In October 2023, Parliament passed legislation which opened the door to making Renewable Liquid Fuels more affordable for off-grid homes by introducing a Renewable Liquid Heating Fuel Obligation. This mirrors similar legislation in the transport sector which has been running successfully for nearly 20 years.

The legislation is subject to a consultation but it has not yet been published. Given this uses a tried and tested route, there’s no reason the government can’t move this forward immediately.

In his Autumn Statement, the Chancellor was also called upon to reduce the tax paid on renewable liquid fuels for heating. The request was not to be treated any differently but to afford renewable fuels the same tax treatment as in transport.

In transport, these fuels have the same tax as fossil fuels. In heating, the renewable fuel is taxed at a higher rate than the fossil fuel which clearly makes no sense. We are urging the Chancellor to rectify this at the next opportunity or in the budget.

For some properties, switching to a heat pump is an ideal solution and we fully support the use of the technology where it makes sense. However, many properties are simply not suited to heat pumps and will require disruptive and costly changes for them to work effectively.

These changes can include new radiators, better insulation, new piping and the reintroduction of the hot water tank. The total cost can be over £20k which simply isn’t affordable or practical.