U.K. pays for heat pumps; backs carbon capture for net zero

Image: BP

The U.K. is unveiling its net-zero plans on Tuesday as it tries to showcase its green credentials ahead of key climate talks later this month.

Here’s a breakdown of the measures so far:

Carbon Capture Clusters

The government has chosen two industrial hubs to get funding by the mid-2020s. It’s earmarked around 1 billion pounds for four carbon-capture projects — a technology that’s crucial for reaching net zero goals, but the sites will still be subject to value-for-money tests. 

The funding could help drastically cut emissions from some of Britain’s biggest carbon emitting industries. And by choosing areas with the most industrial activity, it opens up the possibility for many businesses to use the same infrastructure, reducing costs.

The two projects that the U.K. has targeted first are the East Coast Cluster and Hynet. For the East Coast Cluster, a consortium of BP Plc, Equinor ASA, Eni SpA, National Grid Plc, Royal Dutch Shell Plc and TotalEnergies SE plan to develop the offshore infrastructure to transport and store CO2 in the U.K.’s North Sea, with BP as the operator.

Hynet plans to produce clean hydrogen and capture and store CO2 from energy-intensive industries. The project includes Progressive Energy, Cadent Gas Ltd, Essar Oil U.K. Ltd, Eni SpA, and CF Fertilisers U.K. Ltd.

“The nod to Hynet indicates, in our opinion, government support for hydrogen,” RBC Europe Ltd said in a note.

Heat Pumps for Homes

A 3.9-billion pound ($5.4 billion) plan to drive down carbon emissions from the U.K.’s homes and offices is a long-awaited plank of the net-zero strategy. Homeowners will receive 5,000 pounds to install heat pumps — though the money available so far accounts for about 90,000 homes only. That’s still some way off the government’s target for 600,000 installations a year by 2028.

The idea is that costs will come down, making the pumps more affordable over time. 

Without improved insulation and shifting levies to gas from electricity bills, many in the industry say that heat pumps will be expensive and inefficient. There may be more details on complementary measures in the Chancellor’s Spending Review later this month.

Green Accounting 

The U.K. is also creating a new set of rules to prevent greenwashing and protect investors from being deceived by bogus claims around climate-friendly investing.

“We want sustainability to be a key component of investment decisions, and our plans will arm investors with the right information to make more environmentally-led decisions,” Chancellor of the Exchequer Rishi Sunak said in a statement late Monday.

Pressing Companies 

The U.K. is also set to force companies to show in detail how they will reach net-zero goals by 2050, Bloomberg reported last week. The so-called Greening Finance plan will require firms to publish transition plans or explain why they aren’t doing so. 

© 2021 Bloomberg L.P.

Dear user, please be aware that we use cookies to help users navigate our website content and to help us understand how we can improve the user experience. If you have ideas for how we can improve our services, we’d love to hear from you. Click here to email us. By continuing to browse you agree to our use of cookies. Please see our Privacy & Cookie Usage Policy to learn more.