"Should government support heat pump subscription schemes?" I was asked by The Times. I answered: "on the face of it, it seems like a logical idea”. But I also cautioned - more in short 🧵 www.thetimes.com/uk/environme... - ThreadSky

janrosenow.bsky.social • 88 days ago

"Should government support heat pump subscription schemes?" I was asked by The Times.

I answered: "on the face of it, it seems like a logical idea”.

But I also cautioned - more in short 🧵

https://www.thetimes.com/uk/environment/article/heat-pump-subscriptions-affordable-subsidy-d5tkkbdjl

Comments

andyburke.bsky.social•88 days ago

How would a subscription work if a homeowner later wanted to sell the property? Would the buyer have to take over the subscription?

jimhigham.bsky.social•88 days ago

Yes, or buy outright or replace

brettlittle.bsky.social•88 days ago

In the US we call it rent to own or lease.

guynewey.bsky.social•88 days ago

I tend to be more relaxed about this, Jan. I think this is a sensible way of managing high capital cost asset, and also aligning good performance incentives in the right way….

janrosenow.bsky.social•88 days ago

I'm quite relaxed and supportive. Just need to make sure it's done well and delivers value for money.

p17ete.bsky.social•88 days ago

Seems like a way in for unscrupulous dealings, if not immediately then later down the line, as companies change ownership/sell off assets/new management put pressure on subscribers with high costs/“excluded from the contract” extras/poor service

I’d be more impressed with grants

tilmane.bsky.social•88 days ago

Have a 15 y old heat pump, support was a lower interest KFW Credit

Yes, do it. Convinced in combination with water boilers heat pumps can be great support to Balance energy need between time of high and low supply.

+ Europe should look into technical Standards to support scale and efficiency gain

jim4102.bsky.social•88 days ago

Rather than through the private sector, why not let people take out an interest free loan from the state, paid back via their tax code? Would also work for insulation, solar panels and other home improvements. Concern is that availability of loans may push up prices (a bit like help to buy).

janrosenow.bsky.social•88 days ago

4/ What do you think?

gerbenh.bsky.social•88 days ago

Agree, But the environment will profit the most anyway. I paid 7000€ for the heatpump after subsedies. Probably a bit to much, i don’t know, but my return on investment of around 800 -1000/year is totaly fine Combination with solar makes that even much more. So don’t study to long on a ‘fair’ system

picowlo.bsky.social•88 days ago

In the short term subscriptions could save money compared to existing costs. In the long term, if you have the cash, buying will be cheaper.
Generalising maybe. In either case it's better for the environment to go with a solution that minimises energy use, particularly fossil fuel use.

picowlo.bsky.social•88 days ago

Government support makes heat pumps an option for the less well off. It's an equitable way to improve people's living standards and lower emissions.

robincognito.bsky.social•88 days ago

Wouldn't some form of government backed loan or grant be better? A subscription is just someone charging more than the cost of money to people who struggle to finance a heat pump. Presumably the people who will benefit most will be the companies offering the heat pumps.

hermgamma.bsky.social•88 days ago

After the subsidy, the heat pump should be reasonably good credit, so it very much depends on the cost. Paying 15% ROI to an undertaking which runs the scheme and is levered by credit at 9% would clearly be not in the interest of society.

chascroker.bsky.social•88 days ago

Maybe we just need to sort out the price of gas?

jimhigham.bsky.social•88 days ago

Actually removing our reliance on gas for electricity generation is the answer. Then electricity prices will fall and heating will become cheaper. And we’ll stop polluting our health burning gas too.

econick.bsky.social•88 days ago

I agree with Mr RB and Jim. Removing carbon taxes from electricity and adopting a more European way of pricing electricity in the first place (ie. not “marginal cost of gas”) would transform heat pumps into engines of economic growth that Rachel Reeves would love.

bmagee.ca•88 days ago

As you point out, with right protections from those who would game the system (see Tesla scams CDN EV rebates) This is great idea. We got rid of our old oil burner -went straight to ASHP, but we paid pretty $$ for it. no rebates in place then.

Not sorry in the least. woulda jumped at a sub.

scalextrix.bsky.social•88 days ago

1/2 Solar has had quite a high uptake despite being a fairly large capital outlay. Many people will take the hit of the outlay, if they are going to save money long term. Just guarantee a 3:1 spark gap for anyone with a heat pump and every single MCS install is saving money.

scalextrix.bsky.social•88 days ago

2/2 Installation subsidies are probably primarily going to wealthier households RN, where that should be reserved for less affluent homes.

Subscription seems good until the asset owner collapses, what happens to peoples essential heating then?

janrosenow.bsky.social•88 days ago

3/ "If I was in the Department of Energy Security I would want to make sure there is a clear consumer benefit to subscriptions. If you can solve that, and I’m sure that can be solved by setting the rules, then in principle it could be a good thing."

janrosenow.bsky.social•88 days ago

2/ I also said heat pump subscriptions could be especially helpful to owners of larger properties with higher installation costs, whereas in smaller homes the subsidy can often pay for the heat pumps outright.

janrosenow.bsky.social•88 days ago

1/ "You want want to make sure that there isn’t a situation where companies just hoover up the grant money and then make offers for subscription plans that actually are not very good.”

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