Level playing field to see district heating subsidy-free

Tim Rotheray

The Association for Decentralized Energy believes low carbon district heating networks could succeed without subsidies from 2021, if presented with a level playing field.

In a new report, the ADE claims putting heat networks on a par with other energy infrastructures would enable progress to be built on following the government’s pledge to provide à‚£320 million for district heating networks in the next five years.

ADE Director Tim Rotheray
said: “An investment framework for heat networks has the potential to reduce investor risk, drive down the cost of heat supply and attract major international and UK investors.à‚ Delivering on our heat network ambitions will help us to meet our carbon commitments as cost-effectively as possible, return control over energy to local authorities and their communities and generate jobs and value to local areas across the UK.”

Some of theà‚ policy proposals the report recommends include providing a guarantee to investors to reduce risks of future heat connection capacity by levelling the playing field with other energy networks.

It believes that would lower the cost of projects and therefore reduce the cost of heat for customers, adding the policy would create a low cost framework for district heating infrastructure investment.

The ADE also suggests treating district heating networks “equally to electricity and gas in business rates”. It states heat network customers are subject to business rates far higher than gas and power infrastructure, increasing heating bills by as much as 20% ” orà‚  up to à‚£300 a home.

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