Written evidence submitted by SAV Systems (DHH0028)


To achieve net-zero carbon emissions by 2050, nearly all heat in buildings will need to be decarbonised. Heat networks are a crucial part of the path towards decarbonising heat due to their proven ability to affordably capture and utilise renewable and waste heat from a range of sources.

Heat networks can be split into district heating schemes and communal sometimes known as “Block Heating” schemes. Around 80% of UK schemes are communal systems.

14,000 heat networks are currently operating in the UK, providing heating and hot water to approximately 480,000 consumers[1]. HNs are already an important part of our heat mix but the Committee of Climate Change have recommended that 20% could be connected to a heat network in future, meaning as many as 5 million properties.

SAV Systems’ mission statement is to “optimise indoor living, with minimum energy wastage”. SAV is a leading supplier of low carbon technologies in the UK (HIUs, Energy Meters, CHP & HP energy centres and low carbon School Ventilation Systems) and are one of the parties working extensively for the promotion of better energy standards across the UK.

SAV’s expertise offers a unique combination of engineering reality with an in depth understanding of the commercial and economic challenges associated with the deployment of communal heating. The Danish links of the company allow a perspective that can offer learnings from the heat decarbonisation process in Denmark to the UK’s approach.

 Hard electrification” or “Sector coupling/Integration”:

We are influenced by our knowledge of the Scandinavian and German energy markets; and we are concerned that the UK is unwittingly barrelling down what is known as a “hard Electrification” path which calls for the electrification of all uses which are reasonably accessible by an electricity  grid. Foremost is the electrification of heat supplies to buildings, requiring the wholesale abandonment of gas heating systems.


Alternatively, “Sector coupling” is based on the interaction between networks for power, gas and district heating. An essential component of sector coupling is storage capacity. Storage can be either by hot water or de-carbonized gas, such as biogas, biomethane or hydrogen. 


There have been several reports produced on this topic and a study by the ITRE committee of the European Parliament published in 2018 concluded that a sector coupling for Germany alone would be Euro 600 billion cheaper than a hard electrification vision.[2]


What has been the impact of past and current policies for low carbon heat, and what lessons can be learnt, including examples from devolved administrations and international comparators?

The UK remains very wasteful of energy.

Indeed, earlier this year, Ministers ensured planning permission for the new Gas Fired plant CCGT being developed by Drax in North Yorkshire. The power station will dump waste heat from power generation to atmosphere. Such a plant should be capturing waste heat from the power station to supply low cost heat and help develop the North’s Heat Network infrastructure. For comparison, the last heat dumping power station was decommissioned in Denmark around 2007!

Even today, developers are able to exploit loopholes in the building regulations to install all electric heating systems to the detriment of consumer energy costs and the UKs attempt to de-carbonise. This is a quite prevalent outside the jurisdiction of Greater London in cities such as Manchester, Liverpool, Birmingham.

Earlier building regulations have resulted in white elephants due to lack of monitoring post planning. Tightening building regulations will not necessarily improve outcomes as building regulations are too crude a mechanism.

Past policies have overlooked the potential for benefits of communal heat in buildings such as apartment blocks at a local level that can later be linked up to a larger heat network.

What key policies, priorities and timelines should be included in the Government’s forthcoming ‘Buildings and Heat Strategy’ to ensure that the UK is on track to deliver Net Zero? What are the most urgent decisions and actions that need to be taken over the course of this Parliament (by 2024)?

This parliament must get the future building regulation and SAP right. Calculation methodologies and regulations drive investment decisions from householders, developers and industry.

Decisions should be made on a holistic basis that consider the wider context of changes on the whole energy system. For example, through a shift to a marginal emissions factor for electricity rather than an average factor, which is currently driving perverse incentives that will make the decarbonisation of heat harder and more costly in the long-run.

Which technologies are the most viable to deliver the decarbonisation of heating, and what would be the most appropriate mix of technologies across the UK?

Sector coupling is essential to spread the risk of decarbonisation. It is time to move away from silver bullet approach toward creating a framework which allows different technologies to develop. A mix of technologies will create a complementary approach that will aid the integration of renewable electricity and technologies that can utilise this. Flexible heat generation technologies, such as CHP are vital to be deployed alongside other low carbon solutions such as heat pumps.

