The UK needs to embrace heat networks in urban areas. As the Climate Change Committee has acknowledged, it’s simply not possible for the UK to reach net-zero without the rapid scaling up of heat networks, from supplying 3% of the UK’s heating to 20%. This means rapid, at scale growth of this tried and tested technology, which has been heating homes in Europe for more than 100 years. In Sweden, for example, half of all heating is already provided by heat networks.

Given the right investment environment, the UK could replicate the work done by its European neighbours. UK cities contain an enormous amount of unused heat that can be captured and used to warm homes and businesses, and companies like Vattenfall stand ready to invest in this technology. The opportunity for investment sits at an estimated £60-80 billion by 2050, so it’s not an opportunity we should miss.

Vattenfall is currently working with three UK cities, with an ambition to increase this to between five and eight cities by 2030. We specialise in taking existing low carbon waste heat to heat homes. Heating now accounts for more than one-third of the UK’s annual greenhouse gas emissions, heat networks represent the perfect opportunity to deploy low carbon heating at the scale needed to tackle climate change.

As other sectors in the UK decarbonise, heating becomes an ever-bigger proportion of emissions left in the system. So, what’s needed to build much-needed investor confidence? We believe that government is gaining momentum, but we now need the rapid implementation of policy and delivery pathways.

The government is already making headway to improve investor confidence by taking steps to establish heat network zones and 170 have been identified as suitable for the development of heat networks across the UK. They are typically located in urban areas where the population is dense and there are heat sources in abundance to tap into. The Scottish government has already rolled out heat network zones and the UK government will quickly follow suit, enabling the deployment of the right type of heating technology in the right location.

The shift towards low carbon heating alternatives like heat networks is of course part of the just transition and zoning needs a combination of ‘carrot’ and ‘stick’ measures to be successful. For example, the government could make fossil fuel-based heating systems less attractive and implement a clear timeline on the phasing out of natural gas, so customers have the knowledge that at some point in time they need to switch to low carbon heating. This should be teamed with awareness campaigns for building developers, owners and residents who are required to join a heat network, because knowledge of heat networks is still low in the UK.

For the past 10 years, the UK and Scottish governments have provided much welcome funding to enable the deployment of heat networks, because they are crucial to the 2045 and 2050 net-zero targets. Vattenfall has been successful in securing funding from streams such as, the UK government’s Green Heat Network Fund for the Bristol Heat Network and Scottish Government's Low Carbon Infrastructure Transformation Project (LCITP) for the Shawfair project in Midlothian. Although we welcome this funding, they provide short term budgets and time limited schemes, whereas what we really need is to ensure the successful long-term rollout of heat networks.

Ensuring a level playing field for heat networks with other utilities is also crucial for investor confidence. Heat networks compete with other utilities such as natural gas, electricity, and individual heating systems, such as boilers and heat pumps. A level playing field is needed to promote market growth and facilitate the transition to low carbon heating.

Heat network investment and policy must be implemented in a way that prioritises the interests of the consumer, ensuring that they receive reliable, affordable, and high-quality heating services. Some key considerations for protecting consumers include transparent pricing, clearly outlining the costs associated with their heating service and establishing consumer rights, including guarantees of service quality, reliability, and safety.

Deploying heat networks provides local benefits, such as jobs, skills, improved air quality, and centralised heating and hot water, within the communities they are situated in. The locally centric nature of heat networks mean that they could become the most cost-effective form of heat in urban areas and more awareness of heat networks, and the benefits associated with them, is needed at a local level.

Heat networks also provide benefits to the wider energy system. By using all available diverse sources of waste heat, they can be a useful balancing mechanism, reducing pressure on the local grid rather than adding to it. In doing so, they reduce the need for grid reinforcement and offer cost benefits at a local and national level. This is important when we consider the need to keep the cost of the energy transition as low as possible in the interests of end users and consumers. 

We need the appropriate funding and policy to unlock the potential of low carbon heating solutions to mitigate climate change, improve air quality, enhance energy security, and create a more sustainable future for generations to come.