As we approach the local election season for our new councillors, the government are on a charm offensive to persuade us that they have got genuine green credentials.
You can be forgiven for missing the latest avalanche of new environmental measures which they have announced.
These are designed to secure the UK’s energy supplies and to reduce our reliance on fossil fuels. They do however have a significant effect on all of our finances.
It is perhaps therefore worth reviewing some of the headlines that are now on the table.
Motoring
Government have renewed their commitment to ban the sale of new pure petrol and diesel cars from 2030. Hybrid car sales must cease in 2035. There is a further requirement that the number of electric vehicles that manufacturers must sell each year will start in 2024 at 22% and rise to 100% by 2035. In theory, this should help to drive down prices because the supply of electric vehicles is increasing. However, what is also increasing is the cost of running these vehicles. Drivers will be forced to pay road tax from April 2025. The government has also ended all subsidies which could be worth up to £5,000. Today the average price of a family EV is around £27,000.
Electric Car Charging
It had been hoped that there would be recognition that the difference between the cost of charging at home or outside home would be reduced. Currently, a home with its own charging facility pays only 5% VAT and is on a domestic electricity tariff. Those having to use a public charging facility pay 20% VAT. Charging rates can be somewhere between reasonable and punitive. The government have however recognised that there is a huge shortfall in charging facilities and have agreed that they will spend £350 million on increasing the supply. As at March 2023, there was still only around 39,000 public charging points in the UK.
Heat Pumps
We have known for some time that the installation of new gas boilers will be phased out by 2035. We will be encouraged to replace them with electric heat pumps. The government has reinforced its boiler upgrade scheme. Households are to be offered £5,000 to replace a boiler with a £10,000 Air Source Heat Pump or £6,000 towards the average £15,000 cost of a Ground Source Heat Pump. This scheme will run until 2028. The target for new heat pumps is the installation of 600,000 each year from 2028. Currently, the number of applications for these funds is very low. There is a high degree of scepticism as to whether these targets can be met. There is also a significant shortage of skilled installers.
Gas Boilers
Charges for homes with gas boilers are set to be increased, there are no fixed figures for this but a potential charge of around £120 per year on gas bills could be introduced to encourage the switch to green products.
Home Insulation
The announcements were a fascinating cocktail of old schemes that have been repackaged and rebranded and old money represented as new. A good example was a rerun of the scheme announced in November to hand out £1 billion to insulate 300,000 of our most poorly insulated homes. This scheme has now been rebadged “The Great British Insulation Scheme”. It will be made available for those in council tax bands A-D, who live in properties with an energy performance certificate of D or lower. The focus of this investment will be on retrofitting cavity wall or loft insulation. These are generally effective measures. Property owners can start to register their interest by applying through their energy supplier.
Air Travel
The cost of flying has dramatically increased, largely because the price of jet fuel has soared because of the Ukraine situation. To try and tackle this, the government have started to consult on a requirement that means all airlines should use fuel which is a mixture of sustainable aviation fuel and regular jet fuel.
If this can be introduced, then there is a reasonable chance that greenhouse gas caused by flying can be reduced by around 70%. There are however great concerns that this will not quickly result in any reductions for the cost of plane tickets.
We will all be effected by these measures in different ways. For Northern Devon the big issues are managing inflation whilst the cost of home heating and travel rises on far too regular a basis.
These energy initiatives will undoubtedly have a long term benefit. They are also essential if we are to achieve our Net Zero target.
In the short term, however, for many of us managing on a survival budget is the majority concern. That said, we must do our part in helping to deliver Northern Devon’s ‘Green Day’.
Written by Tim Jones, Chairman of the North Devon Biosphere Foundation
