Huge funding gaps in UK’s energy efficiency plans, climate advisors warn

The body, which independently advises the government on climate change, praised the 'Heat and Buildings Strategy' which includes proposals such as phasing out gas and oil boilers, new long-term policies for low-carbon heat and new funding for heat networks, public buildings and the fuel poor.

However, the CCC said that while the government has committed some funds towards the goals, it will likely need to invest much more, especially in light of the rising number of households in fuel poverty caused by the rocketing wholesale price of gas over the last few months, further exacerbated by the ongoing war in Ukraine.

The funding allocated up to 2025 for public sector buildings such as schools and hospitals is only a third of what is needed to achieve its goals for cutting emissions from those properties by 75 per cent by 2037.

With yesterday’s announcement that the UK will phase out the import of Russian oil completely by the end of the year, the price of gas in the UK is not expected to fall back to previous levels any time soon.

“Action can pay dividends,” the CCC said. “Improving energy efficiency of homes is one of the easiest and most cost-effective steps to reduce the impact of high bills in the near term and will help get the UK to net zero in the longer-term.”

It its 'Sixth Carbon Budget', published in 2020, the CCC calculated that the capital investment needed to get to net zero would more than pay for itself through savings on fuel, healthcare and other costs.

“Recent events have shifted the calculus on this even further in favour of taking decisive action now,” it added.

However, the UK does not currently have “anywhere near” enough capacity in its supply chains to install the number of heat pumps or heat networks that it will need in the years to come, the CCC found.

The government projects 600,000 heat pump installations per year by 2028, up from around 35,000 last year.

“The government needs to move fast to complete its current engagement and clarify the fine details of how many of its policies and programmes are going to work. If nothing else, this detail is essential to enable individuals and firms to start taking action, raising finance and making spending decisions to improve homes and other buildings,” the CCC concluded.

A Department for Business, Energy and Industrial Strategy spokesperson said: “Improving the energy efficiency of our homes is the best long-term method to keep household energy costs down and tackle fuel poverty. This is why we have committed £6.6bn to improve energy efficiency.”