22 Jan Local energy planning rather than single nationwide solution is key to minimising decarbonisation cost – says new study
No single approach to decarbonising the energy system can be applied nationwide, with each local area requiring a unique mix of technologies and networks, according to a new study.
In a set of reports created for Energy Technologies Institute (ETI), experts at Energy Systems Catapult (ESC) found that local areas will need to take a leading role in the planning of their energy systems and infrastructure to meet decarbonisation targets at the least cost.
In response, ESC have designed a planning framework to help local government, energy networks and other key local stakeholders take the lead on preparing for a low carbon future.
Pilots conducted in Newcastle, Bridgend and Bury found that the decarbonisation of heat could be achieved for less than 15% above the cost of decarbonising electricity alone by adopting a ‘Whole Systems’ approach to Local Area Energy Planning1, meaning to consider the entire energy system across vectors, (heat, electricity, transport) supply chains (from energy generation to how it reaches people’s homes) and systems (physical, digital, market and policy systems).
Over half of electricity is now low carbon, including renewable energy and nuclear power. In contrast, just 4% of homes in the UK have low carbon heating2 despite almost a third of all UK carbon emissions coming from heat.
Until now, there has been limited joined up planning across heat, power, gas and energy efficiency in buildings for the decarbonisation of local energy systems. Yet a major overhaul that extends into people’s homes will be necessary to meet climate change targets.
The planning process takes a Whole Systems view, accounting for building energy performance, heating technologies, electrification of cars, gas, power and heat networks, as well as local spatial constraints and opportunities.
The value of Whole Systems thinking was recently highlighted in a separate study3 (also delivered by ESC for ETI) looking at possible ways to decarbonise national energy infrastructure, which estimated that a ‘best value-for-money’ Whole Systems approach would keep the costs at around 1% of 2050 GDP.
This is significantly cheaper than a more simplistic ‘blanket’ solution to decarbonisation, such as maximising the use of electricity or hydrogen, which were projected to cost twice (2.28%) to three-and-a-half times (3.51%) as much respectively. Local Area Energy Planning is based on taking this ‘best value-for-money’ approach, but applying it at a local level.
Local Area Energy Planning, the reports argue, will also create benefits for people and business, including the opportunity to drive local clean growth, create new jobs and increase confidence to invest in new energy products, services and infrastructure.
Areas that do not have a Local Area Energy Plan in place would likely cost more to decarbonise in the long term and would limit the influence local areas have as changes are made to communities, buildings and infrastructure. What’s more, they will miss out on the opportunities for clean growth local area energy planning generates.
Richard Halsey, Innovation Business Leader at Energy Systems Catapult, said: “To meet the government’s national target of reducing greenhouse gas emissions by 80% by 2050, we will need a radical transformation of our local energy systems.
“However, every local area is different. The state of homes and buildings, energy resources and networks, and levels of ambition are unique to each area. A single solution imposed across the country is likely to cost more and produce less desirable outcomes for people, and businesses.
“It will be important going forward that planning for our future local energy systems embraces innovation and considers all options, including the role of hydrogen, in planning future energy systems.
“This open, data-driven and evidence-based process can help support the transition to low carbon energy in a way that recognises the challenges of increasing decentralisation of energy and the importance of connecting network operators across gas and heat, to deliver cost-effective local energy system designs.”
Andrew Haslett, Chief Engineer at the Energy Technologies Institute, said: “Local areas across the UK need to find ways of making the energy transition that fit their circumstances. The work we have done with ESC and the three local areas across the UK has shown how this might work and provided a foundation to support whole systems planning across the UK. The enthusiasm of local stakeholders and support from central and devolved governments has been very encouraging.”
One of the toughest challenges for UK climate and energy policy is the decarbonisation of heat. This will require a major overhaul of the energy system, extending into people’s homes, including the fabric and domestic heating systems of buildings.
As highlighted in last week’s Committee on Climate Change report, almost all heating systems in homes, such as traditional gas boilers, will need to be replaced with advanced low carbon technologies. The gas grid may need to be scaled back or converted to distribute low carbon gases like hydrogen.
Choices made for heating technology will impact electricity networks, as will the introduction of electric vehicles. These significant developments require coherent whole systems energy planning to ensure that actions taken in the short term will not cause inefficiencies in the long term.
Richard Halsey added: “Local areas can play a key role in enabling our low carbon energy systems of the future, engaging communities, and shaping how we respond to some of the hardest challenges we face including decarbonising heat and transport in an increasingly decentralised and digitalised world.”
“To do this will require support from national government and engagement of the sector.”
Two publications have been produced to summarise the conclusions and insights of the work:
- ‘Local Area Energy Planning: Supporting Clean Growth and Low Carbon Transition’ is aimed at government, decision-makers and related stakeholders setting out how local area energy planning can address some of the challenges of UK climate and energy policy and to help deliver the UK’s clean growth opportunity;
- ‘Local Area Energy Planning: Guidance for Local Areas’ is aimed at local/regional organisations, energy network operators and other stakeholders, setting out the case for local leadership and providing guidance to undertake local area energy planning.
A supporting document, ‘Local Area Energy Planning: Insights from three pilot local areas’, is also available. This summarises the insights of the process undertaken with the three pilot areas.