The rise of energy-efficient heat networks in the UK’s public sector
To meet the wider ambition of reaching net zero by 2050 in the UK, it is essential that the public sector faces this challenge head on by realising the importance of developing local energy networks, writes Channa Karunaratne, Regional Director for Decentralised Energy at AECOM.
With around 30 million buildings in the UK, the energy used to heat them contributes to almost a quarter of all UK emissions. Finding a way to eliminate the carbon emissions produced by heating systems in public buildings is now critical.
The drive to reduce our reliance on high-carbon fossil fuels is leading to the exploration and implementation of a variety of low-carbon heating solutions within the public sector. Given the scale of the challenge, expert advice and support will be needed to enable a smooth transition to more energy-efficient heat networks.
Part of achieving net zero involves securing a commitment to decarbonisation within the public sector, supported by strong leadership, investment and reliable expertise. In October 2020, the government launched the Public Sector Decarbonisation Scheme, providing grants for public sector bodies to fund heat decarbonisation and take measures to achieve greater energy efficiency. The scheme supports the aim of reducing emissions from public sector buildings by 75 per cent by 2037, compared to a 2017 baseline.
Not only will this provide dramatic cost savings for organisations, but it will also improve lives and support up to 240,000 vital skilled green jobs, to be created by 2035. Along with addressing the current economic recovery, future generations will also benefit from cheaper, more resilient, more sustainable energy.
Heating for the future
Delivering sustainable energy sources within both domestic and commercial settings has been a growing concern in recent years, further accelerated by the ongoing war in Ukraine and subsequent spike in global energy prices. While there is no one size fits all solution, a number of local authorities are exploring the benefits of local heat networks.
At the end of 2021, over £20million in government funding was allocated to convert UK homes, university residences and public buildings to cleaner, more affordable heat and energy. Drawn from the government’s £320million Heat Networks Investment Project, the investment will go towards setting up five new local heat networks: two in Bristol, and three across Liverpool, London and Worthing. These networks will provide households and workplaces with low-carbon, cost-effective alternatives to traditional energy-intensive, heating solutions such as gas boilers. The ambition is for 15-18 per cent of heat to be generated from these networks by 2050. We think that we can (and should be) more ambitious than this.
District Heating (also known as communal heating at a smaller scale) supplies heat from a central source and delivers it to a number of buildings via a network of underground pipes. The heat source might be a facility that provides a dedicated supply to the heat network, or heat recovered from industry and urban infrastructure, canals and rivers, or energy from waste plants. An advantage of these networks is scalability, as they have the potential to supply new homes or buildings from the existing network over time, without the need to make large structural changes to other buildings or roads.
The use of heat networks in the UK is not new. In the 1960s we started using them for blocks of flats, and many are still in use today. But following a decrease in popularity through the 1980s and 1990s, the rise in energy prices since 2000 and the increasing focus on low carbon heat has improved the financial case for heat networks. To date there are more than 17,000 heat networks in the UK. This is still something like three per cent of total heat, compared to the government’s target of 18 per cent.
Public sector authorities are now taking advantage of the heat network proposition as a viable option in the drive to reduce their own carbon footprint and decarbonise their estates. These projects are often major redevelopments to existing heat systems involving complex discussions to ensure the changeover is successful. The network may need to also factor in building system adaptations, to connect existing public sector buildings.
Supporting sustainable solutions
Public sector clients require expert consultancy on energy efficient infrastructure and building solutions, across a range of different methods, whether through land disposal, refurbishing existing facilities or sourcing potential revenue streams for existing sites.
Many of Perfect Circle’s public sector clients have asked for support as they bid for funding within very tight timeframes. Sources include Salix Finance, which is wholly Government-owned (and is funded by the Department for Business, Energy and Industrial Strategy, the Department for Education, the Welsh and Scottish Governments) provides funding to the public sector to improve energy efficiency, reduce carbon emissions and lower energy bills.
Being able to maximise funding to invest in low carbon alternatives is where Perfect Circle has been able to support, ensuring works can be carried out as cost effectively, quickly and simply as possible. Equally, achieving this transition requires rigorous planning to allow for a smooth process, which can be supported with our expertise and capacity to deliver with an integrated supply chain.
On the ground: two projects in action
Of course, navigating complex projects with the right partners is key. Perfect Circle’s consultancy supply chain and network of specialists are currently delivering several decarbonisation projects across the UK, working to meet the target of a minimum of 18 per cent of our energy powered via heat network energy by 2030.
One such example is the Huddersfield Heat Network commission for the Council of the Borough of Kirklees.
This project is to deliver the development phase for a heat network in Huddersfield Town Centre area and its surroundings, utilising an existing Energy from Waste (EfW) plant as the preferred primary heat and power source.
Waste energy from a Huddersfield incinerator is to be converted into low carbon energy, for use in powering a number of homes and businesses in the local area. Reduced energy prices, a dependent source of energy and refreshed job opportunities through project management, operational and maintenance needs, are among the benefits created. It will also eliminate the need for gas boilers.
Following successful master planning and detailed feasibility studies, a technically optimised and economically viable project has been identified, which the client took to the Detailed Project Development (DPD) stage, with funding secured from the BEIS Heat Networks Delivery Unit. The DPD stage takes the project from feasibility and into project development and commercialisation, resulting in a business case which is the gateway for construction.
AECOM, a founding partner of Perfect Circle, has completed DPD, with a very positive uptake from the council and a successful Green Heat Network Application, which will provide up to 50 per cent of the capital towards the building of the network. AECOM is currently working on the commercialisation of the project, which includes detailed design and negotiation with oftakers.
For another project in West Sussex, Perfect Circle via AECOM was brought on board for the feasibility and procurement stage of Worthing District Energy Network, helping design an innovative market facing solution for the delivery of a heat network. The construction contract award starts from April 2023, with ‘heat on’ by 2025. The project will help Worthing Borough Council meet its declared aim to be carbon neutral by 2030, as well as the decarbonising of Worthing by 2045.
The project will heat approximately 22 existing buildings in Worthing town centre, including satellite buildings such as the Splashpoint Leisure Centre and Worthing Hospital – which will be the first hospital on a heat network not operated by the NHS. With a further five large development sites currently in planning stages, the network will be a major factor in supplying energy for future generations.
The next steps
Perfect Circle has countered the challenges faced by many local authorities and the public sector to realising ambitious decarbonisation projects with accelerating appointment via the SCAPE Consultancy framework. As we progress with Phase 3 of the Public Sector Decarbonisation Scheme, it is more important than ever to seek expert support.
Phase 3 will provide £1.425 billion of grant funding over the financial years 2022/2023 to 2024/2025, through multiple application windows. The speed that Perfect Circle can be appointed to projects offers huge advantages, meaning that decarbonisation projects can continue to progress at pace. Working together, the UK can reach its net zero targets, offering real change and benefitting not only the plant, but communities across the country.
A version of this article was originally published on the Perfect Circle website. Channa Karunaratne is one of Perfect Circle’s founding partners.