Preparing infrastructure for a net zero future presents great opportunity for the electrotechnical community, but it’s a step change that demands the right support to turn ambition into action. As part of the ‘Leading the Charge’ digital series, Steve Bratt, CEO of ECA, explains what net zero and the electric transformation means for the sector, and what the industry needs to drive this journey.
Q: How have the UK’s legal net zero targets transformed the electrotechnical sector?
SB: It’s in the process of transforming. The headline target of net zero by 2050 is symbolic, but there are lots of things that are coming out now that are making a big difference. For instance, not being able to sell petrol and diesel cars by 2030 will drive a big change for infrastructure. People are having to focus more now on their own carbon footprint. Investors are much more conscious of ESG (environmental, social and governance). And of course, the cost of energy generally, although not directly related to the legislation, is making people think hard.
Q: What does that mean in real terms for ECA members?
SB: It’s a huge opportunity and there’ll be lots of scope for them to get involved. Electrification of transport, electrification of heat, decarbonisation of the grid and the emergence of a prosumer – all offers huge opportunity. But the transition isn’t going to happen unless there’s a solid supply chain full of people who know what they’re doing and have the resources to deliver it.
Q: How do you read the market appetite for the transition to net zero?
SB: The contractors are very interested in this, they’re excited, but they need more support. They want to understand where the opportunities lie, and what they need to do to respond to them. But there’s definitely an appetite.
There’s also a degree of scepticism. The Green Homes Grant, the Green Deal, Feed-in Tariffs and the Renewable Heat Incentive are all initiatives that didn’t quite go as planned and left some businesses with a shortfall in benefits after the investment they’d made.
Q: Does that affect how your members feel about what they now are being requested to do?
SB: Yes, it does. They’re open minded and they’re positive generally because they can see the long-term direction. But they need that confidence, and they need that certainty. It’s a big investment for many businesses, and they need to know that they are going to see a return from it.
Q: Tell me more about the role the electrotechnical sector must play in our journey to net zero.
SB: The electrification agenda is a critical one. Nothing is going to happen without a capable supply chain, so our role is critical. I would say we’re the foundation for delivering on this agenda. If transport and heat is going to be electrified, then the supply chain must as well.
Q: How prepared is the electrotechnical industry to take advantage of the opportunity presented by the transition?
SB: If you look at what the opportunity consists of, take the electrification of transport for instance, the numbers are huge. 2020 saw a 168% increase in car sales in April this year. 28% of car sales were electric at the end of this year, so the balance is tipping towards sales of electric cars.
You can see where it’s going, but we need an infrastructure, so the investment required is significant.
When we look at electrifying heat in buildings, the numbers there are huge too. We’re looking at around 600,000 heat pumps that will need installing every year. We’ll get to 2028, then we add the electrification of the grid to the story, and the concept of a prosumer, and all these things offer opportunity for contractors – without them, nothing much is going to happen. Where are they in terms of delivering on this? They recognise the opportunity, but they’re looking for guidance. We need more of them to respond and make the decision to join efforts towards the transition, and they need that certainty to be able to do so.
Q: What else does the industry need to fulfil this journey?
SB: We need confidence and certainty in the business world. Businesses making the investment needed must be assured of a long-term potential for return.
We need skills and capability. There are a lot of people needed to deliver on the electrification agenda, and that means we need to upskill people who are already here, and bring lots of new people in.
We have to create the right business environment. 20% of businesses that have gone insolvent right across the economy are in construction, and 58% of those are in the specialist contracting areas. It can be a pretty volatile area to operate in, so they need that confidence, certainty of payment, and fair contractual arrangements etc.
And we need technical standards that are appropriate. Things like Part L of the Building Regulations, the Future Homes Standard all support new builds, but 80% of the buildings that will exist in 2050 are already here. We need to be clear on what we need to do with the existing building stock. And we need initiatives such as the National Retrofit Strategy which the Construction Leadership Council is pushing forward.
Q: What is the ECA doing to enable members to exploit these opportunities?
SB: There are two key areas – one around advice and support, and the other around influencing and creating the right environment.
We’re working very hard to help the industry understand the opportunity, evaluate what their role might be, and take advantage of that and put plans into action.
We do that through a whole range of things; guides, training, tools and webinars, networking, support on grants.
In terms of the creating the right business environment, we’re focusing on apprenticeships to support the workforce requirements and ensure the right skills are in place.
We’re also working with government, industry and broader stakeholders to make sure they understand some of the implications of this so that together we can create that right business environment.