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The UK needs a new plan for phasing out boilers. What are the options?

The UK government had penciled in 2035 as the phase out date for gas boilers, after which no household would have been allowed to install one. This was set out by then-Prime Minister Boris Johnson in the Heat and Buildings Strategy in 2021.

But now the status of that phase out date looks uncertain.

The previous government watered it down considerably and, before being appointed, Energy Secretary Ed Miliband made a pre-election promise not to press ahead with a 2035 ban on boiler sales.

While the Future Homes Standard (which will prevent fossil fuel boilers being installed in new homes) should come into force in the next few years, it's not clear whether such a phase out will ever be extended to existing homes.

The UK government is still developing its Warm Homes Plan, which should include a policy announcement on phase out dates, but with the recent direction of travel it makes sense to consider alternatives to the 2035 date.

What was the case for the phase out date?

The Climate Change Committee recommended a 2035 phase out date in its advice on adopting the net zero 2050 target.

The idea was that if the average boiler has a life span of 15 years, and the UK needs to hit net zero by 2050, by preventing the installation of new boilers after 2035, most of them should be replaced in time.

This phase out date was arguably the most important part of the UK’s strategy for decarbonising home heating.

It gave the heating industry a very clear signal on what it had to aim for - the technology, skills, capacity and workforce to install low carbon heating systems for every home that needed one by 2035. Most importantly, it was designed to be a gradual rather than sudden change, with the very long lead in time enabling both the industry and consumers to prepare.

Contrary to scare stories there was never a plan to “rip out” functioning gas boilers – instead to simply replace them with a low-carbon alternative when they naturally reached the end of their lives.

What are the alternatives?

If the UK government does want to move away from a phase out date, there are three approaches it could take, all of which could be used alongside each other.

Option 1: Leverage the Clean Market Mechanism

One option is to lean more heavily on the Clean Heat Market Mechanism.

This policy requires boiler manufacturers to install a certain number of heat pumps each year for every 100 boilers they install, providing a signal to industry about how quickly they need to scale up heat pump sales.

It will be set at 6 heat pumps per hundred boilers this year, roughly 90,000 heat pumps in total, and then scaled up from there.

What government could change, under this option, is to set out a much clearer forward trajectory for heat pump installations over a number of years. Given how quickly the UK needs to move to stay on track with its climate commitments, that could mean scaling up to 100 or more heat pumps for every 100 boilers by 2030.

However, the Clean Heat Market Mechanism might only work in the short term.

Once you get above that 100 heat pumps for every 100 boilers mark, there’s a risk that the incentive starts to lose effect, and boiler manufacturers just start to leave the market rather than install heat pumps.

Filling the gap from 2030 to 2035 – where we need to go from a little over half of all new heating systems being low carbon to all of them being low carbon – may require further policy.

Option 2: Encourage people towards clean heat

A second option is to rely more on encouraging people towards heat pumps and low-carbon heating rather than relying on boiler bans as drivers for change.

By making heat pumps and low carbon heating the more financially attractive choice, consumers can be moved by the carrot, in place of the stick.

There are several things the UK government could do here.

For example, reforming levies on energy bills to make electricity cheaper relative to gas will make heat pumps a much more attractive choice, and is an essential step whatever policy the government pursues on heat.

The biggest sticking point, though, is on subsidies.

If the government were to commit to continuing with subsidies at the current rate of £7,500, heat pumps could get a lot cheaper than boilers over their lifetime (when combined with reforms to energy prices, and better and cheaper product offers from manufacturers). However, the cost to the public purse would be steep: if all of the 1.5 million or so heat pumps we need to install every year from the mid-2030s attracted this level of subsidy, the cost to government could be over £10 billion per year.

There’s also plenty more that the heating industry can do to make heat pumps more attractive like improving the customer experience, lowering upfront costs and increasing efficiency.

Option 3: Phase out the gas network locally

One of the challenges of the transition to low carbon heat will be winding down the gas distribution network as the cost of maintaining it outpaces the number of customers.

If say by the early 2040s most homes have replaced their gas boilers, the households remaining on gas may face a steep increase in bills or it may simply become unaffordable to keep the gas grid operating at all.

It’s likely that the adoption of heat pumps and the transition to low carbon home heating will be unevenly distributed - with some areas moving at a faster pace than others. This means maintaining a gas grid could be viable in some neighbourhoods, conurbations or regions but not in others.

Instead of this being a problem, it could be an opportunity for the UK government to help guide the phase out of gas boilers.

Setting local switch off dates for the gas grid - combined with targeted financial support, assistance to households that have switched, and incentives for those that have yet to - could achieve a phase out without setting a single national date.

This option has some big advantages. It could enable a smoother transition and keep costs lower (and maybe let households benefit from economies of scale from buying together).

By avoiding a single, national phase out date, different areas would be allowed to move at their own speed, whilst giving time to assemble the infrastructure required to make fully low-carbon heated neighbourhoods work.

In order to take this path governments in the UK would need to adopt a more coordinated approach to low carbon heating and invest in local capacity to manage a heating transition. Nesta is currently working on what such an approach would look like.

However, a series of local phase out dates may provoke a similar reaction to any hard date for a single national phase out. How would governments or local authorities decide which areas are to phase out when? This option has a lot to commend it, but it is not necessarily the easy option.

Reinstating the 2035 phase-out is still the best course, but alternatives are worth considering

On balance, looking at these available options we think there is a strong case for recommitting to the 2035 phase out date for the installation of new fossil fuel boilers - in our opinion the most straightforward policy option.

Despite the nervousness around the 2035 ban, there’s not much evidence that it’s actually controversial with the public: testing by our friends at the Behavioural Insights Team found 71% of people either supported or did not oppose the phase out date.

However, it's clear that the 2035 phase out date is not the only way to move the UK towards no longer installing boilers, and nor would the policy solve everything on its own.

Whatever policy mix ministers decide on, it must provide a clear route to ending fossil fuel heating in homes, and it needs to be decided quickly. The sooner we start preparing for a world without boilers, the smoother the process should be.

Author

Andrew Sissons

Andrew Sissons

Andrew Sissons

Deputy Director, sustainable future mission

Andrew is deputy director on Nesta's mission to create a sustainable future, which focuses on decarbonisation and economic recovery.

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