We recently passed an important milestone in the UK’s path to reaching its net zero targets when the Government’s published its Warm Homes Plan.
Not only does the plan prioritise the decarbonisation of domestic heating, to lower emissions and lead to more efficient homes, but it also aims to support manufacturing in the UK and the supply chain behind clean heat technologies.
This is a welcome sign for UK manufacturers such as Mitsubishi Electric, with the emphasis on supporting the roll-out and adoption of low carbon technologies a decisive vote of confidence in an industry that is vital to the country’s energy future.
The plan represents a clear commitment to building both market demand and the domestic capability that we need to meet it.
The combination of measures – which include landmark commitments that include a target of 70% of heat pumps that are sold in the UK to be manufactured domestically and increases to the Heat Training Grant to £7 million per year through to 2029 – will support investment, local manufacturing commitment, and workforce development.
Ultimately, it sends a message the industry has been waiting for – the Government backs the sector to lead the UK’s energy transition and will support it do so.
To maximise these measures, and ensure the sector can fulfil its full potential, the Government must now turn its attention to the other barriers which are preventing the decarbonisation of buildings.
The plan aims to support manufacturing in the UK and the supply chain behind it
Russell Dean Deputy Divisional Manager
Huge potential in commercial buildings
It is right and proper that the Warm Homes Plan addresses the retrofit of domestic properties, but the opportunity to extend similar support to commercial and public buildings remains unfulfilled.
With around two million non-domestic buildings right across the UK, this sector holds significant potential for emissions reduction and energy efficiency improvements.
Extending retrofit incentives and clear policy frameworks to the commercial sector would create a pipeline of demand that benefits British manufacturers, installers, and service providers alike.
Large-scale retrofitting of offices, schools, warehouses, and retail spaces can become a cornerstone of green economic growth, which is anchored in UK-made technology.
Reducing the price of electricity
A strong and resilient manufacturing base also depends on a stable and affordable energy system.
At present, electricity prices remain linked to the cost of gas, despite a growing share of generation coming from renewables. This artificially inflates the cost of electricity and undermines the competitiveness of clean electric technologies, including heat pumps.
The Government’s continued commitment and engagement to consult on energy pricing is welcome and we urge swift progression toward implementation of a more balanced approach.
This will not only help provide both cheaper electricity for heat pump use but also bring cheaper electricity for UK manufacturing. The Budget did see the Government making a positive intervention, cutting energy bills by £150 on average from April, however rebalancing is still needed to encourage the public towards clean heating.
Aligning energy pricing with the country’s low-carbon ambitions is a strategic step, by benefiting both households and the domestic manufacturing supply chain.
Implementing modern building standards
The timely introduction of the Future Homes and Buildings Standards will be essential to maintain market confidence and provide manufacturers with the certainty they need to plan, invest, and scale. With consultation responses due imminently and regulations expected early this year, momentum must now be sustained.
Further delays to implementation would risk locking in outdated technologies and design standards, potentially undermining the progress made under the Warm Homes Plan.
Strong, timely standards which begin as soon as regulations are passed will reward innovation and ensure that the products designed and built in the UK today are aligned with the net zero buildings of tomorrow.
A new chapter for clean heat
The Warm Homes Plan represents more than an energy policy – it is an industrial opportunity. As the UK races to cut emissions, we have the chance to anchor that change in British production, skills, and innovation.
By combining clear demand-side policies with support for commercial buildings, fairer energy pricing, and consistent building standards, the Government can unlock a virtuous cycle of investment that strengthens UK manufacturing and accelerates decarbonisation.
Mitsubishi Electric stands ready to help deliver that vision, by continuing to manufacture in the UK, train the workforce, and support the market transformation that will define the UK’s clean heat future.
Russell Dean is Deputy Divisional Manager
