Skip to content
Northern Powerhouse European Union

£320m to be spent on urban heat networks

The government has announced that £320 million will be invested over the next five years in cities and towns to develop low carbon heat networks, dubbed ‘central heating for cities’.

The government has announced that £320 million will be invested over the next five years in cities and towns to develop low carbon heat networks, dubbed ‘central heating for cities’.

Heat networks utilise heat from a range of sources, including large heat pumps, combined heat and power (CHP) plants, waste heat from factories and offices and geothermal heat drawn from beneath the earth’s surface. 

This heat is then pumped around homes and businesses through a network of pipes instead of each building having to generate its own.

By capturing and distributing heat more efficiently, heat networks can significantly cut the cost of energy bills for homes and businesses and reduce carbon emissions.

Emulating Europe

The concept is already commonplace in France, Germany and Scandinavian countries like Denmark, where heat networks provide more than 60 per cent of the country’s space and water heating.

Although only two per cent of heat is currently supplied via heat networks in the UK, interest is growing rapidly, with several local authorities looking to introduce schemes over the coming years. 

Interested local authorities in the north west include Manchester City Council, Bury Council, Chester West and Chester Council, Lancashire County Council and Tameside Metropolitan Borough Council, among others.

The new funding was first revealed in the 2015 Autumn Spending Review and the government is now seeking views from the supply chain, investors and other stakeholders on how best to use it.

It is hoped that the funding will leverage up to £2 billion of additional capital investment and create hundreds of heat networks across the country.

‘Affordable energy’

Amber Rudd, energy and climate change secretary, said: “This is an important next step in developing more home-grown energy, which is a vital part of our plan to ensure long-term energy security and affordable energy for our families and businesses.

“The funding we’re consulting on today will enable these schemes to provide affordable low carbon energy to thousands of homes and businesses across Britain’s towns and cities.”

Dr Tim Rotheray, director of the Association for Decentralised Energy (ADE), said the commitment was a “welcome sign” to the industry.

“The need to cost effectively decarbonise heat in the UK, deliver local infrastructure investments, and make heat more affordable remains imperative”, he said.

“Industry will continue to work with government to make sure that this money can bring forward low carbon heating projects at best value to the consumer.”

The consultation is open until 3 August 2016. For more information, click here.