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Podcast S14E04

Smart thermostats for heat pumps

a modern kitchen in a new home with a smart thermostat on the wall

Heat pumps are increasingly in the news as the Ukraine crisis spurs some people to look at how they can reduce their reliance on gas. But as many listeners will know, keeping comfortable in our houses isn’t just about the heat source – it’s also very much about the controls. In this episode, we explore the interface between heat pumps and smart thermostats – at a high level, as well as getting a bit techie in looking at some of the practical challenges.

Jon Slowe is joined by Helen Boothman, Managing Director, Evergreen Energy; Karolis Petruskevicius, founder of Homely and Head of Smart Home at Evergreen Energy; Matt Trewhella, CEO of Kensa Heat Pumps; and Arthur Jouannic, Delta-EE expert on the topic of home energy management and smart thermostats.

Episode transcript

[00:00:04.690] - Jon

Welcome to Talking New Energy, a podcast from Delta-EE and new energy experts. We'll be talking about how the energy transition is developing across Europe with guests who are working at the leading edge of this transition. Hello and welcome to the episode. Heat pumps are increasingly on the news at the moment as the Ukraine crisis spurs people to look at how they can reduce their reliance on gas. But as many listeners will know, keeping comfortable in our houses isn't just about the heat source. It's also very much about the controls. Now, every heating appliance that you might get installed or buy, including heat pumps, does come with controls. But there are more and more smart thermostats available independent of a particular heating appliance manufacturer that will help households keep more comfortable and keep comfortable in the smartest, most efficient and lowest cost way. Today, we're going to explore this interface between heat pumps and smart thermostats both at a high level, as well as getting a little bit techy perhaps, and looking at some of the practical challenges. I'm joined by four guests today to give us lots of different angles for debate and discussion.


[00:01:22.230] - Jon

Let's say hello and get the discussion going. First is Helen Boothman, MD, of Evergreen Energy. Hello. Hello. Hi, Helen. Can you give us a sentence or two about Evergreen Energy for our listeners that might not have heard of your organisation?


[00:01:39.930] - Helen

Yeah, sure. So Evergreen Energy, we want to make it easy for people to switch away from fossil fuels. So for things like heat pumps, that means addressing affordability and upfront and running costs, but also means that we're making sure we're putting in the right technology now for people to be able to participate in the energy system of the future when we will have more renewables on the grid, but also increased demand from the fact that we've electrified things like heat and transport.


[00:02:09.810] - Jon

Okay. And I guess link to that last point. My next question, you purchased a smart startup, smart thermostat company a while back Homely. Now, your last point about future proofing and the future electricity system, I guess, was the rationale behind that. But can you explain what you did and why you did that and where you want to take that?


[00:02:30.830] - Helen

Yeah, sure. So Homely is really important for us as a business, both now and in the future. So currently Homely's USP is that it will operate your heat pump in the cheapest way possible to meet the temperature you want in your home. And we can do that whether or not you've got a single rate tariff or a multi rate time of use tariff. And I'll let Karolis explain exactly how Homely does it, as he's definitely the brains of the operation. But for us as a business, Homely helps our customers now reduce their running costs, which helps make the case for them switching to renewables. But then in the future, we see Homely doing more than just heat, Homely is going to be able to control and optimise your heat pump alongside your PV, your battery or EV charger, as well as making it possible for you as a home energy consumer or producer to participate in things like network and grid balancing services and get paid for being flexible in the way you use energy.


[00:03:26.970] - Jon

Okay. So it's all about having the best possible proposition for your customers to reduce their costs and maximise their contribution to the future energy system.


[00:03:38.670] - Helen

Yeah, absolutely. And we can do that now in the way they operate their heat pump, but we're also setting them up for success in the future when these new products and services come into the market.


[00:03:48.720] - Jon

Okay, great. We'll talk to Karolis, who is founder of Homely in a second. But let's say hello first to Arthur Jouannic, colleague, my colleague at Delta-EE and expert on the topic of smart heating controls and home energy management. Hello, Arthur.


