Households pushed to scrap gas boilers with £5k grant

The country has been told precious little about how reaching carbon neutrality is going to be delivered

NEW gas boilers will be banned from 2035 and families are set to be offered £5,000 grants to buy heat pumps for their homes under a green energy strategy to be unveiled next week.

The Prime Minister will announce the “boiler upgrade scheme” as the centrepiece of his long-awaited Heat and Buildings Strategy.

It will set a deadline to prohibit the installation of new gas boilers and instead encourage homeowners to switch to low-carbon alternatives before then. Boris Johnson will first hold a Cabinet “away day” in south-west England today to discuss the green agenda before making his announcement next week.

He will also set out a roadmap to achieving net zero emissions by 2050, covering green investment and jobs, as well as the shift to cleaner forms of transport, such as electric vehicles.

Mr Johnson’s plan for boilers will seek to reassure both hard-up families and sceptical Tory MPS that “no one will be forced to remove their working existing boilers” at any point, as the future ban applies only to new installations.

However, it will offer homeowners who choose to switch early a £5,000 “boiler upgrade grant”, it is understood.

Heat pumps cost about £10,000 but concerns have been raised about their effectiveness in draughty older houses and some flats.

The scheme is an expansion of an existing £4,000 state subsidy called the “clean heat grant”. A wider range of households will be eligible for the renamed, more generous “boiler upgrade grant”.

Ministers will also pledge to work with industry to halve the cost of heat pumps by 2025, an aim a sceptical Whitehall source last night warned could be overly “ambitious”, although Octopus Energy has said it believes the target can be met.

At present heat pumps far outstrip the price of gas boilers, which cost between £1,500 to £3,500.

The running costs of the two heating systems are currently similar. But over the next decade green levies imposed on electricity bills are set to be shifted to gas bills under plans to be approved by ministers.

A Government spokesman said: “We want to encourage people to take up more efficient technologies such as heat pumps and electric vehicles by removing levies on electricity over time, working with industry to drive down costs of technologies and ensure they are as affordable as current options.”

The Cop26 summit in Glasgow offers a perfect metaphor for the global climate conundrum. Britain is one of just a handful of countries with a legally-binding mission to achieve “net zero” carbon emissions; we’re urging others to match our ambition and follow our lead.

But when festivities begin (Boris Johnson sees this as an Olympics-style celebration, complete with its own mascot) the UK will be embroiled in an energy crisis. For a nation with pretentions to global eco-leadership, it’s not a great look.

We have a decent defence. Yes, dozens of our energy companies are going bust and yes, we may now be firing up old coal-fuelled power stations in a panic. But then again, gas prices are causing havoc the world over. China’s problems are severe enough to force many of its factories on to a four-day week. The United States, flush with the shale gas it has fracked, has still seen gas prices treble. So no one is immune. But not many are harder hit than Britain: our gas prices are five times that of America’s and we have just four days of gas supplies in reserve. In Italy it’s three months, and in the Netherlands closer to four months.

None of these countries have signed a net-zero target, and at times like these you can see why. Is it practical, or affordable? It’s easy to say you want green factories, less pollution and snug insulation by 2050. Such declarations can be made at any primary school assembly. My daughter went along to one last week, dressed in green as a “zero hero” with her class reciting the nation’s new environmental goals. But in politics, a higher standard of debate is expected.

The idea is to accompany the ambition with a plan for how it will be achieved and how much it will cost. This is the huge, perhaps fatal flaw in the Tory plan.

Ever since net zero was set as Britain’s great national goal – an Apollo mission for our time – we have heard almost nothing about the price tag. Ministers promised that they’d get around to telling us before the Cop26 summit, but there’s still no word. And there are now just 16 days to go.

Next week we’ll hear a bit more about the new heat pumps, which cost about £10,000 a throw. The current thinking is to offer a grant – perhaps as much as £7,000 – to those tempted (or forced) to take the plunge. But we’re unlikely to hear much about where we’d find the skilled workers needed to fit heat pumps at the rate of 2,000 a day. After Kate Bingham’s success with the vaccine taskforce, ministers have come to believe in someone coming along to do the impossible. But we’ll need an awful lot of Kate Binghams to hit net zero.

Throw in the transformation of roads (for electric cars), farms, factories and everything else and the price tag is likely to come in at over £1 trillion. The Climate Change Committee, which does the net zero sums, thinks it will be more like £50 billion a year from 2030 to make the transition, more than four times the sum raised by the coming National Insurance hike.

The difference is that we’ve been told about the tax, whereas ministers are still talking as if net zero will be cost-free.

The Prime Minister has gone so far as to rule out a meat tax or carbon tax – and there’s more to this than Johnsonian denialism. The Cabinet members who are most keen on net zero say in private that the costs will be whittled away, perhaps to nothing, by advances in technology.

Going green, they think, will become the cheaper option so people will do it anyway. The idea is that capitalism, innovation and consumer demand will make Britain richer, as well as cleaner. “The economic growth will outweigh the costs,” says one minister. Quite a claim.

To be sure, the cost of wind power has certainly fallen faster than anyone predicted ten years ago: from $150 to $40 per megawatt hour as turbines became bigger and more efficient. The cost of solar panels has fallen almost as quickly. This is the “bright green” agenda: a belief that technology will come along and make all this affordable and that all we need is a few more Elon Musks.

But this eco-micawberism runs a rather obvious risk: what if the new inventions don’t arrive? A report from the International Energy Agency laid this bare on Wednesday. There has been a headlong rush away from fossil fuels, now cast as the world villains – but renewable energy has not come on anything like as quickly to fill the gap. So we’re now falling between these two stools. France, at least, has nuclear energy to provide two-thirds of its electricity. Britain has nothing like that.

The mood in government, now, is to “double down” on net zero after the energy crisis, which takes us back to Glasgow and how credible the strategy really is. Without dazzling new inventions, we will be left with a big bill. You can argue that it’s unavoidable and that, if we don’t invest now, we will fry. But are we to believe that the Johnson Government will press ahead? He has yet to acknowledge that the current energy crisis will lead to rising bills this winter, let alone admit the costs of going completely carbonneutral.

This is a government, remember, that tends to buckle under popular pressure. It was determined to suspend free school meal vouchers during the holidays until it faced a short campaign by the footballer, Marcus Rashford. The great Tory housebuilding plan also looks to have been abandoned after grumbles from the south of England. So is he really willing to force through a net zero agenda that could (at a low estimate) cost the average household an extra £1,700 a year, piled on top of unpopular tax rises and an emerging cost-of-living crisis?

All important questions – and all being studiously ignored until after the Glasgow summit. The Prime Minister sees in net zero a foreign policy, an industrial policy, a soft-power policy and a narrative that may win over voters who still resent him for Brexit. It deserves some frank discussions about how much it will cost.

Until that conversation takes place, there is no net zero strategy – just a wish list, a whole bunch of questions and a country in dire need of some answers.

‘There has been a headlong rush away from fossil fuels ... but renewable energy has not come on as quickly’