Heat Networks are a critical part of the infrastructure mix, however a lack of understanding of the best way to optimise heat networks within an energy system is leading to incorrect technology choices.

The support that exists for heat networks could be broadened. At present the focus on district/city wide solutions only, when this doesn’t naturally lend itself to our cityscapes and development of the UK urban environment with infill of small spots more common than large district wide development in urban centres. Heat networks at building or development level offer substantial opportunities which are currently missed.

Fundamentally, we disagree with the move to ban Gas CHP whilst consumers are being asked to pay for centralised Gas CCGT to balance electricity load on the grid. It is vital to look at domestic heat decarbonisation holistically within the context of decarbonisation for transport, industry, aviation etc.

What are the barriers to scaling up low carbon heating technologies? What is needed to overcome these barriers?

We are under-developed in our understanding of sector coupling. There is also a lack of significant heat network infrastructure to enable multiple low carbon heat technologies.

How can the costs of decarbonising heat be distributed fairly across consumers, taxpayers, business and government, taking account of the fuel poor and communities affected by the transition? What is the impact of the existing distribution of environmental levies across electricity, gas and fuel bills on drivers for switching to low carbon heating, and should this distribution be reviewed?

The first step is to ensure optimal design for energy system through sector coupling. This is not currently the case with big increases in capacity of ‘’car park generators’’ in recent years and remaining presence of large gas fired CCGT on the electricity system. An efficiently designed, sector coupled energy system will provide lower costs for consumers.

What incentives and regulatory measures should be employed to encourage and ensure households take up low carbon heat, and how will these need to vary for different household types?

A clear plan for infrastructure with given local areas. We support Heat Network zoning and a hierarchy for low carbon heat. Heat Networks as a requirement for new developments wherever heat load/density allows. Consumers in existing homes need to understand the future infrastructure plans in their area. They should know very early on whether a heat network is likely to be constructed, or hydrogen infrastructure deployed.

Heat Networks should not be included within the Building Regulations. They should be considered as a utility similar to gas/electricity networks.

What action is required to ensure that households are engaged, informed, supported and protected during the transition to low carbon heat, including measures to minimise disruption in homes and to maintain consumer choice?

A clear plan for infrastructure may be more important than consumer choice over low carbon heat technology. Zones should identified for particular types of infrastructure and households should be encouraged to consider heating system upgrades in the context of knowing whether a heat network pipe, or hydrogen main is likely to come down their street at some point in the future.

Heat Networks should not be included within the Building Regulations. They should be considered as a utility similar to gas/electricity networks.

A sector coupled approach will allow choice to be maintained for consumers, who will get a solution that works best from an engineering perspective for their specific circumstances.

A key consideration will be the cost to consumers. They will not want to pay more for their heating, especially for those already in fuel poverty. This must be at the forefront of considerations and choice must be maintained to provide solutions that reduce both carbon emissions and fuel bills.

Where should responsibility lie for the governance, coordination and delivery of low carbon heating? What will these organisations need in order to deliver such responsibilities?

A holistic approach which prevents heat decarbonisation happening within a silo is key. This needs to happen at the level other decisions on the energy system are happening. Strategic decisions on heat infrastructure need to be taken at the same level as strategic decisions for other part of energy system.

Local preferences can be developed where they depend on specific circumstances of building stock/heat requirement and availability of low carbon heat source. Local bodies are well placed to understand and work locally to develop these opportunities but we do not believe it is sensible to ask local authorities to decarbonise heat if you are going to reserve decisions on new power stations to central government. We have seen in London and elsewhere that actors will optimise in the areas they have remit. This can lead to some perverse outcomes whereby a strategy which is rational to an individual local authority is pursued despite it being contrary to the overall objective of a balanced energy system.

All local decisions must be driving in the same direction to decarbonise heat across the whole economy rather than making decisions which may bring local benefit at the expense of the whole.

 November 2020



[1] BEIS, 2020, ‘’Heat Networks Building a Market Framework Consultation’’

[2] ITRE Committee of the European Parliament, 2018 ‘’ Sector coupling: how can it be enhanced in the EU to foster grid stability and decarbonise?’’