How the UK Can Accelerate Industrial Electrification

Electric vehicle (EV) adoption in the UK has accelerated, but industry is not keeping pace pace with this transition.

The Climate Change Committee has published a report on progress toward 2025 targets and the findings show gaps in electrification beyond transport.

Emissions in the UK fell by 1.8% last year. This drop was supported by new renewable energy contracts and a 26% increase in peatland restoration.

Progress in electrification has slowed across multiple sectors. Heat pump installations in existing homes increased by only 7%, compared to 56% the previous year.

Industrial energy use patterns

The share of electricity in industrial energy use declined slightly. This decline increases exposure to fossil fuel price volatility and could jeopardise future carbon budgets.

"The government needs a more ambitious plan to electrify these key parts of the economy, including further action to reduce the cost of electricity," the Climate Change Committee concluded.

It says that UK households with gas boilers and petrol cars have experienced energy bill increases nearly four times higher than those of households with heat pumps and EVs since the start of the Ukraine war. This comparison illustrates the potential for cost savings through electrification.

"A typical household could save around £1,200 (US$1,580) a year today by combining an EV, a heat pump, solar panels and a time-of-use tariff," the report says.

Electrification projects face obstacles

Some high-profile, state-subsidised electrification projects have been implemented. The Port Talbot steelworks project is one example.

The report says that widespread industrial electrification has made almost no progress. The share of electricity in industrial energy use fell slightly last year.

According to the Climate Change Committee, economic factors are the main obstacle for manufacturing and industrial sustainability leaders. For many large users, industrial electricity-to-gas price ratios remain above 4:1.

This makes fuel switching financially difficult without efficiency improvements.

Policy recommendations from committee

"The transition to clean electricity is not happening fast enough," says Nigel Topping CMG, Chair of the Climate Change Committee.

"Government support to accelerate the shift to electric vehicles and heat pumps is critical, not only to keep our climate targets within reach but to unlock savings.

"This is about more than targets, it's about cleaner air, energy security and shielding the economy from fossil fuel shocks.

"Ultimately, this is about putting money back into people's pockets."

The Climate Change Committee recommends that the government accelerate grid connections. It also suggests removing network and policy costs that increase electricity bills.

"The UK isn't electrifying fast enough, and households and businesses are paying the price," says Helen Clarkson, CEO at Climate Group.

"Companies looking for energy security and resilience will be investing where governments are backing electrification, smarter grids, storage and a modern energy system led by renewables."

"If the UK wants to compete as a smart electric economy, the next Prime Minister must lock in the progress that's already underway."