How Rishi Sunak watering down his net zero pledges will help consumers

Rishi Sunak
Rishi Sunak has announced changes to his green policies - Steve Reigate/Pool/Reuters

Rishi Sunak on Wednesday held a hastily-arranged press conference in Downing Street to announce major changes to his environmental policies to make them more affordable for hard-pressed households.

While he said he was still committed to the target of making the UK net zero by 2050, the Prime Minister said changes had to be made in the wake of the cost of living crisis to ensure families could afford green laws.

The changes will delay the switch from petrol and diesel cars to electric vehicles, and from gas boilers to environmentally-friendly heat pumps.

Here, the Telegraph takes a look at what it means for you.

2030 petrol and diesel car ban delayed

The ban on the sale of new petrol and diesel cars will be put off by five years, from 2030 to 2035.

It means families who do want to switch will be able to take advantage of falling prices for electric vehicles over the coming decade.

After 2035 all new cars will have to be zero emissions, but people will still be able to buy and sell second-hand petrol and diesel vehicles.

Mr Sunak said the move will put the UK in line with most other European countries and many US states.

It comes days after the Prime Minister’s predecessor Liz Truss urged a delay to the petrol car ban, saying the Government’s approach to net zero needs to be one that is “pragmatic and doesn’t unfairly add costs to the public.”

The original deadline was set in 2020. Just three years later it is being extended.

Mr Sunak said electric cars were already becoming more popular, because they were becoming cheaper.

“I expect that by 2030, the vast majority of cars sold will be electric,” he said.

“Why? Because the costs are reducing; the range is improving; the charging infrastructure is growing.

“People are already choosing electric vehicles to such an extent that we’re registering a new one every 60 seconds. But I also think that at least for now, it should be you the consumer that makes that choice, not government forcing you to do it.”

The Prime Minister said costs need to be brought down in the wake of the cost of living crisis.

He admitted the UK had further to go in setting up its charging infrastructure for electric cars, and said the British auto industry needs to be strengthened to help it compete with China.

“To give us more time to prepare, I’m announcing today that we’re going to ease the transition to electric vehicles,” he said. “You’ll still be able to buy petrol and diesel cars and vans until 2035.

“Even after that, you’ll still be able to buy and sell them second-hand.

“We’re aligning our approach with countries like Germany, France, Spain, Italy, Australia, Canada, Sweden, and US states such as California, New York and Massachusetts and still ahead of the rest of America and other countries like New Zealand.”

The move was welcomed by Fair Fuel UK, which said the original plan was “always doomed to be dropped”.

But Ford, one of the UK’s most popular car brands said the change would “undermine” the move to electric vehicles.

Gas boilers staying for longer

People will have “far more time” to replace their gas boilers with heat pumps, and be given more money to help them make the change.

The plan was for all new gas boilers to be banned after 2035.

For a family living in a terraced house in Darlington, the upfront cost could be around £10,000.

But Mr Sunak said about a fifth of homes, for whom heat pumps would be ineffective, will be handed an exemption from having to make the change at all.

The exemption will cover those on off-gas-grid homes, people who need expensive retrofitting or a very large electricity connection.

The date until which most families will be able to buy gas boilers – 2035 – remains.

However, a handout called the Boiler Upgrade Grant will be increased by 50 per cent to a £7,500 voucher.

This will help those who want to replace their boiler with a heat pump or another low-carbon alternative.

Mr Sunak said he had watered down the target to avoid “imposing costs on hard-pressed families, at a time when technology is often still expensive and won’t work in all homes”.

“I’m announcing today that we will give people far more time to make the necessary transition to heat pumps,” he said. “We’ll never force anyone to rip out their existing boiler and replace it with a heat pump.

“You’ll only ever have to make the switch when you’re replacing your boiler anyway, and even then, not until 2035.

“And to help those households for whom this will be hardest I’m introducing a new exemption today so that they’ll never have to switch at all.”

The current voucher scheme offers £5,000 for air source heat pumps and £6,000 for ground source models.

