One of the great problems facing the policy – proposed by both Labour and Conservative – to decarbonise domestic heat by replacing gas boilers with heat pumps is that it’s fundamentally uneconomic. As I pointed out in a recent paper for GWPF, while air-source heat pumps are, on average, three times as efficient as gas boilers, electricity is four times the price of gas, so unless your installation is much more efficient than the norm, you will not see operating cost reductions from a heat pump, let alone pay back the extra capital cost.
One of the wheezes dreamt up to address this issue is to remove all the renewables subsidy costs from electricity bills. This has been suggested by the Climate Change Committee today, and the simultaneous picking up of the idea by the BBC and others suggests a fully fledged Green Blob campaign in support of the idea is under way.
Given that the subsidies are for, well, electricity generation, the policy would further divorce consumer bills from the underlying economic realities, and it would therefore be expected to cause harm to the public at large, but it’s interesting to consider just how much harm.
To that end, I’ve done some rough calculations, taking the £13 billion of renewables subsidies and allocating them elsewhere so as to give a flavour of the price changes that might result.
One possibility is to move renewables subsidies to general taxation. However, this only reduces the electricity-gas price ratio to 3.3, which is still higher than the typical efficiency of a heat pump. This means most heat pump installations wouldn’t give an operational saving compared to a new gas boiler, and few would give savings sufficient to justify the extra capital cost.
Another alternative is to move the subsidies to gas bills. Here there are two key observations. Firstly, the policy would increase the cost of gas by around a third, from its current level of 5.4p per kilowatt hour to 7.3p. This would be pretty serious for householders, and it would potentially be terminal for businesses. It’s quite likely that many would go out of business, which would leave householders picking up the cost anyway.
Secondly, the policy would still not deliver on the Government’s decarbonisation plans, since the ratio of electricity to gas prices would only decline to 2.5. This figure would mean that more than half of air-source heat pumps would deliver operational savings, but very few would give a payback on the extra capital cost involved.
A third possibility would be to shifting the renewables subsidy costs onto retail consumers alone. If that were the case, businesses would be okay, but gas prices for householders would nearly double, to 10.9p. This is above the highest level of the price cap at the height of the price crisis, so it’s fair to say that it would be a hard political sell. Excess winter deaths would undoubtedly soar, and it’s hard to imagine that the public wouldn’t take to the streets. However, the electricity-gas price ratio would fall to 1.67, which would be enough to make a heat pump give both operational and overall savings for most installations.
But this is true only if the subsidies for heat pump installation continue at their current, grossly inflated level of £5,000. Without this bounty, heat pumps would still not make economic sense for most people.
And this is where we get to the title of this article. The installation subsidies and the shifting of renewables levies onto gas bills (if it happens) can only ever be temporary. The installation subsidy is already only available to those replacing gas boilers, of course; next time round, you will pay full whack. Similarly, once everyone has a heat pump, the windfarms are still going to want their subsidies, and so the levies are going to have to go onto electricity bills.
This means, at some point in the future, the innocents who have, at Mr. Miliband’s prompting, dutifully ripped out their gas boilers in favour of a heat pump, will suddenly find that their bills have soared. The cheap energy prices that lured them in will be gone. And when the time comes to replace the heat pump unit, it will cost many thousands of pounds more than it did the last time round.
The Government is engaged in a classic bait and switch – possibly the greatest bait-and-switch of all time.
Don’t fall for it.
Andrew Montford is Director of Net Zero Watch.
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Never much of serious consideration for me as I would have nowhere to put it. Smallish Victorian terrace house, I would have to destroy half the kitchen. That place where you prepare food to stay alive. But we all know that if you a mere prole, being alive is of no importance to those in charge.
Simply put , this is an example of our elected representatives voting to dump on the people who elected them . In other words , these are Crooks Conning the Public into a position many will not be able to afford .
Good conversation between Ivor Cummins & Sovereign Pete.
https://www.youtube.com/watch?v=5w30KzL9qNc
Now that is interesting!
You can’t beat a good Wood Stove. Though I would’ve bought one with a cooking Hub if it came to mind!
Agree Ron.
Correct about the cooking hub but who would ever have thought we’d be discussing such a topic in 2024?
We won’t even be able to have animal dung fires. They want to cull the cattle.
Our local authority (Wakefield) has just announced the first home-owners have been fined for “non-compliant” wood burning stoves. We can all see where this is going – they’ll progressively reduce the maximum permitted emission levels to ensure that, eventually, no wood burning stoves comply.
If the Globalists get their way, we are at a crossroads I’d say. My stove was only installed 18 months ago so is efficient.
Our central heating system uses 8mm pipe work. I’ve been told these are too small for use with a heat pump. If this is true then they would have to be replaced and the cost would be prohibitive to say the least.
It’s true.
It would also mean all your floors would have to be taken up to fit the new pipes so you might need to move out for a couple of weeks while the work is done. I rent and have nowhere to go if my landlord (the council) decide to gut my flat to fit a heat pump and larger pipes. Bet nobodies thought about the millions of tenants in a similar situation.
