National Infrastructure Commission proposes huge investment in heat pumps

Our CEO Sharon Johnson and our CCO Shueb Ali were in Westminster on Wednesday 18th October for Energy UK’s annual conference. They heard directly from Nick Winser from the National Infrastructure Commission, about the launch of their second review of the what the nation needs to invest in over the next 30 years.

The Commission advises the Government on all aspects of public infrastructure, and a key part of this new review is the electrification of heating. Their view is that gas boilers need to be phased out and replaced by heat pumps – around 8 million additional buildings by 2035, and in all buildings by 2050. They are clear that there is no case now for hydrogen to be used to heat buildings, and that it should be ruled out as an option by government, due to the much more efficient use of clean energy by heat pumps.

The Secretary of State for Energy Security and Net Zero, Claire Coutino, noted that the report is influencing her department’s thinking, as did her Labour shadow Ed Milliband. This is very positive news as to achieve these huge targets will require a substantial increase in investment. The Commission suggests spending up to £4.5 billion a year in social housing, committing up to £4 billion grant funding to cover the full cost of works for low income homes, as well as offering £7,000 a year towards the cost for better off households (currently the government’s Boiler Upgrade Scheme offers £7,500). The impact of this investment won’t just be a reduction in carbon emissions, but also in bills, with the report predicting that the average household bill will drop to around £1,400 by 2035 and £1,000 by 2050 thanks to more efficient heating as well as cheaper renewables.

The Commission notes the concern about ensuring that properties are suitably insulated before installing heat pumps. Their view is that most homes that have an EPC of Band D of higher are likely to be suitable in principle. Those rated E and below will need improvement, and this is exactly what AgilityEco and our partners Alto Energy are achieving for fuel poor homes through the Connected for Warmth scheme, and through our deployment of ECO funding to our installation partners across Britain.

Of course, agreeing the funding this heat revolution is just the start as British companies will also need to recruit an army of skilled workers to get the work done. We are heartened by the focus by both main political parties on skills, but our industry needs to have confidence in the long-term funding of retrofit schemes in order to invest in expanding the workforce.

And we must not forget customer engagement and building people’s confidence in heat pumps as the best solution for their home. Every day we and our partners are seeing the life-changing impact that modern, low carbon heating and retrofit can have for people on low incomes, like our Connected for Warmth customers Victor and Judy.

At AgilityEco we plan to work closely with Alto Energy and all of our partners to help make the Commission’s positive vision a reality.