[00:04:06.170] - Arthur

Hi, Jon. Hi, everyone.


[00:04:08.730] - Jon

Arthur, from what Helen described, how does this compare with what you see going on in the market more widely, both from, I guess from the smart thermostat angle and also that wider home energy management vision that Helen painted?


[00:04:22.650] - Arthur

Actually, I think what Helen said is pretty much bang on in terms of the vision that everyone should have in terms of the future of the energy industry. The electrification is clearly underway across heat, transport. Self generation and self consumption will be critically important. So actually, the controlling of all these loads and particularly heating loads like it pumps will be a major factor of the transition. So enabling customers to have the right comfort with the right temperature levels, but also participate in optimising the energy systems in the home will be one of the most critical business model of the next 10,20 years. So that vision to me resonates quite a lot.


[00:05:03.780] - Jon

Okay, Helen, do you see others trying to do what you're doing from different angles, or are you not too bothered about what others are doing? It just makes perfect sense to you and what you're doing with heat pumps today.


[00:05:17.550] - Helen

I think Homely is unique in what it does, and we do see other people coming into kind of the optimisation market, but at the moment very much focused on EV or PV and battery. For us Homely, it just makes complete sense in the way that heat pumps are controlled. We can optimise them now, and we've got this future there as well. But it makes sense from an efficiency perspective to put Homely on your heat pump at this point.


[00:05:52.290] - Jon

Great. So it makes sense today and future proofing for tomorrow.


[00:05:57.880] - Helen

Exactly. Yeah.


[00:05:59.730] - Jon

Let's say hello after the next couple of guests and then get into the discussion. So next we've got Karolis Petruskevicius. I'm not sure pronounced that surname right, Karolis? I'm sure you're correct me. The founder of Homely and now head of Smart Home at Evergreen Energy. Hello, Karolis.


[00:06:18.950] - Karolis



[00:06:20.370] - Jon

How did I do on the pronunciation?


[00:06:23.010] - Karolis

It was better than the last time you tried it.


[00:06:25.030] - Jon

Right. So pronounce it properly for our listeners so they know who they are hearing from.


[00:06:29.810] - Karolis



[00:06:31.420] - Jon

Ok, thanks, Karolis, in terms of that proposition about it making sense that Helen described, can you say a bit more about why it makes sense today for someone with a heat pump to use the Homely smart thermostat what exactly does it do? How does it help them?


[00:06:52.110] - Karolis

Sure. So I'll just do a quick intro why how it came about, because I think it makes it a little bit more sense to start off with the problem that we're trying to solve. I started Homely when I was doing my PhD looking at the impact of heat pumps. The heat pumps are going to have in the future in 2030 when we have a lot more of them and we producing power from renewable sources. And when we're starting to produce power from renewable sources, they are intermittent. We'll see the electricity prices changing quite significantly throughout the day. And to be able to utilise this, we'll need to have controls available for heat pumps that can shift that consumption into the periods of high renewable power production. So Homely started off with the idea of time of use tariffs. And this was initially the agile Octopus where we started controlling some heat pumps and we were trying to actually shift the consumption of the heat pump into the period itself, low cost electricity.


[00:07:49.180] - Jon

So for listeners not in the UK, that's a dynamic tariff where the price changes every half hour here.


[00:07:55.750] - Karolis

Yes. And there are other countries where we are seeing this becoming reality, or there has been reality for quite some time. Even so, some countries like Estonia, Lithuania, they're starting to see these exchange tariffs getting popular. And it's not just the UK where these are available. Time of use tariff optimization is not the only thing that we can offer our customers. So as we started more and more seeing more and more people coming in, messaging us about how to control their heat pumps. And as we started installing more of these on systems with Evergreen Energy, we needed to cater for people that are on fixed tariffs as well. And this was trying to make sure that they get the best out of their heat pump, where we're trying to lower those, increasing the efficiency of the heat pump by operating in the most efficient way. So lowering the flow temperatures, for example, trying to maintain them as low as they can be to push those efficiencies higher. That was the proposition for our customers who are trying to get the most out of your heat pump with a future proofing of the time of use tariffs.


