16:17 The Minister for Energy, Clean Growth and Climate Change (Greg Hands)

The UK is the first major economy in the world to set a legally binding target to achieve net zero greenhouse gas emissions by 2050. We are continuing to advance sustainability through the Prime Minister’s “Ten Point Plan”, the net zero strategy, and the heat and buildings strategy. Currently, heating buildings and industry is responsible for 21% of the UK’s greenhouse gas emissions. Decarbonisation of heat is recognised as one of the biggest challenges in meeting our climate targets. The Government’s ambition is to phase out the installation of new natural gas boilers beyond 2035. Heat pumps are a proven scalable option for decarbonising heat and will play a substantial role in any net zero scenario. A UK market with the capacity and capability to deploy 600,000 heat pumps per year by 2028 can keep us on track to net zero. However, the current UK market for low-carbon heat is relatively small and, due to that, these technologies are largely unable to compete on a capital cost basis with conventional heating options. Subsidy is required to mobilise and grow the market, and to bridge the cost gap between fossil fuel and low-carbon systems. The low-carbon heat market has been supported by the domestic renewable heat incentive, which will close to new applications next week, on 31 March 2022.

The scheme established by this statutory instrument will increase deployment of low-carbon heating technologies, making crucial progress towards our climate targets. Investing in this scheme will reduce our exposure to volatile prices and protect British consumers. It will also grow the retrofit market, put downward pressure on costs and expand the supply chain ahead of the introduction of regulations and market-based approaches later in the decade.

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16:22 Dr Alan Whitehead (Southampton, Test) (Lab)

I hope hon. Members will bear in mind a very important figure that the Minister mentioned: 600,000 heat pumps to be installed a year by 2028. That figure derives from the Prime Minister’s “Ten Point Plan” and is an ambition for the number of installations that we should reach, which will continue after that point at 600,000 or so a year. That, among other things, will get us more or less in line with what the Climate Change Committee has suggested on the roll-out of heat pumps to ensure that our heat decarbonisation targets are realised. That is therefore a key figure, and it should be the yardstick against which this measure is judged.

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16:34 Greg Hands

Heat pumps will play a substantial role in any net zero scenario, so we need to build the market for them now. This targeted support will help to grow the low-carbon heat supply chain to enable the proposed introduction of regulatory and market-based measures in the mid-2020s. Not only will investment in the scheme contribute to carbon reduction targets and increase consumer awareness of low-carbon heating solutions, but the creation of high-quality jobs will help with boosting the economic recovery, levelling up across the country and ensuring that we build back better. I urge the House to support this measure.

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