Sunak set to water down UK climate commitments on cars, boilers, home efficiency

The UK is committed to reaching net-zero climate emissions by 2050 but it will not do so by bankrupting its hard-pressed citizens, Home Secretary Suella Braverman told BBC Radio 4 in an interview Sept. 20.

Braverman was responding to reports UK Prime Minister Rishi Sunak is about to water down a range of climate policies on vehicles, gas boilers and energy efficiency in homes.

"The prime minister will be setting out more detail in the coming days and I'm not going to pre-empt that, but what I support is an element of pragmatism and proportionality," Braverman said.

Sunak is reported to be planning a delay to the 2030 phase-out of sales of new gasoline and diesel cars, as well as proposals to phase out natural gas-fired boilers in new homes from 2025. The prime minister is also expected to drop plans for new energy-efficiency targets for private rented homes.

"We need to take into account economic growth, household budgets and the cost of living," Braverman said. "We're not going to save the planet by bankrupting the British people."

Responding to the reports late Sept. 19 with a statement, Sunak said he was committed to net zero, but it must be delivered in a "better, more proportionate way" that was "honest about costs and trade-offs."

Conservative MP Alok Sharma, who was president of the COP26 climate conference in Glasgow in 2021, said abandoning climate action "will not help economically or electorally."

"If we have countries around the world resigning from their commitments, the patient -- by which I mean the world -- is going to be on life support," he told BBC radio Sept. 20.

The Society of Motor Manufactures and Traders' CEO Mike Hawes said a change in policy on cars would be "incredibly confusing" for the sector.

The industry "continues to invest billions of pounds into these new technologies, electrified vehicles, battery vehicles, both abroad and here in the UK," he said.

More than 800,000 electric vehicles have been registered in the UK since 2018, with the sector on track to reach an 18% market share by the end of 2023.

In a Sept. 20 statement, Lisa Brankin, Ford UK Chair, said the UK's 2030 target on car and van sales was "a vital catalyst to accelerate Ford into a cleaner future. Our business needs three things from the UK government: ambition, commitment and consistency. A relaxation of 2030 would undermine all three."

On home heating, meanwhile, the government has a target of 600,000 heat pumps installed annually by 2028.

There are no official plans yet to phase out gas boilers in households, but proposals are for a ban in newbuild properties from 2025, and a ban on the sale of new gas boilers from 2035. The UK has around 23 million gas boilers installed in homes.

UK gas consumption in the domestic sector -- mostly for use in heating and cooking -- accounted for around one third of total consumption in 2022 at some 254 TWh, according to UK government data.

Carbon price undermined

Sunak's government has been criticized for not doing enough to spur clean energy investment, reflected in a steep price slump observed in the country's carbon price.

Platts assessed UK Allowances at GBP36.57/mtCO2e ($45.22/mtCO2e) on Sept. 19, the lowest price since July 2021, when Platts started assessing these values, according to S&P Global Commodity Insights data.

On Sept. 20, UKAs were trading at GBP36.74/mtCO2e at 0804 BST, , up $0.465/mtCO2e, according to ICE data.

"The government has shown signs of wavering over the perceived short-term costs of the UK's net zero targets, and this has been a factor in the steep discount in UK carbon allowances, which has weighed on domestic power prices," analysts at S&P Global said in a recent note.

Piers Forster, interim chair of the UK parliament's influential Climate Change Committee, told S&P Global in a recent interview that UK carbon price worries were "really hampering good green investment. It is making the whole thing slow down, which is not good."

In a recent report, the Climate Change Committee said the government needed to nearly quadruple the rate of non-power sector emissions reductions if it is to meet its 2030 goal of at least a 68% fall in greenhouse gas emissions from 1990 levels.