[00:09:11.450] - Karolis

There was also a big installer part which was trying to give the to the installers so that they can make when they come to site. For example, if they are seeing that your system is malfunctioning, you can be prepared to fix your system the first time that they get there. That's what we have, Homely installer app, where the installers can actually access the information, such as the heat pump is in error right now, even before the customer finds out that he doesn't have heating. That's what we're using internally. And there's also that stuff that Helen has mentioned about the future optimization of the grid. So if we all were to have heat pumps installed call today, and if we were all to turn them on at the same time, our grid would not be able to sustain that. But we need to shift those loads around. And one of the ways to incentivize this is through dynamic tariffs such as Agile Octopus. Although.


[00:10:14.070] - Jon

Whereabouts are you on your journey, Karolis, or Helen, whoever wants to answer you selling these today, have you installed tens, hundreds, thousands? Can you give us some sense of where on the journey from that idea and doing your PhD Karolis that you mentioned to just scaling this up?


[00:10:41.750] - Karolis

We are at a scale up position at the moment, so we were looking into quite a few things. We want to make sure that we have our thinking right about all the future technologies as well. So you've mentioned PV, EV Chargers, batteries. We want to make sure that we capture some of that information and put in at least the bare bones of those optimizations in place. So at the moment, actually at my place, I have a heat pump that is talking to my battery, that is talking to the PV panels, that is also talking to the EV charger and all being optimised by Homely. That is something that we're testing out and that's what we were spending a lot of time on. But at the moment, we're very focused on getting our core heat proposition out there, and then we're going to return back into optimising the whole home.


[00:11:34.370] - Jon

Okay. Thanks, Carol. Let's say hello to our final guest, Matt Trewhella, who is CEO of Kensa Heat Pumps, one of the UK's leading ground source heat pump companies. Hello, Matt.


[00:11:48.330] - Matt

Hello, Jon. How are you?


[00:11:50.240] - Jon

Thanks for joining us. So, Matt, if someone buys a ground source heat pump from Kensa, they'll get a heat pump and they'll get a controller as well. But you're also working with Homely. So can you explain a bit the difference between, I guess, the standard Kensa control and what a customer could do with Homely? Or give us a bit of context about the discussions that you're having with Homely and the work you're doing together?


[00:12:23.510] - Matt

Yeah, that's a relatively easy one. The simple answer is there is no such thing as a standard Kensa control.


[00:12:28.800] - Jon



[00:12:29.760] - Matt

They aren't supplied with controls. We took a decision many years ago, more than a decade ago, to supply heat pumps without heating and hot water controls so that they would be able to take advantage of any other off the shelf controls that are out there. So instead, the heat pumps rely on a run signal. So tell it when you want heating, tell it two different areas of the house or two different temperature targets that you go for. Tell it when you want hot water and the rest can be handled by third parties. So going back a few years, that was handy because some people wanted almost on off controls.


[00:13:06.730] - Matt

Simple thermostat, some people wanted one by one Internet connected under floor controls with different times and temperatures and different things turning on and off. And now moving into the smart control world, they're automatically compatible with anyone's smart controls.


[00:13:21.960] - Jon

Okay, so you started off with a deliberate philosophy to be open then, because presumably saw a lot of third party companies coming along doing the sorts of things that Karolis and Helen have described.


[00:13:34.910] - Matt

Yeah, they're still very ahead of the game. There's very few people trying to move into this area, and even some of them are doing it with boilers in mind rather than heat pumps in mind. It's still pretty early on with the Homely idea. That was great a few years ago when we met up and started running our R&D programmes in parallel.


