14. Heat Networks

Heat networks are still regarded as one of the essential components of a low carbon future particularly in high-density urban developments. There are also many existing networks that were initiated through planning requirements (the London Plan) or in response to Government incentives like the Renewable Heat Incentive. In many of these, heating technologies are combined: biomass boilers or combined heat and power (CHP) provide heat for a base load and gas boilers deal with peak loads or as a backup when the gas biomass boiler or CHP engine is being serviced.

The management of these systems is generally not under the control of residents. There is also a perception that residents’ choices are constrained by a ‘virtual monopoly’, they cannot opt out of the heat network or shop around to achieve lower energy and service charges. The problem of a perceived lack of ‘customer choice’ and frustration with inefficiencies persists because residents are not necessarily the beneficiaries of previous policy incentives and the costs that contribute to the service charges are not being adequately explained.

Consumer organisations such as ‘Which?’ have campaigned for more transparency (Turning up the heat: getting a fair deal for District Heating users, March 2015) and a consumer champion, the voluntary Heat Trust has come forward. However, the Government has now appointed Ofgem as the heat networks regulator, as part of its plan to further expand low carbon heat networks. Ofgem will enforce consumer protection and regulate supply and operational functions.

One of the advantages of a heat network is that the combustion technology at the ‘front end’ can be changed without making alterations to all of the homes on the network. As gas is phased out, low carbon solutions will be more common, including heat from waste incineration and from landfill and from a number of emerging systems based around heat pumps.

Things that can go wrong:

• Inefficiencies and redundancy from blended (combined) technologies;
• CHP and Biomass turned off or underused;
• Under-delivery of carbon savings;
• Very high service charges.

Future-proofing recommendations:

• DESIGN: Design the network to work efficiently for householders;
• COMMISSION: Make sure the pricing tariffs and standing charges are properly explained and adopt the consumer protections recommended by the Heat Trust;
• COMMISSION: Ensure clear handover information on efficient operation is provided for residents.