Agenda item

Jonathan Graham, Head of Policy at the Association for Decentralised Energy (ADE) gave a presentation on District Heating and Heat Consumers.

In the presentation and discussion, the following points were made:

·         The ADE vision was “for an energy system that was dictated by the consumers needs rather than one that dictated to them, creating a more local, efficient and less costly energy system”.

·         The following services were delivered: - Combined heat and power; district heating and cooling; and demand side services.

·         The ADE had more than 90 members which included local authorities, housing associations, university campuses, industrial manufacturers and energy suppliers and it was funded by members.

·         District heating was common in other European countries. It was most common in Scandinavia, Germany and Sweden.

·         There were currently 405,000 dwellings in the UK with district heating and 4% of heat demand was met by district heating schemes. There was a Government ambition to grow district heating to meet 14% of heat demand by 2030, where suitable. However district heat not the right solution in all places. It worked best in urban areas with high density.

·         There were 50,000 dwellings on modern district heating schemes and new build and retrofit planned projects would provide district heating to a further 50,000-60,000 dwellings.

·         377,000 dwellings had been put on district heating systems as a result of block heating refurbishment. This equated to 2% of dwellings.

·         There was potential for 3-8million dwellings to have district heating.

·         District heating was growing at about 10% per year. There was much investment in London through the London Plan and ECO delivery.

·         32 university schemes had been completed and 17 more were planned. 64 hospital schemes had been completed with a further 20 schemes possible.

·         Local authority led development required authorities to undertake energy master planning, address planning requirements, conduct brokering, procuring, operating and owning heat networks and direct ECO funding.

·         Emerging schemes included Leicester City Council, Newport City Homes Limited, Manchester – Media City, Newcastle - Riverside Dean, Stoke and Association of Greater Manchester Authorities.

·         London schemes included Olympic Park and Stratford City, Southwark SELCHP, Guildhall, Bastion House and London Central Markets, Pimlico District Heating, Bloomsbury Heat & Power, Kings Cross, Barkantine Heat and Power, Greenwich Millennium Village, Shoreditch and Bunhill in Islington.

·         Established schemes with growth potential included Birmingham, Nottingham, Shetland Heat, Energy and Power, Southampton City Council, Woking, Sheffield, Milton Keynes and Aberdeen Heat & Power.

·         Benefits of district heat included being able to access a wider range of heat generation technologies, being able to generate heat more efficiently, lower energy costs, reduce labour and maintenance costs as well as CO2 emissions. It also helped to tackle fuel poverty and cold homes.

·         Challenges included high heat network losses which added to costs and could cause overheating, systems not being designed to exploit value from CHP electricity sales, capital cost cutting (‘value engineering’) resulted in higher running costs, there could be poor communication between contractors, district heat suppliers and building managers/network operators and a lack of transparency between network operators and customers.

·         The Heat Network Code of Practice set minimum technical standards and obligations for all parts of the supply chain. Training and accreditation schemes were planned. The Department of Energy and Climate Change supported this programme with grant funding.

·         The Heat Metering and Billing Regulations required building level meters to be installed by the end of 2016. Meter visibility and accuracy was required and bills would have to be linked to usage. Members raised concern that the regulations could present a challenge as tenants’ charges were currently pooled.

·         The Heat Trust was a voluntary scheme designed to ensure customers received a comparable level of standard as on gas or electricity services. It was open to all customers with direct relationships with the heat supplier. The initial scheme might not be compatible with housing association or local authority schemes if heat was not sold directly to customers. The scheme would be launched in September 2015.

·         Gas unit costs were not the same as heat unit costs. A true comparison had to include not just the unit cost of gas but also the gas standing charge, boiler maintenance costs and boiler replacement costs.

·         A new heat cost comparator provided an online resource for customers.

·         Ways to ensure high quality district heating included setting minimum design standards set by the Code of Practice, ensuring technical expertise in planning and using the Heat Trust, where appropriate. Any planning measures should aim to apply to all technologies. These measures should help provide residents with the highest quality housing and heating.

·         The council regularly applied for ECO funding. It had recently been used for the Holly Park Estate solid wall insulation.

·         Recent research found that installing individual heating controls did not reduce demand.

RESOLVED:

1) That the evidence be noted.

2) That the committee would consider the Heat Trust and code of practice at a future meeting.