How to take the long term perspective with Heat & Cooling Networks to cut cost, carbon and customers bills

One of the questions that sits at the forefront of our discussions, both within our heat business and with our clients, is how do we get the long term, asset owner and customer engagement perspective into the early stages of heat networks planning and design?

You may quite rightly ask why that is so important when we now have design codes of practice for heat networks and the “Heat Trust” to provide independent customer protection when networks are built.

The reason is that design, delivery and commissioning decisions all have a huge impact on the long-term reliability, efficiency and operability of the network. Most importantly they all influence the price that customers ultimately pay for their heat.

As heat networks move “front and centre” in the journey to net zero carbon as a fantastic “low regrets” means of transporting waste and renewable heat to customers, there has never been a better time for heat network project developers to bring SSE into their projects early so we can help to make sure we consider the long term from the start.

Reducing the risks

We’ve been investing in and operating heat and cooling networks in the UK for over eleven years.  We have designed, built and adopted heat and cooling networks in the new build and retrofit arenas.

Our approach is to take key project risks away from developers and project sponsors, help to reduce construction costs, simplify systems and to insulate customers from network performance, maintenance, equipment replacement and energy price risks.

As an investor in the asset we have commercial and reputational reasons to make sure systems are optimised from a commercial and carbon point of view, that tariffs are as low as possible, reliability is excellent and customer service is of the highest standard.

Over our time in the sector, we have seen it grow and mature with important landmarks such as the CIBSE Code of Practice 1 (CP1) bringing guidance to design, commissioning and operational approaches and “Heat Trust” heralding minimum levels of service for customers and, for the first time, access for customers to a specialist, independent, Energy Ombudsman.

The recent announcement by BEIS of a market framework consultation has heralded the start of a more formal regulatory regime for the sector which just goes to show it is really coming of age.

Value of a long term perspective

However, one key lesson from our experience in the sector stands out: the crucial importance of taking the long term perspective when designing heat and cooling networks and deciding how best to operate them.

We have witnessed, first-hand, the negative impacts on a project when design, commissioning and long-term operation and asset management strategies are not fully integrated from day one.  Designs may be sub optimal, network efficiency is impacted and energy consumption higher as a result.

Crucially, often single point accountability for “keeping the heat on” is not clear.

Networks that are designed for optimal performance through:

  • Optimised plant and pipe size selections;
  • Whole system design that fully integrates secondary and tertiary systems;
  • Whole system commissioning;
  • Plant rooms that are simple to maintain and facilitate plant replacement and contingency planning;

…ultimately means excellent reliability, lower carbon and lower tariffs for customers.

Our team have loads of examples of providing design advice at an early stage of the development process which has:

  • Reduced capex for example by removing block plate heat exchangers, installing smaller plant and reduced pipe sizing
  • Improved system efficiency for example by ensuring proper commissioning of HIU’s to reduce return temperatures and increase CHP and heat pump efficiency
  • Improved safety for example by carrying out HAZOP assessments which have ensured that valves are installed at safe operating heights
  • Facilitated operation and plant replacement for example by ensuring proper access and egress for plant replacement
  • Improved resilience and contingency planning, for example by ensuring connection availability and space for temporary boiler set down
  • Reduced tariffs eg by removing plant and hence operating costs.

This all requires SSE to be engaged early enough in the development process that we can bring this experience to the project and effect change.

Technology Dilemma

Right now policy makers and the industry are working towards establishing the best pathways to meet our Net Zero targets by 2050 and in particular, how to decarbonise heat.

But in the short and medium term, we are acutely aware of the real and practical challenges faced by project developers in making heat source technology selections that meet current and potential future carbon obligations particularly for schemes which will “build out” or expand over a long period of time.

We are also aware, when it comes to low carbon heat provision, that developers must assess the relative merits of a centralised network versus an “in block” or “in property” approach.  To further complicate decision making there’s also a plethora of different technologies and suppliers to meet these different low carbon heating strategies.

But taking the long term view is the best way to arrive at the right design for occupants and all stakeholders and that’s where we can help.

We are working with project developers, from the initial concept design stages providing “asset owner” advice including whole system cost analysis (showing outcomes for project developers, landlords and for end users), carbon analysis and reviewing capex and opex assumptions based on our practical experience.

As we move to a world where heat pumps proliferate, SSE is also helping developers by assessing the viability of waste and renewable sources of heat close to their developments.

We are able to take a long term view on developing a long term energy strategy for a site incorporating different sources of heat energy over time.

This process, backed-up with evidence (based on robust, reliable and proven technology), makes designs more appropriate for the type of development and ultimately makes decision-making simpler for the developer.

Only by considering long term capex, repex, carbon, energy price and end user charges can the best technology and operating model decisions be made. 

What’s more, by employing SSE as the long-term asset owner/operator, our clients bring our expertise to influence and adapt to change and to ensure that future technology selections for the network’s heat source are optimised to meet the prevailing carbon, air quality and other regulatory requirements of the day; all whilst maintaining our core focus to deliver heat safely, reliably and affordably.

 

The case for the long-term perspective has never been stronger and our message is clear:

Bring the longterm view to the design process to improve efficiency, reduce carbon and minimise tariffs.

 

Employing SSE as a long term network operator brings our wealth of experience in this sector backed by SSE’s balance sheet and low carbon credentials and ability to manage strategic assets over the long term, influencing and adapting to change.

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