Utility Week

UTILITY WEEK | AUGUST 2021 | 23 Policy & Regulation ting infrastructure in the ground, I've got to spend half a million quid buying it." Reynolds says zoning can also save money by enabling consolidation, standardi- sation and economies of scale: "The worst thing that can happen for me is what's hap- pened to a lot of the incumbent heat network operators in the UK, which is they've got 50 to 60 island projects dotted around cities, all with their own energy centre, all with their own designs done by separate consultants, all with diƒ erent performance, all with dif- ferent customer service standards. Frankly, it's a nightmare." He continues: "As it gets bigger, the costs of your pipes go down, the cost of your dig and your install goes down, the cost of your operation goes down and because it's a local energy system I can then work with the local community to invest in the skills, the labour. "When we get zoning right, what you ena- ble me as a multinational business to do is double down on an area of the city." He draws attention to the heat network Vattenfall is developing around the Cory Riv- erside energy from waste plant in southeast London: "There's a quarter of a million – I think up to half a million – properties that could be connected to that district heating network over the 20 to 25 years, which means I look at that completely diƒ erently. "By creating a certainty for me as an investor and operator you enable me to do it cheaper, faster, bigger." Although he agrees that heat zones should be implemented and enforced by local authorities, Reynolds believes the loca- tion of the zones themselves should be deter- mined at the national level: "We don't plan large rail projects at a local level. We don't plan transmission lines at a local level. And the reason is because you need a bigger view than you will have a local level." Mandated connections With regards to enforcement, Ritchie believes this should include the mandating of con- nections for certain buildings: "The ADE's position at the moment is that within a zone mandated connections should eventually go as far as possible given that, within a zone, a heat network has been designated as the most cost-eƒ ective solution. "We are pushing for mandated connec- tions for all public and private non-domestic buildings and also for blocks " ats or blocks where there is an existing communal heat network in place. "In terms of how we're thinking about that potentially working is having a set number of years for those building types to connect to the network or potentially using things like triggers points, so when an existing heating system comes to the end of its life." She describes these as the "easy wins" and says the association is still considering its position on individual homeowners. Following the release of the ADE's report, the Department for Business, Energy and Industrial Strategy announced plans to hold a consultation on zoning in 2021. As Utility Week went to press this consultation is due to be published imminently, setting out the government's position on mandated connec- tions, something it has previously suggested as a possibility. However, Katie Greenhalgh, head of car- bon reduction projects and policy at Notting- ham City Council, which already operates an extensive heat network serving around 5,000 domestic properties and 70 businesses, believes mandating connections is not the right way to go. "There might be site-speciš c challenges or various reasons why it's cost-prohibitive or for some reason isn't the lowest-carbon option so I do think there needs to be options for developers and we need to do things on a case-by-case basis rather than have a blanket approach – you must connect – because what we don't want to do is stop development. "We don't want to put people oƒ invest- ing by making them go with an option which isn't viable for any reason. But you would hope that if they were in that zone, they would be a compelling case for them to choose that as the best option." Greenhalgh says local authorities' powers in this regard should instead be limited to requiring developers and customers to con- sider a connection, rather than just default- ing to gas, "which obviously they won't be able to do for much longer anyway; making sure that each development has some sorts of options appraisal undertaken so that they know that they're choosing the best option, both in terms carbon reduction and eœ - ciency and obviously cost". She says this would at least avoid a heat network from being "discounted very early on" as ož en happens now. "It needs to be a balance," she says. "There needs to be enough in the policy to make sure it is well considered but perhaps some caveats so if there's signiš cant justiš - cation for why a heat network isn't the best option for a range of reasons, that would also be considered." Greenhalgh says there also needs to be a balance between local and national govern- ment when it comes to zoning: "The support from central government is essential, so hav- ing the policy mechanisms in place to make sure we can set and enforce these zones. "The methodology needs to take into account the local knowledge and local plans we have in place, so I think a combination of the two, making sure that there is a con- sistent approach nationally and the policy in place to support that, but using that local knowledge to inform decision making would be a good solution." Tom Grimwood, energy editor To read the full version of this article, visit: https://utilityweek.co.uk/zoning-in-on-heat- networks/ "By creating a certainty for me as an investor and operator you enable me to do it cheaper, faster, bigger." Mike Reynolds, managing director, Vattenfall Heat UK "Heat zoning would allow government funding to be directed to those areas of the country and there's no confusion about where they should be." Amy Ritchie, policy o cer, Association for Decentralised Energy "By creating a certainty for me as an investor and operator you enable me to do it cheaper, faster, bigger." , managing director, Vattenfall Heat UK networks/ "Heat zoning would allow government funding to be directed to those areas of the country and there's no confusion about where they should be." , policy o cer, Association for Decentralised Energy

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