The Climate Change Committee’s latest progress report provides much to be commended – 2025 saw overall emissions fall by 1.8% and the UK has seen record-breaking renewable energy capacity.

However, domestic electrification has all but stalled, and heat pump installations are up just 7% this year compared to 56% the year before.

The report’s headline figures have confirmed the SEA’s recent findings. While electricity prices are a significant barrier to heat pump deployment, this cannot be the sole solution to incentivise consumers to make the switch away from fossil fuel systems.

Electrification must be accompanied by wider electricity market reform, greater use of demand side response and flexibility, including time-of-use tariffs, and renewed support for energy efficiency measures.

Today’s report also comes after the scrapping of the Energy Company Obligation, and the publication of a watered-down proposal for non-domestic energy efficiency standards, as detailed below.

Non-domestic Minimum Energy Efficiency Standards (MEES)

We also welcome the long-awaited announcement on non-domestic minimum energy efficiency standards, which provides clarity for the UK’s 10th highest emitting sector.

The decision not to proceed with the 2027 interim target, although disappointing, recognises the need for sufficient lead-in time for industry and landlords to scale up retrofit delivery.

The initial 2021 consultation explicitly stated that removing buildings over 1,000m2 from the scope of private rented sector regulations would have ‘a clear impact and reduce the overall benefits of the policy’. We are glad to see this observation upheld, with these larger buildings now subject to EPC B by 2031. However, this win has instead been to the detriment of all buildings under 1,000m2.

These new standards do provide some positive news. 2025 data suggests that this new policy applies to non-domestic buildings responsible for 60% of electricity consumption and 70% of gas consumption. However, this roughly translates to only 7% of the overall non-domestic building stock, a highly watered-down proposal.

Further support is necessary to help non-domestic buildings under 1,000m2 decarbonise without an EPC B target in place. We cannot leave over 90% of non-domestic buildings behind at EPC E.

This is particularly urgent as these buildings have no alternative incentive to decarbonise, with limited government support and regulatory mechanisms available in this space.

The non-domestic sector also represents an important market for suppliers of manufacturing equipment and provides a steady income stream to support further investment in innovation and R&D.

Overall, the publication of these standards after a five-year wait is a step in the right direction. We eagerly await the full consultation outcome, which will hopefully provide us with more clarity on how the Government plan to implement the policy.

We stand ready to work with government and our members to drive forward delivery and support the successful implementation of these policies.