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District heating is making a comeback! These heating systems are winning support from the Government, landlords and planners alike as we look for energy-efficient alternatives to conventional heating systems. Casey Cole, Managing Director at Guru Systems, explains how modern-day technology is helping to reignite enthusiasm for district heat.

District heat is enjoying a renaissance.

Having been all but confined to history after the demise of the ‘streets in the sky’ building programme of the 60s and 70s, many are now turning to modern day district heat networks as a long-term solution to providing low-carbon energy to our housing stock.

It is more than 50 years since the concept was first introduced in the UK, and the mistakes of the past have been well documented.

Today, however, the landscape couldn’t be more different.

New technology, with the support of Government financing, means that district heat is now a reliable source of energy that is increasingly easy to monitor and manage.  

The Department of Energy and Climate Change estimates that 14% of UK heat demand could be cost effectively met by heat networks by 2030, with the figure rising to 43% by 2050. While in the capital, the Mayor of London has set out plans for 25 per cent of heat and power used in London to be generated through the use of localised decentralised energy systems by 2025.

Planners are similarly championing its use in new housing developments, particularly in London, as they promote an “eco-first” approach to planning permission.  

Robin Feeley, Director of L&Q Energy, which manages 2,000 homes on 33 district heat networks across London and the south east, said: “In London in particular, district heat is no longer a choice, it is a necessity and as developers, housing association are having to adapt and fast.

“The technology developed to monitor these networks has come on leaps and bounds in the last few years and in many ways housing associations are leading the way in implementing these advancements and pioneering new technology, including smart meters.”

The 21st century district heat schemes benefits have been widely publicised, as energy is distributed from a central hub, rather than from boilers in individual properties, heat networks are more energy efficient than conventional heating systems and allow landlords to supply low cost heat to their tenants.

The challenges

Heat networks are notoriously difficult to administer, especially as landlords are not allowed to make a profit from the energy they sell to their tenants. If they charge too much they face legal challenges, if they charge too little they could lose money every time a tenant turns on their heating.

In most cases landlords will set tariffs based on the expected performance of the system – not on real world data that shows how well the network is actually working. This means that if initial assumptions are inaccurate, or there is a sudden dip in efficiency through a fault in the network, costs for landlord could spiral rapidly.

At Guru, we have seen cases of a 100-home scheme losing £65k in 14 months, simply because their tariff had assumed a much better efficiency than was achieved in practice.

The landlord billed their residents every month according to aggregate consumption, but they had not had access to performance data and so did not know their tariff was wrong.

The technology

With landlords having to take on the unfamiliar role of energy provider – and facing a raft of technical and legal ramifications – housing professionals are mixing traditional ideas with new technology to bring district heat into the modern age.

Robin Feeley continues: “We spent five years refining our district heat networks to the point where we have a produced a technical specification for our networks. At first, like I am sure many housing associations were, we relied heavily on contractors to specify what we needed.

“Since first installing district heat networks, technology has transformed the way we deliver and monitor the energy we provide to our tenants, to such an extent that we are now revisiting earlier developments to install smart meters where previously we had old-fashioned prepayment meters.”

The majority of landlords have no way of knowing how well their networks are running as the data is collected monthly, rather than being logged minute-by-minute. While many recognise the need to provide cost-effective heating to their residents, the majority have no way of reviewing efficiencies on their networks.

Although older heat meters provide essential data, most of it remains unused due to antiquated data collection systems. Some operators of district heat networks rely on customers to provide readings or send an operative with a radio receiver to collect readings from each meter, while others are using the 20-year-old technology to transmit data on usage from individual homes.

These basic methods mean that if landlords are calculating their tariffs incorrectly or networks are not running efficiently, they can suffer huge financial losses in the months between meter readings.

Today housing associations can monitor key information on how the network is performing – from the central plant right through to each individual’s home – meaning landlords can quickly identify any issues in the network long before costs mount up.

By delivering real-time information on energy usage and payments, smart meters allow registered providers to identify and focus resources on vulnerable residents who are in fuel poverty and in immediate need of support.

The technology to manage and monitor heat networks is constantly advancing. Guru Systems recently won funding from the Department of Energy and Climate Change to develop an algorithm to evaluate the efficiency of schemes.

Using innovative algorithms that build on techniques developed for Big Data applications, the technology will be able to recognise patterns in performance data and identify the likely source of any inefficiency on networks.

As well as identifying the problem, the new system will also propose solutions ranked by cost-effectiveness, while machine learning will ensure the algorithm’s accuracy continues to improve the more data it analyses.

Guru Systems has seen its technology installed on 35 schemes across the UK for landlords including, L&Q, Affinity Sutton, Octavia Housing, and Peabody Trust, and private developers, such as Berkeley and Telford Homes.

Casey Cole is Managing Director of Guru Systems, which provides smart payment and energy-efficiency technology systems for local energy networks 


This feature was originally published in the April edition of Housing Association and Building Maintenance Magazine. To read more great articles, visit www.habmonline.co.uk

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By Steve Richmond, Business Team Manager for REHAU Ltd’s Renewable Energy department

The introduction of the Non-Domestic RHI in November 2011 helped to trigger significant growth in small scale district heating.  REHAU realised this potential and it was one of the drivers in our decision to invest in UK district heating pipe production in the Spring of that year.

Since then, a small scale district heating market which has been until now, dominated by sub 200kW biomass boilers has recently broadened to include CHP solutions (gas and renewable), anaerobic digestion and heat pumps as well, showing just what a wide range of heat source options are possible.

