Government allocates £90m to UK heat networks

The Department for Energy Security and Net Zero has allocated £90 million to new and upgraded heat networks, combining funding for major development projects with improvements to existing systems suffering from inefficient pipework and ageing equipment.

The programme covers new networks, extensions to existing infrastructure and £13.3 million of work across 76 heat networks in England and Wales. Government says the projects receiving support could ultimately serve more than 750,000 homes, although several of the larger schemes remain subject to planning and further development.

Heat networks distribute hot water from a central source to several buildings rather than relying on an individual boiler or heating plant in each property. The heat can come from dedicated energy centres, heat pumps, energy from waste facilities, industrial processes or sources such as data centres that would otherwise reject thermal energy to the atmosphere.

The largest individual award is £41 million for a London project intended to move heat along and beneath the River Thames. The proposed network has been presented as capable of serving around 650,000 homes, with longer-term potential to reach more than one million residents if the full system is developed.

The initial concept would transport hot water for part of the route using electric barges before a dedicated tunnel beneath the river becomes available. Government says the scheme could help unlock around £5 billion of investment in London heat networks, but the project remains subject to planning consent, making the funding award a development step rather than permission to begin the complete infrastructure programme.

Other awards cover a range of smaller but more immediate schemes. Bradford is receiving £9.7 million to extend its existing network to 255 homes, a hospital and seven schools and colleges. Solihull has been allocated £3.9 million to expand a network already serving public buildings, while Bexley and Greenwich are receiving £11.5 million towards a network that could ultimately serve as many as 100,000 homes.

A further £11.4 million is being directed to a Marble Arch project in London using water-source heat pumps to extract energy from the London Chalk Aquifer. The proposed system would serve a mixture of offices, homes, hotels and other commercial buildings around Oxford Street.

The range of projects illustrates why heat networks are as much an infrastructure engineering problem as a heat-generation problem. The performance of a system depends on source temperature, distribution temperature, pipe diameter, insulation, pumping energy, thermal storage and the equipment connecting each building to the network.

Losses through poorly insulated or leaking pipework can undermine otherwise efficient heat production. The same applies where heat interface units are badly configured or network temperatures are higher than necessary, increasing distribution losses and forcing heat pumps or other plant to operate away from their most efficient point.

That explains the separate £13.3 million allocation for existing networks. The Heat Network Efficiency Scheme funding covers 76 systems and includes replacement of leaking pipes, additional insulation and new heat interface units intended to improve control and reduce wasted energy.

Projects receiving that support include £1 million for networks serving 130 residents in Manchester and £5.5 million for systems serving 1,143 residents at Prospect House in Bermondsey and the Packington Estate in Islington. Funding is also being provided for upgrades at two schemes in Wales.

The value of basic efficiency work is illustrated by the Vega Building in Brighton. Government says the network had been operating at 35% efficiency before a £200,000 grant funded changes to the engine room, pipe insulation, thermostatic radiator valves and heat interface units. Gas consumption subsequently fell by 50%.

The figures do not mean every older network can achieve the same result. Heat losses depend on the original system design, building demand, pipe condition and operating temperatures, but the case demonstrates how much performance can be lost after heat has already been generated.

Waste heat creates another set of engineering questions. Data centres and industrial facilities can provide large thermal sources, but useful recovery requires demand close enough to justify pipe infrastructure and a temperature level that can be upgraded economically where necessary. Heat pumps, thermal storage and backup plant may all be needed to turn an intermittent or low-grade source into a dependable network supply.

Reliance on an industrial source also introduces continuity risk. A factory can reduce production, alter its process or close altogether over the operating life of a heat network. Designers therefore have to consider alternative sources and long-term resilience rather than treating currently available waste heat as guaranteed for several decades.

The same principle applies to large new London infrastructure. Government funding can move design and development forward, but planning, detailed engineering, commercial agreements and construction still have to be completed before the proposed heat reaches customers.

The £90 million package consequently spans two different parts of the market: ambitious new infrastructure intended to move heat at city scale and less visible work repairing networks that already exist. Both determine whether heat networks deliver useful energy efficiently, and the latter can be considerably cheaper than replacing an inefficient system with an entirely new one.

The next measure of progress will be the conversion of individual awards into consented and operating networks. Funding establishes the opportunity, but the engineering outcome will depend on pipe routes, heat sources, pumping, building interfaces and the ability to maintain acceptable losses over the life of each system.