Low carbon heat international showcase Edinburgh The Public Sector Role in Developing Area-wide Low to Zero Carbon Heat 18 th November 2014

2 2 How It All Started: The London Thames Gateway Heat Network (2007)

Reducing London’s CO 2 Emissions 30% of London’s CO 2 emissions are attributable to consumption of heat (mostly mains gas) Greatest opportunity for CO 2 reduction within London is to reduce demand for heat through building retrofit and low carbon, local (decentralised) heat supply. Decarbonising electricity supply is better placed as a national action (nuclear, wind, carbon capture and storage)

Mayor’s Climate Change Targets An ambitious target for London for a 60% reduction in 1990 levels of CO 2 emissions by 2025 Mayor’s targets is to decarbonise 25% of London’s energy supply Mayor’s CCAP sets a target of 2.2 million tonnes p.a. of CO 2 emissions to be saved by 2025 through decentralised energy DE can deliver 12% of the CO 2 target and counts for 55% of ‘committed Mayoral action’

THE MAYOR’S CLIMATE CHANGE MITIGATION AND ENERGY STRATEGY - OCTOBER 2011 London’s CO 2 emissions reduction targets Reductions based on 1990 levels: o 2015 (interim target) 20% o 2020 (interim target) 40% o % o 2050 at least 80% 25% from decentralised energy by 2025 An £8bn investment opportunity

6 Delivering Low Carbon Energy for London Annual CO 2 reduction of 3.5 million tonnes Tenfold increase in generating capacity National political will is creating a favourable policy framework for DE - changing investment environment Public sector is working to remove barriers and harness the private sector’s financing and delivery capability

Decentralised Energy Capacity Study (2011) This study provides data on, and analysis of, the potential for renewable and low carbon energy in London. It breaks down in three parts: -Report 1: assessment of the technical potential for renewable energy and DE in London up to Report 2: economic viability and deployment constraints -Report 3: deployment of DE focusing solely on those technologies connected to heat networks. Conclusions: -30.5% and 21.2% of London's demand for electricity and heating respectively can realistically be met by DE by CO2 savings: 0.8Mt/year -Investment opportunity: £8bn (£6bn from heat networks only) by 2030

Type 1 - Single sites -Small/medium CHP up to 3MWe (<3,000 resi units) -Capex up to £10m and a PBP ~ 5 years for commercially viable schemes Type 2 - Multi-site mixed use schemes -CHP units 3 to 40MWe (3,000 to 20,000 resi units) -Capex up to £100m and PBP ~ 10 years Type 3 - Area wide heat transmission networks -Extensive heat pipe networks connecting multiple heat producers such as power stations, industrial waste heat or energy from waste facilities -May serve 100,000+ residential units and a large range of mixed public and private commercial facilities -PBP > years but with the potential for steady cash flow and utility type yields Decentralised Energy – scale of projects The generation of electricity local to demand and recovery of waste heat for building space heating and domestic hot water production. PUBLIC SECTOR INTERVENTION

London Plan, Chapter 5 Climate Change Policy 5.1 Climate change mitigation Reduce London’s CO2 emissions by 60 per cent (below 1990 levels) by It is expected that …London boroughs …will contribute to meeting this strategic reduction target Policy 5.2 Minimising carbon dioxide emissions Energy hierarchy: Be lean: use less energy Be clean: supply energy efficiently Be green: use renewable energy Further reduce carbon dioxide emissions through the use of decentralised energy where feasible, such as district heating and cooling and combined heat and power (CHP) Policy 5.5 Decentralised energy networks 25% per cent of the heat and power used in London to be generated through localised decentralised energy systems by LDF preparation Boroughs should: safeguard existing, identify opportunities, develop master plans, require developers to prioritise connection to existing or planned decentralised energy networks where feasible. Policy 5.6 Decentralised energy in development proposals Development proposals should evaluate the feasibility of CHP and where a new CHP system is appropriate examine opportunities to extend the system beyond the site boundary to adjacent sites. Major developments to select energy systems according to the following hierarchy: connection to existing heating or cooling networks; implement site wide CHP network; Communal heating and cooling Policy 5.7 Renewable energy Major development proposals should provide a reduction in expected CO2 emissions through the use of on-site renewable energy generation, where feasible.

10 Decentralised Energy Development Methodology Capacity Building Heat Mapping Policy Support Resourcing

Peter North Senior Manager Programme Delivery – Sustainable Energy Greater London Authority Contact