Considering the future of heat networks in the UK
In its recent report ‘Heat Networks in the UK’ the Association for Decentralised Energy (ADE) has highlighted new opportunities to transform the way we heat homes and buildings. The Heat Networks in the UK report notes that £320m of government funding has been allocated for growing the heat networks market – and that this is likely to draw in a further £2bn of additional capital investment. The hope is that this will lead to the construction of hundreds of heat networks in England and Wales. Scotland hopes to connect 40,000 homes by 2020, providing 1.5TWh of heat through heat networks. Such a boost in heat networks in the UK can have a significant effect on fuel poverty. The heat network consumer survey by BEIS (Dec 2017) suggests that heat network consumers, on average, pay around £100 a year less for their heating and hot water, compared to non-network consumers.
The report concludes that as much as 50% of the UK’s building stock is in areas of suitable density for heat networks, with the potential to reduce CO2 emissions by up to 5.7Mt by 2030.
In a related document (entitled Shared Warmth), the ADE has also reported on a stakeholder collaboration that has produced a set of proposals and principles around the role of heat networks in a decarbonising economy. To that end, the Association created the Heat Network Task Force in order to consider how best to address the key issues of investability and customer protection.
The Task Force has concluded that a regulatory framework is required to reduce risk for potential investors. This framework would be based on addressing future heat demand risk and, in doing so, would also establish a route to ensure customer protection.
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