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In this blog I want to share the example of the city of Amsterdam to highlight how successfully decarbonising heat will mean using a range of technologies & energy vectors, targeted based on a local approach to planning. Thus far in the heating transition this approach has been far from the norm, but it looks like things could be starting to change.
An orange blueprint to make heating green
It’s almost 13 years since I first immersed myself in understanding the heating market, and began supporting Europe’s biggest energy suppliers and HVAC companies in navigating the heating transition. 2020 seems like a good time to reflect on what’s changed since then and consider what the next decade could bring.
Thirteen years ago I had just completed a PhD quantifying the impact of climate change on Icelandic glaciers – and predicting how these impacts would play out in future decades. The impact of continued warming – and the need for urgent action to stop it – was painfully clear. This desire to solve the climate crisis was of course what drove me to the energy industry. The science of climate change was clear – now to tackle action and adaptation. I focused in very quickly on heat, as one of the most critical (if most challenging) parts of energy consumption to decarbonise.
In discussions about decarbonising heat, we often hear people lament that heating just isn't "sexy" enough. A few months ago I was at an event where one of the UK environmental NGOs complained to a room of heating industry professionals that heat pumps are "bl**dy ugly", and don't really offer anything over gas boilers in terms of delivering comfort. Why can't we learn from the likes of Tesla or Apple, they asked, and make a product that offers a superior user experience and looks alright outside our homes?
This got me thinking about how comparable heat pumps are to electric vehicles, and to Teslas in particular. So I looked into the stats, asked the HVAC manufacturers what they thought, and debated the topic with my colleagues. There are certainly some lessons I think we can take from EVs, but there are also fundamental differences between heating and vehicles that we shouldn’t forget. In my view, all this talk of “making heat sexy” is a generally unhelpful distraction from the challenges we really need to address. Here’s why.
There’s been a lot of talk about the potential for ‘Heat as a service’ & ‘Comfort as service’ (HaaS & CaaS) to revolutionise Europe’s heating markets, reaching more end-users with new, potentially low-carbon, heating appliances. While our research has turned up a number of HaaS-like offerings, so far, we’ve only found one example of what we consider to be ‘true’ heat as a service: Eneco, in the Netherlands.
On reflection, this isn’t surprising. The Netherlands has all the right ingredients that make it the key market where innovative, ‘new heat’ offerings are likely to emerge, and ultimately to succeed. The 7 key has are:
The Netherlands has set some of the most ambitious targets in Europe to phase out natural gas in heating (and elsewhere), aiming to be “natural gas free” by 2050. This is no small ask in a country where, today, almost 90% of the >7million homes use natural gas - usually via an individual boiler (or “CV-ketel”) as their main source of heating and hot water.
Since the gas free target was set, heat pump sales have grown rapidly, increasing numbers of new homes are being built without a gas connection, and the government subsidy supporting renewable heating installations – the ISDE – proved so popular, it had to be closed to new applications part-way through 2019.
Energy communities is emerging as one of the hot topics of the 2020s in the energy world. This has been accelerated by the current Covid-19 crisis, which has made the need to find local solutions to global problems even more pronounced. Many of the discussions around community energy are centred around electricity - but are we missing an opportunity by not talking about the benefits of a multi-vector approach which integrates electricity together with heat (and ultimately other vectors like mobility and hydrogen)? In this blog, we will focus on the opportunities for heat to be at the heart of energy communities.
The transition from “old heat” to “new heat” is making a community energy approach to heat more and more appropriate – and potentially more valuable. We believe that working directly with communities on local heat decarbonisation strategies will be critical to the success of heating product and service providers in the future. Energy communities with heat at their heart are not just the future – they are already here, and they are a growing opportunity not to be missed by the energy and heating industries.
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