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Key areas to successful off-grid decarbonisation


Malcolm Farrow, head of public affairs at OFTEC believes there are four areas Labour needs to coordinate to deliver successful off-grid decarbonisation


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abour has rightly identified decarbonisation as a major policy focus. With its large majority in the Commons, they are expected to take a bold


approach. Although the finer policy details are not yet clear. However, it’s important the government doesn’t drive ahead on its own without coordinating with industry, consumers and wider stakeholders. This may be the temptation for a Party ambitious


after years of being in opposition. However, as the Conservatives found, the change needed can’t be achieved alone. To succeed, here are the four areas Labour needs to coordinate on.


1. Aligning policy with real world insights


Decision makers in Westminster don’t always fully understand the off-grid landscape. The previous Conservative government prioritised the off-grid sector for heat pump deployment, seeing it as a ‘quick win’. However, off-grid buildings are very different. They tend to be older, poorly insulated with lower


energy efficiency and much higher heat demand. Around 65% of oil heated homes in England are in the least efficient EPC Bands E-G. This means the costs to upgrade them for a heat pump to work effectively are typically much higher compared to urban areas. It’s also more difficult to install new radiators and replace pipework in period or unique properties. It’s not just the housing stock, but the social-


economic situation is different too. There are higher levels of fuel poverty in rural areas, disposable income is lower and the population tends to be older with fewer options for generating additional income. As a result, heating systems are often only changed during a distress purchase situation. At this point,


households want the quickest and lowest cost solution. This is usually a boiler replacement, not purchasing a heat pump. That’s why we’ve seen a slow uptake of heat pumps off the gas grid. After the last election, Labour MPs are representing many of these constituencies for the first time. They will start to understand these challenges and it will be their responsibility to ensure these concerns, on behalf of their constituents, feed into policy decision making at Westminster.


2. A multi technology policy agenda


So far, however, the Labour Party seems to be continuing the so called ‘heat pump first approach’. They’ve announced their intention to continue with Conservative plans to introduce the Clean Heat Market Mechanism (CHMM). This is a controversial scheme that requires boiler manufacturers to also produce heat pumps at a gradually increasing percentage of their production, or pay heat pump manufacturers to make them on their behalf. That’s not to say that heat pumps don’t


Above: By coordinating with the heating industry and consumers, the new Labour government can deliver successful off-grid decarbonisation


have an important role to play off-grid. On the contrary, there are modern properties where the technology can be installed cost-effectively. There will be opportunities when older properties are renovated or because households with high levels of disposable income are willing to make the investment. However, for the majority who can’t, they need to have alternative solutions. During the election campaign, Labour said they would not force people to rip out their boilers. So, what are the options? For too long the focus has been on pushing a particular technology, when it needs to be on the best way to achieve the outcome of cutting carbon emissions. A multi-technology approach is the most pragmatic way to achieve this. That should include renewable liquid fuels. We’ve shown that an oil boiler can be converted with minimal disruption and cost to Hydrotreated Vegetable Oil.


Left: Malcolm Farrow, head of public affairs at OFTEC


Industry insight


This would reduce emissions by 88% and is a far better solution that leaving households on fossil fuels if they can’t afford, or don’t wish to buy, a heat pump.


3. Diversification and training for technicians


The rollout of heat pumps is behind schedule. There are currently as estimated 3,000 heat pump installers and 55,000 heat pumps sold every year. Realistically, the target of 600,000 installations by 2028 doesn’t look achievable as we need a much bigger workforce which takes time to grow. However, there is clear interest from technicians to diversity and we’ve already seen over 2,000 technicians complete our heat pump training courses. There is a clear correlation between uptake and


the availability of government funding. The reality is that for technicians, many of them sole traders, have limited time and budget to invest in training. The recent Low Carbon Heating Technician Apprenticeship (LCHTA), the first dedicated training provision for heat pump engineers in the UK, was warmly welcomed. We, and the wider industry, are keen to work with the government to share our insights to make these schemes a success. A clear and consistent funding policy will be key to achieving this.


4. Support from consumers and delivering social value


Perhaps the most important group to collaborate with is consumers. Policies can only go so far in driving uptake of low carbon heating technologies. Households need to be on board. The slow uptake of heat pumps has been due to concerns over the high costs and disruption. That’s why, for harder to treat properties, we need to offer alternatives, which includes renewable liquid fuels. A year ago, on 26th October 2023, the Energy


Act received Royal Assent and became an official act of parliament. Within the Act at Section 159 is legislation which, if invoked by the Secretary of State for the Department for Energy Security and Net Zero (DESNZ), could create the renewable liquid heating fuel obligation, and pave the way for the introduction of HVO. This legislation was introduced with the


promise of a consultation on the technical details in a few months and certainly within one year. The legislation received cross party support in Parliament, including from the Labour Party. Rural consumers were effectively promised a consultation by Westminster within a year but, so far, the consultation has not been forthcoming. For Labour, a party with its routes in social and


economic equality, this is an opportunity to not just deliver on net zero but to tackle the inequality blighting so many rural communities. With the right investments to improve energy efficiency, upskill the workforce and keep energy costs down, the transition to renewable energy could deliver the social change Labour wants to see.


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