Britain’s misfiring wonder fuel condemns households to a heat pump future

Hydrogen

David Martin ditched the oil-fired heating system at his three-bed bungalow in rural West Wales three years ago. The 74-year-old widower installed a heat pump and solar panels instead, and has never looked back.

He says his energy costs were £347 in 2022 once sales of electricity from his solar panels were taken into account, with his bungalow “never allowed to go cold”.

Hundreds of miles east, near Peterborough, 70-year-old Sara Hawkes had a very different experience with the heat pump she had installed in 2018.

“In prolonged cold weather, mine ices up and stops the blades from turning,” she says.

The two households are early movers in a growing shift up and down the country as the net zero push reaches inside the home.

Over the next few decades, 23m or so UK homes will be asked to ditch their gas boilers for a cleaner alternative as Britain tries to cut its carbon emissions to net zero by 2050.

What will replace them has been the subject of fierce debate, with industry divided over the merits and pitfalls of the front-runners – hydrogen or heat pumps.

Recent developments have led to heat pumps gaining ground, with hydrogen still a long way off from being deployed in people’s homes.

Hydrogen-ready boilers are not yet on the market, and a growing body of research has raised questions about its usefulness for mass heating.

As the future of heating starts to take shape, is hydrogen’s potential role diminishing? And what does this mean for households looking to ditch their gas boilers?

“I think heat pumps are definitely in the ‘box seat’,” says Guy Newey, chief executive at the government-backed Energy Systems Catapult, “but there are still challenges.

“We’ve got to make sure that whatever technology is installed in people’s homes, people want it and welcome it.  Consumers have a veto on net zero.”

Heating UK homes is a major source of carbon emissions, accounting for about 14pc of the country’s carbon footprint.

None of gas boilers’ potential replacements are without challenges at a system-wide level, however.

Heat pumps are highly efficient, drawing warmth from the outside air, to produce more energy than they use to run.

They are powered by electricity, more of which in the future will be generated from green sources such as the wind and the sun.

However, that adds to the strain on the grid, which will already be trying to cope with increased demand from electric cars.

Studies suggest heat pumps more than double a household’s annual electricity consumption – and they will add to surges in demand at peak times.

The Government is considering introducing short, randomised delays to when appliances including heat pumps switch on, to help lessen the pressure on electricity grids.

Hydrogen, on the other hand, which does not produce carbon emissions when burned, can be produced at any time, transported through the existing gas network and used by the consumer in the same way as natural gas.

The gas is currently expensive and difficult to produce cleanly, however, potentially eating up vast amounts of clean electricity.

Many experts believe it will end up being prioritised in areas which have no other options for cutting carbon emissions, such as some parts of heavy industry.

Dr Jan Rosenow, an energy efficiency expert at the University of Sussex, recently reviewed 32 “independent” studies, and says they indicate hydrogen for domestic heating is less economic and efficient than heat pumps and other sources.

He says it “takes about five times more electricity to heat a home with hydrogen than it takes to heat the same home with an efficient heat pump, either individually or as part of a district heating”.

In a paper published in September, he added: “Despite the significant attention heating with hydrogen has received, independent evidence does not support wide-spread use of hydrogen for space and hot water heating.”

Meanwhile, households are starting to engage with heat pumps. More than 40,000 were installed last year – albeit a fraction of the 1.7m gas boilers put into houses.

Leading energy suppliers Octopus and British Gas have started something of a price war, with British Gas offering a heat pump at £1 less than its rival.

The Government’s confidence in heat pumps appears to be increasing, spurred by an Energy Systems Catapult report earlier this year that reported better efficiency than expected.

So are its efforts to ramp up the market. Ministers are pressing ahead with plans to force boiler makers to make a certain number of heat pumps, and to move levies off electricity bills.

Grant Shapps, the energy minister, is planning on getting a heat pump.

The Government does not intend to decide on its strategy for hydrogen in home heating until 2026, after trials have been carried out.

One of those planned trials has had a troubled start. Cadent Gas has had to promise households in Whitby, Ellesmere Port, they can opt-out and stick with natural gas, following an uproar at being forced to ditch their boilers.

Dr Angela Needle, director of strategy at Cadent Gas, says it’s still too early to determine hydrogen’s role.

“We expect the future energy system to have about 30pc hydrogen in it,” she says.

“The amount of homes that end up having hydrogen is quite difficult to say – it will depend on if there is enough hydrogen, and how much of the gas network gets converted.

“I think it will be somewhere between 30pc and 50pc, let’s say, but it comes down to choice for customers and how much it costs.”

As heat pumps gather pace there is a risk of choices narrowing, however. Gas network owners will, presumably, need a certain number of customers to make a pipeline commercially viable.

“It depends,” says Dr Needle. “There may be some streets where you say, this is a heat pump street, and we end up looking at decommissioning at some point in the future.

“But we are a long way away from that.”

Questioning the conclusions that can be drawn from the academic research studied by Dr Rosenow, she asked: “Do they [the studies] cover the whole value chain of production of the energy to consumption? Are they relevant for the UK energy system?”

With so much yet to play for, investors are still hedging their bets. Brookfield Asset Management, the $800bn asset manager chaired by Mark Carney, the former Bank of England governor, paid £4bn for the UK home repairs and boiler installer HomeServe last year.

Through its Thermondo subsidiary, it installed hundreds of heat pumps in Germany last year. It also owns a stake in UK gas pipeline owner Scotia Gas Networks.

“We think that there's a range of decarbonisation technologies which will be critical to reduce household emissions in a cost-effective way,” says Louis Socha, who leads on Brookfield’s strategy for residential decarbonisation in Europe.

“There'll be use cases for hydrogen; it obviously has benefits. But also we think there’ll be millions of homes that will be retrofitted to heat pumps over the long term.

“We  see benefits to both – we want to remain agnostic. We’re focused on providing consumers with the right package.”

For households wanting to ditch their gas boiler right now, however, the slow progress on hydrogen means there is little choice other than a heat pump.

Getting the best possible installation is the best advice for those that do. The range of experiences is stark.

“The only way to stop [the heat pump icing up after initial defrosting] is by pouring warm water from a watering can over it,” says Mrs Hawkes.

“As you can imagine I'm very happy,” says Mr Martin. “I really feel for the people who have been struggling this winter.”