UK Heat Networks
The UK government is being urged to invest £1bn in heat networks to unlock further private sector investment
The UK government is being urged to invest £1bn in heat networks to help meet its net-zero targets. According to a new report from Energy UK and the Heat Networks Industry Council, this investment could unlock a further £4bn in private sector investment by the end of the decade.
Background
The report highlights the disparity between the government's public ambition and the private capital available to deliver on its net-zero targets. It suggests that a specific intervention, such as investing £1bn in heat networks, could provide market and investor certainty and unlock significant private sector investment.
Funding and Projections
The organisations behind the report claim that if the government can provide upfront investment, it will catalyse its efforts to drive £17bn investment by 2035 and £100bn by 2050. The government has already pledged £195m a year for the Green Heat Network Fund and £15m a year for the Heat Network Efficiency Scheme. The current funding will be used to upgrade almost 100 existing networks, including those in Salford, Solihull, and London.
Comparison of Funding
The following table compares the funding pledged by the government for heat networks and other initiatives:
| Initiative | Funding |
|---|---|
| Green Heat Network Fund | £195m per year |
| Heat Network Efficiency Scheme | £15m per year |
| Ultra-Long Duration Energy Storage (Ultra-LDES) | £28m |
The report comes as the government funnels funding into solutions to improve the intermittency of renewables, including Ultra-LDES. Energy Minister Michael Shanks said that storing clean energy for when it is needed most is critical, and that the £28m grant will support the development and testing of systems that store hydrogen underground and release it when needed. According to new analysis, deploying one gigawatt of long-duration energy storage could generate €150-250m a year in variable grid operating cost savings across Europe. Energy UK's director of policy and advocacy Adam Berman said that heat networks are an essential piece of the puzzle in a cleaner, more secure energy system, and that supporting this sector can drive economic growth and strengthen energy security. The government's funding initiatives and the report's findings are based on information from the source, edie.net.