It comes after low take-up of the upgrade scheme, with only 14,800 vouchers redeemed up to last week.

With a typical heat pump costing £13,000 to install before any grant, the upfront costs of the devices remain high even after the grants are applied.

Green speech in numbers
Green speech in numbers

Ministers hope that making the boiler upgrade scheme more generous will help to stimulate demand, boosting sales and helping manufacturers to bring down prices.

Octopus Energy, which owns Northern Ireland heat pump manufacturer RED, last week announced a new model – the Cosy 6 – that it said could cost as little as £5,000 if no home improvements were necessary.

Ministers launched the boiler upgrade scheme in May 2022 to encourage more households to replace their gas-fired boilers with electric-powered heat pumps.

However, uptake is still falling drastically short of the Government’s target to install 600,000 heat pumps per year by 2028.

Keeping oil boilers for longer

Families with oil or liquid petroleum gas boilers and coal heating systems were facing the prospect of having to scrap them after 2026.

Oil boilers were due to be phased out from that year, with the sale of new ones being banned.

Instead Mr Sunak said this ban will be delayed until 2035, ensuring homeowners will not face the prospect of having to spend £10,000 or £15,000 upgrading their homes in three years’ time.

An oil boiler ban could affect around 1.7 million homes and has been the centre of a backlash from Tory MPs, with former environment secretary George Eustice likening it to a “rural Ulez”.

Many cited the expensive cost to install heat pumps, with or without a government grant, and expressed fears that in remote areas without connection to the grid, a heat pump will be insufficient in heating their property.

Landlords’ improvements scrapped

Landlords will no longer be forced to make costly improvements to their rental properties after Mr Sunak scrapped requirements to make homes more energy efficient.

The plans would have forced all homes available to let in England and Wales to achieve an Energy Performance Certificate (EPC) rating of at least a C, the third highest efficiency rating, as soon as 2025.

To meet the new rules, property owners would have had to spend an average of £8,000 on insulation and other improvements, according to research by the estate agents Hamptons.

Failure to do so could have led to a £30,000 fine.

Homes are given an EPC score from A for the most efficient homes, to G for the least.

More than 2.4 million privately rented homes in England are estimated to fall below EPC band C, which amounts to 56 per cent of all private lets.

The minimum requirement rule was due to come into force on April 1 2025 for new leases and April 1 2028 for existing leases, but campaigners warned landlords faced vast bills to insulate their properties and make other improvements such as installing heat pumps.

Others said the onerous requirements risked landlords selling up, creating a shortage of housing and pushing up rents.

Miles Gilham of Gilham Properties, a lettings agent, welcomed the abolition of the plans.

“It’s definitely a big positive,” he said. “The EPC scheme would have been a massive additional cost onto landlords, especially at this time when mortgage rates are rising.

“The uncertainty surrounding the scheme was damaging to the buy-to-rent market. Landlords didn’t know what they would have to pay.”

Thousands of landlords have already sold up in anticipation of the energy efficiency rules coming into force.

More than 65,000 rental properties went up for sale in the first three months of the year. Of these some 36,460 had low energy efficiency, with EPC ratings of D or less, according to market analyst TwentyCi.

Mr Sunak said: “Some property owners would have been forced to make expensive upgrades in just two years’ time.

“For a semi-detached house in Salisbury, you could be looking at a bill of £8,000. And even if you’re only renting, you’ll more than likely see some of that passed on in higher rents. That’s just wrong.

“Those plans will be scrapped, and while we’ll continue to subsidise energy efficiency we’ll never force any household to do it.”

Fast track hook up to National Grid

The time it takes to hook wind farms, solar farms and battery plants up to the national grid will be cut dramatically under Mr Sunak’s plans.

In his speech, the Prime Minister vowed to fast track projects by scrapping arcane rules that have been blamed for decade-long delays for renewable power projects.

At the moment, businesses are lining up to build schemes worth billions of pounds across the country.

In total, projects that could generate 300 gigawatts of power are waiting to be connected to the electricity grid - compared to just 65 gigawatts of schemes already connected today.

