The Climate Change Committee (CCC) has published its annual assessment of the government’s progress in reducing emissions.
It warns that households are facing higher energy bills because the UK is not electrifying fast enough.
The committee highlights that the UK has one of the lowest market shares of heat pump installations in Europe. The Government must ensure installations accelerate in all segments of the market by urgently addressing the gap left by the closure of the Energy Company Obligation (ECO) scheme.
In the last three years, this scheme accounted for around a third of retrofit heat pump installations in the UK, providing targeted support for low-income households. Without a sufficient replacement, installations could fall significantly this year.
It must also remove any unnecessary barriers that make a heat pump harder to install than a gas boiler, so that low-carbon heating installations become the default choice by 2035. This could be done by: reducing regulatory barriers, addressing skills gaps, improving advice to households and businesses, and enabling market conditions which reduce installation costs.
The committee is also calling for the introducing a comprehensive programme to decarbonise public sector buildings, following the closure of the Public Sector Decarbonisation Scheme. The Government should consider restricting the installation of fossil-fuel boilers in public buildings.
Moving instead to low-carbon combined heating and cooling systems can both reduce fossil fuel dependency and protect vulnerable people from rising temperatures, as set out in the Climate Change Committee’s (CCC) Adaptation Committee report on A Well-Adapted UK, published earlier this year.
New analysis shows that since the start of the Iran war households with gas boilers and petrol cars have seen energy bills rise almost four times more than those with heat pumps and EVs. A typical household could save around £1,200 a year today by combining an EV, a heat pump, solar panels and a time-of-use tariff. This rises to around £1,900 for some rural homes.
Overall emissions fell 1.8% in 2025. There has been good progress in a
range of areas, and the UK is on track to meet the fourth and fifth
carbon budgets. Electric vehicle uptake continues to grow, with nearly
one in four new car sales now electric. A record amount of new renewable
energy was contracted in the latest auction, and peatland restoration
has increased by 26%.
Progress in electrification has slowed
in other areas including heat pump installations in existing homes – up
just 7% this year compared to 56% the year before. The share of
electricity in industrial energy use also fell slightly last year. This
is leaving people exposed to fossil fuel price shocks and puts later
carbon budgets at risk. The government needs a more ambitious plan to
electrify these key parts of the economy, including further action to
reduce the cost of electricity.
Nigel Topping CMG, Chair of the Climate Change Committee, said: “The cost-of-living crisis continues to put pressure on households, with people paying the price of another fossil fuel price shock, so close to the crisis in 2022.
“The transition to clean electricity is not happening fast enough. Government support to accelerate the shift to electric vehicles and heat pumps is critical, not only to keep our climate targets within reach but to unlock savings. At this moment of political uncertainty, any weakening of current positions risks slowing these transitions, undermining investment and the long-term consistency businesses need.
“This is about more than targets, it’s about cleaner air, energy security and shielding the economy from fossil fuel shocks. Ultimately this is about putting money back into people’s pockets.”
Only 58% of the required emissions reduction to hit the UK’s 2030 Nationally Determined Contribution target is covered by credible plans, or those with some risk.
The Committee’s priority recommendations in the report include:
- Make electricity cheaper through measures such as removing remaining policy costs from electricity bills.
- Enable a more rapid transition to EVs, for example by expanding affordable charging infrastructure.
- Accelerate the installation of heat pumps in buildings by cutting costs, removing barriers, and supporting low-income households.
- Deliver on industrial electrification including speeding up grid connections to remove barriers for businesses electrifying operations.
