Heat accounts for almost half of energy consumed in the UK and half of total carbon dioxide (CO₂) emissions. Of this, homes use 54% of the heat consumed, non-residential buildings 16% and industry the remaining 30%. However, industry is responsible for around half of heat related CO₂ emissions. This is due to a greater use of carbon-intensive fuels such as oil that is needed to generate the high temperatures required for process heat.

Currently only 1% of heat that we use comes from renewable sources, with the rest coming from gas, oil and coal. Renewable heat can be produced using a variety of different technologies: biomass boilers, air and ground source heat pumps, solar thermal and biogas (see glossary for definitions of technologies). 

The UK has committed to an EU target to produce 15% renewable energy by 2020.  This  is to be met by increasing the use of renewables in heat, transport and electricity generation.    In terms of the contribution from heat, the Government has suggested that 12% of the heat that we use is supplied by renewable energy in  2020. 

The CCC commissioned NERA to analyse the abatement potential that exists from renewable heat and our estimate of what is feasible  by 2020 is in broadly in line with the previous government’s proposals (see Chapter 5 of the Committee's 2009 Progress Report).