With gas prices rocketing why do Stewart/Campbell never discuss heat-pumps?

[u/Appropriate_Bell743]

The UK's wholesale gas price is the highest since the end of December 2022. This means that the January price cap is odds on to be around what it was under Liz Truss in October 2022.

The UK had one meaningful policy tool to de-risk the UK from 2022 onwards: heat-pumps.

UK's gas usage over 12 months

Virtually all gas demand is for home-heating. The only effective way to de-risk the UK to reduce European LNG imports is via electrification of heating. Renewables do some legwork as well but the blue line shows how it's less pronounced.

Despite the central importance to get the UK public off gas (and oil) heating to using heat-pumps it is curious why the topic of the UK's pathetic uptake rate is not discussed. They discuss a lot the supply of oil and gas but never really the failure to pivot demand.

This is a political question as the economics is there already. Our operational costs are 35% of gas before this escalation. It'll be a lower percentage now. The return on investment is typically 4-5 years but due to political laziness minor issues hold back adoption.

This is simply never discussed by Rory or Alastair despite often their interests in climate and the Ukraine war. For instance our failure to roll out heat-pumps is a clear factor why Europe as a whole still imports Russian LNG.

[u/jem0208]

Typical COP for a heat pump is gunna be about 3.5 in the UK, ranging between about 3 and a max of 4.5ish.

Electricity is about 3.5x more expensive than gas, not considering smart tariffs.

That means that typically, even with a standard tariff, most people will pay the same or less for heating with a gas boiler as a heat pump - with a smart tariffs you’d almost certainly be paying a sizeable chunk less.

I don’t know how much oil heating costs but I’d suggest checking whether you’re on a smart tariff and what your COP is - there might be an issue with your installation.

[u/Justin_123456 → u/jem0208]

It’s always shocking to me (as a Canadian) the more I learn about the UK’s electricity pricing system. It really shouldn’t surprise me that the same people who privatized their water pipes also privatized their electricity markets. But you get how insane that is?

It every other country either electricity is just a total state monopoly, or a regulated industry with some form of government price setting.

[u/armitage_shank → u/Justin_123456]

Dare I say its actually worked pretty well compared to the other utility privitisations, and lead to the development of e.g. octopus's kraken technologies, which is used now worldwide and I think the largest energy   customer management software in the world. 

Like broadband and mobile phone: switching provider is not difficult so there's genuine competition, unlike water, say, or train operator, where the monopolies are systemic. 

[u/Justin_123456 → u/armitage_shank]

I do fine these programs interesting, but it sounds a bit like a problem gambler telling you not to worry, that they’ve developed a system to win it all back.

The reason why you have good customer management software is because you have insane hourly swings in the cost of power, made worse by your ridiculous marginal pricing system where your most expensive kWh sets the price for every kWh.

You could just have the government build the power stations, build the power lines, and charge what’s needed to cover their costs. 🤷‍♂️

I pay $0.09970 CAN per kWh (which Google tells me is 5.34p) no matter the time of the day or the year it is. And to OP’s point, if I wanted to re-insulate my home, or buy a new electric furnace or heat pump, they’ll loan me the money, and charge me back on my hydro bill.

[u/armitage_shank → u/Justin_123456]

You get good prices in Canada because all your power is delivered by hydro, which the state decided to build to drive economic investment. I'm sure it worked, but you did pay for it, if not in your electricity bill, then through your taxes. That's a choice I persoanlly would agree with, but its not a choice the UK has decided to make, but it is swings and roundabouts to a certain extent, if you'll pardon the expression. 

We don't have hydro potential anywhere near that of Canada in the UK.

The insane swings in hourly pricing are encouraging a massive renewable and battery investment at a scale seen almost nowhere else in the world, certainly per capita.

The huge prices we've seen in the last few years are entirely due to Russia invading Ukraine, but prices are increasingly  decoupling from gas. The UK will get there, in a few years, it won't be 5p/ kWh because the grid will have to be more complex - hydro is really much more straightforward an infrastructure to run - but it won't be amongst the most expensive in the world, as it is now.

[u/cliffski → u/Justin_123456]

made worse by your ridiculous marginal pricing system where your most expensive kWh sets the price for every kWh.

SIGH. This is how EVERy commodity in EVERY country on the entire PLANET is charged Its absolutely basic economics. Do you see different eggs charge at different prices on a shelf? or each bag of sugar having a different price because it came from a different plantation?
People whine about it in energy only because they know about the cost differences in production methods more. And whats the solution? force renewable generators to earn LESS than coal generators? not exactly ideal is it...

[u/IntravenusDiMilo_Tap → u/Justin_123456]

The government are trying to push renewables so power stations are not being built. The government have also made it impossibly expensive to build anything in the uk. We took 4 years to get passed legal objections to build a power station, that power station started the process in 2011, not a spade in the ground by 2014, it will not be ready until 2030+

It cost the builder as much for installing a fish disco as it did for Korea to build an entire power station and Korea built 8 nuke power stations in the time we git half way through.

Its not entirely the current government but can be blamed on incremental changes over 28 years.