[00:13:58.610] - Jon

Arthur, how do you see that in terms of what Matt described, that open philosophy, and also what Matt mentioned of a lot of smart thermostat companies focusing on boilers today?


[00:14:10.610] - Arthur

Well, let's just say that the industry will be much better if everyone will be doing the same strategy. But unfortunately, most of the heat pump manufacturers think that they should be in control of the heat pumps and don't want to give the control to anyone else, mostly because it's not like a boiler. It's harder to control that there are more technicalities to heat pump compared to just turning it on and off, for example. But regardless of that, having a completely open system which would allow smart thermostat companies to control them would be great because these companies are actually talking to PV systems, batteries, EV chargers, and there is no heat pump manufacturer who is able to do all of these products and to offer it to customers. So the success of the future energy system will rely a lot on openness between manufacturers and companies like Homely in between to make all these plans talk to each other. So it's really interesting and reassuring to see companies being open. But the reality is we are really far from that today and there is a long way to go in Europe, and it's not like there are big standards and open protocols across Europe.


[00:15:19.070] - Arthur

So everything is quite close today, and that's pretty much the biggest barrier for that market to develop.


[00:15:24.830] - Jon

That make it hard for you, Karolis, in terms of going to different heat pumps and trying to talk to them?


[00:15:33.230] - Karolis

Very hard. We're still struggling with quite a few of them but yes, that is because they want to be the ones controlling them. And heat pumps are very different from boilers. It's not about just turning them on and off. You need to take into account other things like the efficiencies at different flow temperatures.


[00:15:50.870] - Matt

Yeah. Even with our heat pumps, we supply with a refrigeration controller that kind of looks after the efficiency of the heat pump if you like. But there is the next level on where Homely could actually integrate into that. And that's something we're trying to work on in this way. You can control the flow temperature of the heat pump. That's probably the thing that has the biggest effect on its efficiency, and it's quite easy to measure the outdoor temperature and control the flow. But what would be far better is if you knew what the weather forecast was going to be. So doing it in real time is probably a little bit too late. Actually doing it 12 hours ahead would be far more useful. And that's some of the things we're working on with Homely.


[00:16:33.890] - Jon

So, Matt, what would you say to other heat pump manufacturers after you described heat pump manufacturers wanting to control being a bit scared to open up, maybe because they don't other people playing about with the operation of their system. Matt, do you have any fear there or in being open? Are you taking risks?


[00:16:55.910] - Matt

Not hugely. Some of the other ways of doing it, they might give you the nicest numbers on the screen of the heat pump, and they're not necessarily the most efficient ways of controlling them. They're designed necessarily to make the product look good rather than the energy system look good. So I think we've just got a little bit of a longer focus for us. It's about the electrification of heat as a concept. It's clear that electrifying heat and transport is going to put strain on the grid. And if you do that in an inverted commerce “dumb way” and try to keep the vehicles and heat pumps as if they're just other appliances or boilers, the amount of strain on the grid is going to be many times and it runs into billions. The extra costs for reinforcement that you can avoid by doing in a smart way. A lot of times people say, well, I can't electrify all this stuff. I'm going to come home from work, plug my car in, and I want it to be nice and warm. So my car is going to be plugged in, my heat pump is going to be running.


[00:17:57.160] - Matt

I'm going to turn all the lights on, I'm going to have a shower and make a cup of tea and run the kettle. And the whole thing is just going to fall over. Of course, it's not going to be like that at all. You plug your car and it's not going to start charging straight away. And probably a heat pump came on 3 hours before you got home to make sure you're nice and warm when you get home. It's probably just switching off by the time you get home, rather than just turning on.


[00:18:20.930] - Jon

Nothing's going to boil the kettle and make you a cup of tea for when you come home, though, Matt.


[00:18:24.490] - Matt

No, but a grid can already cope with that, as long as it's not getting the other things, just naively plugged in and turned on at the same time. Very simple example.


