Energy UK, the industry body for UK energy suppliers, published analysis on 1 November 2023 estimating the cost of what it calls inertia in the low-carbon heat market. The analysis compares heat pump deployment under the National Grid ESO Future Energy Scenarios (FES) "Leading the Way" pathway against the same pathway delayed by two years1.
Energy UK states that the gap between a hydrogen-heavy and a heat pump-led scenario amounts to whether or not 3.7 million heat pumps are installed between 2026 and 20301. On the delay scenario, it says this would mean 2.9 million fewer heat pumps in operation by 2030 and could lead to the UK importing £3 billion more gas between 2026 and 2030 than if conditions were created to grow the market1.
"Delaying the rollout of heat pumps by just two years"
The £3 billion figure rests on stated assumptions: that each heat pump replaces a mains gas boiler using the typical annual gas volume of 11,500 kWh, that gas at the margin is imported rather than produced domestically, and that the gas price used is the System Average Price for Q3 20231. Energy UK also cites the Government's Heat Pump Investment Roadmap, which estimated that up to £1 billion of investment in manufacturing could be unlocked by a growing market by 2028, and the Climate Change Committee's estimate that near total decarbonisation of the building stock is required under its balanced net zero pathway1.
| Measure | Figure |
|---|---|
| Heat pumps installed 2026 to 2030, hydrogen-heavy versus heat pump-led scenario | 3.7 million difference |
| Heat pumps in operation by 2030 under a two-year delay | 2.9 million fewer |
| Additional gas imports, 2026 to 2030, under a two-year delay | £3 billion |
| Assumed annual gas volume replaced per heat pump | 11,500 kWh |
| Gas price basis | System Average Price, Q3 2023 |
Energy UK also argues that uncertainty affects system planning, saying it hampers future system modelling, innovation in flexibility markets and demand side response, and risks delaying distribution network operators' decisions on where and when to upgrade the low-voltage network1. It notes that the RIIO uncertainty mechanism has typically operated slowly and has not been well placed to respond to short-term market changes1.
Why it matters for households
The analysis links the pace of heat pump deployment to the volume of gas the UK imports, and therefore to exposure to international gas prices. Energy UK's position is that a slower market means more imported gas over 2026 to 2030, which it connects to the stability of household bills and to energy independence1. For a household, the practical question is what is available and when: the analysis does not set out consumer incentives, grant levels or installation costs, and none of those figures appear in it. What it does describe is a market where manufacturers, installers and households are unable to take informed decisions about investment and business plans, which it says leaves the market suffering from inertia1. The policy and targets that would sit behind any change of pace are not detailed in the analysis beyond the existing deployment target.
What happens next
Energy UK says the Government should act to address the uncertainty and work with industry to deliver its target of deploying 600,000 heat pumps annually by 20281. No further dated steps are set out in the analysis.