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The Netherlands is at the forefront of the move to decarbonise the European heating sector through electrification of heat, driven by a policy goal to phase out natural gas. In the Netherlands, this drive has been strengthened by a series of earthquakes in the north of the country that have been caused by natural gas extraction. This is quite a shift as, similarly to the UK, the Netherlands has previously been a country dominated by gas heating. 85-90% of homes currently use natural gas as their main heat source.
Cate Lyon, manager of Delta-EE's Electrification of Heat research, says that building regulations have been the key to kick-starting the electrification of heat in new build housing.
The Republic of Ireland is one of many EU countries with increasing focus on the electrification of heat to reduce carbon emissions in downstream energy use. Already, 40% of residential new build developments have a heat pump installed. This is set to increase at the end of 2019 with the introduction of Nearly Zero Energy Buildings, effectively removing condensing gas boilers as an option in new build.
Electrification brings with it challenges for the operation of the electricity grid – pressure from variable loads and high peak loading from electric heating and transport combined with increasing inclusion of peaky renewable generation. So, is the Republic of Ireland firmly on the path to electrification of heat? What can be learned from their approach?
For utilities, the rise of EVs presents as much opportunity as it does threat, as a recent blog from my colleague Jon Slowe has described, so let’s unpick the opportunity, and discuss how new-entrant energy supplier Octopus Energy is positioning itself to capture part of the prize.
Octopus Energy is a good example of an innovative, agile player that is moving quickly. With less and less doubt about the future value at stake, a key question is how companies can go about capturing this value and avoid being left behind?
Demand-side response and flexibility are becoming increasingly important – this is evident in the UK following BEIS’ announcement of its new plan to upgrade the UK’s energy system and give homes and businesses more control over their energy use. The opportunities for innovation and investment in the energy sector, therefore, are vast.
Smart electrically-driven heating is a potentially valuable field in which to invest, but to what extent will customers and the energy system benefit, and how can these benefits be unlocked?
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