[00:18:36.390] - Jon

Yeah. Sorry, Karolis. So you're knocking on a lot of heat on manufacturers doors at the moment. Do you have to go literally one by one and try and get access through an API to different heat pumps, or is there a certain amount you can do without having bilateral discussions and arrangements with each manufacturer?


[00:19:00.990] - Karolis

That is very different between the manufacturers. So as Matt mentioned, Kensa has been very open from the very beginning, from the very outset of Homely. And I think we're on the same page where the market is going and we saw it. What is the future? We started off with Homely. We tried to capture as much of the market and understand actually the problem at the moment, even though heat pump manufacturers might not want the third party controls controlling those units, in a lot of cases, there's still a third party thermostat just giving it a call for heat and turning it off. So it is happening. It's happening through the thermostat on and off signal. It's a binary signal to turn on and turn off where we're trying to go to get into a little bit more into the brains of it and try to actually control the flow temperatures. The heat pump can be kind of like an always adapting weather compensation curve that is constantly changing to adapt to the outside condition.


[00:20:02.270] - Matt

Okay. That equation changes depending on the price of electricity. So there will be times it will be best to run the heat pump inefficiently because electricity is cheap and there will be times when electricity is expensive and you run it long and slow and low. So, yeah, that changes every day. It's different for every property and it's different for every lifestyle. So it's got to be done dynamically and it's got to be done in the cloud.


[00:20:26.510] - Arthur

I'm also hearing that the best way to potentially do flexibility on heat pumps may be to look at the domestic hot water part because it's less difficult to manage and potentially filling a tank. Storing it and using it is maybe more flexible. Karolis, is it something that you potentially look at in more details than just controlling the heat in the house?


[00:20:49.550] - Karolis

We are controlling both, and we have ways to control both of these intelligently. Heating, this one was interesting because you can still shift quite a lot of heat, as Matt was saying, that you get home at, for example, 06:00 in the evening after work and your house has been heating throughout the day and it probably has turned off quite a while ago, and there is quite a lot of thermal mass in the house that it can be used to store the heat. And when the Agile prices were favourable, you would heat the house, for example, twelve till 400 in the afternoon, or depending on the weather conditions. Of course, it's always changing, but you heat it, then you'd overheat the house slightly to a higher temperature. And even though you were using more energy, that energy was actually a lot cheaper because of the agile, the way that the agile tariffs work, and because of potentially less carbon intensive as well, because you were using different energy sources, renewable sources. I don't think that I've answered the question in terms of the heat pump control. So some heat pump manufacturers do have ability to get into the brains of those controllers, but there are ways to control them.


[00:22:21.450] - Karolis

There are only a few that are open.


[00:22:25.590] - Matt

It's definitely true that it's easier to load shift hot water, though. Doing hot water through the night is something that people often want to do anyway with their heat pumps. So moving that low cost, low carbon time, people often ask is it easy to turn heat pumps on and off remotely and do load shifting? And the answer is just, yeah, it's really easy. I think we recommend a Kensa make no more than six starts per hour. So essentially every ten minutes you could ask the heat pump to do something different, either being turned on or turned off. What's difficult is working out the effects of turning a heat pump on and off. So what's it going to be like for the people living in the property to work that out? You need to know how warm they need to be. You need to know what the weather is like outside and how long the property is going to stay warm or how slowly it will cool down. So it's all of those factors really, that are far more important than whether the heat pump can actually turn it off. But in some ways it's not quite trivial because you still need an Internet connection, but it's not far off it.


[00:23:29.610] - Jon

So there's lots of analysis, lots of different factors, and that you've just said there, Matt, that you need to pull together, Karolis, your intelligence and the cloud blends all that together and then works out the best operation for the heat pump. I'm quite interested in what you said about it might in some times, if energy is cheap, be worth the heat pump operating at a slightly lower efficiency? And I think I can imagine some people listening to this podcast must be thinking, what? Why would you do that? But I think we've got to get more used to energy being worth different amounts at different times. Whether that's through dynamic tariffs, whether it's through capacity charges, the purest approach of maximise the seasonal performance factor, maximising efficiency at all times. That will change more and more in the future, I think.