Correct. You will need 22mm dia. circulation pipes (at least). Your better half will love the look of these pipes running round your rooms and up your walls.
I have the same problem and also, as my 2001 house is elevated (to mitigate flood risks), it has a concrete slab foundation rather than more usual concrete strips. So no way to run pipes under the floors.
Then there are the noise problems.
Heat pumps might be appropriate (if ridiculously expensive) for new build, especially if you can install a ground source system. And if you can have a back up heating system for hot water and for very cold weather.
Nonsense on stilts. Again.
Most ground source systems need a large garden, or equivalent. The vertical sort are more economical with the ground needed, but not so economical with the cost.
Why not just have the backup system, like Gas?
No one protested when the government told us we could only use certain types of light bulb. Maybe we should of realised that once they got away with banning certain things they’d move onto others, or at least try to force use “greener” alternatives, such as heating systems and cars.
You can still purchase good old filament bulbs in the shops. The shops are obliged to label the box “not for domestic use”, and that’s that.
True. But modern LED bulbs are fine – produced by private industrial innovation, long lasting, a choice of ‘warmer’ or ‘cooler’ light, far cheaper.
Those promoted by HMG and supplied by the electricity distributors (especially the “twisty” fluorescent bulbs) contain Mercury. If you break one you should get your Hazmat gear on and de-contaminate to room. Good luck. In addition, absolutely horrible and takes ages to illuminate properly.
An object lesson about how useless innumerate and scientifically illiterate politicians are at picking winners.
There are some indications that coefficients of performance significantly larger than 3 are possible. One undoubtedly skilled engineer has a good youtube channel on the subject. See for instance https://www.youtube.com/watch?v=bXaPAOUNWI4&t=29s in which COPs well over 4 are obtained.
But it’s not just the running cost that is the issue. I pressed for total installation costs and the replacement of an oil-fired boiler with a heat pump cost about £16,000. Some of that is the cost of the kit: some is the high cost of the skilled labour which is required: one is replacing a relatively simple gas or oil boiler system, which delivers reasonable efficiency when set up by a relatively unskilled engineer, with something that is much more expensive and sophisticated…and much harder to set up well.
The same applies to annual maintenance, repairs and ultimate replacement. A heat pump is, like a car air conditioning system or refrigerator. The heat pump pumps heat in and the last two pump heat out. Refrigerator and aircon engineers are in short supply because the job needs patience and care and I wouldn’t like to rely on the supply of them to ensure that my heating worked in winter.
In some areas of West London there is already a break on new developments as the electric supply infrastructure is already at full capacity. I am sure there are others on here better qualified than me to comment but can our current supply infrastructure cope with a big switch to heat pumps?
Again this is not something I know much about but my understanding is that as heat pumps have a compressor they have a high start up electrical requirement and thus they need cabling and fuse protection for cope with the start up draw. Again, how many houses have an input supply cable capable of adding the load of a heat pump, plus also the load of an EV charger.
Are National Grid of whatever the local provider is called going to have to call a halt on new heat pump and EV charge installations when the supply infrastructure is maxed out? I think both heat pump and EV charger installations are part P certified and so I guess the authorities could control the installations via that system?
And as an extra sting for us smart meter refusniks, my understanding is that the installation of a heat pump must go hand in hand with the installation of a smart meter.
The electricity supply to virtually all domestic properties is inadequate for a heat pump equivalent to a gas boiler. I raised this and got a rubbish response claiming I could get a 100A supply. This is not enough to meet a total demand for an electricity only house. I have oil heating, still the cheapest. My peak load is around 60A which covers an air source heat pump used to provide air conditioning – cooling – in a garage. Add an EV and that would be well over what is feasible.
Smart meters solve the problem because, as is contained in the recent energy legislation, the supplier can switch off loads under remote control. I.e. rationing.
Near where I live in Fife Scotland 260 households signed up to have Hydrogen in a recent project as their heating source instead of gas. The roads were all dug up and people were given the piping etc to their houses and free boilers. One person in the area decided not to have it and to keep his gas boiler. The reason was that he did his sums and found that after the initial bribe of free boiler etc that the cost of the hydrogen would be excessive. A very wise man indeed. This is the problem with a large chunk of the public. They take the words of government and media on the issue of climate and energy at face value and believe most of it. But on this issue what people are being told is at best a smidgeon of the truth and mostly a bare faced lie.
Heat pumps will be the next mis-selling scandal. The manufacturers claim 300% efficiency; so if I input 1kW of electricity you get 3kW of heat!
theoretically this is correct, in ideal circumstances… which rarely exist in the real world, and especially the UK
Apparently excess winter deaths are of of little importance to the climate change alarmists. They would far rather focus on the much fewer deaths in the summer, despite that being far less scary.
Rather like the bait and switch for all those virtue-signalling (or naive) middle-class idiots who bought an expensive EV thinking they would be safe from road tax, ULEZ etc.