I don’t know about you, but I was really encouraged to see the new Chancellor ambitiously setting out his stall with a range of bullish environmental commitments in his inaugural Budget statement this week.
As a manufacturer of heat pumps, we have been involved in the Department for Business, Energy and Industrial Strategy (BEIS) ‘end of RHI’ working group and the largest concern coming from the industry has always been the impact that a lack of notice of legislation changes has on the sector.
By extending the Renewable Heating Incentive (RHI) by another year, the government has ensured that it isn’t pulling the rug out from under the growing heat pump sector.
This was an undoubtedly ambitious but necessary package of green measures
Stability for now
Many renewable heating installers along with the businesses adopting renewable heating have been concerned about what, if anything, is going to replace the RHI, so this announcement provides some stability for now.
The announcement of the extension will also inject much needed confidence into the industry, allowing manufacturers to more effectively forecast and providing a platform to continue growing and establishing a sustainable UK heat pump market.
The extra year will also allow BEIS time to find a suitable replacement scheme to RHI, which helps consumers transition more quickly away from gas and oil, helping put the country on the road to zero carbon.
The vast majority of UK households are currently being heated using high carbon fossil fuels and, at the moment the costs of fuel remains relatively cheap, so people aren’t incentivised to move to renewable heating.
This is where the RHI is designed to encourage the uptake of low carbon renewable technologies such as heat pumps because it provides quarterly payments for seven years on every kilowatt of renewable heat your home uses.
The government is particularly concerned with the burning of the most unsustainable fuels - Oil and LPG - in our homes, so the RHI is therefore integral in driving the uptake of renewable heating technologies.
For this to be truly effective though, we would like to see the introduction of levies that the chancellor has proposed stretched further to help reduce the run costs of renewable heating methods when compared to natural gas.
This would enable and encourage the growing number of people who realise that they have to change the way they heat their homes, to adopt low carbon systems earlier than they otherwise might.
Much needed certainty
The £270m budget set aside for green heat networks was another very positive sign that the government is taking this march to Net Zero seriously, clearly signalling that it’s willing to back up its strong statements on decarbonisation with affirmative action.
It’s also encouraging to see a further £100m set aside for 2022/23 and 2023/24 as grant-funding for households and residential buildings to install heat pumps to replace fossil fuel heating. This will form part of government action to help build supply chains ahead of future measures to phase out high-carbon heating.
What all this amounts to is much needed certainty, helping the industry to build supply chains that will be instrumental in phasing out high-carbon heating and firmly setting the country on the road to its ambitious 2050 target.
This was an undoubtedly ambitious package of green measures, but necessarily so in order to redress the threat to the environment posed by high carbon non-renewable heating.
Max Halliwell is communications manager for Heating and Ventilation