Page 6 - Gi flipbook March 2018

NEWS | INDUSTRY

Heat networks call for regulation

Heat networks call for regulation to ADE

protect consumers and investors

THE HEAT TRUST Task Catch-22 in that “future as possible to achieve the market for heat networks.”
Force has called for a new customers cannot commit returns anticipated.” Energy and Clean Growth
regulatory framework for until the network is built, As part of the Minister, Claire Perry, said:
district heating schemes and investors cannot arrangement, the developer “Heat networks offer huge
to protect customers and commit without future would be obligated to meet potential to reduce carbon
soothe investors’ fears. customers”. certain conditions, “including emissions from our homes
The industry body says To overcome this minimum customer service and businesses, deliver
the framework would problem, the report calls requirements, and heat significant cost savings
reduce investment risk, for a new regulatory network design and build for consumers and create
lower financing costs framework based around standards”. thousands of skilled jobs.
and cut energy bills for “demand assurance”. “For customer protection “Our ambitious Clean
consumers, according to Under this model, a to be effective it needs to Growth Strategy sets out
Utility Week. developer would produce be both binding on, and how we will support the
The task force, which a strategic plan for a heat aligned with, the interests market to build and extend
was set up in March 2017, networks project based of those supplying the heat networks across the
made the recommendation on reasonable projections service of heat provision,” country. That’s why we
in a new report titled, for the heat demand that it adds. “By making access are investing £320 million
Shared Warmth: a heat would arise from customers to demand assurance in the Heat Networks
network that benefits if it went ahead. contingent on meeting Investment Project and
customers, investors and the The plans would then be customer service standards, why we welcome the
environment. submitted to a regulator. the investor has a direct Heat Network Task Force
The report states that Once approved, the stake in ensuring those report, which sets out clear
investor confidence and developer would be offered standards are met.” proposals on how to reduce
consumer protection are protection on part of their The Heat Trust investment risk and develop
“two sides of the same investment if the demand Task Force was led a market which provides
coin. Investors want predicted in the plan failed by the Association for strong protections for
assurance that customers to materialise. Decentralised Energy consumers.”
will be content with the “As a minimum this (ADE), whose director, ADE has also released
service, as it reduces protection would cover the Tim Rotheray, said: a separate report on the
the risk of investment. cost of capital for demand “Government recognises current state of heat
More investable projects shortfall,” the report explains. heat networks as a key network market. It says
can attract institutional “The demand assurance tool for cost-effective heat there are currently around
investors, which lowers the would operate as a safety decarbonisation. This report 17,000 heat networks in
cost of capital and results net, ensuring that the heat sets out how to build on operation around the UK
in lower heating bills.” network developer was current policy support supplying roughly 12TWh
It says district heating incentivised to secure new to create a long-term of heat each year to half a
projects often face a heat customers as quickly sustainable investment million customers. ■

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News.indd 1 15/02/2018 14:25