London decentralised energy making headway but uptake still ‘shallow’

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The City of London is making progress in stimulating the development of decentralised energy but there is still a way to go if the largest metropolis in the European Union is to meet its decarbonisation targets.

The Mayor of London’s Decentralised Energy Project Delivery Unit (DEPTU)’s senior manager Peter North spoke to COSPP this week and while he acknowledged the level of uptake was slow at the moment, the pipeline being built up since the unit’s formation four years ago is starting to bear fruit.

While cities like Copenhagen do more to facilitate the use of their district heat networks, by in effect making it compulsory for any new building to be connected to it, the Greater London Authority must work within a liberalised energy market, with no such legislative help.

“Our starting point centres around climate change strategy and fundamentally the Mayor recognises that building heating gives rise to some of the larger CO2 emissions in contrast with power production and transport so he knows it is within his gift to bring about changes in those areas and has the London Plan, specifically chapter five, detailing that approach.”

In 2011 Boris Johnson’s office published its Climate Change Mitigation and Energy Strategy (CCMES) to that end. Its target is to reduce London’s CO2 emissions to 60 per cent of 1990 levels by 2025 and goes further than that to align with the government’s 2050 target of an 80 per cent reduction.
Peter North - Manager of Mayor's Decentralised Energy Unit
“Within that 2025 target he recognises the benefits of decentralised energy technology, generating electricity locally and, where appropriate, recovery of heat to displace the use of gas in building heating. So he set a supplementary target of 25 per cent of London’s energy supply coming from decentralised energy by 2025,” says North.

“That London plan has been successful to a certain degree with new build, installing CHP and district heating but it’s the rate of uptake remains far too shallow to meet the 2025 target.”

  North heads up the Decentralised Energy Project Delivery Unit (DEPTU), a small team which works hard offering technical, financial and commercial advisory services in a bid to decarbonise the city.

DEPTU works within a context where London’s boroughs are asked to be in conformity with the London Plan, perform energy master planning and development control.

What amounts to an energy hierarchy also requests that developers use building insulation better than building standard regulations, think about connecting to local heat networks and where that is not possible install their own combined heat and power (CHP) units. The balance as far as is economically possible should come from renewable energy.

“DEPTU is a £2.8m programme, 90 per cent funded by European Union Elena Technical Assistance Facility, 10 per cent from the Mayor. We provide the direction and act much like a developer would bringing stakeholders together to look at major projects. Over the last four years we have helped bring about 18 projects to market with a total market value of about £107m.”

The earliest projects assisted by the body include Cofely’s work at the Olympic Stadium in east London, ensuring LOCOG meet their objective of leaving a lasting positive legacy in that jurisdiction.

DEPTU helped the developer to accelerate their work on the Olympic Park by 10 years to bring the heat network to the park boundary to make 20 MW of low carbon heat available to the Stratford High Street area.

“That project had its difficulties but is now almost to the point of connecting the first heat load outside the park. This is a good example of where public sector intervention has brought forward a scheme.”

Other high profile projects include the GLA-owned Crystal Palace National Sports Centre, which possesses a CHP installation with an interesting heat pump recovery loop, Camden’s Sommers Town CHP district heating scheme, which serves the Francis Crick medical research institute, and social housing developments in that borough. Then there is the Edmonton energy from waste plant in Enfield.

The latter was a 40-year old facility, with a poor 21 per cent efficiency factor ‘throwing away a shedload of heat’ before DEPTU presided over its rejuvenation, improving its heat recovery standard to the point where a new body called the Lea Valley Heat Network, as well as one of the city’s biggest regeneration projects, is to benefit. It promises to be one of London’s greatest decentralised energy achievements to date.

“We are in negotiations with the plant’s owners, the North London Waste Authority. The first phase is to take heat to the Meridian Water Regeneration Project and that new housing that will be built will be connected directly to this incinerator. That pipeline has the capacity to go elsewhere and we have done energy master planning that looks at taking the heat north to Upper Lea Valley and south to Haringey, North Tottenham and ultimately Waltham Forest. So some of the very early large scale plans we envisage are now coming forward in smaller projects which will expand over time.”
London Mayor's Office

Bigger is better when it comes to making decentralised energy projects viable, according to North. The sheer size of London makes bigger, more obviously the way to go.

“Faced with investing in a gas engine for example, the larger it can be the more efficient it will be – it lends itself to bigger economics. Take for example another project involving Transport for London (TFL). They are looking at installing a number of 4 MW gas reciprocating engines, taking the heat from there and distributing it through the borough of Greenwich. Greenwich are looking at the heat network part while TFL are looking at the CHP investment so we provide support to both sides to specify, study and deliver those projects. They are in a phase of procurement with the gas engines, finishing off the study work for the business case for the heat networking in Greenwich.”

Other notable and increasingly frequent projects involved London’s vast waste energy capacity. It represents ‘free heat’ and organisations such as London Underground are present in this space, with a most recent example being the Bunhill CHP scheme in Islington.

“Phase 2 is about recovering heat from London underground vents and using heat pumps to get it out to reusable temperature then pumping it out to the expanded network. So not only do we try and go for scale and heat that’s already there we try to innovate and anticipate what London will look like by 2050 and a low electric future – industrial sized CHP pumps linked with district heating networks are very much on our mind at the moment.”

The team have studied the Scandinavian example in particular in assembling ideas aimed at proliferating decentralised technology. As mentioned British legislation isn’t as accommodating as found in those places and developers are often reluctant to embrace low carbon possibilities due to perceived impact on costs and timescales. They often opt to pay more to maintain control and independence.

Projects are now coming on stream and what started as a trickle may start to turn into a flood.

“These schemes take at least three to seven years to develop, with reference to timing, licensing and procurement. Given that we started three to four years ago we are beginning to see the first ones come to fruition –When you think of Crossrail and the time it took to plan and build even though they had acts of Parliament to enable them we are doing this entirely within a liberalised energy market with very few powers at this moment besides the GLA brand name and the Mayor Of London plan. It’s tough going but these projects will gradually come out into the market and get constructed.”

North’s team is now assessing successor arrangements to DECTU, through an entity likely to be 50 per cent funded from the European regional development fund and 50 per cent from the GLA.

There is also ongoing work in facilitating energy trading through an idea called Licensed Line or junior electricity supply license. The mayor is one of the first public applicants for this license and it will enable his office to buy electricity from local generators at better prices than they can currently get with the aim of selling it to transport for London as part of the GLA family.

“We want to try enhance the revenue streams for local generators because the current regulatory arrangements prevent them accessing the retail market. There’s a barrier there so License Line is aimed at overcoming that barrier, improving the revenue and hopefully more decentralised energy schemes will then come forward to go into construction.”

Peter North and the delivery unit now keenly await the government’s comprehensive spending review in November. It will provide an opportunity to hear the department for energy and climate change’s perspective on heat in particular, and the hope is that DECC shares their urgency on the subject.

“DECC has a heat team and has a similar delivery unit to what the mayor has. We want to hear how they plan to support the approach to heat, given its one of the biggest sources of co2 emissions in the country.”

“The city’s population is 8.3 million now and is forecasted to grow phenomenally and we need the infrastructure to support that growth and that includes energy.”

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