16:09 Graham Stringer (Labour)

Decarbonisation policies and renewable energy policies, both nationally and internationally, may not be in crisis but they are at a turning point. The Chicago climate exchange ended carbon trading, and a year ago the Copenhagen summit was not a success. Wind farms are increasingly criticised as an environmental blight as well as extremely expensive, and it has been noted that energy companies make three times as much money from wind farms as they do from coal and oil. The debate takes place in that context.

The 2009 European directive on renewable energy excludes low-performing heat pumps from making a contribution to renewable energy targets. It states that

From other data, we can deduce that that the EU implicitly requires heat pumps to achieve a COP of 2.875 before their energy contributes to the renewable energy target. The logic behind the EU requirement for a minimum efficiency level is that replacing a fossil-fuel heating system with a poorly performing heat pump may result in increased CO 2 emissions. That is because the emissions costs in the extra electricity requirement of a heat pump need to be balanced against the emissions of burning a fossil fuel.

In response to a parliamentary question, the Minister of State, Department of Energy and Climate Change, the hon. Member for Bexhill and Battle (Gregory Barker), confirmed that

The key point is that the nominal or certified design of coefficient of performance of a heat pump can differ radically from the efficiency after installation; so radically, in fact, that it can detract from rather than add to our battle against climate change. The Department of Energy and Climate Change is to subsidise heat pumps with taxpayers’ money at 5.5p per kWh for 20 years. That is an enormous amount of money committed for a long period, and we must be absolutely certain that taxpayers’ money subsidises only that which is renewable after installation and that which is good, rather than inefficient, not renewable and bad.

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16:23 The Minister of State, Department of Energy and Climate Change (Charles Hendry)

We need to recognise that many different types of technology are included in the concept of heat pumps. There are fundamentally different types, including those that use water, ground-source heat pumps or air-source heat pumps. We are looking at a policy that will drive investment towards them, because we believe, as the hon. Gentleman does, that they can make an important contribution in the battle against climate change. We can help individual consumers to understand the contribution they can make in their own homes towards tackling some of the problems we are facing.

We have been increasingly interested in heat pumps because the analysis of pathways to 2050 suggests that in almost all scenarios there is a high degree of electrification of heating in order to reduce greenhouse gas emissions by 80%. By that stage, the grid is projected to be mainly decarbonised, so electric heating offers a low-carbon alternative to gas. In that context, domestic heat pumps could provide an efficient way to raise the performance of electric heating. The International Energy Agency has estimated that heat pumps might contribute 6% of global CO 2 emissions reductions over the time scale.

By 2020, we also have to increase dramatically, for reasons of security of supply as well as climate change, the proportion of energy that comes from renewable resources such as solar or wind. Our level of ambition is suggested by our proposed contribution to the meeting of renewable energy targets. Those targets cover not just electricity, but heat and transport fuel. Heat pumps in that context, as long as they are efficient enough, count as renewable—or rather, the fraction of heat provided by the geothermal or aerothermal source, minus what the electricity produces directly, counts as renewable.

We aim to ensure that renewable heat plays a robust role in meeting our renewable energy targets for 2020. To help to achieve that ambition, we have announced that from June 2011, we will be launching a renewable heat incentive. Current scenarios suggest it will encourage up to 800,000 domestic or commercial heat pumps by 2020, but we are already supporting the installation of heat pumps to improve household energy efficiency and reduce fuel poverty. An estimated 2,245 ground-source heat pumps have been installed through the carbon emissions reduction target. Energy suppliers, who have to meet carbon emissions reduction goals, have increasingly chosen to meet their goal by the promotion of heat pumps in the domestic sector.

Turning to the specific issues raised by the hon. Gentleman, some heat pumps use hydrofluorocarbons—a type of fluorinated gas—as refrigerant. Such gases are greenhouse gases that come under the Kyoto protocol. Like stationary air conditioning and refrigeration equipment that also uses those gases—supermarket refrigeration, for example—heat pumps are subject to the provisions of a comprehensive EU regulatory framework, fully underpinned in the UK by domestic legislation. The framework aims to minimise gas emissions by ensuring that equipment is properly installed, serviced and disposed of. We are satisfied that the risk of HFC leakage is very small, but both the Department of Energy and Climate Change and the Department for Environment, Food and Rural Affairs are aware of the issue.

To conclude, I welcome this debate and hope that I have been able to reassure the hon. Gentleman on some of the issues that he raised. What strikes us the most clearly at the moment is the range of new technologies that are emerging at an extraordinary pace to deal with some of the challenges that we face on both the energy and the climate change fronts. We have to be sure, though, that those technologies work well. We believe that heat pumps offer the prospect of an exceptional contribution to meeting the challenges and the goals that we have set, but we must ensure that consumers understand what they are buying, that they get a good deal and an efficient product, and that it makes the contribution that we all hope for.

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