Decarbonising heating at home: Learning from past successes and failures to improve energy policy making

With the Green Homes Grant cancelled just nine months after its high-profile launch, this report warns the government will fail to decarbonise the UK’s domestic heating – essential to hit its 2050 net zero target – unless it learns from the scheme’s failures. This means resolving the conflicting priorities of the Treasury and BEIS and doing more to ensure that government energy policy aligns across major departments.

The report sets out a series of recommendations ahead of the publication of the government’s much-delayed Heat and Buildings Strategy – which must provide a clear roadmap for achieving the government’s clean heating goals.

While government support has seen the cost of renewable energy drop, too few houses are being insulated, and too few households have switched to low-carbon heating technologies. Domestic heating accounts for around 14% of UK emissions, and decarbonising the way homes are heated – meaning more efficient homes and the electrification of most heating systems – will cost an estimated £200 billion over the next 30 years.

There have been successes: government policies have started to improve the energy efficiency of privately rented homes, and regulations requiring more efficient boilers have driven a decline in greenhouse gas emissions from heating. But the Green Homes Grant is another example – following the spectacular failure of the coalition government’s Green Deal in 2013 – of government energy policy badly undermined by poor delivery, an overly-optimistic timescale, and a lack of coordination between government departments.

Drawing on lessons learned from key officials involved in the Renewable Heat Incentive (RHI) in Great Britain, and the minimum energy efficiency standard (MEES) in private-rented housing in England, both of which suffered from weaknesses in their initial design and delivery, the paper sets out five key lessons for the government to improve energy policy making:

• Central government policy makers must put implementation at the heart of policy design. 
• Use more trials and experiments to learn which policies work, and then be ready to scale up.
• Give more sustained attention to the development of technologies, skills and the supply chain.
• Improve policy development coordination between key departments, particularly BEIS, MHCLG, and the Treasury.
• Give BEIS and MHCLG the resources they need to design effective policies.