Boiler Upgrade Scheme (England and Wales) Regulations 2022

Lord Oates Excerpts

Monday 4th April 2022 Grand Committee

I have a small second point. I was rather surprised to discover that installing a heat pump can actually have a negative impact on energy performance certificates. That means that, for a landlord looking to achieve the required EPC, there is a disincentive to install a heat pump. I have this problem as a landlord, albeit in Scotland—so it is devolved—but I think the same is true in England. That cannot make sense, so if the Minister could look at that I would be most grateful.

[Lord Oates (LD)]

My Lords, I too thank the Minister for his comprehensive explanation and for having spared the time last week, with his officials, to explain some of this stuff to me. It is welcome that we have a simpler scheme and that the Government are trying to understand that big schemes that cannot be met with the skills required, et cetera, do not bring any benefit. These are the key things that arise from the scheme.

The noble Lord, Lord Jones, raised the issue of skills, which are fundamental to everything in this area, not just in terms of heat pumps. As we green our economy, we have to ensure that we build our skills base. I know that the Minister talked about a lot of money having been spent on training under the previous green homes grant scheme and the money being spent by manufacturers. But we need to ensure that the Government, working with local authorities, skills providers and industry, are really looking across the piece about greening the economy and how we ensure that the skills are there to do it.

As I understand it, the grant scheme is to be installer led. That is obviously beneficial because the installers will, I hope, get used to that process, which will make it a bit less daunting for consumers. It is also encouraging that proper quality assurance is being required although, again, that clearly also constrains the ability to meet demand.

It is very important that all those installers will be required clearly to advise home owners on the appropriateness or otherwise of installing a heat pump in their property. As we have heard from the noble Lords, Lord Carrington, Lord Jones, and Lord Vaux of Harrowden, properties vary immensely. The performance of these pumps also varies and public confidence in the scheme should not be lost—as the noble Lord, Lord Vaux, said, it could really disappear overnight. If people feel that it has been oversold and they have been provided with replacements for their heating systems which do not achieve the heat and hot water that they are used to, or have been promised, we will have a real problem. I hope that the Minister will be able to reply to those important points that the noble Lord raised.

I do not have a heat pump in my own property. I sought to get one installed under the green homes grant scheme; unfortunately, that scheme came to an end, but my property was also said not to be suitable. It is clear that not every property is suitable and that we will really have to think about those which are not. Although a lot of rural properties may well have the space for a ground source heat pump, many of them may be old and poorly insulated and it may also be difficult for heat pumps to operate effectively there. I notice that, for off-grid properties, biomass boilers are to be allowed. In response to the question of the noble Lord, Lord Carrington, I would be interested to know whether liquefied natural gas made from the organic materials that he talked about would be counted as biomass.

We have also heard about two gaps in particular, one of which is the seven-week gap in this scheme, which is obviously an important concern for manufacturers. But we also heard about the gap raised by the Secondary Legislation Scrutiny Committee between the Government’s ambition of 600,000 heat pumps being installed per year by 2028 and the 30,000 each year over the next three years under the grant scheme and the 200,000-plus heat pumps it is estimated will be installed in new builds when the new future homes standard come in. There is still a big gap there, and I am not entirely convinced that the Government have thought through how they can match their ambition with delivery.

If we are to decarbonise domestic home heating in this country, we cannot rely simply on grant schemes. I know that lots of different schemes are running, which sometimes overcomplicates things for consumers, but we really need to have fiscal incentives in place as well to encourage home owners to take various measures that can help not only to decarbonise the heating system but reduce demand, because reducing the amount of energy that we waste must be one of the central things we do. We cannot have systems in place that disincentivise the installation of heat pumps via the impact that the noble Lord, Lord Vaux of Harrowden, explained on the energy performance certificates. It would be interesting to hear the Minister’s response on that as well.

Finally, we on the Liberal Democrat Benches commend the Government on their ambition in this area and on having learned some of the lessons of the green homes grant scheme. There is obviously an issue about how we meet this 600,000 target. I am not sure that all the detail is there, but we hope to hear more about it in the coming months.

[Baroness Blake of Leeds (Lab)]

My Lords, in debates such as this, from listening to the excellent contributions from my noble friend Lord Jones, and the noble Lords, Lord Carrington, Lord Vaux of Harrowden and Lord Oates, more questions come up as we go along. I look forward to the Minister’s response on some of the technical details.

I go along with the general response in welcoming the purpose behind the scheme. The ambition is clear. Obviously, the context is the imperative to decarbonise for our net-zero targets and energy security is absolutely at the forefront of everything we are discussing at the moment, but perhaps we have not dwelt enough on the link with the cost of living crisis and the real concerns we have about people being able to afford to heat their homes, as well as all the other challenges for people bringing up families, in particular, and older people, who are also making terrible decisions about heating or eating. There is a very complex background to this, as we have heard.

The main question we have running through this is whether the amount of funding available—I thank the Minister for the detail on the background to the upgrade scheme—realistically has a chance of delivering the number of conversions laid out in the proposals.

I go to personal experience. I have talked to people over the past few days who have been considering upgrading their boiler and heard clearly the reasons why, at this moment, they have decided not to go down that route. Of course, the fundamental one is cost, but efficiency is also a major concern. Noble Lords know my background in local government; I know that the Minister visited Leeds to look at a scheme for retrofitting housing. The biggest challenge we have is retrofitting and suitability for purpose.