 600,000 electric heat pump installations by 2028, up from the current 30,000 a year. The Clean Heat Grant, due to launch in 2022, will support the installation of heat pumps and
How will the UK’s green revolution be delivered?
biomass systems. A consultation this year will consider policies to underpin the development of the heat pump market, including voluntary take-up in on-grid homes.
A consultation in early 2021 will set out potential new regulations to phase out fossil fuels in off-grid homes, businesses and public buildings, including a backstop date for the use of any remaining fossil-fuel heating systems.
There are also plans to increase the proportion of biomethane in the gas grid, funded by a levy on gas suppliers, to treble the amount of biomethane in the gas grid by 2030 from 2018 levels.
The government hopes clean hydrogen will be a significant contributor to decarbonisation, and there are plans for a pilot scheme to heat an entire town through hydrogen by the end of the decade. Studies are under way to assess the feasibility of hydrogen heating, as well as assessments of the infrastructure that would be required, with plans to decide on the long-term role of hydrogen for heating in the mid-2020s. A consultation on hydrogen-ready appliances will take place towards the end of this year.
The government is also committing £122 million towards a Heat Network Transformation Programme to support the roll-out of district heating systems, with further legislation on the regulation of heat networks due in this parliament.
Heat in buildings
Buildings are the second biggest source of emissions in the UK behind transport, with 90 per cent of homes in England currently using fossil fuels for heating, cooking and hot water. The White Paper notes that the installation of energy efficiency measures and tighter Building Regulations have already improved the energy performane of buildings, and
reduced household dual fuel bills by around £40 in the past decade, but more needs to be done. Achieving the UK’s net-zero ambitions by 2050 requires a reduction five times greater than has been achieved to date, however.
Public awareness of the high carbon cost of traditional heating is low, with BEIS research suggesting that almost one-third of gas users believe they are using environmentally friendly heating. This increases the challenge, though, encouragingly, the research also says 90 per cent of respondents believe it is important, or very important that the UK makes a full transition towards greener heating systems.
The White Paper sets out concrete actions to reduce building energy usage, including publishing a dedicated Heat and Buildings Strategy in early 2021, which will provide further details of policies to encourage consumers and businesses to make the transition.
The Future Homes Standard will require all new-build homes to be zero-carbon ready, and have
75-80 per cent lower carbon emissions than current new-build standards. The government has already consulted on an interim 31 per cent reduction in carbon emission standards, and will set out a roadmap to the Future Homes Standard as soon as possible.
Upgrading existing homes is a much bigger challenge, and the government wants as many existing homes as possible to reach Energy Performance Certificate (EPC) Band C by 2035. Current schemes, including the Green Homes Grant and local authority delivery schemes, have been extended to support this goal, and the government has also consulted on proposals for all privately rented homes to achieve Band C by 2028, where practical.
A £50 million funding pot has been allocated to kickstart the upgrade of social rented homes to Band C, although the White Paper makes it clear that the estimated £100 billion capital required to improve the energy performance of existing buildings must come “principally from business and homeowners, and from landlords of domestic and commercial premises”.
The government says it will focus primarily on creating a long-term regulatory framework to improve the energy performance of homes, along with the package of financial incentives outlined in the 10-Point Plan.
To ensure that fuel-poor households can also take advantage of energy efficiency measures, ECO is being extended 2026 from 2022, and a Fuel Poverty Strategy for England, which is due to be published in early 2021, will include a “multi-billion-pound plan to transform the poorest quality housing”. ■
You can read the full White Paper at: www.gov.uk/government/
