Utility Week

UTILITY WEEK | NOVEMBER 2022 | 25 Talking Points… "Every member of the public has a role [in tackling water scarcity]. Changing behaviour to use less will be one of the most powerful things to do." James Bevan, chief executive, Environment Agency "It is important not to rush [wholesale market reform]. I understand why speed is high up the agenda for the government, but you are playing with an incredibly complicated market." Keith Anderson, chief executive, Scottish Power "When everyone is talking about water and sewage, it's vital that company CEOs are front and centre. Public accountability includes being seen and heard when the media is discussing the issues that matter to the public and for the environment." Aileen Armstrong, senior director, Ofwat Quote, unquote of this exibility to the electric- ity networks, we expect smart thermal storage to further atten demand. We o er 16 recommenda- tions in the report, including rearranging the wholesale market to decouple renewables from fossil gas generation, requiring retailers to o er time-of-use tari s and training more UK heating engineers for the transition. Heat exibility policy is an underdeveloped area of thinking in the energy sector. We rec- ommend that further work is done to re• ne the analysis and to consider the interaction with potential power mar- ket reform options. We also welcome feedback on any or all of the assump- tions we have made. We are con• dent the future of heat requires designing low-carbon electric heating to provide heat to buildings and exibility to the power system. This requires drawing together a wide range of people with expertise in heating systems, buildings and the electricity sector. It means using the skills of heating engineers and the skills of electricity system designers. It means listening to those who work on heating systems and power systems day a€ er day. We sometimes hear talk of silver bullets in energy. Silver bullets in folk- lore ward o werewolves. The changes brought about by climate change are too real to rely on folklore remedies. We have the technical solutions to use renewable electricity to heat build- ings. We now need to ensure that lots of people work together to design e ective power markets, develop time- of-use electricity tari s and install exible heating products. Tom Lowe, founding director, Thermal Storage UK We need to talk about heatfl exibility I n an increasingly electri• ed world, heat exibility is at the heart of making the best use of renewables , running our electricity networks eƒ ciently and ensuring our heating sys- tems warm our buildings. The UK is building renewables to diversify the generation mix, improve energy security and decar- bonise. On the demand side, the UK is electrifying transport and heat to move away from fossil fuels. These products increase peak demand on the electricity system, with National Grid Electricity System Operator (ESO) expecting electricity demand to dou- ble by 2050. The more that exibility is utilised on the demand side, the less the UK needs to spend on network infrastructure, curtailing renewables and using the capacity market for fos- sil gas power plants. There are multiple ways to provide exibility in heating. One option is to use smart thermal storage, working with or instead of heat pumps, to shi€ heating demand. Smart thermal stores produced by British companies such as Sunamp, tepeo and Caldera can use electricity at times of lower wholesale prices, which are increasingly at times of higher renewable generation. Thermal Storage UK has published a report on the potential for heat exibility by 2030. We worked with consultancy LCP Delta, who estimated that by 2030 the UK could use smart thermal storage in 2.4 million homes to reduce peak electricity demand on the coldest day of the year by 1.6GW. This peak demand reduction from smart thermal storage could increase to 4.1GW if the bene• ts of exibility to electricity networks were re ected in pricing. With the right reforms to the power market to recognise the value Comment: There are many options for fl exibility in heating, but regulatory reforms are needed to maximise their potential. but you are playing with an incredibly complicated market." Keith Anderson, executive, Scottish Power James Bevan chief executive, Environment Agency the issues that matter to the public and for the environment." Aileen Armstrong

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