National Grid Future Energy Scenarios: What It Means for the North West
National Grid’s Future Energy Scenarios (FES) map out how the UK’s energy system could evolve through to 2050. The 2024 edition presents four pathways, each with different implications for how Lancashire homeowners heat their homes, charge their cars and pay for electricity. Understanding these scenarios helps you make better long-term decisions about home energy investments. The consistent message across all four pathways is that the energy system is changing fundamentally, and homes that adapt early will benefit most.
The Four Scenarios: A Quick Overview
National Grid models four scenarios, ranging from the slowest to fastest decarbonisation. Falling Short assumes limited progress on net zero, with continued reliance on gas heating and slow EV uptake. System Transformation relies heavily on hydrogen for heating, with the gas grid converted to carry hydrogen. Consumer Transformation focuses on electrification with heat pumps, EVs, and demand-side flexibility becoming the norm. Leading the Way is the most ambitious scenario, achieving net zero by 2047 through rapid electrification and behaviour change.
For the North West specifically, the most likely outcome is a combination of Consumer Transformation and System Transformation elements. Lancashire and Greater Manchester’s extensive gas grid infrastructure makes hydrogen conversion technically feasible, but the current momentum behind heat pump installations and the government’s policy direction strongly favours electrification. Most energy analysts consider heat pumps and electrification the most probable pathway for the majority of UK homes.
What the Scenarios Mean for Home Heating
In the Consumer Transformation scenario (which aligns most closely with current government policy), the number of heat pumps in UK homes grows from roughly 400,000 today to over 10 million by 2040. Gas boilers are phased out of new installations from 2025 (through the proposed building standards) and existing installations from 2035 (subject to consultation). Lancashire’s approximately 650,000 homes would need to transition from gas to alternative heating over a 15 to 20-year period.
The System Transformation scenario offers an alternative where the gas grid is converted to hydrogen. In this pathway, Lancashire homeowners would keep a gas boiler (or replace it with a hydrogen-ready model) and the gas network operator would gradually blend and then switch to 100% hydrogen. Several UK hydrogen trials are underway, including the HyNet project in the North West, which could supply hydrogen to parts of Lancashire. However, the timeline and cost of full hydrogen grid conversion remain uncertain.
For Lancashire homeowners making decisions today, the safest investment is a heat pump. It works under any scenario – if hydrogen arrives, you still have an efficient electric heating system that costs less to run than hydrogen would. If hydrogen does not materialise (which many experts consider the more likely outcome for domestic heating), you are already on the right path. Investing in a hydrogen-ready gas boiler is a reasonable hedge if you are replacing a broken boiler now and are not ready for a heat pump, but it does not future-proof your home as effectively.
Electricity Demand and Grid Upgrades in the North West
All four FES scenarios show significant increases in electricity demand, driven by heat pumps, electric vehicles, and the electrification of industrial processes. By 2035, UK peak electricity demand could be 30% to 50% higher than today. For Lancashire’s electricity network (operated by Electricity North West), this means substantial investment in local grid capacity.
Electricity North West has published its own investment plans to accommodate the transition. Priorities include reinforcing substations and cables in residential areas to handle increased demand from heat pumps and EV chargers, installing smart grid technology to balance local supply and demand, connecting new renewable generation (solar farms, onshore wind, and potentially tidal energy from Morecambe Bay), and enabling vehicle-to-grid and domestic battery storage to provide flexibility services.
For Lancashire homeowners, the grid upgrades mean that connection capacity should be available when you want to install a heat pump or EV charger. However, some older parts of the network, particularly in rural areas, may need local reinforcement that could take 6 to 18 months. If you live in a rural Lancashire area and are planning a large electrical installation, check with Electricity North West about your local network capacity before committing.
Energy Prices Under Different Scenarios
The FES modelling suggests different price trajectories depending on the pathway. In scenarios with high electrification (Consumer Transformation, Leading the Way), electricity prices may decrease in real terms as renewable generation increases and the cost of wind and solar continues to fall. Gas prices are expected to remain volatile, tied to international markets, and potentially increase if carbon pricing rises.
The ratio between electricity and gas prices is critical for heat pump economics. Currently, electricity is about 3.6 times the price of gas per kWh (24.5p vs 6.76p). A heat pump with a COP of 3.0 produces heat at the same cost as gas only when this ratio is 3:1 or less. Government policy to rebalance green levies from electricity to gas (or to general taxation) would improve this ratio, making heat pumps cheaper to run than gas boilers.
Under the Consumer Transformation scenario, electricity prices could fall by 10% to 20% in real terms by 2035, while gas prices rise by 10% to 30%. This combination would make heat pumps clearly cheaper to run than gas boilers, strengthening the financial case for Lancashire homeowners who switch early.
Renewable Energy in Lancashire’s Future
Lancashire and the wider North West are well positioned for renewable energy growth. Offshore wind in the Irish Sea (including extensions to Walney and the proposed Morecambe Bay wind farm) will provide increasing amounts of clean electricity to the region. Onshore solar farms are appearing across Lancashire’s agricultural land. Community-scale battery storage is being deployed to smooth out intermittent renewable generation.
The HyNet carbon capture and hydrogen project, centred on Merseyside but extending into parts of Lancashire, could provide low-carbon hydrogen for industrial use and potentially some domestic heating. However, the project’s focus is primarily industrial, and domestic hydrogen distribution remains uncertain and is unlikely before the 2030s at the earliest.
For Lancashire homeowners, the growing renewable capacity means the electricity powering your heat pump and charging your car will become increasingly clean over time. A heat pump installed today runs partly on gas-fired electricity; by 2035, the same heat pump will run predominantly on wind, solar and nuclear. The carbon footprint of electric heating will continue to fall, making it an increasingly green choice as well as a financially sensible one.
What Lancashire Homeowners Should Plan For
Regardless of which scenario unfolds, certain trends are consistent across all pathways. Electricity will play a bigger role in home energy. Insulation will become more important as the energy system changes. Smart technology (smart meters, smart thermostats, smart EV charging) will be essential for managing costs. And homes that are already efficient and electrified will be best positioned for whatever the future holds.
The practical actions remain the same. Insulate your home to reduce total energy demand. Consider a heat pump when your boiler needs replacing. Install solar panels if your roof is suitable. Switch to an EV when your car needs replacing. Use smart controls to optimise energy use. Each of these investments pays for itself under any future scenario and positions your home for the lowest possible energy costs in the decades ahead.
Should I wait for hydrogen instead of getting a heat pump?
No. Hydrogen for domestic heating is uncertain, expensive, and unlikely before the 2030s even in trial areas. A heat pump works under any future scenario and starts saving money immediately. If hydrogen eventually arrives in your area, you can reassess at that point. In the meantime, every year you delay switching from gas costs you the difference between gas and heat pump running costs – money you will not recover.
Will electricity get cheaper in the future?
The FES models suggest electricity prices may fall in real terms as renewable generation grows and costs decrease. Government policy to rebalance green levies from electricity to gas would also make electricity relatively cheaper. While nothing is guaranteed, the direction of travel favours lower electricity costs relative to fossil fuels, which benefits heat pump owners, EV drivers and solar panel owners.
What is HyNet and will it affect Lancashire homes?
HyNet is a carbon capture and hydrogen production project centred on North West England. It may produce hydrogen for industrial use and potentially some domestic heating in parts of Lancashire. However, the project’s primary focus is industrial decarbonisation, and domestic hydrogen supply is not expected before the 2030s. Lancashire homeowners should not factor HyNet into their heating decisions today – it is too uncertain and too far away to influence current choices.
