Climate change: Financial incentives ‘essential’ for net zero switch

Heat pumps cost thousands of pounds to install

Financial incentives will be "essential" to get households to switch to lower carbon heating, research for the NI Utility Regulator suggests.

NI's energy strategy and net zero legislation will require a big shift away from oil and gas heating in the near future.

Across all socio-economic groups it was found the cost of making changes was "often considered prohibitively high".

The current lack of available public funding was discussed in the report.

It found that this makes consumers question the commitment of Stormont to support energy transition.

The UK climate watchdog, the Climate Change Committee, has suggested that Stormont's net zero commitments mean that by 2033 all new heating appliances being installed should be zero-carbon.

NI's energy strategy and net zero legislation will require a big shift away from oil and gas heating

That will largely mean the installation of heat pumps alongside much-improved insulation.

The Utility Regulator's research, which consisted of 10 focus groups, was carried out by the market research firm Ipsos in February and March.

There were also one-to-one interviews with 12 key stakeholders in the energy sector.

The findings suggest that:

• Consumers lack information on different options available to change how they use energy

• Upfront costs of installing new technology are consistently described as the most significant barrier

• The lack of financing options and grants may also contribute to a delay in making changes, as consumers wait for anticipated future financial support

The report concluded that: "Consumers need to be supported with public financing to encourage them to explore and undertake changes, especially given that such changes involve not only significant cost, but also disruption, risk, and uncertainty."

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Stakeholders suggested that finance options such as fully-funded grants, partial funding, and low-interest loans should be explored by public organisations.

The focus groups suggested a willingness for consumers to cover some costs, however, they also found that in general people had "little awareness of the total costs of renewable technologies or the specific costs for their own circumstances".

That therefore "made it difficult to have concrete conversations on willingness to pay, resulting in most consumers being unsure what they would be willing or able to contribute".