Rishi Sunak’s new approach to cars, boilers and Net Zero

“Net Zero” refers to a concept regarding the emission of greenhouse gasses. It requires a balance between the greenhouse gasses we emit and remove from the atmosphere. If we can emit the same or fewer greenhouse gasses than we emit, we have achieved Net Zero.

As part of the Paris Agreement to combat global warming, multiple countries have pledged to reach Net Zero by the year 2050, including the UK. To be successful, this will need to be a monumental effort across the globe, backed by scientific advances.

Rishi Sunak recently spoke about the UK’s Net Zero by 2050 pledge in a speech with some notable changes. Here are the key takeaways from that speech.

A delay to the petrol and diesel vehicle ban

One of the major changes to come from the speech was a delay to the illegal purchasing of petrol and diesel vehicles. The initial plan was to ban UK residents from buying new petrol and diesel vehicles by 2030. However, this has now been pushed back five years until 2035. This would not stop anyone from buying a second-hand petrol or diesel vehicle after the ban.¹

However, the PM did state that despite this delay, he does expect to see a significant percentage of the UK population buying electric vehicles by 2030. The delay of five years has been introduced because the cost of electric vehicles is still considered too high.¹

What’s happening to boilers?

The speech included no major policy change on the transitioning from boilers to heat pumps and nobody is going to be told they have to change from a boiler to a heat pump either.

Yet, there will be incentives to do so, including a grant of up to £7,500 to make the change which never has to be repaid – “no strings attached”. The initial phase-out period was expected to last until 2026, but this has now been pushed back until 2035. Although, what this means exactly is not specified, considering homeowners won’t be mandated to replace their boiler in any case.¹

Another key takeaway from the speech on this topic was the scrapping of a policy that would force landlords to upgrade their energy efficiency by 2025 to rent out their property. Although this remains strongly encouraged, the policy will no longer be mandated.¹

So, are we on track for Net Zero by 2050?

Despite the changes – especially the delays in buying petrol and diesel vehicles - Rishi Sunak believes Net Zero by 2050 is still a possibility. However, he caveated this claim by stating people need to be pragmatic and honest to achieve this aim. He continued to state achieving such a target would be the proudest achievement of our lifetimes.¹

The PM will attend COP28 later this year, where we expect to hear more on this subject.

Sources
1.    https://www.bbc.co.uk/news/uk-66871073

All the information in this article is correct as of the date of publishing. The opinions expressed in this publication are those of the authors Euxton Mortgage Market. The information provided in this article, including text, graphics and images does not, and is not intended to, substitute advice; instead, all information, content and materials available in this article are for general informational purposes only. Information in this article may not constitute the most up-to-date legal or other information.

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October 2023