How to scale the heat pump sector
Kyle Usher, sustainable future mission manager for Nesta in Scotland
To get the heating industry ready for net zero is a huge opportunity – but we need to do it right
To get anywhere near our net-zero targets we will need more than 20 times the current workforce trained to fit low-carbon heating systems, such as heat pumps, in our homes.
A recent Nesta report, How to scale a highly skilled heat pump industry estimates that the number of engineers across the UK will need to grow from a total of 3,000 today to at least 27,000 by 2028 – an increase of between 4,000 to 6,000 every year.
Doubling a workforce year-on-year poses very real challenges as well as providing those in the industry who can make the most of this transition with a huge opportunity.
Market forces are not enough
The assumption that a rise in demand for heat pumps will lead to a rise in supply, may not be as direct or immediate as we might like.
One of the limitations for heat pump installations is that it can be hard to get hold of experienced installers. Those few that are in the industry are in high demand, and if someone has a distress purchase – where their heating system has failed during the winter – are likely to end up fitting what they can get installed quickly: a like-for-like boiler.
This means that the gas installer is kept busy and doesn’t feel the vacuum caused by reduction in work, the heat pump installer won’t see or hear from that customer again for 20 years and the money that would support the growth of the low carbon heat industry is also deferred.
Having an industry throttled by supply will not lead to sustained and scaled growth.
Pre-emptive training
Instead we need to pre-empt demand and stimulate supply so that we are ready to cover every possible low-carbon installation. This comes with its own challenges.
Ensuring quality of installation relies on well-trained, competent and experienced installers. If we train too many new low carbon heating engineers and there is not enough immediate work for them, they will lose motivation, stagnate and potentially drop out of the industry.
To ensure that we pre-empt demand but do not leave people disillusioned and disaffected, we need coordinated deployment and strategic action:
Anticipate demand. By using geographic data on property-types, building details, fuel source and income estimates, we can anticipate demand in the next 3-5 years. Nesta’s recent data visualisation, Modelling heat pump growth in Scotland, explores how this could work on a local scale
Train strategically. Target training of local heating engineers in areas of anticipated high demand. This will include upskilling existing engineers and broadening appeal to new entrants
Provide assurance. Incentivise new entrants with clear pathways into the industry and assurance of long-term job security and role progression. This could be backed with an assured low-carbon workforce guarantee
Stimulate demand. The anticipated demand needs to be realised through local area interventions; targeted communications promoting financial support, education and engagement as well as potential ‘matchmaking’ events between installers and consumers
Coordinated delivery. Community-level purchasing schemes can reduce costs for the consumer as well as raising efficiencies in the sales, design and installation for the installers
Support local businesses. Providing business support such as human resources and legal expertise has been shown to help SMEs to expand their businesses. We need the whole of the sector to scale
How to scale the sector
As the industry develops, we not only need the numbers of individual installers acting as sole traders to increase, but the companies who can take on newly trained installers and support their professional development to also grow in size.
It is difficult to get exact numbers, but we can estimate that there are currently between 300 and 500 heat pump installers active in Scotland, based on the number of MCS-registered companies. We will need over 6,000 installers by 2030.
To raise the numbers of installers at a fast enough rate, we need the whole of the low-carbon heating sector to expand:
For school, college and university leavers to be able to join an industry with assurance of safe, secure and prosperous work
For existing heating engineers to retrain and establish themselves as sole traders or join existing firms
For the entrepreneurial and experienced traders to establish new companies
For the existing micro and small businesses to expand to meet demand
For larger companies to employ more junior installers and support them as they gain experience during their early career
If we do this right, then there are good, secure and green jobs coming to every region in Scotland. Jobs that last, that bring economic benefits along with environmental impact.
It’s also an opportunity to not just to transition our heating fuel but also to transform the workforce; attracting new and more diverse entrants into an industry that is currently over 95% male and has an average age over 50 years old.
We are on the cusp of an inevitable and necessary low-carbon heating revolution – it’s time to get it started.