How can the industry support the UK's net zero targets?

The UK’s journey to net zero hasn’t been a smooth one, with the Conservative government reneging on its own previously agreed strategies. The new Labour administration, however, seems serious about a low-carbon future and how to achieve it.

“Firstly, we need clear and consistent policy from the new government,” says Neil Sawers, commercial technical manager at Grant UK. “The biggest shift required is a collaborative approach from policymakers, manufacturers and installers to make low-carbon heating accessible.”

Innovations in the low-carbon sector offer high efficiency heating and hot water solutions, but much more needs to be done to ensure that the deployment of these innovations is widespread and affordable.

The government’s Future Homes Standard (FHS) aims to ensure that new homes built from 2025 will produce 75-80% less carbon emissions than homes built under current Building Regulations.

“We have a golden opportunity with the FHS, which will lead to the fast acceleration of heat pump numbers in the new-build market,” says Paul Smith, managing director of NIBE Energy Systems. “Retrofit [any improvement work on an existing building to improve its energy efficiency] requires the stimulus to grow. The Boiler Upgrade Scheme (BUS) is a good start, but the upfront cost of a heat pump is still prohibitive for many, even with BUS funding.”

One barrier to uptake is the UK’s spark gap – the difference in prices between gas and electricity, measured per kWh – which is reported to be the highest in Europe. If there was a significant reduction in the price of electricity, the benefits of switching to a heat pump would be hard to ignore. However, closing the gap shouldn’t come at the expense of consumers who rely on gas.

“We need policies that incentivise homeowners and reduce the barriers installers face in adopting new technologies,” says Sawers. “At the top of this list is a streamlined approach to training because without this key element, we will all be busy fools.”

Calls for change

There is a general consensus among the plumbing and heating community that further legislative changes are essential to support renewable heating, with calls to tighten building regulations and prioritise energy efficiency in all properties.

“This should include mandatory minimum energy requirements for homes, but it is still unclear how the Home Energy Model (HEM) [which will replace the Standard Assessment Procedure for the energy rating of dwellings] will address this,” says Sawers. “It should be straightforward to make technologies like heat pumps a default choice, but serious consideration must also be given to those dwellings where a heat pump can’t meet the heat loss on its own. In these cases, solutions such as biofuels must be available to the consumer. Legislation needs to focus on improving infrastructure to support this transition, such as upgrading electricity grids to manage the increased demand from low-carbon heating.”

Despite current legislation outlined in Building Regulations, the government has reiterated that it does not want to force people to replace existing boilers and is unlikely to ban boilers by 2035, as the previous government had indicated.

“An interesting proposal is to raise the minimum boiler efficiency to around 115%,” explains Martyn Bridges, director of external affairs at Worcester Bosch. “This is obviously impossible for a standalone boiler and would only be possible with a hybrid system. There is concern within the industry that more could be accomplished with existing systems and legislation, and that reducing waste through heat loss, for example, might be a more affordable and achievable solution.”

Permitted development and planning regulations for heat pumps is another area of concern. The government is consulting on proposals that would remove barriers to installation and reduce the administrative burden of planning applications, with updates expected before the end of the year.

“The FHS is crucial for accelerating the energy transition and clarity around timing is needed to enable the preparation and scaling required,” says Elizabeth Wilkinson, product director at Ideal Heating. “The HEM, which will need to be implemented at the same time as the FHS, is critical and further details, including the impact on the Products Characteristics Database (PCDB), are needed to enable manufacturers to prepare.”

Another school of thought is that a simplified regulatory framework and better support for continual education and training would accelerate the transition to low-carbon systems.

“Right now, regulations surrounding heat pump installation are too complicated,” says Griff Thomas, managing director of GTEC and Heatly, both part of the United Living Group. “They slow deployment and make heat pumps more expensive than they need to be.”

Some argue that new legislation to decouple heat pump funding from registration schemes is needed to significantly enhance access to the grant and would result in more installations.

“The difficulty these schemes have is determining who is competent, but in doing so they favour large enterprises and alienate a huge section of the skills base,” says Paul Spence, technical manager at Heatly. “Small businesses have trusted relationships with their customers which are being eroded by scheme requirements and ignored as a pathway to speed up deployment.”

Implementing legislation to encourage District Network Operators (DNOs) to accept large-scale deployment of heat pumps will speed up the installation process, according to Daikin.

“It would also be helpful to see reform in the electricity market to unlock flexibility from across the energy system to future-proof wholesale electricity and decouple gas and electricity prices to close the spark gap,” says Hamid Salimi, heating and renewables product manager at Daikin. “Introducing regulation to support Property Linked Finance options could also help to overcome the upfront cost barrier.”

