The Future of Heating in London

March 2013: The Government’s Future of Heating policy paper released yesterday gives prominent coverage to activities underway in London to promote the use of decentralised energy systems through the use of district heating and high efficiency Combined Heat and Power (CHP) systems. The paper includes the following:

  • A case study of The Shard CHP heat network [p41]
  • How Islington Council, the GLA  and UK Power Networks are working together on “a proposed extension of the existing Bunhill heat network that will capture and use identified sources of waste heat produced within the area, such as from a nearby electricity sub-station. This project will help London and its boroughs to identify, capture and make use of urban sources of waste heat and play an important part in developing their lower carbon, lower temperature heat networks ofthe future” [p43]
  • That the Mayor “has committed to generating 25% of London’s energy requirements through the use of local, decentralised energy by 2025.  The ‘London Plan’ indicates that this target will be predominantly met through gas-fired CHP and heat networks.To support the delivery of this target, in September 2011 the GLA established the Decentralised Energy Project Delivery Unit (DEPDU) to support the London boroughs in bringing forward plansfor decentralised energy. The unit, which is staffed by technical, financial and commercial specialists,has focused primarily on developing heat network projects. So far, the unit has supported the majority of boroughs to develop in excess of 25 projects ofwhich seven have been taken to market and five are close to that stage for investment in thecapital costs of building the network. Four of the projects, in particular, feature key barriers thatneed to be overcome to deliver heat networks at scale: linking two existing schemes, creating a strategic network with multiple heat sources, whether local-authority led schemes can be transferred to the private sector or expanded to join a private sector scheme, and connecting existing and future low carbon heat sources” [p55]
  • “The principle of this proposed heat network in North London is to capture otherwise unused low carbon heat from waste-to-energy facilities in the Edmonton area of the Lee Valley and othersources of heat in later stages of development and supply the heat to existing businesses andresidential customers as well as to new developments. This will include connections to existing smaller networks. The GLA’s role in sponsoring the early-stage development of the project is tocreate a ‘strategic network’: a large pipe that can collect heat from several sources and deliver it tocustomers across a wide area. While common in other European countries such a strategic heatnetwork has yet to be built in the UK. For the London boroughs of Enfield, Haringey and Waltham Forest, who are taking part in this project, the expectation is that it will deliver significant benefits, including inward investment, new jobs, low carbon heat, and a reduction in fuel poverty” [p55]
  • There is a need for better access to the electricity market for smaller electricity generators and suppliers whose electricity salesare an important part of the economics of the competitive supply of energy by heat networks.DECC will continue to support the implementation of Ofgem’s Licence Liteproposals (referred to in the section on policies in place now) which, if successfully implemented, have the potential to offer significantly improvedmargins on the sale of electricity from small scale CHP systems of the type connected to heat networks. The Mayor of London has applied for a Licence Lite licence and DECC will monitor the progress the Mayor makes and any barriers he encounters closely [p59]
  • In February 2013 the GLA’s DEPDU published the District Heating Manual for London which contains (inter alia) principles ofheat network design, heating standards and construction. However, the proliferation of advice can confuse installers, engineers andthose involved in commissioning new schemeswhere advice differs. DECC will work with industry and local authorities to consider howto publicise and embed new harmonised standards. Anything new must draw upon the wealth of existing guidance in the UK and elsewhere in the EU. It will also be important for any technical standards to be used by the whole heat networks industry [p61]
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