Gas boilers will be gradually removed and replaced with cleaner alternatives. By the mid-2030s, the government hopes that all newly installed heating systems will be low carbon models or be appliances that are hydrogen-ready for future conversion to hydrogen supply. However, the government says it expects gas to continue to play a role for at least the next 10 years.
Decarbonisation of heat will require multiple solutions, including heat pumps, hydrogen, green gas and heat networks.
One of the key goals is a massive ramping-up of electric heat pump installation from 30,000 per year to 600,000 per year by 2028.
The potential for hydrogen heating is also being explored, with a proposal for a pilot hydrogen-heated town before 2030. One option could be to adapt existing gas infrastructure for hydrogen distribution, supported by the government's plan to consult on the role of “hydrogen-ready” boilers next year. Energy efficiency is a quick and cost-effective method of decarbonising buildings. As first announced in the Prime Minister’s Ten Point Plan, the Public Sector Decarbonisation Scheme, launched in September 2020, is to be extended for a further year. The £1 billion first tranche of funding is expected to cut emissions by up to 1.3MtCO2e by 2032.
We are expecting a Heat & Buildings strategy, a UK Hydrogen strategy and an Industrial Decarbonisation strategy in the first half of 2021. This will provide more detail on the policy frameworks and funding for these sectors and Centrica will be discussing these strategies with the government in the coming months.
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