Yet because of “first come, first served” rules that govern how projects are hooked up, many developers are being told they must wait as long as 14 years before they can start generating. This is even the case for projects that could be built by next year.

Mr Sunak said fixing the issue would be made a top priority, and he also vowed to speed up planning permissions and to set out an “energy spatial plan” that will give developers clearer guidance on where green energy schemes can be built.

What are Rishi Sunak’s changes to net zero policy?
What are Rishi Sunak’s changes to net zero policy?

He said: “Right now, it can take 14 years to build new grid infrastructure.

“There are enough projects waiting to be connected to generate over half of our future electricity needs.

“We’ll set out the UK’s first ever spatial plan for that infrastructure, to give industry certainty and every community a say.

“We’ll speed up planning for the most nationally-significant projects and we’ll end the first-come first-serve approach to grid connections by raising the bar to enter the queue – and make sure those ready first will connect first.”

One energy executive said: “At the moment, grid infrastructure is sclerotic. You cannot expect investors to put aside £30m and then sit there and wait more than a decade to deploy it.

“There is no world in which it’s acceptable to have to wait 14 years for a connection.”

Car sharing dropped and no new flight taxes

Mr Sunak pledged not to bring in any plans to force people to share cars, saying it would interfere too much in the way people live their lives.

Carpooling is promoted by environmental activists as a way to limit the number of cars on the road, cutting emissions.

Some have pushed the idea of making it compulsory for people to share cars on the way to work.

One idea is for cars with odd numbers on their registration plates to be able to use the roads one day, with even numbers allowed the next day.

But Mr Sunak said: “The debate about how we get to net zero has thrown up a range of worrying proposals and today I want to confirm that under this government, they’ll never happen.

“The proposal for government to interfere in how many passengers you can have in your car: I’ve scrapped it.”

In his speech on Wednesday, the Prime Minister also committed to no new direct taxes on passengers to discourage flying.

One example of such a scheme is a frequent flyer tax, which increases along with the number of flights taken in one year.

Two years ago Grant Shapps, who was then transport secretary, said the government was looking at “carbon pricing”.

These are extra costs passed from airline firms on to consumers.

Mr Shapps considered reducing the number of free allowances on flights in the UK and to the EU received by airlines, or expanding the scheme to cover other non-carbon greenhouse gases.

No taxes on meat or dairy products

The Prime Minister promised that his government would never bring in measures designed to change people’s diets.

As an example, he said there would be no taxes on meat or dairy products designed to reduce carbon emissions.

Mr Sunak said he would do nothing to “harm British families”.

A study by Oxford University in 2018 found a meat tax could cut consumption of processed meat by about two portions per week in high-income countries.

Researchers suggested a tax of 14 per cent on red meat and 79 per cent on processed meat.

That would mean the price of a 227g Tesco sirloin steak – currently £4.60 – would go up 64p to £5.24.

A pack of eight Sainsbury’s pork sausages would rise from £2.30 to £4.12 – up £1.82.

The Prime Minister said: “The proposal to make you change your diet – and harm British farmers – by taxing meat. I’ve scrapped that.

“It cannot be right for Westminster to impose such significant costs on working people especially those who are already struggling to make ends meet and to interfere so much in people’s way of life without a properly informed national debate.”

No ‘burdensome’ recycling

Mr Sunak said any plans the government has to strengthen recycling rules will also be scrapped.

In his press conference, the Prime Minister said he wanted to get rid of burdensome schemes, such as one which would have made households use seven bins.

These would have included six separate recycling bins for food waste, garden waste, metal, plastic, paper and cardboard.

There would be another bin for general waste which cannot be recycled.

The plans were floated earlier this year as part of a nationwide standardisation of recycling rules.

But council leaders warned they were unworkable and would mean more bin lorries on the roads.

On Wednesday Mr Sunak said: “The proposal that we should force you to have seven different bins in your home. I’ve scrapped it.”

Progress on recycling across the UK has shown little progress in recent years, with the rate in England remaining around the 45 per cent mark since 2015.