Net-zero: the bubble bursts?

By Richard North - December 22, 2023

It can’t really be said that the nation as a whole is winding down for Christmas yet, and the poor weather (so unusual for late December) through the last few days hasn’t made life any easier.

However, one certainly gets the impression that the media have given up any serious pretence at covering the news – apart from those engaged on the latest mass shooting horror. In the main, the politicians are less visible than normal, even if Starmer is taking a bit of a ribbing for dressing up in combat fatigues in order to visit an Army unit and make some asinine comments about Israel.

Politics, though, never truly dies. A sharp spike of commentary dominated yesterday evening’s late news that the government unexpectedly announced a climb-down in its plans to increase the minimum salary requirement for British nationals bringing foreign family members to the UK.

It had originally announced only a couple of weeks ago that, from April 2024, British citizens or those with leave to remain, would have to give proof of earning £38,700 annually they could be joined by overseas partners – a stiff jump from the current threshold of £18,600.

This provoked much wailing and gnashing of teeth in the left-wing media, with the Independent branding the new policy “cruel”, followed by the lawfare machine cranking into action with plans to mount a legal challenge.

No sooner was that threat on the table, it seems, then the government was backing down – as it always seems to do every time there is an immigration issue involved. The proposed threshold has been miraculously lowered to £29,000 as an “interim” stage. No timescale has been offered for the introduction of the higher level.

This, as Pete points out, fits with the broader pattern of the Tories kicking any difficult issues into the long grass, making U-turns the moment the whining starts.

But shadow home secretary Yvette Cooper, cited by the ever-receptive Guardian, also has a point when she says that this latest move is “more evidence of Tory government chaos on immigration and the economy”.

Perhaps of more significance is that it is confirmation – if any were needed – that the government still doesn’t have a handle on border control. Its fond dreams of reducing next year’s legal migration figures by as much as 300,000 can, along with all the rest of Sunak’s empty promises, be taken with a very large dose of salt.

There is a thing about pre-Christmas news stories, though, that the festivities tend to act as a firewall so that few but the most prominent – if any – survive the break. As the media picks up again for the New Year, it tends to start with a clean slate.

That gives plenty of opportunities to second-guess which stories will make the cut, and carry though unabated into the new session, and one domestic subject that I think is going to hold the attention of idle hacks, and even grow in magnitude, is net-zero implementation and, especially the heat-pump policy.

When I returned to this subject just under a week ago to discuss what is officially known as the “Clean Heat Market Mechanism”, I had thought that it was one of those flash-in-the-pan stories with very little in the way of legs.

It’s fair to say, therefore, that I didn’t expect to be covering the same issue days later or, that having done so, there would still be some mileage in it.

What has possibly made the difference is that the unwieldy “Clean Heat Market Mechanism” has been dubbed the “boiler tax”, which gives it a certain resonance in what might be called populist sections of the media. But the new handle all seems to have inspired something of a political revolt, where a small number of right-wing Tory MPs seems to be in the throes of setting up a Commons rebellion.

Here, things start to get interesting. As I pointed out earlier, in order to implement the “tax”, the government needs to promulgate regulations, made under the authority of the Energy Act 2023, which itself has only recently gained royal assent.

Most likely, these will be laid before the House – as the procedural term goes – in the form of secondary legislation requiring what is known as “negative assent”.

This means that, the regulations have to lie in the House for a period of 40 sitting days and, unless formally challenged, they are automatically deemed to have the consent the House and can no longer be laid aside by parliament.

The challenge procedure is, as one might expect, arcane, rarely undertaken and even more rarely successfully so. It requires MPs to “pray against” the regulations, the “prayer” in modern practice taking the form of an Early Day Motion.

This is signed by MPs during the 40-day period (during which time, incidentally, the regulations can come into force, even without MP’s approval). It doesn’t require the majority of MPs to sign it, but the more that do, there more likely there is to be a debate and a vote.

Barring an absolute majority of MPs signing, the government can ignore the “prayer” so it is usually down to backbenchers to make a nuisance of themselves, disrupting government business and the many other tactics they can employ, in order to force the issue.

Even then, the government can skirt the issue by arranging for the debate to be referred to a committee, where an inbuilt government majority can ensure that the regulations are given safe passage.

The secondary legislation route was the one adopted for implementing most EU legislation and attempts to overthrow such regulations were usually stonewalled on the basis that throwing them out would breach the UK’s “treaty obligations”.

This same trick could be tried again, with the government arguing that the “Clean Heat Market Mechanism” is a necessary part of implementing the Paris Agreement, in which case any rebels would have a hard time even seeking a vote, much less winning one.

However, if there is an attempt to pray against the regulations when they are laid, this could keep the “Boiler Tax” in the news, well into the New Year. There is nothing the political hacks like better than reporting on “Tory splits” and putative “rebellions”, so this could be a constant source of embarrassment for the government for some time to come.

Even without this activity, though, there is enough to keep the subject in the news as there is also a significant and growing European dimension. About 50 percent of all energy consumed by EU member states is used for heating and cooling, and more than 70 percent still comes from fossil fuels (mostly natural gas). In the residential sector, around 80 percent of the final energy consumption is used for space and water heating.

If the UK government has a problem with trying to meet an annual target of 600,000 installations, the EU member states have the staggeringly difficult task of changing over nearly 100 million premises, to which effect the Commission has recently drafted an EU Heat Pump Action Plan to ramp up the rate of new installations.

But, as Euractiv recently reported, European heat pump sales are collapsing, down from the third quarter of 2022, when some 565,000 heat pumps were sold in Europe, to some 485,000 in the last quarter, an overall drop of 14 percent. The biggest drops were recorded in Finland and Denmark, traditionally strong markets.

This, according to The Times, has spooked the Commission and, to avoid what it calls a “popular backlash”, it has delayed the implementation of its plan until after the European elections..

“Europe is falling behind on the decarbonisation of heat”, complains Thomas Nowak, secretary-general of the European Heat Pump Association, the members of which are faced with the prospect of installing 10 million additional heat pumps by 2027 – over 3 million a year, EU-wide.

There is serious money involved here, with manufacturers having invested over €7 billion in production capacity and training of installers, building on the key role given to heat pumps in the Green Deal and other EU programmes. But, as in the UK, without the wholehearted support of the paying public, the official “decarbonisation” plans are going nowhere.

And this, just possibly, might be what keeps the issue is the news, with the potential for 2024 becoming the year in which the net-zero bubble burst – or developed an unfixable leak. With so much going wrong in the world at the moment, we have to have something on which to pin our hopes.