EE#24 Political priorities are undermining climate
Recent Tory decisions on clean heat are only to hurt Labour
We are governed by politicians, not by technocrats. Policy is always going to serve political aims. But at the moment the Government’s political aim is not to further the Conservatives’ electoral prospects but to make life as hard as possible for a Labour government so they are around for as short a time as possible. Recent decisions on heat decarb lay that bare.
The government has delayed the Clean Heat Market Mechanism. Dubbed the boiler tax by its opponents (gas lobbyists), it is, in fact, an incentive to shift production towards heat pumps, similar to the Zero Emissions Vehicle Mandate. In anticipation, rather than start shifting production some boiler manufacturers increased prices, hence ‘tax’. Government wary of this has kicked the can a year down the road so that Labour will have to implement it in April 2025.
Similarly, the government also chose to delay officially ruling out hydrogen as a viable option for home heating - despite the wealth of evidence in government’s own consultations, communications and from its independent advisors like the National Infrastructure Commission. Although the NAO this week also pointed to a DESNZ lacking evidence to proceed - something I'm sceptical of, as Chris Stark points out you could just make electrification the default.
This has two political implications. The first is short-term politics, but the second creates bigger challenges for net zero.
In the short-term delay provides two attack lines to the Conservatives from opposition. While the boiler tax argument has been levelled at them in power, it would be very easy for them to hop on that bandwagon and point it at Labour - especially as their wider attack lines on Labour’s climate plans boil come down to cost and who bears that. But second, the hydrogen heating decision is harder for Labour. One of its biggest backers, GMB, is pro-hydrogen. A lot of their members work in gas, and it’s the clearest continuity option for them. This creates a win-win for the Tories, either Labour has a big fight with GMB or the Tories can claim it’s in hock to unions, and, given hydrogen is so pricy, hammer the cost argument again.
This is annoying, but it’s manageable, especially so if the polls are right about the prospective size of the Tory Party next election. Ed Miliband seems bullish. But it’s the longer-term implications that are harder to deal with. Look at the heat transition in France and Germany you see that the more you condense the timescale, the harder things get.
Labour will “support the Clean Heat Market Mechanism” (the heat pump scheme scrapped until 2025 by the government). Labour will back the policy “very publicly, very clearly,”
In France, Heat pumps outsold boilers last year. The French installation rate is now ten times the rate of the UK. But that’s because the politics of clean heat in France is relatively easy.
France is an electric country, less than half of homes are on gas. Energy supply is dominated by the state-owned nuclear industry, which keeps electricity prices low. France is warmer than the UK and has more air conditioning. This means there is a broad business lobby in favour of heat pumps, and a consumer base that understands them. Industry lobbying and a lack of resistance from voters have built consensus across politics, even Le Pen backed heat pumps in her 2022 manifesto. Both Le Pen and Macron have gone big on increasing French manufacturing of heat pumps.
This strategy of boosting manufacturing and accelerating rollout is only possible because it builds on long-standing policy. France put heat pumps in new build standards in 2005 while energy companies offered subsidies to customers. The state has provided a 0% loan and grants since 2009. The only ‘new’ policy was a one-stop shop in 2022.
The politics in Germany are less pretty as I’ve written before. The country is due to miss its heat pump target by almost half (though still four times the UK rate).
Driven in part by the need to get off Russian Gas, the coalition government brought forward a new heat pump law in June 2023. The proposal was radical, seeking to ban new oil and gas boiler installations from 2024.
The immediate impact of a six-month timescale was a doubling of new gas boiler sales as people sought to get in before the deadline. But there were further consequences, despite the government’s electoral climate mandate and energy security message the bill met hefty opposition. The new law was weaponised by the right and far-right and met opposition from German industry (which makes a lot of boilers). Given the pace, there wasn’t time to win people over. The public was very sceptical and worried it would increase costs.
The law was watered down after the government spent months of infighting. The ban was delayed until 2028. It is now for large cities to create heating plans until 2026, which residents can consult to inform their heating choices. Yet, the law continued to flounder, grants were hit by uncertainty over legal wranglings on government investment, and falling gas prices slowed heat pump takeup.
The Tories presumably noticed the implications here. Industrial lobbying is central to success or failure. The Tories are trying to turn GMB and the gas lobby towards Labour and away from them.
The second is that this cannot be done quickly. France has gradually built to this level of ambition. But Germany like the UK had to act quickly after years of inaction on homes and buildings. Delaying for a further year will only make this harder. On hydrogen, without that decision, Ofgem, NESO and consumers all struggle to do their bit.
While I’m not generally minded to call the current government political masterminds, this is definitely been a smart bit of political strategy, and not great work by officials. It's just a shame it's one that is damaging to households and the climate, even if it is in immediate Conservative interests.