Going Electric – The Current State of the Heat Debate

The vision of the future is clear, we’re going electric on heating. The Intergovernmental Panel on Climate Change (IPCC) says as much, and the current average carbon factor is already lower than gas. Great, no more debates required, let’s roll out the heat pumps and brush up on our electrical engineering… 

This may be the impression after a cursory review of the facts and look at some of the simpler articles on this topic. It may even be reinforced by the implications of the government’s budget statement. There is certainly some core of truth in the above, but scratch the surface and much more complex issues lie below.  

The IPCC does highlight that heating systems will need to electrify with rapid change required in the next decade to restrict global warming to less than 1.5oC. The implication of this is that we need to decarbonise heat now. There’s no time to wait for hydrogen, though this may have a later role, it is required to use technologies already to hand.  

The National Infrastructure Committee has investigated what electrifying heat might mean on a macro strategic level. Surprisingly, direct electric and heat pumps come out at broadly similar costs levels, with the cost of retrofitting energy efficiency measures to existing building stock to allow the use of heat pumps offsetting the reduction in grid reinforcement costs required to run systems with direct electricity. The headline though is both costs are high, requiring substantial investment in infrastructure and buildings. As the Climate Change Committee concludes: “low carbon heating is among the toughest challenges facing climate policy.”

Issues for building developers, operators or service engineers 

We seem to be at a point of inflection. A lot of change is taking place simultaneously, with issues to address but no clear solutions. For example: 

• In new build, there are few new low-hanging energy efficiency fruits left to reach for. 
• There is continual evidence of a substantive performance gap between buildings as strategically designed, and as realistically constructed. In part this is due to a delay arising from a lack of experience in understanding and installing a lot of the new technologies and products being deployed. Closing the gap is not a simple undertaking. 
• The national grid has decarbonised faster than anticipated, but is also facing local capacity restrictions arising from the roll out of decentralized energy technologies, which are already putting connection costs up. 
• Under the Kigali agreement, traditional HFC refrigerants are being phased out, with limitations in alternative technologies in the market place and often additional risks present in the replacement gases. This is naturally impacting the heat pump market. 
• Emissions from existing buildings remain a key challenge, with few easy options to address these. 
• The electrification of transport is also on an upward trajectory, and is competing with buildings for the same electrical resources. 

Electrical capacity – future risks 

There is no doubt that some spare capacity exists in our electrical distribution systems, for example in London. But there needs to be careful consideration of how this is utilised, particularly with the rise of electric vehicles. Under current rules, a connection may be made to the electrical network for a given fee provided capacity is available.

However, once significant reinforcement of the local power system is required, the connection or connections driving this pay a proportion of the costs of the local supply reinforcement. These can be large costs, potentially making development unviable, and is already being witnessed in some parts of the country. 

Furthermore, the balance of costs for reinforcement, i.e. the costs not met by the connecting party are met by the DNO and ultimately the consumer through ongoing electrical charges for new and existing local users in their bills. This continues pushing up the price of electricity ahead of inflation with the associated fuel poverty and economic impact of this.

These costs may also be large, for example if upon a new connection a 10 MVA transformer needs replacing with a 15MVA unit to reinforce a system, the connecting party pays his share (e.g. the 5 MVA uplift) however existing consumers pay for the replacement of their equivalent capacity (the 10 MVA). This leads to a cliff edge scenario, whereby connections for those that can get them are relatively cheap, up to the current system capacity. 

However subsequent connections may be very expensive or result in increasingly greater impacts on consumer electricity prices.  

There is a risk if we continue allowing development without strategic foresight that some new developments may absorb local electrical capacity, but once a critical level is met connections for other electrically heated developments or transportation become too onerous in a given location. This can affect not only large cities, but also rural towns and settlements where the electrical distribution system is weaker and fewer alternatives to electric vehicles exist for future personal transportation.  

OFGEM and the DNO’s are aware of these challenges but there is a need for wider industry debate as to how these costs will be apportioned fairly in the future, particularly where the driver is new-build electrically heated development. 

Therefore, it’s likely that the capital costs of connection and upgrading local electrical power networks to accommodate heating and transportation as well as traditional loads will come to dominate the future debate and decision making on low carbon heating system selection. Where these are high, it may drive alternative system approaches. 

Building owners, DNOs, operators and service engineers are likely to need to work very closely to understand these interactions and particularly their long–term cost and maintenance implications as we progress through this time of change.