UK's low-carbon heat networks receive £40m Government boost

The Government has outlined how it will allocate £40m to bring seven new low-carbon heat networks online across London, Leeds, Liverpool and Bristol.

The UK's heat networks currently serve about 500,000 customers, but this could rise to five million by mid-century 

The UK's heat networks currently serve about 500,000 customers, but this could rise to five million by mid-century 

Across the four city-regions, the funding will support the provision of clean heating to 30,000 homes.

Of the funding, £10.9m will be used on projects in Bristol. The city’s Old Market Heat Network will supply 10 office blocks, 4 residential blocks, two hotels and one school in the city centre, while a smaller project in Redcliff will cover the local commercial estate.

Enfield Borough Council will get £14.76m and Veolia South East London will receive a £5.5m pot. The former is seeking to heat 10,000 with waste heat, rising to 15,000 homes by 2030, while the latter is building a pipe to connect 3,500 homes with the South East London Combined Heat and Power plant.

Leeds City Council will receive a £2.4m share for infrastructure to deliver heat from the city Centre’s Recycling and Energy Recovery Facility (RERF) to five council buildings.

The remaining £1.3m is being awarded to Peel L&P’s Peel Energy Arm, for its Liverpool Waters project. Earlier this year, office blocks within the project were verified as net-zero carbon against the UK Green Building Council's (UKGBC) standard, in what Peel L&P described as a national first.

BEIS secretary Andrea Leadsom said that supporting heat networks, sometimes called district heating, will play a “crucial role” in the Government’s delivery of its 2050 net-zero target.

“Increasing the number of homes and businesses on heat networks is an important part of the Government’s plans to improve take-up of low-carbon heat as the UK seeks to end its contribution towards climate change entirely by 2050,” BEIS said in a statement.

“Heat networks are one of the most cost-effective ways of reducing carbon emissions from heating, and their efficiency and carbon-saving potential increases as they grow and connect to each other.”

The Department claims that the seven projects backed by the £40m pot will collectively mitigate 154,300 tonnes of CO2e emissions by 2035, compared to gas boilers.

The funding is being allocated by BEIS as part of its £320m Heat Networks Investment Project (HNIP), which opened in 2018 and will close in 2022.

From lagging to leading?

At present, less than 5% of energy used for heating homes and buildings in the UK comes from low-carbon sources. Heating and hot water account for around 15% of the UK's overall annual carbon footprint, with the nation currently off-track to meet a key target of ensuring 12% of heat is generated using renewables by the end of 2020. 

It is unsurprising, then, that the Government has faced multiple accusations of poor policy support for decarbonising heat in recent times.

In the lead-up to the general election in December, Committee on Climate Change chair Lord Deben said all major political parties have approached the issue “too delicately”, and that Westminster had not “shown the necessary degree of urgency” in light of the UK’s decision to legislate for a 2050 net-zero target. The CCC is calling for 18% of the UK’s heat consumption to be met with district heating by mid-century.

Similarly, Citizens Advice has consistently warned that failure to implement a "credible" framework for the decarbonisation of heat could undermine public confidence in the net-zero transition.

In a bid to overcome this criticism, BEIS is bolstering the £320m HNIP with an Energy Systems Catapult centre to assist small and medium-sized businesses (SMEs) with decarbonising their heat systems.

Triple Point Heat Networks Investment – one of BEIS’s delivery partners for the HNIP – said the moves made by ministers to date are “only the beginning of the story”.

“We know that there is a substantial pipeline of projects out there and as such this announcement today will be the first of many,” Triple Point Heat Networks Investment’s project director Ken Hunnisett said.

“We hope it helps to build confidence in the market and that it encourages others to come forward and take advantage of this unique opportunity.”

On the public trust piece, BEIS has this week opened consultations on a string of new protections for heat network customers. Proposals include establishing Ofgem as heat network regulator; mandating heat network operators to regularly report on prices and service; introducing new carbon requirements on new and expanding heat networks through to 2050; and offering new practical advice to developers.

BEIS claims that these measures, if implemented in full, will “ensure that customers are paying a fair price for their heating and getting good service by bringing the regulation of heat networks into line with other utilities”.

Sarah George



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beis | geo_uk_london | heating & cooling | low-carbon

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