Lack of support for home energy efficiency improvements in Budget is concerning
This Budget has missed a key opportunity to first improve the fabric of buildings to lower heat demand and achieve crucial emissions reduction wins, ahead of a final decision on low carbon heat deployment, says Paul Rose, Chief Executive of OFTEC.
Whilst yesterday’s Budget contained a package of measures relating to low carbon heat, the lack of support for home energy efficiency improvements such as insulation and double glazing is concerning. This is an urgent national infrastructure priority which should be placed ahead of further funding commitments for roads and rail.
If government is to meet its carbon reduction and fuel poverty targets, improving the fabric of homes must be a vital first step before the deployment of all low carbon heating solutions.
Without any support for energy efficiency improvement measures, the £100m which could be made available, subject to consultation, in both 2022/23 and 2023/24, to help homeowners install heat pumps and biomass technologies, along with the extension of the domestic RHI to 2021/22, will only really benefit those already living in well-insulated homes or those able to fund the necessary fabric improvements themselves.
The result of this omission is that government’s regressive approach to heat policy will continue, meaning many low income households carry on facing unnecessarily high heating bills. There is already a significant danger that poorer households will be left behind in the race to net zero and this Budget only increases the chances of this happening.
Rural off-grid households are particularly prone to this policy trap as their homes are typically far less energy efficient than their urban counterparts. The scenario is further compounded by the fact that levels of disposable incomes are, on average, lower in rural areas.
The government has already announced its intention to phase out the installation of high carbon fossil fuels from off-grid homes. Yet, this Budget has missed a key opportunity to first improve the fabric of buildings to lower heat demand and achieve crucial emissions reduction wins, ahead of a final decision on low carbon heat deployment.
This makes OFTEC’s low carbon liquid fuel proposal for off-grid homes even more compelling. This solution is less dependent on home energy efficiency levels and requires far less capital investment than converting to a heat pump, providing an accessible, solution for the majority of existing oil heating users.
On a more positive note, this was a Budget for small businesses and the self-employed which includes the majority of OFTEC’s 9,000 registered technicians. We welcome the measures of support during the COVID-19 situation, along with an increase in the National Insurance threshold to reduce employment costs.