Value for Money
Decarbonising home heating
Published 18 March 2024
8 recommendations
Department for Energy Security and Net Zero
Energy and environmentHousehold energy
nao.org.uk
The number of heat pump installations by December 2023 was less than half of planned projections; uncertainty regarding the role of hydrogen in home heating is hampering investment and effective planning.
Recommendations (8)
Source: NAO Recommendations Tracker · PAC follow-up below
Department for Energy Security and Net Zero
Rec 1
Partially Accepted
Work in Progress
On establishing a pathway towards decarbonising home heating, DESNZ should:
a Establish an overarching long-term consumer engagement plan to support achieving key milestones, such as the phase-out of the sale of new fossil fuel boilers by 2035. This should include clarifying roles and responsibilities for existing organisations in central and local government. DESNZ should also consider introducing a new body with specific responsibility for consumer engagement.
Department for Energy Security and Net Zero
Rec 2
Partially Accepted
Implemented
On establishing a pathway towards decarbonising home heating, DESNZ should:
Publish an updated Heat and Buildings Strategy by early 2026 at the latest, that takes account of its revised expectations around the relative roles of electrification and hydrogen for home heating.
Department for Energy Security and Net Zero
Rec 3
Partially Accepted
Work in Progress
On establishing a pathway towards decarbonising home heating, DESNZ should:
Consider whether it is possible to provide more certainty on the role of hydrogen in home heating before 2026 to help industry plan and invest.
This could include:
? making some aspects of the decision before 2026. For example, indicating that hydrogen will only be used in locations where certain conditions exist, such as proximity to hydrogen production facilities; and
? providing clarity on what is in scope for the 2026 decisions, for example whether it will decide on hydrogen as an option for all consumers, or if it will determine hydrogen has a role in specific areas and/or circumstances.
Department for Energy Security and Net Zero
Rec 4
Accepted
Work in Progress
On establishing a pathway towards decarbonising home heating, DESNZ should:
Continue its work to consider the cost implications of a potentially reduced role for gas networks, including how to ensure sufficient investment in their ongoing operation while still in use, and how the costs of decommissioning will be met.
Department for Energy Security and Net Zero
Rec 5
Accepted
Work in Progress
On the deployment of heat pumps, DESNZ should: Accelerate its work to rebalance the costs of energy, for example by moving levies and obligations from electricity to gas bills. As part of this it should ensure households that are unable to switch away from fossil fuel boilers do not experience disproportionate adverse consequences.
Department for Energy Security and Net Zero
Rec 6
Accepted
Implemented
On the deployment of heat pumps, DESNZ should: Establish a single measure for the number of heat pumps installed regardless of policy, and report to Parliament annually, indicating whether deployment is ahead of or behind DESNZ?s expectations and the reasons why.
Department for Energy Security and Net Zero
Rec 7
Accepted
Implemented
On the deployment of heat pumps, DESNZ should: Ensure it has regularly updated information on all key barriers to heat pump installations, including reasons for Boiler Upgrade Scheme attrition, and use this to inform its approach. This should include key potential barriers such as costs, public awareness, supply chain capacity and others identified through behavioural insights research.
Department for Energy Security and Net Zero
Rec 8
Partially Accepted
Work in Progress
On the deployment of heat pumps, DESNZ should: Develop a decision framework for its approach after 2028, particularly the balance of taxpayer-funded grants, manufacturer regulations and consumer costs. This should draw on evidence from DESNZ?s evaluation of ongoing programmes. It should consider the thresholds at which government financial support can be reduced, such as the cost of heat pumps and availability of installers
Parliamentary Committee Follow-Up
The Public Accounts Committee examined this NAO report and published its own recommendations. The government responds to PAC recommendations via Treasury Minutes.
Thirty-Seventh Report - Decarbonising home heating
Public Accounts Committee
· 26 May 2024
· 22 recommendations