A Censuswide survey for Ecotricity found two-thirds of 1,000 heat pump owners reported higher heating costs last summer. Heating and transport produce over 40 per cent of UK emissions, but progress on shifting from gas boilers and petrol cars is falling short of targets due to misplaced government priorities. The Government’s focus on reducing emissions from electricity generation — which makes up only about 10 per cent of total emissions — is raising electricity costs and discouraging adoption of heat pumps and electric vehicles.
The Government claims renewables will boost energy security, cut emissions and reduce bills by lowering dependence on imported gas. But is this true, or is cleaner electricity taking priority while heating and transport fall behind?
The cost of clean power
While renewable energy generation is inexpensive, delivering it requires a costly system. The true cost depends on what is measured, and focusing only on generation overlooks the expense of the entire system. Electricity must be dependable, needing backup generation and a robust network. UK peak demand is 45GW, while previous systems supplied about 60GW using coal, gas, and nuclear. With renewables, around 120GW of capacity and a larger grid are required to transmit offshore wind energy.
While figures vary, renewables are making the energy system bigger, more complex, and costlier. These expenses are reflected in bills, with grid expansion raising network charges. ‘Balancing costs’ also include payments to wind farms to shut down when excess electricity can’t be used. The UK has abundant offshore wind, a costly renewable resource. Solar power is cheaper due to mass production, mainly in China, but Britain’s climate limits its impact, especially in winter when demand peaks. Offshore wind is more reliable but involves complex projects that haven’t benefitted from similar cost reductions.
The cost of progress
The UK has reduced emissions by about 50 per cent since 1990, but this doesn’t reflect its true global footprint. Many goods now produced abroad and imported to Britain are made in countries with higher emissions, like China, which relies on coal for over half its energy. As a result, emissions have largely shifted overseas rather than been cut overall. The 50 per cent figure excludes aviation, shipping, imports, and exports — including these factors, emissions have dropped by about 20 per cent since 1990.
In addition to impacting household expenses, elevated system costs affect the broader economy. UK households face some of the highest electricity prices in European markets, with an even greater impact on businesses. Gas remains the primary factor in UK energy costs, even with significant reliance on renewables. Power generators bid in half-hour blocks, but prices are set by the most expensive source needed to meet demand — usually gas. While renewables produce much of the electricity and are cheap after installation, gas plants typically dictate market pricing.
The politics and energy
Great Britain’s higher energy costs have contributed to several closures of energy-intensive industries, described as a ‘national act of self-harm’, with calls for an urgent independent review of the country’s approach to Net Zero.
The politics of climate change has begun to shift. The Conservative Party, which set the 2050 Net Zero target in 2019, has since reversed its position. Reform UK says it would abandon ‘net stupid zero’ altogether. Even the Green Party has criticised aspects of government policy, saying the current approach is not delivering for ordinary people.
Polling suggests the public continues to support decarbonisation, with four in five Britons believing it is important the government addresses climate change. However, cost remains a key concern, with energy bills among the most frequently mentioned issues.
The hard truth
Reducing emissions depends on persuading people to switch to electric technologies such as heat pumps and electric vehicles. But decisions often come down to cost. If electricity is expensive, households and businesses have little incentive to make the switch. If it is cheaper, the transition becomes easier and faster.
Senior academics, the Conservatives, and the Tony Blair Institute argue that slowing the pace of renewable expansion and maintaining a larger role for gas in the short term should be considered. However, while using fewer renewables could ease system cost pressure, it risks slowing the pace of emissions cuts.
The UK needs to face up to a hard truth: tackling climate change has a cost. As costs rise, bills increase and living standards may fall. There is no easy way around that. The thought behind today’s push for clean power is that countries like the UK can show it is possible to decarbonise the grid without imposing unacceptable costs — and in doing so, lead the way for others. But there is a risk: if the transition here in the UK drives up costs and erodes public support, it will not be a model to follow, but a warning to avoid.