Hugely popular in Scandanavia and seen as the next big thing in green power, District Heating and Combined Heat and Power (CHP) in high density cities are currently more expensive, more carbon intensive and releases more CO2 than traditional electricity generation according to Bill Watts, senior partner at engineers Max Fordham.

District Heating uses a network of pipes to different buildings to pump hot water for space heating and domestic hot water. But it is clear that District Heating that dispenses warmth via hot water in pipes loses heat.

“That is not news,” admitted Watts.

CHP makes use of heat produced as a byproduct of electricity generation from sources such as coal, gas, biomass or nuclear production – the “waste” heat in other words. But using this waste heat is only a great idea if the costs of using it and moving it and using it don’t negate the advantages.

Even Yan Evans from ENERG Switch2 – which promotes itself as “a market-leading district heating provider” – admits that “from our experience… the overall efficiency of the heating system is typically between 50 per cent and 60 per cent, once heat distribution losses have been taken into consideration.”

“The efficiency of the system is often over-stated leading to incorrect tariffs being set by the scheme owner or operator,” said Evans. “This can lead to under-recovery of operating costs and is a key pitfall that many fall into.”

“Under-recovery of operating costs can only mean one thing. We need to charge the customer more!”

It stands to reason that the losses go up as the heat requirement goes down. The pipes are always warm and the losses are fixed. The less you take out – the lower the demand – the greater the percentage that is wasted. At times when there is no demand for heat, the losses are 100 per cent but pumping costs remain even when the heat is not being used.

“This is borne out by the data from the Danish district heating association,” said Watts. “They note that system losses are around 20% when heat demand is high. The losses nearly double, 30 per cent to 40 per cent, when demand is halved.”

The G15 is a group that represents the 15 largest Housing Associations in London. It has undertaken a research programme to “assess the effectiveness of technologies used to improve the sustainability of new homes and mitigate fuel poverty, initially focussing on the performance of district heating and combined heat and power schemes.”

District Heating Diagram

Though the research has yet to be published, Watts has already been privy to some of the results.

The six schemes tested all have a higher carbon intensity than a local gas fired domestic boiler.

“The CHP system is spectacularly bad,” said Watts. “It is even worse than using electricity directly from the grid for heating. It would have been better to save the several 100s of millions of pounds investment and use a £10 electric fan heater plugged into a 13 amp socket using grid electricity.”

The capital expenditure and additional fuel use related to CHP and District Heating comes at a very high cost. Some have quoted costs at being 50 per cent higher. Watts say his team at Max Fordham is aware of schemes with far, far higher numbers than that.

“The residents usually have to accept the heat from this energy supplier whose costs are not regulated,” he said. “Furthermore they are told that it is a green scheme. That’s a long way from the truth.”

So what’s the answer?

“Some say heat pumps,” said Watts. “And maybe one day they’ll be right”

“They produce more heat than the electricity you put in by taking heat from the outside air or ground. But the G15 research has shown that electricity releases more CO2 than burning gas and the ratio is such that air source heat pumps and those making hot water are more carbon intensive than a boiler.”

“Electric heat pumps won’t be low carbon until the grid can provide low carbon electricity – and a lot of it.”

So what does Watts suggest is sensible from an engineering, economic, social and political point of view?

“I won’t apologise for a very unsexy solution,” he said. “The best response we can make right now – the best way we can invest our effort and our money – is to use less energy.”

“It is clear that a well built, highly insulated modern building needs much less heat to keep it warm than a poorly insulated one. It follows that it should be possible to retrofit a poorly insulated one into a well insulated one.”

Watts does not understand why in the UK it is the “low carbon” systems that are receiving generous state support, rather than building insulation schemes.

“District heating is a substantial tax on development that leaves pensioners with a higher heating bill,” he said. “If the considerable money and effort going into district heating and renewable heat incentives went into providing an incentive for people to insulate their dwellings, we would see a reduction in cost, fuel use and CO2 emissions.”

He suggests lowering demand is the best solution, at least in the short term.

“In time we will need to decarbonise our heat which could be from renewable electricity or even renewable gas, but that ambition is a good 15 to 25 years away, and much easier meet when only requiring a miserly amount of energy,” he said.

“Is it a good idea in other places in the world not blessed with a gas grid? Perhaps, but it needs to be worked into the thinking of that region’s future energy policy. I am suspicious of any system that thinks that heat is so free that you don’t need to conserve it. I can’t think that any heat will be free enough to waste in the future if not now.”