The commission also said that by 2035, no boilers burning fossil gas are expected to be installed in homes, with technologies such as heat pumps and district heating being used instead.
Grants or loans should be made to help individuals and businesses make the switch, which, combined with energy efficiency measures, would reduce household energy bills.
Heating is the biggest source of carbon emissions in the UK, accounting for over a third of the total. Decarbonizing heat is the biggest energy challenge in tackling the climate emergency, especially because it requires action in millions of homes. Currently only 1m of the UK’s 27 million homes have low carbon heating.
Current government policy is to ban gas boilers only from 2025 in newly built homes. But the group said taking action to transform the UK’s heating system would create 150,000 jobs and help the country recover from the economic damage caused by the coronavirus pandemic.
Karan Bilimoria, Chairman of the CBI and Chairman of the Heat Commission, said: “A green recovery and progress towards the UK’s net zero emissions goal is doomed if we do not respond to the urgent need to decarbonise the heat in our homes and buildings.
“Besides the moral imperative, there are also strong economic arguments for protecting our planet. [It] would provide a huge boost to employment at a time when [they] are needed more than ever.
University of Birmingham Professor Martin Freer and part of the commission said: “Decarbonizing heating is the biggest energy challenge we face in reaching net zero. Unlike electricity, which can be changed at the system level, more than 20 million homes have to adopt new energy efficiency measures and new methods of heat production. “
Members of the commission included business leaders from National Grid, the UK Energy Research Center and Cadent, the UK’s largest gas distribution network.
The commission’s report says: “This transition will undoubtedly be disruptive for consumers and businesses.”
New types of heating systems will be more expensive until suppliers increase their production. Lord Bilimoria said: “We recognize the initial costs and we do not believe that these should be borne by the consumer alone.”
The commission said the government had a “central role” to play, which required “political courage and vision” and the creation of a national heat distribution body, modeled on the organization that organized the 2012 Olympics.
« [Heat] will take center stage in the years to come, ”said Chris Stark, chief executive of the Climate Change Committee, official government advisers. “So we really welcome this CBI report, which gives us an idea of what a net zero-compatible set of measures might look like.”
He said the CCC would release new advice for the government this year, including the critical steps needed to decarbonize UK homes.
The commission’s report indicates that oil-fired boilers are particularly polluting and should be banned from 2023. Alternatives to conventional boilers include heat pumps, which draw heat from the ground or from the air and, by way of hybrid systems that combine gas and heat pumps will shut down until 2035.
The installation of heat pumps in houses by Wealden District Council has saved tenants an average of £ 500 per year, according to the commission. Hydrogen boilers only produce water during fuel combustion, which could be created by renewables in the future.
The commission said that a vital step in installing the new systems is to reduce heating needs by increasing the energy efficiency of buildings. Part of the funding needed for this could come from reforming the £ 2bn a year winter payment currently being made to those over 65 to target the money on those who need it most.
The UK will host a critical UN climate meeting in 2021, and Bilimoria said the country could show its leadership on the global stage by implementing the heat commission’s recommendations.
The government has been asked for comment.