Moving forward, the likely reduction in the 200kW small biomass tariff on 1st July 2015 may actually have a positive effect on best practice system design, discouraging possible over/under sizing of the plant.  I’m certainly hoping to see more projects sized more appropriately in the future regardless of the heat source chosen, with the emphasis shifting from tariff banding to optimum efficiency.

Polymer district heating pipe can easily accommodate up to ca. 2MW in a single 160mm pipe, making it the material of choice for many of these small to medium scale schemes.  Steel pipes are ideally suited to  large, city-wide projects which require bigger pipe diameters (eg 500-1000mm), whereas polymer pipes offer significant installation savings on the small to medium sized projects.

The emphasis needs to be on reducing flow/return temperatures since this is what makes schemes more efficient in terms of heat losses, and reduces capital costs because it allows the smaller pipe sizes to be used.  This message was reinforced recently in the CIBSE Code of Practice which encouraged specifiers to focus on the importance of good system design. Training courses on this Code of Practice and manufacturer-led training such as CPD courses and design courses are key to ensuring best practice in this growing industry.

Personally, I hope that more community-based heat pump schemes are installed as they are ideal in terms of efficiency and pipe sizing because of the lower flow temperatures which heat pumps demand.

Obviously, there is understandable concern in the industry about the possible changes to the RHI after 2016 and what impact they might have on future deployment of district heating in the UK, but I remain confident that, with the right focus on efficiency and cost effectiveness, it will still have a major role to play in the UK heat market.

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-      The oldest district heating scheme dates back to the 1300s when a village in France set up a network of wooden pipes to distribute warm water from a geothermal source. 700 years later and the UK is just catching up with plans for the UK's first geothermal district heating scheme announced this year.

-      The more modern version of district heating was invented by Birdsill Holly in 1877. Holly designed a system that used a central boiler to generate steam that was then pumped to homes and commercial properties connected together by a pipe network running along several main streets in the US town of Lockport.

-      Here in the UK, district heating became a popular choice for use in high rise buildings and saw a boom during the 60s and 70s.

-      Now, the UK has around 2,000 heat networks that connected around 210,000 homes and 1,700 businesses – a little under 2% of all properties in the UK.

-      With support from the Government, the technology is set to make a comeback, with over 50 local authorities and counting looking into the feasibility of heat networks in their area.  

-      Stats from DECC show that there is a significant opportunity for district heating in the UK, with potential as big as 20% by 2030 and 40% by 2050

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The CHPA with Arup recently held a one day district heating conference entitled ‘Re-thinking District Heating: Removing the barriers for successful projects’ which featured some great speakers covering a breadth of topical issues of concern to the industry and users. Check out the Storify for a collection of 140 character thoughts from the day.

I’ve attended a good number of similar events over the past few years, but it’s clear that there now exists a real sense of momentum amongst local authorities, along with a recognition that their ambition to take greater control over the provision of energy to their communities is finally being supported by government. 

There were a number of interesting points raised on the day – here’s five that I picked up on:

1. With over 50% of the audience representing local authorities, it’s clear that there is a huge level of interest by local government in taking forward district energy projects.

Over the past few years a number of initiatives from organisations such as Carbon Trust, Scottish government, the District Heating Vanguards, Combined Heat and Power Association, London government and pioneering local authorities have paved the way for the successful launch of the Heat Networks Delivery Unit (HNDU).

In just a few short months, HNDU has successful financed 76 local authority projects in the first two rounds of funding applications which a further 50 local authorities having expressed interest in applying for the third funding round, which recently closed.

2. Though there has been lots of district energy feasibility, economic and commercial analysis commissioned over the past few years, it’s not always been easy to identify or locate, which is disappointing, as it would be great to share this knowledge across the local government sector (I should say, the London Heat Map does however make a good attempt at doing this).  Hence it’s good to hear that DECC have made it a requirement that research funded by HNDU must be made widely accessible. It’s not clear where all this information will be held – but hopefully that will become apparent soon!

3. With the heightened level of interest in district energy – and an injection of funding by government – it’s perhaps not surprising that all this activity is leading to significant demands for district energy expertise.  With the government’s Heat Strategy pointing to as much as 20% of heating coming from heat networks by 2020 or 40% by 2050, there is a real issue of a potential skills shortage in the sector which needs to be addressed by government and industry.

4. A great presentation by Metropolitan, the ESCO operator of the Kings Cross CHP and district heating network highlighted that new build heat density is not always the determining factor in deciding the financial viability for district heating. If trenches being constructed to hold district heating pipes also handle other utility services such as water, electricity and telecommunications, the costs can be easily spread.

5. Finally – and perhaps most importantly – a message that came through was policy clarity and stability are a huge deciding factor in helping both industry and users decide on strategies to invest in district energy.

The government’s original zero carbon target sent out a clear message about how developments would need to be designed to incorporate low carbon solutions.

However, each subsequent announcement by Department for Communities and Local Government (DCLG) Ministers has weakened the policy, effectively diluting the original zero carbon intention by nearly two-thirds.


This contrasts with London government, where a much clearer policy intent in the London Plan on the use of decentralised energy systems has now led to a renaissance in the use of district heating in the capital. 

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  • Jim
    Jim says #
    I couldn't believe how much my heating bill was this winter. It was more than it has been in the past ten years. Hopefully we ca
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