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1 The long-term future for heat Adrian Gault, Chief Economist “What does a heat transformation mean for UK heat sector businesses?” 18 January 2017

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Page 1: Adrian Gault, Chief Economist - University of Exetergeography.exeter.ac.uk/media/universityofexeter/schoolof... · 2020-02-27 · 1 The long-term future for heat Adrian Gault, Chief

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The long-term future for heat

Adrian Gault, Chief Economist

“What does a heat transformation mean for UK heat sector businesses?”

18 January 2017

Page 2: Adrian Gault, Chief Economist - University of Exetergeography.exeter.ac.uk/media/universityofexeter/schoolof... · 2020-02-27 · 1 The long-term future for heat Adrian Gault, Chief

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UK ambition on climate change is designed to “embody” the Trilemma.

Legal duty to incorporate: fuel

poverty, competitiveness,

energy policy, fiscal

circumstances + others

Page 3: Adrian Gault, Chief Economist - University of Exetergeography.exeter.ac.uk/media/universityofexeter/schoolof... · 2020-02-27 · 1 The long-term future for heat Adrian Gault, Chief

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Meeting targets requires emission reductions across all sectors, though in our scenarios, over the period to 2035, buildings and industry decarbonise more slowly than most others

Page 4: Adrian Gault, Chief Economist - University of Exetergeography.exeter.ac.uk/media/universityofexeter/schoolof... · 2020-02-27 · 1 The long-term future for heat Adrian Gault, Chief

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It will take time to reduce emissions from buildings – we need to start now.

Page 5: Adrian Gault, Chief Economist - University of Exetergeography.exeter.ac.uk/media/universityofexeter/schoolof... · 2020-02-27 · 1 The long-term future for heat Adrian Gault, Chief

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But lately, action to reduce emissions in homes has stalled…

Page 6: Adrian Gault, Chief Economist - University of Exetergeography.exeter.ac.uk/media/universityofexeter/schoolof... · 2020-02-27 · 1 The long-term future for heat Adrian Gault, Chief

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…as has action to improve the energy efficiency of commercial buildings.

Information and reporting has little impact:

– Energy Performance Certificates (EPCs)

– Display energy certificates (public buildings)

– energy audits (Energy Savings Opportunity Scheme for large business)

Need to focus on:

– Actual not modelled performance

– Board-level reporting, “salience”

– Identification of low cost options

– Comparisons with peers

Funder: “I would finance but there

is no demand from occupiers”

Developer: “The funder won’t

finance, the tenants are not asking

for improvements”

Contractor: “I could build it but

developers don’t ask.”

Tenant: “There are no energy

efficient buildings and energy is

not a material cost.”

“Circle of blame”, Carbon Trust 2009

Page 7: Adrian Gault, Chief Economist - University of Exetergeography.exeter.ac.uk/media/universityofexeter/schoolof... · 2020-02-27 · 1 The long-term future for heat Adrian Gault, Chief

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The options are well known. They include effective energy efficiency, heat pumps…

Page 8: Adrian Gault, Chief Economist - University of Exetergeography.exeter.ac.uk/media/universityofexeter/schoolof... · 2020-02-27 · 1 The long-term future for heat Adrian Gault, Chief

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…heat networks and possibly low-carbon hydrogen for heating.

Page 9: Adrian Gault, Chief Economist - University of Exetergeography.exeter.ac.uk/media/universityofexeter/schoolof... · 2020-02-27 · 1 The long-term future for heat Adrian Gault, Chief

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Where do we need to be in 30-40 years?

Heating may shift from one

dominant technology to a range

of solutions depending on local

demand.

Page 10: Adrian Gault, Chief Economist - University of Exetergeography.exeter.ac.uk/media/universityofexeter/schoolof... · 2020-02-27 · 1 The long-term future for heat Adrian Gault, Chief

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Getting there requires effective roll-out of each option now – and associated investment in training, certification and supply chains.

Full infographic: see https://www.theccc.org.uk/wp-content/uploads/2016/10/Infographic-The-future-of-heating-in-UK-buildings-Committee-on-Climate-

Change.pdf

?

To

2050…

Low carbon heat by early 2030s in CCC scenarios:

1 in 7 homes & half of public and commercial buildings

Page 11: Adrian Gault, Chief Economist - University of Exetergeography.exeter.ac.uk/media/universityofexeter/schoolof... · 2020-02-27 · 1 The long-term future for heat Adrian Gault, Chief

http://www.theccc.org.uk

@theCCCuk

Page 12: Adrian Gault, Chief Economist - University of Exetergeography.exeter.ac.uk/media/universityofexeter/schoolof... · 2020-02-27 · 1 The long-term future for heat Adrian Gault, Chief

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Annex - Buildings heat policy: Five low-regrets areas and one that requires big decisions in the next Parliament