Seventh report - Decarbonising heat in homes

The government says it has published its response to the Heat Networks Market Framework consultation, outlining proposals for regulation and appointing Ofgem as the heat networks regulator to ensure fair pricing and reliable supply.

The government redirects by stating that consumer protection for heat networks is a reserved matter across Great Britain and that they are working closely with the Scottish Government on consumer protection rules, and sharing lessons on zoning policies.

The Government acknowledges concerns around heat networks and mentions its support for the market, data publication and forthcoming regulatory framework, but does not specifically commit to giving Ofgem the mandate and resources to expand and enforce consumer protections.

The Government states that the Future Homes Standard delivers on Net Zero commitments, that they have accelerated work on a full technical specification and plan to launch a full consultation in 2023 and introduce legislation in 2024, ahead of full implementation in 2025.

The Government states it will continue to make the case for moving quickly to Net Zero and expects social housing landlords to help tenants to understand why works are required to their homes and the benefits of the transition, and commits to considering a long-term regulatory standard to improve social housing to EPC band C, alongside measures to decarbonise the housing stock in line with emissions targets, and provides funding.

The government states they are taking a range of measures to ensure the market can deliver 600,000 annual heat pump installations by 2028, including the Boiler Upgrade Scheme, a market mechanism for low carbon heating from 2024, and the Future Homes Standard from 2025.

The government's response focuses on the ambition for heat pump installations and domestic production, without addressing support for tenants or housing associations regarding low carbon heating transition.

The government discusses the Green Home Finance Innovation Fund, the Green Home Finance Accelerator Programme (doubling funding to £20 million), and consultation on incentivizing mortgage lenders, but doesn't directly commit to a ban on fossil fuel heating systems or more ambitious plans for pricing and innovation, as the recommendation urged.

The Government outlines the measures being taken to ensure the market is in place to deliver on the ambition of 600,000 annual heat pump installations by 2028, including financial support, market intervention and regulations. They are working with industry to ensure the enabling conditions are right to support this growth through initiatives like the Heat Pump Ready Innovation Programme and by ensuring appropriate training is available.

The government describes its plans for a market-based mechanism and consultation but does not directly address how it will meet the 600,000 heat pump target, only stating that the mechanisms are *designed to deliver* on the ambition.

The Government will run a Heat Pump Investment Accelerator Competition in 2022 worth up to £30 million to ramp up domestic manufacture of heat pumps.

The Government states it is already working closely with industry to ensure high-quality training is available and mentions coordinated action through the Electrification of Heat Task Group and the upcoming Green Jobs Delivery Group, along with examples of industry investment in training.

The Government's response focuses on energy efficiency schemes, skills competitions, consumer advice tools, and general energy advice services, but does not address facilitating low-cost lending products or the use of public funds for grants to lower-income families, which was the recommendation's core point.

The government states it is investing £550 million to expand Skills Bootcamps for green skills and working with local authorities to ensure training is widely available.

The government rejects the recommendation to expand the market-based mechanism and explore other options. Instead, it describes alternative local authority delivery schemes for improving the energy performance of low-income homes, arguing its approach is different.

The government says they are committed to keeping costs fair and affordable, exploring options to shift energy levies away from electricity, expand carbon pricing, and remove costs from electricity bills, with proposals to be published in 2022, while providing financial support through existing schemes.

The Government agrees that further action is needed to increase consumer awareness and mentions progress made in raising public awareness and interest in climate change, enhancing communication channels, and increased investment into the digital service, Simple Energy Advice, but doesn't directly address developing a low carbon heating training program in partnership with industry and trade unions.

The government acknowledges the vital role of local and regional governments and mentions the Local Net Zero Forum, the Local Net Zero Programme, and funding for various decarbonisation schemes delivered in partnership with local authorities, but does not commit to specifically working with local and regional authorities on the regional delivery of the adult skills budget, or promoting the connection between net zero policies and ‘green job’ creation.

The government acknowledges the role of local authorities in decarbonising homes and mentions strategies and milestones for decarbonizing heating, but doesn't commit to prioritizing a replacement for the Green Homes Grant delivered locally, as specifically recommended.

The government's response discusses the importance of climate and governance structures but does not address any of the specific recommendations regarding the Boiler Upgrade Scheme.

The government acknowledges the need to incentivise green choices and is looking at options to shift or rebalance energy levies and obligations away from electricity, with proposals to be published in 2022, considering system impacts and low-income consumers.

Ministers cannot mandate the actions of the Committee on Fuel Poverty but will continue to work closely with them.

The government agrees further action is needed and says progress has already been made to raise public awareness, pointing to the 'Together for our Planet' campaign and increased investment into the digital service, Simple Energy Advice.

The government states that Ofgem already regulates companies in the heating sector and will regulate heat networks, and the BEIS Secretary of State will have powers to introduce a price cap, but the government is considering responses to a consultation to enhance consumer rights.

The government acknowledges the role of local governments, mentions the Local Net Zero Forum, continuation of the Local Net Zero Programme, and highlights funding boosts to schemes delivered in partnership with local authorities, including specific funding amounts for various decarbonisation schemes, as well as increased funding for local authorities.

The government states that it has been working closely with regional government representatives to attract investment within the supply chain, providing funding through schemes like the National Skills Fund, and supporting local governments through the Net Zero Innovation Programme.

The government states that the Heat and Buildings Strategy and Net Zero Strategy, published in October 2021, already set out joint milestones and metrics jointly owned between DLUHC and BEIS for decarbonising heating in homes, and they report on progress annually.

The government states that the Prime Minister chairs the Climate Action Strategy Committee (CASC) and the COP26 President chairs the Climate Action Implementation Committee, and that they respond annually to the Climate Change Committee’s (CCC) Progress Report on Mitigation, including a comprehensive set of answers to the ‘Joint Recommendations’ each year.