Boiler makers are pushing back against government efforts to force a rapid ramp-up of thousands of heat pumps after a new flashpoint over the pace of the transition to low-carbon heating.
Starting next year, the government will fine companies if they fail to meet strict quotas for heat pump production and installation. But leaders are lobbying Whitehall to postpone and revise the plan.
They argued that the allocation was unrealistic given the weak demand for heat pumps and the tight supply of installers, and that a fine of £5,000 per missing heat pump would drive up costs for consumers and jeopardize investment and jobs. claimed to be exposed to
Boilermaker Vaillant UK, which has invested £4m in a new heat pump production line at its Derbyshire factory, has warned it will review its plans to invest in the UK if it goes ahead.
Vaillant UK & Ireland Managing Director Henrik Hansen said: “Across the UK we employ around 1,000 people. If penalties start to be imposed, we will have to reassess our investment plans. We believe there is a risk of
Planned quotas and fines reflect proposals to encourage the transition to electric vehicles, with proponents saying the mechanism is necessary to stimulate the market and reduce costs for consumers. claim.
A spokeswoman for the heat pump advocacy group Electrify Heat added: “We believe the government’s proposed scheme design is fair to those who have obligations.”
But the turmoil highlights the complexities facing governments as they push for a major overhaul of home heating to reach the legally binding target of net zero carbon emissions by 2050. I have to.
The majority of UK homes are heated by gas boilers, but ministers want to rapidly expand the deployment of heat pumps. These draw warmth from the outside air and run on electricity, which is increasingly being generated from low-carbon sources.
About 8,790 heat pumps were installed in the UK in the first three months of this year, but the government wants the installation rate to reach 600,000 per year by 2028, prompting a major overhaul of supply chains and demand. is required.
The spread of heat pumps is held back by the relatively high cost of the equipment, but according to Nesta’s estimates last June, the number of heat pump installers will increase by about 800% from about 3,000 to 27,000 by 2028. need to increase.
Under a market stimulus plan in talks, manufacturers will be fined next year if they don’t sell a certain percentage of heat pumps compared to gas or oil boilers.
The UK industry is already consolidating around a few large European-scale groups that manufacture and sell heat pumps alongside boilers. Vaillant, Baxi and others have expressed concern to the government.
Mike Foster, chief executive of the lobby group the Energy and Utilities Alliance, said there is currently “a deadlock between the industry and Whitehall.” . . Whitehole is disconnected from the workings of the industry. “
As one industry executive said: This penalty is severe and commercially significant. “
Colm Brichfield, policy adviser to the environmental think tank E3G, which manages the Electrify Heat campaign, argues that the policy will help develop supply chains and has broad support in the energy industry.
“The cost of compliance needs to be lower than the cost of non-compliance, so fines are at their current level,” he said.
The Department for Energy Security and NetZero said heat pumps are a proven means of decarbonizing heating across the UK and are key to increasing the country’s energy security.
“We are discussing proposals that will give the industry greater incentives to invest in ways to make heat pumps a more attractive and easy option for more households in the UK,” the company said.
