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Heat network report eyes £30bn cut in UK investment hurdles

ETI public-private partnership set up between industry and government has set out eight-part strategy to cut upfront funding required to adopt district heating solutions

The Energy Technologies Institute (ETI) has set out recommendations to curb the upfront investment costs of district heat networks to improve UK take up of the technology.

The findings follow the UK government’s recent publication of its Clean Growth Plan, which pledged to finance the expansion of heat network as part of plans to improve energy efficiency and curb greenhouse gas emissions.

New findings commissioned by the ETI, a public-private partnership that includes the UK government, have identified eight solutions that could curb capital requirements by up to 40 per cent if combined. This is estimated to amount to a £30bn reduction in required national investment.

Despite district heating being an established means of heating in Scandinavia, as well as used for city-wide schemes in Germany, France and Eastern Europe, the report said the use of similar systems in the UK has been limited. This was attributed, in part, to cultural reasons and the availability of indigenous natural gas from the North Sea. The findings estimate that about two per cent of UK buildings are connected to district heating networks at present.

However, district heating is being put forward as a means of providing lower carbon heat, with 56 per cent of Britain’s heat demand coming from four per cent of the country’s total geographic area.

“[Heat networks] have the potential to deliver CO2 emissions reductions and cost benefits using low-carbon heat, waste heat from power stations and large-scale heat pump deployment, as well as reducing reliance on imported gas,” said a summary of the findings.

ETI commissioned design group AECOM to undertake an 18-month project to look at possible costs reductions for installing district heat networks and any supporting infrastructure, as well as overcoming broader barriers to their use.

The research was compiled in association with Total Flow and contained the following recommendations:

  • Create a new ‘District Heating Knowledge Centre’ that can coordinate approaches for research, training and innovation
  • Support lower flow rates and reduced pipe diameters by minimising peak demand and cutting return temperatures
  • Encourage alternative routes on external building walls or loft of cellar space to cut down on the cost of trench excavation
  • ‘Trenchless technology’ should be used to cut installation investment
  • Ensure contractors have better survey and design information ahead of starting work on heating networks
  • Share costs of civil work with other utility companies that may have plans for similar work in a specific area
  • Implement simpler system designs that use direct connection Heat Interface Units (HIUs) or keep existing hot water cylinders
  • Find further costs savings for HIUs through greater standardisation in the manufacture and development process

The report also called on the government to provide £10m to help realise these recommendations, with the district heat industry being asked to supply £5m.

Nicholas Eraut, ETI’s project manager for energy storage and distribution, said that heat networks were in use around the world to deliver large quantities of heat at times of high demand.

However, he argued that high initial capital investment and long installation times had hampered interest in larger scale implementation in the UK.

“Our analysis indicates that close to half of the UK’s existing heat demand could be economically connected to heat networks. We believe that, whilst industry can fund many of the activities required, central government is best placed to support the route maps in areas where commercial investment is unlikely, said Mr Eraut.

“We welcome the government’s commitment to building and extending heat networks across the country, both through its Heat Networks Investment Project and as part of its Clean Growth Strategy, and we recommend the route maps developed in this project to achieve greater roll-out, more quickly and at lower cost.”

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