Taxing gas to drive us to heat pumps would epitomise the miserable failure of net zero

A person using a central heating thermostat
A person using a central heating thermostat

Net Zero often entails replacing things that work with things that don’t. In power generation, we swap reliable gas turbines for intermittent wind. In transport, cars that can be refilled in minutes once a week make way for ones that need recharging for hours daily. But it’s heating where the Government is most keen to regress, by venerating heat pumps as a miracle solution to a problem that doesn’t exist.

Our current heating system, rooted in a gas grid that supplies 85% of domestic properties, works well. We are a chilly country where we are typically more likely to die from the cold than the heat, and this is unlikely to change substantially even with 2-3oC of global warming by 2100. Our ability to affordably heat homes has helped us live longer, happier lives.

Now the government wants us to switch to heat pumps, which do the same job as a gas boiler at a much higher cost. Their installation charges range from £7,000 to £35,000, their electricity-based running costs have typically been higher, and they are not appropriate for a range of older properties with poor insulation. They run at lower temperatures, requiring larger radiators, and their ability to do so efficiently falls in winter just when they are needed most.

This is not to say they're of no use whatsoever. In modern well insulated houses, particularly those built for colder climes, they work well. They are a good choice for many. What's odd is that the Government doesn't believe people can work this out for themselves. Rather than leave markets to decide on the pace of the roll-out, we have a target to install 600,000 a year by 2028, more than ten times the current pace of change.

This is could be met in two ways. The first is through existing schemes that make installation costs artificially cheaper with taxpayer funded £5,000 vouchers for qualifying properties, and welfare schemes for the vulnerable put on bills. The second is a proposal for penalising gas use by shifting the cost of billions of pounds worth of renewable subsidies from electricity to gas bills. The intent is to stimulate demand and drive the domestic industry to recruit and innovate, driving down costs than the market would if left to its own devices. The problem is the fundamental barrier to adoption: people simply don't want them.

Most government attempts to interfere with our home energy choices, from rooftop solar panels to smart meters, have been horrible failures, and where this isn’t true the intervention has been trivial. The shift to LED lightbulbs, for instance, was largely market driven.

Our politicians should learn from this. Decarbonisation fundamentally is an economic choice, not a planet-saving moral quest. It is right to nudge the market through consistent competitive carbon pricing that encourages better choices, targeting the cheapest options first. It is not right to try to micromanage every market through deployment targets, regardless of cost.


Andy Mayer is Chief Operating Officer and Energy Analyst at the Institute of Economic Affairs