UPDATED: Industry reaction to Clean Growth Strategy

The HVAC industry has reacted to the news that the government intends to pump significant investment into lower carbon heating.

The Association for Decentralised Energy welcomed the commitment to expand the role of heat networks and the fact that the Clean Growth strategy also lends support to the ADE’s Heat Network Task Force. 

ADE Director Dr Tim Rotheray said: “We welcome Government’s recognition and commitment to decarbonising heat as a method to meet our carbon reduction goals, and we are delighted to see ongoing support for the use of heat networks as a means to decarbonise heat dense areas, and backing for the role of the ADE Heat Network Task Force to deliver heat network infrastructure investment through the 2020s. The Heat Networks Investment Project is a hugely important part of creating a self-sustaining heat network market post-2020 and it is clear that all customers from householders to large industrial sites can benefit from good value, low carbon district heating”.

He added: “The UK is poised to create a low-carbon, competitive economy, and combined heat and power, demand response and energy efficiency all have important roles to play; With commitments to deliver the smart energy plan and new industrial energy efficiency investments power, alongside a potential for £6 billion in energy savings, businesses and investors will have increased confidence to invest in new measures to help improve their competitiveness and meet our carbon goals.”

Under current policies the UK is set to miss its targets for the fourth and fifth carbon budgets, the ADE noted.. The ADE’s Energy Productivity Report, published last year, highlighted how current renewable and energy efficiency policies are only able to take the UK around half way towards the cost effective path to decarbonisation, and far behind many of its European peers, leaving a significant policy gap.

Analysis published in the Clean Growth Strategy highlights that up to £6 billion could be saved in 2030 through investment in cost-effective energy efficiency technologies in the industrial and commercial sectors. It goes on to state that “roughly half of these savings are available through improving the efficiency of buildings and processes, including by fitting better insulation and smarter energy controls. The other half can be realised through eliminating electricity waste.”

Meanwhile, the heat pump sector gave an enthusiastic response to the news that the government intends to phase out ’high carbon fossil fuel heating’ for offgrid properties in the 2020s, principally conventional heating oil.

The Heat Pump Association said that while the details of how this is to be achieved have yet to be determined, this declaration is seen as a path to eventual regulation. Focus initially will be toward new build but will then be directed to existing building stock heated by heating oil.

Mike Nankivell, President of the HPA said: ”This momentous announcement is vital to assist in cleaning up the emissions from UK heating systems. It is extremely welcome as it gives much needed insight into the direction of travel and enables businesses to plan for the future, whether a supplier or a consumer,”

He continued, “In addition it demonstrates clear intent by the government to seriously tackle the issue of relatively high carbon emissions from heating systems using oil as the predominant fuel and should act as a precursor to other fossil fuels which produce relatively high emissions.”

”Although the exact detail has yet to be worked out, the HPA views this as a clear signal of intent toward ‘cleaner heating’ systems and heat pumps of all genres can contribute significantly to this as low emission technologies.”

Practicality and affordability needs

Trade association OFTEC welcomed the publication of the strategy for recognising what it said was a key consumer need for “practical, affordable” methods for improving energy efficiency and reducing carbon emissions.

OFTEC chief executive Paul Rose said that the government’s recommendations were in line with its own vision to reform off-grid heating as part of a ‘two-stage solution’ launched at the organisation’s annual conference in June.

“We believe our two-stage solution, that we published in June, is the most cost-effective way to deliver significant carbon reduction and energy efficiency gains for the UK’s 1.5 million oil heated homes. Our approach would see a boiler replacement programme in the short term (2018-2022), followed by the introduction of a low carbon liquid fuel as a direct replacement for kerosene,” said Mr Rose.

“This timescale ties in with the government’s ambition to ‘phase out the installation of high carbon fossil fuel heating in new and existing off gas grid residential buildings during the 2020s’.”

OFTEC also praised the Department for Business, Energy & Industrial Strategy for backing use in the strategy of “clean fuels” such as hydrogen and bioenergy in heating and transport.

“OFTEC’s ambition to bring to market a low carbon liquid fuel for domestic heating will build on this crucial work and, by achieving future economies of scale, we are confident that a cost-effective low carbon liquid fuel could be successful,” said Mr Rose.

“We would like to see the important role low carbon liquid fuels could play in the future of domestic heat recognised, alongside bio gas (bio methane), in forthcoming revisions to the Renewable Heat Incentive (RHI). It is vital that off-gas grid homes do not continue to be marginalised by heat policy and are offered a range of competitive and cost-effective options, similar to those on the gas grid.

Worth the Wait?

Consultancy group WSP, which earlier this month released findings backing the replacement of gas boilers with heat pumps to meet UK energy efficiency goals, said the Clean Growth Strategy has been worth the wait.

Frazer Mackay, WSP’s managing director of energy and industry, said the document offered a broad, over-arching plan concerning efforts to become a lower carbon economy. Mr Mackay argued it also raised some opportunities for the private sector to help meet these ambitions.

“It is reassuring to see government confirm that innovation, sustainability and prosperity go hand in hand but it remains unclear exactly how it intends to get us to an all-electric future. With Brexit just around the corner, greater stability and clarity over clean energy auctions after 2020 is an essential first step for investors and developers,” he said.

However, Mr Mackay argued that the government’s ambitions for heating and energy efficiency have been lacking.

“Recent announcements on banning petrol and diesel vehicles have provided momentum, but decarbonisation efforts still disproportionately focus on generation and transport over buildings, even though in places like London buildings contribute nearly 40 per cent of NOx emissions,” he said.

“Our recent research showed replacing gas boilers with heat pumps in buildings can cut business costs, so this was a missed opportunity for a quick win on air quality and clean growth.”