There is so much noise surrounding the topic of heat electrification as the future platform for the energy transition that it seems a world away from when BEAMA set out to stop electric heating being banned in 2004. Yes, you heard it right, the Government of the day in 2004 was planning to ban electric heating in new buildings. Seems crazy now when you think back.
Many graphs, much analysis and endless meetings in Whitehall pulled that around, but we still seem to be struggling with the concept of heat electrification, and it opens up so many side discussions, including the future role of hydrogen and the cost effectiveness or liability of operating a gas network for a relatively small number of homes.
In the Prime Minister’s announcement to extend the fossil fuel ban target date, he talked about exempting homes from electrification. Why? Because somebody told him that heat pumps may not be suitable for a mystery 20% of our housing stock. Whether that is right or wrong is not really the point because actually the central issue is the fact that the Government has such a narrow view of heat electrification that it seems to be heat pumps or nothing. Not much choice there! And of course, once you get into binary technology choices, you end up with the grey areas and all the noise about hydrogen and gas networks. But this debate and noise is so unnecessary because we already have the solutions for that mystery 20%, and more potentially.
Whilst it is clear that heat pumps will drive a lot of the movement to electrification, we are making a big mistake in ignoring other technology options. The central themes of the heat pump versus boiler debate are (i) the need to balance the electricity grid to ensure we do not have to over invest in grid capacity for peak heat periods (flexibility or Demand Side Response for those in the know); (ii) the length of time it takes to design, install and commission a heat pump (a necessity we cannot avoid but tricky for distress purchases); (iii) cost of technology switching (a gap that is fast closing); (iv) the need to re-balance energy prices (difficult to explain that to current gas customers so almost certainly needs to be funded from the Treasury purse rather than re-distributing green levies); (v) and, very importantly, the potential on cost of upgrading a home or the current heat distribution system to accommodate a heat pump.
This brings us back to choice, or lack of it in terms of Government support. The odds are stacked so much in the favour of a single technology route right now that other innovative solutions are struggling to be heard, and are actively excluded from the levels of support received by heat pumps.
If the desire is to move towards an electrified heat market, the Government will need to take the blinkers off and level up the playing field. Products such as heat battery boilers or hot water stores are excluded from VAT relief, not covered under the Boiler Upgrade Scheme, and certainly not incorporated into any funding mechanism such as ECO. Similarly, High Heat Retention Storage Heating units are also left on the financial sidelines when it comes to Government support. This cannot continue if we are to take heat electrification seriously and grow demand with installers and consumers.
Last week we published our response to Treasury in advance of the Spring budget 2024. The case was clearly made that it is now time to open up the subsidy and VAT relief space in order to push electrification forwards. For example, if a heat battery boiler - which can offer you storage and flexibility potential, cost effective operation with time of use tariffs and an easy retro-fit solution to replace a gas or oil boiler with no system upgrades to speak of – received the same level of support for roughly the same financial and comfort benefit as a heat pump, why not back it? There are many installers who do not like rapid change, and this gives them an opportunity to dip their toe into the non-fossil fuel world. There is minimal training needed as it is a boiler, and it is an easy retrofit solution. Similarly, if we are taking electrification seriously, why are we not pushing for phase change storage for hot water offering 4 times capacity with the same space as a traditional cylinder and the time of use flexibility we need. And let’s get back to re-positioning storage heating too as the modern options are a world away from our perceptions of the 60s and 70s solutions. Modern High Heat Retention Storage units offer much better heat store capability at their core, close controlled heat release and access to that all important time of use flexibility we are going to need.
And let’s not forget the humble ‘off the shelf’ net zero ready panel convector heater (or any direct electric heater): Everyone from BRE to the Climate Change Committee agrees that this low capital cost technology has a place in the hierarchy of choice for modern, small, highly -insulated flats and apartments. Their state-of- the -art controls and installed efficiency make this a low -carbon option for very low energy demand dwellings.
A journey has to start somewhere, not only for customers but installers too; so why not go for the low hanging fruit and talk about electrification in the round? It is a ‘soft landings’ approach into a new world, and the quicker Government starts to really understand how markets grow and how to create a movement, the quicker we will see heat electrification as the norm.