The variety of warmth pump installations by December 2023 was lower than half of deliberate projections; uncertainty relating to the function of hydrogen in residence heating is hampering funding and efficient planning, a brand new Nationwide Audit Workplace (NAO) report has discovered.

Dwelling heating represents 18% of UK greenhouse fuel emissions. Authorities sees warmth pumps as the principle know-how to decarbonise the UK’s 28 million houses over the subsequent decade.

The federal government desires to see 600,000 warmth pumps put in per yr by 2028 – an eleven-fold improve on 55,000 warmth pump gross sales in 2022⁴. By 2035, authorities desires to see as much as 1.6 million warmth pumps being put in yearly.

However the impartial public spending watchdog says the federal government’s assumptions about ranges of client demand and producer provide⁵ are optimistic. The federal government’s flagship Boiler Improve Scheme has additionally underperformed, putting in simply 18,900 warmth pumps between Could 2022 and December 2023. DESNZ had anticipated the scheme would ship 50,000 installations by this level.

A key problem behind lower-than-expected warmth pump uptake is their value to make use of and set up. DESNZ delayed its deliberate work to cut back working prices, by rebalancing fuel and electrical energy costs, for instance by transferring some levies and expenses from electrical energy to fuel payments⁶. The division says that value rebalancing stays a necessary coverage however is difficult. Warmth pump set up prices additionally fell extra slowly than DESNZ hoped.

The NAO additionally discovered that DESNZ has no overarching long-term plan to deal with the low ranges of consciousness amongst households concerning the steps required to decarbonise residence heating.⁷

In response to the Boiler Improve Scheme’s underperformance, DESNZ elevated the grant accessible to individuals changing boilers from £5,000–£6,000 to £7,500, which has enabled some power suppliers to supply warmth pump installations beginning at £500. Purposes to the scheme in January 2024 elevated by practically 40% in contrast with January 2023, although extra information is required to find out whether or not the change is sustained.

DESNZ is contemplating what function hydrogen will play in decarbonising residence heating. The division has to this point indicated that it’s going to have a restricted function, however it should formally take a choice in 2026.

Trials of hydrogen schemes supposed to supply proof to assist the federal government’s choices have been delayed or cancelled. Stakeholders advised the NAO ongoing uncertainty may gradual progress by limiting the power of native authorities and trade to plan and make investments.

Elements of the fuel community could have to be decommissioned if pure fuel is now not in use and hydrogen is confined to sure areas of the nation.⁸ DESNZ is working to develop its understanding of the results for fuel networks of decarbonising residence heating and the way decommissioning may very well be funded.

The NAO recommends authorities considers offering extra certainty on the function of hydrogen in residence heating earlier than 2026.

To enhance its transparency and accountability on the rollout of warmth pumps, the NAO says authorities ought to report its progress yearly to Parliament.

The general public spending watchdog is recommending authorities develops an overarching long-term client engagement plan for decarbonising residence heating. And it additionally recommends that DESNZ accelerates its work to rebalance the price of power to enhance warmth pump uptake.

Gareth Davies, the pinnacle of the NAO, commented:  “Authorities wants to have interaction each family to realize its goal to decarbonise residence heating as a part of the transition to web zero. DESNZ’s progress in making households conscious and inspiring them to change to low-carbon options has been slower than anticipated.”

“DESNZ should draw on its expertise thus far to make sure its mixture of incentives, engagement and laws addresses the obstacles to progress in its present programme of labor.”

You may learn the total report right here.