Plan to switch green surcharges on bills ‘a powerful idea’
A plan to switch green surcharges on household electricity bills to gas bills to encourage consumers to move to lower carbon alternatives is an imaginative idea, says a Midlands green energy expert.
Ron Fox was commenting on a scheme which would mean people who heat their homes with electricity or drive electric cars would pay less, while those who continued to use gas boilers would pay more.
The proposal, expected to be announced within the next fortnight, would be brought in over the next ten years. That is to ensure that spiraling gas prices would not stop the Government’s aim of eliminating all net carbon emissions by 2050.
“It is a sensible idea when you consider 23 per cent of the cost of electricity is made up of environmental and social obligation costs, while bills of the pollutant gas include less than 2 per cent of those costs,” said Ron, of Noreus Ltd on the University of Keele Science and Innovation Park in North Staffordshire.
“It will encourage people to consider buying heat pumps and electric vehicles, especially as installing new gas boilers will be banned by 2035 and the sale of petrol and diesel cars will stop by 2030.”
He said the problem is that homes emit 23 per cent of the UK’s greenhouse gases with heating 17 per cent, hot water 4 per cent and cooking 2 per cent, and while the electricity network has gone green with 2020 being the first year that renewables overtook fossil fuels, other heat networks have not been so successful.
However, Ron said the announcement now is likely to prove controversial as household and industrial gas bills, which rose 10 per cent in April, are set to go up by 12 per cent this month and to rise even further in April next year due to the “price cap” set every six months by Ofgem, the energy regulator. The cap depends mainly on wholesale energy prices, which have risen sharply this year.
He said one alternative to gas boilers are heat pumps which work by using small amounts of electricity to collect heat from cold spaces, which is then released into warm areas. But he said the home must first be super insulated.
Both air and ground heat pumps are reliable all year round and as they use natural heat and they do not emit any greenhouse gases.
The cost of installing a heat pump is around £9,000 to £12,000 with running costs ranging from £870 to over £1,000 per year for a four-person household for both heating and water. But it should lead to lower energy bills as a large amount of heat is produced from a small output of electricity.
Also, having a heat pump fitted qualifies for Renewable Heat Incentive (RHI) payments which could be around £1,300 for a ground source heat pump or £2,500 for an air source heat pump.
To find out more about heat pumps call Ron on 0845 474 6641.
Caption: One alternative to a gas boiler is an air source heat pump.