BEIS and city councils on the Net Zero challenge

Queen's Quay Energy Centre - Clydebank, Glasgow (Vital Energi)

The first in our '2021 energy and sustainability' series brought together the Head of Local Energy from the BEIS, Patrick Allcorn, with Tom Warburton, Director of City Futures at Newcastle City Council and the Chief Executive of Warrington Council, Professor Steve Broomhead, as well Vital Energi's Managing Director for the North and Midlands, Mike Cooke and Alister Kratt, Director and leader of LDA Design's energy and infrastructure teams. We are discussing a range of sustainability and green energy themes in the run-up to COP 26 in Glasgow later this year.

This debate asked questions around how local authorities can create sustainable heat and waste networks/plants to cut city emissions, how appropriate infrastructure planning can aid this, how councils can work with private finance to achieve their net zero goals, how new technologies can be embedded effectively to curb emissions and keep costs low as well as the impact that some new energy installations might have on our environments.

Developing complex heat and waste projects for local authorities sustainably was tackled first in our debate. When asked about its partnership with French global energy company Engie, Tom Warburton of Newcastle described the journey the council had taken:

'Back in the days of regional development agencies we had a big regeneration site of 24 acres in the city centre then called Science Central but now branded the Helix. We wanted to produce an exemplar of sustainability practice with a combined heat and power plant to serve both offices and residential. We were going to do a standard approach in procurement terms but it can be an expensive process with a lot of money and time spent on legal fees. So rather than do a one off for one site we thought we would go for a structure of a single long term frame work with one partner who was procured at high value to do more energy work across the city in future. This made the procurement of project one very complex but we eventually got there. We have finished project one - the Helix site - and we are using the district heat network. We have recently won £27.5 million from the government programme for public buildings to do another site and we got this partly because Engie has the skill-set to help with both the application for funding and with carrying out the energy projects.'

Poor planning around heating and dealing with low quality housing has traditionally been an issue for the drive towards energy saving and sustainability. The forum asked Patrick Allcorn of BEIS to comment:

'Heat is the big obstacle to decarbonisation. Hydrogen has potential but we have not proved it is safe in homes yet although we are seeing some gas networks using it to decarbonise. And then you have electrification of heat with heat pumps being the primary technology and then more traditional electric heating in super insulated properties.

'All of our building stock is pretty poor. We have had relatively cheap energy for a long time and this has allowed us to put up lower quality housing and more poorly insulated homes than would have been the case, perhaps, if we had been thinking about Net Zero.

'Newcastle is one of the places that has been doing heat mapping and zoning. We are bringing in the capacity for the provision of mapping of heat zones in towns and cities, to recommend that one part of a city may be better on a district heat network, and one part may be better on hydrogen and so on.'

'The reality of a heat network is that once the infrastructure is in place if you can be clever about the generation side of things, you can de-carbonise further. The risk is that you build it to do one thing but you find that your energy centre cannot be retro-fitted for hydrogen or biogas for example, and you have to knock it down and start again. That is where poor forward planning comes in, where you have rushed to a solution without future-proofing it.'

Future Cities Forum posed the question around whether government funding will eventually run out for decarbonisation schemes? Patrick responded:

'There is HNDU (Heat Networks Delivery Unit) to develop the feasibility and design of schemes and there is the heat network investment programme to invest behind that. This was never supposed to 100% fund schemes, rather it's there to act as leverage for commercial finance.

'If you look at Leeds City Council's Carbon Commission Plan, this estimates that decarbonising Leeds will cost £12 billion and that's just Leeds! This is not all going to sit on the public book. We have to find ways to blend the finance - commercial, public and private. Some funding may come from local authorities investing commercially in these systems alongside public grants and subsidies. There's a real challenge here right across the Net Zero portfolio on how we blend projects and how we blend finance.

'The retrofit side is still not commercially viable. Look at the way Bristol has approached it with City LEAP. It's about what works for your place, your city. Central Manchester has an ideal environment for a heat network but they have just spent 10 years laying a tram network, so you would have to dig that up to lay the pipes for heat.'

Warrington Council's Chief Executive, Professor Steve Broomhead, joined the discussion around dealing with austerity and trying to find a new entrepreneurial approach to energy provision:

'The deliberate strategy here, following eleven years of austerity and then Covid-19, is to be as entrepreneurial and as commercial as possible. We - like many councils - declared a climate emergency. That's all very good in theory but you must do the practical stuff. We have been action focused and we have two solar farms which we own and as from end of this calendar year we will be self-sufficient in energy as a borough council. That will include all of our buildings and all of our street lighting. We have also made an investment in Together Energy because it supports our green energy strategy. Together Energy procures renewable energy from Danish company Orsted and their values are driven by a concern for fuel poverty. We have also created a housing company which is now now on site with solar panels for 160 homes.

'Could we raise money from the community for energy projects? In fact we raised one million pounds in one week from the community via crowd funding to invest in a solar farm in Cirencester. That shows the level of community appetite. However, we are geographically located in the middle of a motorway box between four motorways so reducing carbon is not easy. People are responding well via the community investment bond, though.

Mike Cooke, Managing Director of Vital Energi, then described his experience of working with councils and developers and the lessons the company had learned along the way:

'We recognise the difficult and arduous journey through the planning and procurement stage of these projects. It often takes only a third of the total time duration to actually execute the projects as opposed to the planning as the hurdles are often at the front end. There is a lot of brain power to get the concepts across the finish line and construction side is often much simpler. The validation of the business case can change over time from being around carbon currently to historically being around economics.

'We are seeing a huge transition in technology from fossil fuels to renewables. As Patrick said, this is in the electrification of heat. We are on the edge of real change and we have the 'energy trilemma' which is made up of the challenge of security of supply, the carbon reduction element and then the cost of energy. Unless we do something radical with cost of energy we will see price increases. The challenge is also how we embed the new technologies to help reduce carbon.

'Manchester's new central heat network is a CHP centre underneath one of the tram system bridges. We are privileged to be working with Manchester City Council on this, and great to see new infrastructure being put into the city, although we have to work very carefully around and beside the metro lines.

On funding Mike added:

'The heat network project in Leeds is a terrific success, and we are helping with accessing grant funding. We need to take stock of the high energy costs that may be coming. Hospitals and universities with large campuses can help cities to make the step-change. Getting to the table to work together can take time. It does require public-commercial partnerships.'

The debate turned to how cities work on new low carbon energy solutions but preserve the look and character of place? LDA Design's Alister Kratt responded to the question about whether it is possible to build these energy centres and the renewable energy infrastructure in a 'beautiful' and 'good' way:

'Good now is a deeper vein of thinking and this includes more than aesthetics. It encompasses biodiversity, carbon emissions, community impact and equality of outcomes. I believe the ability to think and plan in a joined-up way across disciplines has been one of the challenges historically. It has been improving but this is still an issue.

'On Oxford (where LDA Design has been advising the city council on housing inequalities and sustainable growth) I think it is critical to understand people, place and the wider natural environment. Oxford is largely defined by the quality of its built environment but no city escapes inequality. It is how the curation of the environment is managed while allowing the city to be resilient and to grow. Settlements cannot generally speaking stand still. They have to grow but need to grow well.'

Read more detail from our speakers above in our extended report due to be published in the autumn and in the meantime join us for our next energy and sustainability forum in May.

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