A think tank has urged government and Ofgem to implement a low carbon gas obligation.
Bright Blue’s report, supported by the Energy Networks Association, takes in a range of views – from gas networks and other hydrogen proponents, to those that believe that gas networks cannot exist in a decarbonised system.
It outlines the options for decarbonising heat, the associated challenges and costs, and makes the case for new policies, incentives and rule changes to reduce emissions from existing gas infrastructure while minimising cost and disruption.
Implementing a low carbon gas obligation, which obliges suppliers to buy an increasing proportion of gas from lower carbon sources, would enable a market-based approach to reducing emissions and send a clear signal to energy suppliers and investors, the report argues.
Emphasising the importance of improving energy efficiency to reduce the significant consumer costs of deep decarbonisation, the report also recommends:
- Ofgem increases the amount of money networks are allowed to spend on innovation within the next price control
- Rules governing the amount of gas such as hydrogen that can be injected into the network are relaxed
- Energy Performance Certificate methodologies are improved
- ‘Home Affordability Assessments’ (HAAs) be introduced for new-build homes
- The minimum Energy-related Products (ErP) requirement for domestic gas boilers should be raised from the existing level of 92% to 95% energy efficient
- Introducing carbon life cycle assessment as part of public procurement procedures to drive the market for energy efficiency and renewable heat technologies
- Establishing a new regulatory unit within Ofgem to oversee regulation of district heat networks and develop price controls.
See the report here.