In an article written for Heating and Ventilating Review, Richard Harrison, CEO of Switch2 Energy, explains why heat networks are key to the UK’s net zero transition.
The government is right to target major heat network expansion as part of its heat decarbonisation strategy. Currently, only around 3% of the UK's domestic heat is supplied via networks, but the government aims to supply at least 20% by 2050.
Housing is a major greenhouse gas contributor, with 28 million homes accounting for 15 per cent of the UK’s annual carbon emissions. In large part, that’s due to the wide use of natural gas for heating, hot water and cooking.
Efficiency and flexibility
Heat networks can operate more efficiently than individual domestic boilers by providing heating and hot water from a central fuel source. They also provide the ultimate flexible pathway to net zero as they can be easily adapted to switch to new lower carbon fuels and technologies, as they become commercially viable.
The climate crisis is driving an urgent need to move towards low temperature heat networks and greener alternatives to natural gas, such as heat pumps, waste heat, and hydrogen (in the longer term).
This is starting to happen, but the challenge is to complete this transition cost effectively to ensure that heat is affordable for residents of heat networks.
Raising performance of existing networks
The cheapest and lowest carbon form of energy is that which you don't use in the first place, so energy efficiency is the starting point for any heat network - whether retrofit or new build.
An urgent priority for the sector is to improve the efficiency of the UK’s existing 17,500 heat networks. Many of these schemes operate at only 35 to 45% efficiency. As such, there’s huge potential to raise performance to levels achieved by the best performing legacy networks, which can reach 65%.
This can be delivered by taking a strategic and data-driven approach to operations and maintenance (O&M). The customers we’re supporting in this way are benefitting from significant carbon reduction, as well as reducing their energy and operational costs. Crucially, we can deliver this specialist O&M service at the same cost as standard, fragmented services.
These legacy heat networks must be fully optimised and operating at maximum efficiency and lower temperatures before retrofitting new low carbon technologies, such as heat pumps, or connecting to energy-from-waste schemes. This will maximise financial and environmental performance to deliver low carbon heat at the most affordable price.
Why heat networks can pump up savings
Heat pumps are seen as the prevailing solution for lower carbon heat networks, but without grant assistance, economic viability is currently tricky. However, as the industry rapidly scales and costs reduce, heat networks are ideally placed to lead the switch to heat pumps for 6 reasons.
- Flexibility - Communal heating schemes are ‘fuel agnostic’ and can be converted to other heat sources with relative ease and minimal disruption. The sector can thus provide much greater flexibility in shifting to renewables than conventional individual heating systems.
- Economy of scale - It stands to reason that a single central energy centre is more economical than many costly individual heat pumps. In addition, costs can be reduced by using a combination of energy sources.
- Thermal storage – is the cheapest method of storing energy and can be delivered more effectively and economically when managed in bulk via a heat network.
- Grid connection – The high cost of site power grid connection for heat pumps can be minimised by using progressive control and optimisation strategies, including thermal storage, to minimise capacity requirements. Heat networks with heat pumps and thermal storage also benefit from flexibility contracts to help reduce the costs of heating.
- Combine on-site solar generation – Solar panels can provide low-cost, 100% renewable power for heat pumps on networks – avoiding paying premium domestic rates for grid-supplied electricity and providing long term budget certainty.
- Noise and space - individual domestic heat pumps can be noisy and space consuming. Large scale centralised heat pumps on heat networks solve these problems.
Towards net zero
By developing and retrofitting the next tier of low and zero carbon heat networks, heat suppliers can deliver low-cost, efficient heating to homes, while supporting the government’s net zero target and meeting regulatory requirements.