OFTEC and UKIFDA: Working on behalf of the industry

OFTEC’s marketing and external affairs director, Malcolm Farrow, describes two recent instances where the trade associations have acted on behalf of the industry.

Taking positive action when government advertising crosses a line

With BUS grant funding seriously underspent this year, the recently announced additional support for homes replacing oil or LPG looks suspiciously like an attempt to boost the flagging scheme, rather than a serious attempt to help rural households manage high energy bills.

That said, DESNZ has recently doubled down on promoting the changes, with a promotional campaign designed to encourage uptake. Unfortunately, the campaign takes more than a few liberties and OFTEC and UKIFDA have written to DESNZ to express their concern and ask some important questions.

As you might expect, the campaign includes supportive quotes from heat pump owners, and links to a series of mini case studies on the Nesta website. One quote is from an owner in Carmarthenshire and the Government press release states: “We’ve got down to -6°C this winter and it was still warm in the house. The technology is amazing…I would say to go for it.”

However, on the Nesta website the quote also includes a reference to high running cost: “The cost is the main factor, but it will get better value when they change the gas and electric unit pricing system.” DESNZ deliberately omitted this, misrepresenting the views of the owner.

Other examples signposted by the Government’s campaign included technologies that are not eligible for the additional grants. A further case study featured a home that was 90% rebuilt, changes so significant it should surely have been considered a new build – which also don’t qualify for grant funding.

Finally, the campaign focusses mainly on oil heating and makes no mention of LPG – despite the enhanced grants being available for both – which is clearly unfair.

At the time of writing, OFTEC and UKIFDA have not received an adequate reply, but we will keep the pressure on until a response that fully addresses our concerns is received.

Challenging the Climate Change Committee’s research

Every year in June, the Climate Change Committee (CCC) publishes its report to Parliament on what progress has been made towards achieving Net Zero. This year’s report contained some contentious points about the potential cost savings that could be achieved by switching from oil or gas to a heat pump, solar and an EV. For example, it claimed: Following the recent increase in fossil fuel prices, bills have increased almost four times more for a typical household with a gas boiler and a petrol car, compared to a household with a heat pump and an EV. For a rural household with an oil boiler and a diesel car, the increase is 10 times more.

Energy prices have risen since the start of the (Iran) war. Given this, a typical household with a gas boiler and petrol car would save around £1,210 a year by installing solar panels and switching to a time-of-use tariff, a heat pump, and an EV.

A rural household with an oil boiler and a diesel car could save around £1,880 a year by switching to a heat pump and an electric car, even without solar panels or a time-of-use tariff, compared to £350 before the Iran war.

As a result of the conflict, a rural household with an oil boiler and a diesel car would see a £1,700 annual increase in household costs, compared to £170 for the same household with a heat pump and an electric car.

It’s understandable that the CCC would wish to accentuate the positives. However, much of the underpinning data used to back up the claims was missing, and it wasn’t clear to what extent the savings were attributed to the heat pump, solar, or the EV. Perhaps most concerning was that the CCC attributed the highest annual savings to the recent Iran conflict, even though the spike in oil prices is likely to only be temporary. That means the claimed savings may not even be achieved this year, let alone over the lifetime of the products.

Consequently, OFTEC and UKIFDA wrote a joint letter to the CCC, asking for clarification on how the calculations were made and with an offer to meet, which was accepted.

The meeting was constructive and cordial, although what OFTEC discovered confirmed many of our suspicions. For example, despite including the upfront cost as part of the calculation, they had used a boiler efficiency for oil of only 78%. There also appeared to be a discrepancy in the calculation of the heat demand, and it became apparent that the EV accounted for a significant portion of the claimed savings.

More positively, the CCC asked for OFTEC’s and UKIFDA’s views on the barriers to decarbonisation.

This gave us the chance to explain the potential role of renewable heating fuels such as HVO. We also used the opportunity to describe some of the challenges faced by heating technicians, who could play a vital role but are largely excluded from the process by the way government funding schemes are designed. An offer to supply more information was accepted, and the CCC also agreed to provide further clarity on some key points.

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