In recent months, the UK property industry has done more to advance the environmental agenda than ever before. What is often unseen is the very rapid deployment of utility-scale and development scale renewable energy generation and storage, which the heat and power networks industry are working extremely hard to respond to, and which could provide great opportunities for the transitions to net-zero in the real estate development and regeneration sector. Part 3 of our Game Changers series looks at these opportunities.
Developers, consultants and professional bodies have come together to declare a ‘Climate and Biodiversity Emergency’ and have taken concrete action. Together, we’ve developed much needed clarity and guidance on how to truly achieve Zero Carbon.
Hilson Moran has worked with local government, private developers and other business to help develop policy and supporting guidance that is practical and straightforward. We have responded to key consultation documents published by central government on our own merit and with our industry peers.
In the UK, 49% of annual carbon emissions are attributable to buildings. This note forms part of our Zero Carbon Game Changers Series and summarises key documents that were issued between April 2019 and today.
Part 3 is focussed on energy networks, including utilities grids, district energy networks and energy infrastructure shared between multiple consumers.
Back in March 2019, the Chancellor, Philip Hammond, announced a ‘Future Homes Standard’, mandating the end of fossil fuel heating in all new homes from 2025. The key changes to be aware of since this announcement are that the electricity grid is planned to decarbonise fast, but this is not sufficient for the UK to achieve its Zero Carbon target by 2050. Energy network digitalisation, energy storage and smart management, fast-tracking of Hydrogen and Carbon Capture & Storage, and consumer protection all form part of the bigger national Zero Carbon picture.
Since then, the electricity network operators in Great Britain have started to transition from ‘Network Operators’ to ‘System Operators’ and have introduced a flexible connections market. This allows renewable generation and storage to off-set demand loads so buildings, and communities of people and places, can connect systems of demand, supply and storage, with smart controls that can interface with the grid; and with off-site and remote communities via local energy archetypes and energy services companies. BEIS has also issued a key consultation, ‘Heat networks: building a market framework’ (February 2020), that sets out their proposals to build a market framework to both regulate and support the growth of heat networks.
Policy-led game changers
Future Energy Scenarios: The latest FES was published in July 2020 and updated credible pathways for transforming the energy network over the next 30 years. This year the impact of societal change and the rate of decarbonisation were considered. Key messages include:
1. Net Zero Carbon is achievable by 2050 but it requires immediate action across technologies and policy, and full engagement with key players and end consumers
2. Hydrogen and Carbon Capture and Storage must be deployed and operational this decade
3. Markets must evolve to provide incentives for investment in flexibility and zero carbon generation
4. Open data and digitalisation are critical to navigate increasing complexity at lowest costs for consumers
Heat networks: BEIS has issued a key consultation, ‘Heat networks: building a market framework’ (February 2020), that sets out its proposals to build a market framework to both regulate and support the growth of heat networks. Highlights include:
5. Policy options for establishing a market framework to deliver important consumer protections, equivalent to those offered to gas and electricity customers, as the market expands
6. Proposals relating to the choice of regulator, the regulatory approach, enforcement powers and step-in arrangements and to giving heat networks equivalent rights and powers (such as undertaker or statutory access rights) compared with other utilities
7. Proposals for developing technical standards and certification and accreditation processes to improve the quality, cost and reliability of heat networks
8. Proposals to drive decarbonisation of heat networks and use of waste-heat sources
Electrical vehicles: Closed consultation (July-October 2019) proposals for a new part to building regulations to ensure that electric vehicle charge points are installed in all new build and refurbishment projects. Consultation was extended and was due to come into effect in April 2020. Highlights include:
1. Every new residential building with an associated car parking space to have an EV Chargepoint (likely 7.4kW, or ‘fast’) installed
2. All new non-residential buildings with more than 10 parking spaces to have one EV Chargepoint for every 5 spaces
3. From 2025, all existing non-residential buildings with more than 20 car parking spaces to have at least one EV Chargepoint
Part L of the Building Regulation 2020 and the Future Homes Standard (est. 2025)
This consultation sets out our plans for the Future Homes Standard, including proposed options to increase the energy efficiency requirements for new homes in 2020 (expected this summer). The Future Homes Standard will require new build homes to be future-proofed with low carbon heating and world-leading levels of energy efficiency; it will be introduced by 2025. In addition to highlights summarised in Part 1 of the Zero Carbon Gamechangers Series the consultation proposes:
1. The formal adoption of a decarbonised electricity factor
2. Factors to help a more gradual phasing out of gas CHP, as long as a strategy is in place to replace this with heat pumps at a later date
The New London Plan
The current 2016 Plan is still the adopted Development Plan, but the Draft New London Plan is a material consideration in planning decisions. The Mayor is to publish final London Plan working towards summer 2020. Associated guidance includes the updated Energy Assessment Guidance (April 2020), that provides information on how to comply with the New London Plan energy policies. Relevant highlights include:
1. Application of new decarbonised electricity figures (SAP 10.0) and new Heating Hierarchy
2. Zero Carbon for all new development and Carbon offset increased to £95/tonne
3. Requirements flexible power solutions to reduce energy peaks
Industry-led game changers
In July 2020 UKGBC Infrastructure Forum with a group of industry specialists including Hilson Moran, published a report that explores the scale of infrastructure change needed to meet net zero heat.
‘The Path To Zero Carbon Heat’ provides pathways for decarbonising the heating of Britain’s homes and workplaces by 2050, presenting 3 possible scenarios: (1) electrification of heat replacing natural gas; (2) a hydrogen-led scenario; (3) a hybrid of the first two options. Key recommendations:
- All scenarios require taking technologies such as Carbon Capture & Storage (CCS) and auto-thermal reforming from pilot stage
- The development of infrastructure will need to be accelerated quickly and maintained.
- The changeover to net-zero heat requires a complex mixture of national, regional and city involvement, systems thinking and extensive digitalisation
- New skills need be developed, with a refocus of existing expertise.
Hilson Moran continues to work with the UKGBC to develop a Net Zero Carbon Definition Framework for the infrastructure sector, as well as guidance around the definition of acceptable Renewable Energy investment to standardise grid and local decarbonisation initiatives.
Hilson Moran is also working with CIBSE, via their net-zero electricity working group to create guidance for building designers looking at the interface between buildings, communities of buildings and electricity (and heat) network operators, in terms of resource sharing, aggregated storage and generation, and demand-side response.