Heat networks

• The energy centre is a building which is the source of heating and possibly cooling, it will connect to the identified buildings via highly insulated pipes.
• The energy centre will use renewable technologies to utilise waste heat sources, possibly along with air source heat pumps to supply low-carbon heat efficiently.
• These will often be located close to heat sources but on occasions they are remote from the heat network area.
• An energy centre could be in the basement of an existing building or a standalone building located near the heating demand

• A variety of heat sources can be used waste heat can be captured from data centres or industrial activities or generated using heat pumps or other technologies.
• The renewable heat sources can also be from water bodies, and geothermal amongst others.
• These can also in some cases be used for cooling.

• There are already Heat Networks within the West Midlands which vary in size.  These offer an opportunity to expand and a chance for stakeholders to share their experiences in developing a heat network.
• Map of the Heat Networks within the West Midlands Combined Authority area
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These will be people, companies and businesses who have an interest in or affected by a heat network, falling into the possible scenarios listed below amongst others.  Within the exploration of a heat network there will be a process to identify stakeholders.

• Heat network operator: This could be the asset owner or entity who will have a significant role.
• Heat network supplier: This is the group that builds and runs a heat network and can comprise of developers and operators. They are responsible for the contractual relationship with consumers.
• Heat off-takers / consumers: These play a crucial role in the Heat Network with their commitment to purchase heat in exchange for a reliable, cost-effective, and sustainable heat supply.
• Heat source owners: These are crucial as they can supply low carbon heat to heat networks from waste heat generated within their business.

• The West Midlands is a densely populated area with high heat demand therefore has identifiable local heat demand clusters 

• Local heat sources such as energy from waste, mine water, industrial waste heat, and wastewater treatment plants are limited. Strategic management is essential to develop heat networks in optimal locations, aligning consumers, energy sources, and demands.

• Areas of heat demand intensity, building density and availability of low carbon sources will be identified by government using the National Zone Methodology.
• These will be further investigated by the zone control bodies working with stakeholders and statutory consultees.
• WMCA is developing an interactive energy infrastructure planning tool (LEAP+) to assist zone controllers and its councils to understand the strategic energy planning implications for heat networks. 

• The current identified area for the Advanced Zoning Programme (AZP) are Birmingham and Coventry. These are part of the AZP with each map shows the extent of a potential heat network zone, plus additional relevant information where available, such as where there are pre-existing heat networks. Further information can be found here.

• This will be set strategically in conjunction with stakeholders using local and national data by the zone controller in collaboration with the lead government department; the Department for Energy Security and Net Zero (DESNZ).
• Currently as part of the Advanced Zoning Birmingham and Coventry have been identified to be part of this initiative.

• A heat network zone will be an area in a densely built-up urban area where implementing heat networks is the most economically feasible method to heat buildings and reduce carbon emissions from heating. 

• Heat network zoning will mandate specific buildings and low carbon heat sources to connect to a heat network within a set timeframe. There will be some exemptions. 

• Once in place the zone coordination body will develop the heat network.

• The government is utilising National Zoning Model (NZM) methodology which will identify the initial indicative zones. This uses national data from utility companies and other sources to determine areas.

• There will then be refinement at local level led by zone coordinators in consultation with local stakeholders and the government, utilising local data and knowledge.

As such we understand Zone Coordination Bodies to be:

• Zone coordination bodies can be a local authority, combined authority or sit jointly within both, forming a designated entity who will deliver the heat network with relevant stakeholders including central government. 

• Zone coordination bodies will also be able to work across two or more authorities or parts of their area.  
• Zone coordination bodies will work with relevant stakeholders to deliver the heat network, these include developers, building owners, consumers and heat source owners amongst others.
• Zone coordination bodies can be responsible for identifying and designating zones, tendering infrastructure contracts, and monitoring and enforcing zone requirements.
• Further information can be found at these Government websites:
  • 2023 Energy Bill Policy Statement
  • Energy Security Bill factsheet: Heat networks regulation and zoning (updated 20 March 2023)
  • Energy Act 2023 Part 8

• This will be a mixture of buildings including but not limited to new buildings, existing communally heated residential buildings, public-sector buildings, and non-domestic buildings.
• Heat sources can also be mandated to connect to the network for example data centres or industry identified as having waste heat.

• Legacy heat networks within a zone can be required to connect to the new scheme. If not meeting the required standard, operators will be required to submit a Heat Network Improvement Plan.
• As part of the regulations existing Heat Networks outside of the heat network zone, will have to register and meet the new standards of operation.
• Both existing and new Heat Networks must be registered with Ofgem by the end of the initial period.

• Ofgem has been appointed as the regulator for heat networks, regulating both supply and operation functions ensuring consumers get a fair price and a reliable supply of heat, with heat networks under the same controls as other utilities such as gas electricity and water. The link for the Citizen Advice Bureau CAB
• The Heat Network Technical Assurance Scheme (HTNAS) will set out technical requirements (e.g. pipe insulation, water flow temperatures) which will be required for all new build heat networks. Legacy heat networks will have to formulate an improvement plan to meet these requirements. The link to Governments HTNAS page can be found here.
• There is also the Heat Network Industry Council (HNIC) which is the Government and Industry forum working together to develop the low-carbon heat network sector. This combination of Government and Industry allows the exploration of the Cost of heat, the routes to market and the skills required.  The link to the HNIC webpage can be found here.  The web site explains some of the pieces of equipment installed when connected to a heat network.