Green light for district heat expansion
3 Apr 2013
London - Plans are in place for a major programme of investment in new district heating infrastructure in communities across the UK, energy & climate secretary Ed Davey has announced.
Launching a new strategy paper for district heating, Davey outlined proposals to invest in new networks in towns and cities. This is to operate alongside and in some cases displace gas networks.
The policy envisages the establishment of a new Heat Networks Delivery Unit within DECC to support local authorities and communities in accelerating decision-making and new project development.
Together with initiatives already underway in London and other cities, the new measures could accelerate early investment of around £300 million in new low-carbon infrastructure, believes Graham Meeks, director of industry body CHPA (Combined Heat & Power Association).
The plan, he said, could also be a platform for an estimated £2bn of investment each year in the coming decades – creating tens of thousands of local jobs in engineering, contracting and operations.
‘Modern heat networks are efficient, fuel-flexible, convenient and controllable,” said Meeks. “Heat accounts for the largest proportion of household energy costs, and district heating offers householders secure and reliable heat along with the scope to control rising energy bills.”
The strategy paper also addresses heat use in industry and underlines the important role for combined heat and power (CHP) technology in providing reliable and affordable low-carbon heat to these consumers.
Meeks welcomed this endorsement, but sounded a note of caution over prospects for capacity growth: ‘The strategy reinforces the value of CHP as a means of controlling energy costs to business and supplying reliable, low-carbon heat to emerging district heating networks.
“But the reality of today’s market is one of low coal and CO2 prices undermining CHP economics. We now need to establish a coordinated and focussed policy for CHP that can sustain our existing capacity and build confidence for the new wave of investment that is essential to meet the goals of the Heat Policy.”
For domestic consumers, though, Jeremy Bungey, head of E.ON’s Community Energy, saw the DECC announcement as an endorsement of district heating and the role it can play in reducing carbon emissions and energy bills.
“Right now, E.ON is developing projects in many major cities across the UK, quite literally building energy efficiency into the foundations of communities,” said Bungey. [This] announcement gives us as a company and the communities we work with the confidence to move forward.’
Heat networks can offer better long-term value for heat consumers when compared to the traditional utility solution, notes Ian Whitelock, joint MD of Vital Energi – a district heating developer.
“At Vital Energi we have invested heavily in staff and training, increasing our workforce by 53% in the last two years. The capacity building that DECC is now offering is an important step in bringing local authorities to the market, supporting our efforts to grow the business and provide stable long-term jobs and opportunities for people,” Whitelock said.
