• REA welcomes publication of long-awaited Heat and Buildings Strategy, but continues to call for a holistic, multi-technology approach to heat decarbonisation;
• £450m Boiler Upgrade Scheme, plans to drive down heat pumps’ costs by 2030, and ambition for all new heating systems installed in UK homes to be low carbon by 2035 heralded as crucial measures to decarbonise heat;  
• However, REA warns limited funding may not deliver at scale required, expresses disappointment that technologies such as deep geothermal continue to be ignored and says there is a major vacuum on industrial decarbonisation.

The Association for Renewable Energy and Clean Technology (REA) has described the newly published Heat and Buildings Strategy as ‘good news’ for domestic heat decarbonisation, but has warned about the growing policy vacuum for industrial decarbonisation.

The REA described Government plans to drive down the cost of low carbon heating technologies, like heat pumps, by 2030 and its confirmed ambition for all new heating systems installed in UK homes from 2035 to be low carbon, as crucial measures for the decarbonisation of domestic heat.

The increased funding attached to the new Boiler Upgrade Scheme will also increase the affordability of low-carbon home heating measures such as heat pumps and biomass boilers, while removing VAT on these technologies – as advocated by an REA-led industry coalition last week – could further increase the uptake.

However, the REA also reiterated its call for a multi-technology approach to both domestic and industrial heat decarbonisation, with a need for greater roles for biomethane, clean hydrogen, biomass, biopropane, heat pumps, deep geothermal and other low carbon heat technologies.

The Association says that, in lieu of a replacement for the Non-Domestic Renewable Heat Incentive (RHI), a major policy vacuum opened up at a time when the drive towards industrial heat decarbonisation should have been intensifying, with the REA long-standing advocates of a CfD mechanism for industrial heat. In addition, the year-long delay to the publication of the Strategy has curtailed the renewable heat sector’s routes to market, while the funding available for heat pumps will only deliver 30,000 installations a year so not at the scale required for the transition.

The REA’s Strategy for Net Zero, published in February, set the ambition for renewable and low carbon heat to be the dominant form of heat by 2035.

Frank Gordon, Director of Policy at Association for Renewable Energy and Clean Technology (REA), commenting on the domestic market, said:

“This strategy offers some good news, particularly on the ”heating our homes” front.

“The £450m Boiler Upgrade Scheme offering £5000 grants and the ambition for all new heating systems to be low-carbon from 2035 are significant and will go some way to help the move away from our over reliance on fossil gas boilers. The Government’s pledge to work with industry to drive down costs will also make this transition much more affordable for many people.

“We are also advocating a removal of VAT on domestic renewables and clean technologies to help reduce the carbon and bills burden from our homes – if the Government took this sensible step, it would open up access even further and provide a major catalyst to the sector.” 

Frank Gordon, commenting on the industrial and commercial market, said:

“However, it is disappointing that the industrial side of heat decarbonisation has again received less attention. In lieu of a replacement for the Non-Domestic Renewable Heat Incentive (RHI), a major policy vacuum has opened up at a time when the drive towards industrial heat decarbonisation should have been intensifying. This Strategy does little to close that gap and its year-long delay has curtailed the renewable heat sector’s routes to market.

“It is clear that we need a multi-technology approach to both domestic and industrial heat decarbonisation, with a need for greater roles for biomethane, clean hydrogen, biomass, heat pumps, deep geothermal and other low carbon heat technologies.” 

—ENDS—

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Notes to editors:

About the Association for Renewable Energy and Clean Technology (REA):

The Association for Renewable Energy and Clean Technology (known as the REA) is the UK’s largest trade association for renewable energy and clean technologies with around 550 members operating across heat, transport, power and the Circular Economy. The REA is a not-for-profit organisation representing fourteen sectors, ranging from biogas and renewable fuels to solar and electric vehicle charging. Membership ranges from major multinationals to sole traders.

For more information, visit: www.r-e-a.net