Renewable Subsidies Could Be Passed On To Gas Users

By Paul Homewood



What a tangled web we weave!



Electricity bills could be slashed to persuade homeowners to abandon gas boilers by 2035 under green plans to be outlined within weeks.

Nearly a quarter of consumers’ bills currently cover taxes to pay for policies, including subsidies for renewable energy and fuel vouchers for poorer households.

Ministers believe these additional costs are acting as a major barrier to get people to heat their homes on low carbon electricity alternatives such as heat pumps, at a time when gas prices are lower.

The Government wants heat pumps to replace 600,000 gas boilers every year from 2028, and will announce that costs will be removed from electricity in the coming years in its upcoming Heat and Buildings Strategy.

The move is part of an ambition to end the sale of gas boilers from 2035, and from 2025 in new homes, most of them to be replaced by air or ground source heat pumps, which use electricity to pull in heat from the air or ground to supply a hot water tank.

However, households switching to heat pumps are currently paying on average £408 more in energy bills compared to running a gas boiler.

A consultation announced in the strategy will decide how much of the 23 per cent of policy costs will be removed from electricity, and how the £10 billion they bring in will be recouped by the Treasury.

Options to recover the costs include transferring the levies directly to gas bills, or adding them to general taxation, but the Government is likely to be wary of any policy that increases taxes or drives up fuel bills.

Moving the costs directly from electricity to gas will make the average fuel bill for a home using a gas boiler around £70 more expensive, according to analysis by consultancy Public First, but would make running a heat pump £200 cheaper than a boiler. Gas boilers account for around 17 per cent of the UK’s overall emissions.

More than 23 million homes will have to make the switch, which currently entails thousands of pounds in upfront costs for equipment, installation, and retrofitting insulation….

The upcoming strategy from the Department of Business, Energy and Industrial Strategy (BEIS), is expected to include a replacement for the £1.5 billion Green Homes Grant, which provided £5,000 to homes for insulation measures, and was scrapped after just six months.

It is also expected to include extra incentives to help with the costs of purchasing and installing a heat pump, which are around four times that of a gas boiler. 


So we mandate extremely expensive renewable electricity, which makes consumers even more reluctant to move away from gas.  And then we then decide to switch some of this extra cost on to gas bills!

Talk about rearranging deckchairs on the Titanic.


It seems the Telegraph is finally waking up to the crippling costs of decarbonisation which is about to be dumped on the public. They now admit that heat pumps cost four times as much as gas boilers. And that insulation will cost thousands more. And that running a heat pump will also cost £400 a year more than a gas boiler. (The latter being something I have been pointing out for years).

Simply robbing Peter to pay Paul does not alter the fact that somebody has to pay. And governments clearly don’t have the money to.

Even if electricity prices were reduced in this way, I doubt whether it would make any difference at all to the uptake of heat pumps. After all, few people even know they cost more to run. What puts people off is the initial outlay, not to mention upheaval of installation.

For years, successive governments, aided and abetted by the media, have tried to cover up the true cost of climate policies. But now the truth is beginning to catch up on them.


May 8, 2021 at 08:03AM

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s