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Making the Green New Deal Happen Blog Series, November 2021: The conundrums of delivering low-carbon heating

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Decarbonising the heating in people’s homes is one of the trickiest areas of the climate transition. The European Commission’s Renovation Wave strategy highlighted the range of actions needed. Here Professor Martin Freer, Director of the Birmingham Energy Institute, discusses the options and difficulties governments and citizens face in the UK in making this transition, difficulties that are present in many other European countries.

 

Introduction

The passing of COP26 reveals just how challenging it is going to be to get to net zero with plenty of warm words, but specific, targeted and measurable actions being hard to come by. The art is a net zero transition which creates investment, jobs and economic growth. Perhaps the even more complex challenge is a managed transition in which the consumer, and voter, becomes an active participant. The decarbonisation of electricity to some extent has been done behind the scenes, as grid scale coal is transformed to grid scale wind and solar. As long as the grid does not become unstable, then the consumer does not notice a change.

However, other arenas of decarbonisation intrude more directly on the consumer through visible changes to established practices.  In some cases, such as the electric car, despite requiring a point of purchase decision, it is facilitated by the knowledge that sale of internal combustion engine vehicles is to be ended, that there is some kudos associated with electric vehicles and, for some, only the minor inconvenience of installing a home charging point.  In other areas the changes are more complex and in the absence of imaginative public policy appear far more challenging.  A significant illustration of this is domestic heating.

Decarbonising Heating

For countries with a non-interventionist political philosophy, such as the UK, decarbonisation of heating has been left to last. The UK has a fairly miserable housing stock in terms of energy efficiency, though improving. It has 28 million homes with 17 million (60%) below Energy Performance Certificate rating C, on a descending scale from A-G. Heating accounts for one third of all CO2 emissions, homes 20%. The UK relies almost exclusively on gas powered central heating systems with condensing boilers which, often as not, are installed such that they do not deliver optimal performance. This places the UK near the bottom of the pile in Europe in terms of the carbon intensity of domestic heating.

1: District heating networks.

There seem to be three main choices when it comes to low, or zero, carbon heating solutions. The Nordic civic model, in countries such as Sweden, Denmark and Finland has led to well-developed district heating systems which supply centrally generated heat through pipes delivering hot water or steam. Such systems have the ability to capture waste industrial process heat and heat generated from waste incinerators. The Amager Bakke energy from waste plant in Copenhagen able to heat 150,000 homes is an example of the art of the possible. Many UK cities, Birmingham being an exemplar, have district heating systems but these are mainly limited in connectivity to municipal buildings. This highlights the development challenge for district heating systems; the prevailing UK model needs a large anchor customer, otherwise the business case to develop the network does not exist.

The other pressing challenge with district heating is that it is often they powered by combined heat and power engines (CHP) which burn natural gas. This means they are not particularly low-carbon and making them zero carbon is not trivial. Moreover, the waste heat sources they connect to, e.g. waste incinerators, are not free from carbon emissions either and as the waste processing sector diversifies and develops, the way in which waste is used to produce energy and heat will evolve. At the very least carbon capture from incinerators will be required. The UK discussion around zoning may be the way ahead for the development of future district heating networks and overcoming the need for a large anchor customer. A level of mandation or incentivisation for consumers to connect to a district heating system will aggregate demand delivering an investable proposition. Consumer choice may be a casualty.

2: Green hydrogen

The UK is also toying with the idea that large scale, green hydrogen could pave the wave for heat decarbonisation. This would be a simple household intervention with a modification to the burner within the gas boiler and in principle much of the more modern parts of the gas network are hydrogen ready. This solution is attractive to government as it is a straightforward reconfiguration of an existing network.  And in a parallel to the decarbonisation of the electricity grid the switch for the consumer is easy. The main issue is the volume of green hydrogen required and the cost of producing it. Electrolysis is the main solution at present for green hydrogen production, and the efficiency of an electrolyser is about 70%, meaning that every unit of electricity produces less than the equivalent unit of heat energy. Electric resistance heating is essentially 100% efficient and so in energy terms alone it would make sense to use the electricity that would go to an electrolyser directly to an electric heater in the home.

3: Heat Pumps

A third option is the use of electricity powered heat pumps. Heat pumps work by pumping heat from one place to another, e.g. from the outside of a home to inside. Perhaps surprisingly, they can even work at very low temperatures to extract residual heat from the environment, e.g. the air, water or ground. The beauty of a heat pump is that they can have efficiencies of up to 300%, i.e. one unit of electrical energy can deliver three units of heat energy. Norway is a country that has championed the installation of heat pumps and indeed the greatest penetration of heat pumps in Europe is in Scandinavian countries. The majority of those installed in Norway are reversible – they can do cooling as well as heating.  They are also primarily air to air systems and do not rely on a ‘wet’ radiator system to distribute heat around the home.  Reversible heat pumps are the most commonly installed type of heat pump in Europe. The UK, on the other hand, has mainly wet heating systems. In other words, the heat is transported from the gas boiler around the house to radiators via hot water pipes. This means the that the most simple transformation is the installation of a ground source or air source heat pump connected to the hot water system.

The solution to decarbonising heat then seems pretty obvious; install heat pumps. So why isn’t it happening? The answer in the UK is it is just too hard and too expensive. Heat pumps cost over 5 times the cost of a gas boiler and given the poor thermal efficiency of typical (60%) homes installation needs to be accompanied by major investment in thermal efficiency improvements in order not to leave the homeowner in the cold. This means major interventions into the home which could last several days and require significant changes to the appearance of the building, inside and out. Typically, people replace their boiler at the point of the previous one breaking, a distress purchase, and hence will not wait for lengthy home energy efficiency improvements for their heating and hot water system to be restored.

Need for Government Action

The cost and inconvenience means that this is not going to be a consumer led transition and that there is a need for government to take a proactive role. The UK government released its Heat and Building strategy in October 2021. The reception was tepid at best. There is no mandatory end date for gas boiler installation; there is no complementary package of efficiency upgrades linked to low-carbon heating appliance; and there is no mandate on energy companies to install a quota of heat pumps. There is instead enough funding to pay for 90,000 heat pump installations in a country of 28 million homes and a proposed requirement that manufacturers produce low-carbon heating appliances, which there is a danger no one will buy.

The success of countries in the North of Europe points the way. Investment in infrastructure is key and ensuring that the costs of electric heat pump installation and running costs are competitive with gas is crucial. The price of gas has for a long time been a barrier to change and the addition of the UK government’s own policy costs associated with decarbonisation of electricity have been put on the price of electricity. Stronger intervention is required and the time for some hard decisions is now.

The politics of the low carbon transition needs creative solutions which combine technical realities with feasible transition pathways for consumers and citizens.  The policy players who rise to this challenge and escape from old habits will set the pace in the decade ahead. The aspiration to keep on a plausible track to minimise global warming depends on it.


Professor Martin Freer is Director of the Birmingham Energy Institute

This blog is produced by TIPC and partner, EIT Climate-KIC

The editors of this blog series are Fred Steward, Emeritus Professor, School of Architecture and Cities, University of Westminster, London; and Jon Bloomfield, Systems Innovation Policy Advisor, Climate Innovation Ecosystems, the European Institute of Technology’s Climate Knowledge & Innovation Community (EIT Climate-KIC).

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