Decarbonisation of Heat – How it Helps Reach Net Zero

Net zero and sustainability are common themes within public sector bidding and are only gaining more importance and attention by the day. Heat decarbonisation represents a significant challenge as most homes are not heated in a low carbon way. Currently, heating for homes and buildings accounts for a third of the UK’s carbon footprint – something has to change.

In this article, we will cover some of the insights shared with us by Alastair Thorpe, Account Director at Vattenfall – a multinational energy company owned by the Swedish state. We will explore how smart heat networks and district heating can contribute to decarbonisation and the overall journey to net zero.

What are heat networks and district heating?

Most people have a basic heating system at home, usually in the form of a gas boiler – this is an individual heating system. However, Alastair explains that this is very different to district heating – something that Vattenfall is an expert in.

In a district heating system – which can be part of a heat network – the heat comes from outside of homes instead of being generated within individual boilers.

Although district heating can mean different things to different people, in general, it is a system where a central location is used to heat a large number of buildings or blocks of flats. This achieves economies of scale as you are able to efficiently distribute heat and manage the process for a larger area, and therefore, save money..

How district heating can help in decarbonisation and net zero

District heating is very geographically-focused as pipes are built from the sources of heat to the buildings requiring that heat. This makes them perfect for built-up, urban environments like cities where there numerous buildings that need heating. In these locations, district heating is very effective at distributing heat, and thus, helps significantly in lower carbon footprint.

Often overlooked, a lot of buildings (e.g. factories, waste plants, data centres) actually produce excess heat that could be captured. District heat networks are able to collect and reuse this energy to heat and pump hot water directly into many homes and buildings using a network of insulated pipes, filling radiators and providing hot water for whole neighbourhoods and cities. This approach means fossil fuels don’t need to burned to heat homes and buildings, effectively reducing the carbon impact of heating on the overall environmental.

Furthermore, the system also allows for easy and efficient decarbonisation as hundreds or even thousands of buildings can be decarbonised all at the same time. This is much easier than decarbonising individual heat systems or boilers via an air source heat pump!

Heating systems in the UK

Whilst Vattenfall has decades of experience delivering large-scale district heating throughout Europe, currently they have mainly delivered communal heating within the UK (heating for individual blocks of flats or buildings). The main thrust for district heating, particularly within the UK, is currently for larger new build development projects.

District heating projects in the UK

Currently, Vattenfall is involved in several large-scale district heating projects in various cities throughout the UK including Edinburgh, Glasgow, London and Bristol.

For example, for the ongoing Riverside Heat Network project, Vattenfall is developing a district heat network to provide low-carbon heating for up to 21,000 homes in London. Energy from Bexley waste plant will be used to power this, which is a much more resource-efficient way of heating homes as it makes use of existing energy from waste before considering new sources of low-carbon heat.

Although the vast majority of district heating in the UK has been led by innovative and sustainable new build developments, these new build developments may well be the starting point of a wider project. These projects will likely present opportunities for existing buildings to connect to the district heat network and start using low-carbon heating in the future.

Energy Service Companies (ESCOs) and the role they play

Energy Service Companies (ESCOs) are companies that offer energy services which may include implementing energy-efficiency projects and renewable energy projects.

ESCOs tend to guarantee energy savings and/or provision of the same level of energy service at lower cost. This performance guarantee can take several forms:

  • Revolve around the actual flow of energy savings from a project
  • Specify that the energy savings will be sufficient to repay monthly debt service costs
  • Specify that the same level of energy service is provided for less money

They can finance, or assist in arranging financing for the operation of an energy system by providing a savings guarantee. Hence, ESCOs have to accept some degree of risk as the payment for their services is usually delivered based on the achieved energy efficiency improvements.

Funding for district heating projects

Funding for heat network projects can be problematic as they are often large projects involving high capital expenditure that can take a long time to realise return on investment (ROI).

Vattenfall has an advantage as they are owned by the Swedish State, providing them easier access to cheaper funding (through a rigorous application process) to continue delivering out projects that help in carbon reduction.

This funding received allows Vattenfall to undertake larger projects, such as the one in Bristol, where they are developing a heating system (under the Bristol City Leap partnership) that will connect 90,000 properties and help towards decarbonising the entire city. This would certainly be impossible to do without the right funding.

Heating technology used in heat systems

We are now moving away from the convenience of gas boilers and more towards various heat technologies that deliver better environmental outcomes.

A major benefit of large-scale projects (town or city-wide scale) is that they can benefit from various heat sources such as factories, data centres, and waste plants. This is a major benefit as they are able to reuse this heat energy that would have otherwise been wasted.

Large infrastructures are also flexible and can use a wider range of technology. For example, if users require intense heat but cannot wait for the air source to provide it, the system will adapt and use another source of heat, such as e-boilers which are more efficient than gas boilers.

However, with the constant advancements in technology, it is still unclear which technologies will come out on top. Fortunately, this should not matter for district heat systems as they will be able to adapt and use different sources of heat and technology.

The future of district heating

Overall, the flexibility of district heating to use various technologies and sources of heat allows them to be a future-proof solution that is cost-efficient and more environmentally friendly.

At the moment, there are already several district heating projects being delivered in the UK. Vattenfall remains committed to promoting the use of district heating throughout the UK, as this will ultimately play a critical role in the decarbonisation of heat and the UK’s journey to net zero.

With thanks to Alastair Thorpe, Account Director – Vattenfall
Our UK Business – Vattenfall