Installers’ opinions

Plumbing and heating installers play a key role in promoting the move away from gas boilers, but are held back by a lack of practical training, complex government incentives and sluggish consumer demand, according to Baxi’s 2024 Installer Skills Survey.

Conducted in partnership with green supply chain consultancy Gemserv, the survey results, which were presented to the industry at an event in September, revealed that installers’ attitudes towards low-carbon heating aren’t improving, an issue that is thought to be contributing to the slow growth in heat pump adoption in the UK. That said, positivity towards heat pumps has increased in the past two years, but many installers still lack the training, knowledge and incentive to help homeowners transition away from gas boilers.

Just 9% of installers fit heat pumps, with 50% admitting they are ‘somewhat’ or ‘extremely’ unlikely to start fitting heat pumps in the next three years. This compares to 46% in 2022 and even less confidence (53%) in 2023. However, there is more enthusiasm for hybrid systems, with 30% of installers showing interest.

According to the survey, policies such as the BUS frustrate consumers due to perceived complexity, excessive paperwork and lack of awareness. Only 9% of installers rate government schemes as ‘good’ or ‘excellent’ and 42% say customers never mention the BUS.

It seems installers simply lack the confidence to promote and install low carbon heating technologies, with just 11% saying they are ‘extremely confident’ discussing them (up from 7% in 2023) and only 35% saying they are ‘moderately confident’.

Practical training is a preference for 34% of respondents, but the perceived high cost of training, along with the complexities of MCS (Microgeneration Certification Scheme) accreditation, are an ongoing obstacle to learning.

The lack of consumer demand for heat pumps further contributes to installers’ low engagement. In the absence of strong demand, installers feel hesitant about making the transition to low-carbon heating, including investing in training. In the 2024 survey, only 3% of installers say customers always ask about low-carbon heating.

“While the 2024 survey shows some positive developments, insufficient training, poor government support and low consumer demand haven’t moved on,” says Ian Trott, Baxi’s head of UK training. “The transition to low-carbon heating will require more targeted interventions to support installers in overcoming these barriers.”

Some industry members believe the heat pump market needs to be opened up to all installers, with multiple routes to access the BUS.

“Without installers, we are only going to trundle along at a very low rate, but there are barriers,” warns Spence. “If installers hold the relevant certification to carry out heat pump work, they should be able to register installations through the manufacturer’s portal or a government registration scheme which would bypass the blockage in the system where the only way to gain access to the BUS is through the MCS.”

Barriers to uptake

There are several issues that are responsible for slowing down consumer uptake of low-carbon technology, including affordability, finance options, lack of knowledge and trust in the technology and installation process.

UK consumers say they can’t afford a heat pump and don’t understand how the technology works, according to research by Energy Systems Catapult in partnership with Heatio and Perenna. Of those surveyed, 36% said they would need to borrow money to install the technology, while 83% said they would consider financing through a long-term fixed-rate mortgage that rewards energy improvements with a lower interest rate.

“Better financing options are needed to ensure everyone, not just the affluent, can make the transition,” comments Thomas Farquhar, co-founder and CCO of Heatio. “It’s particularly concerning that there is a lack of trust in heat pumps – this technology is proven to work but a constant stream of misinformation from the gas industry and in the media feeds the fear that heat pumps will not help people save money or be more environmentally sustainable. This needs to end so we can help more people adopt low-carbon technology and take positive steps to reach net zero and reduce energy bills.”

The research also revealed that saving money is the main driver for considering low-carbon technology for 65% of consumers, followed by eco benefits (49%) and increasing energy costs (47%).

“Most UK consumers don’t have sufficient savings to pay upfront, which means finance is key to getting more homes decarbonised,” says Aniq Ahmed, chief communications officer at Perenna Bank. “Spreading installation costs over a longer term can make these technologies more attractive.”

Aside from the financial barriers, there are also practical issues, such as space. In many homes, particularly those with a combi boiler, finding room for a hot water storage cylinder will be a challenge. Additionally, radiators and pipework may need to be partially or entirely replaced, which creates further complications and expense for homeowners.

“Heating is a low-interest category for consumers,” says Bridges. “It’s unimportant until something goes wrong, then it becomes a crisis. Clearly, education is key, and it might be worth considering that when a consumer calls an installer to replace their boiler, the installer should be required to provide two quotes – one for a boiler and another for a low-carbon option.”

Workforce skills are critical to the transition to net zero and installers need to be better supported with courses and CPD to ensure they can meet demand for low-carbon technology.

“Upskilling gas engineers can make a significant difference,” says Wilkinson. “If installers are better educated and more confident about low-carbon options, they can provide homeowners with balanced, informed advice, which in turn boosts consumer confidence in making the switch.”