[00:24:28.120] - Helen

Yeah. And I think at the end of the day, the electricity is cheap for a reason. Right. It's being overproduced for the demand. So chances are it's highly renewable because maybe there's a lot of wind generation going on or something like that. And at the end of the day, National Grid has to balance the grid and balance the system. So if you can use energy where it's not in high demand, that actually helps from a whole system balancing perspective.


[00:24:55.350] - Jon

Well, and there are times increasing the number of times in the UK and other countries when wind farms are curtailed because there's too much wind on the system or there's constraints on the network.


[00:25:08.750] - Matt

Going back a couple of years, the Octopus Agile tariff actually went negative during those times. It was better to pay people to consume electricity, then turn the wind turbines off in those circumstances. Yeah. Your efficiency or heat pump is close to meaningless. You just want to get as much heat into the property, a hot water tank and store as much as you can, as quickly as you can.


[00:25:31.840] - Jon

The analogy is a bit of an old energy analogy, but the analogy that sticks in my mind for that is driving past a petrol station and seeing the prices being negative. People think, how can that happen?


[00:25:46.380] - Matt

Not this week.


[00:25:48.980] - Jon

Not with the current energy crisis. Arthur, you mentioned quite a lot of companies are looking at this home energy management from different angles. And Helen, you talked about strategically with Evergreen Energy that you want to become a smart home energy management, a smart energy company, not just around heat pumps, but blend all the different technologies together. I'm interested in how quickly that will emerge and Arthur the different types of organisations or the different angles people are coming up from that. And Helen, what you think is going to be critical to enable you to succeed with that, maybe Arthur first, and then Helen.


[00:26:31.160] - Arthur

Yeah. Across Europe, we have identified more than 80 companies who are somehow involved in optimising electricity flows within the home. A lot of the times these come from solar PV, self consumption optimization. So you maximise the use of your own generated electricity. And I think actually the current crisis will mean that this will increase quite a lot, given people will want to be more independent from the grid. And we see a lot of companies looking at the opportunities through EV charging. So while heat pumps will grow very rapidly, EV charging is something that is currently exploding across Europe, and that's where people are really looking at right now. So I think right now we're looking at some use cases, specific use cases which companies are targeting. But once the home energy management world will evolve towards more appliances in the home, more use cases, flexibility, TV consumption, dynamic tariffs, et cetera. We will see a lot more integration between all of these systems. And this is where I think it would be important to be ready to enable the interactions between appliances. So my prediction is that we will see a lot of unique point solutions in the next two to three years, but very quickly and accelerated by the crisis, we will see a lot of companies optimising everything that they can in the home, whether it is PV, heat pumps, batteries, charge points.


[00:27:58.130] - Arthur

That's going to be quite an interesting battle there.


[00:28:03.490] - Helen

I think from our perspective, definitely get to we've chosen heat as an entry point because we actually think it's very complicated. And if you can get that right, the other things you can kind of add and fall into place. But really for us, the two biggest challenges I would say would be interoperability and integration as we've kind of talked about, because every time you add on a new technology, you're kind of reducing your addressable market. You can control ten heat pumps and then another three EV chargers and ten battery systems. You've got to have your customers having a combination of those for them to get the full effect. And then I would say the other probably challenge would be around the kind of market dynamics and the regulation and how industry participants interact with each other. Certainly in the UK, the energy supply market is interesting right now. So we haven't got those kind of tariffs and we have an interaction between the suppliers and the network operators. And all those different models are all kind of different around Europe. And some will kind of lend themselves to this better than others.


[00:29:16.990] - Jon

So that related to how much of the value is capturable, whether that's by the customer throughout a price signal phone to them or it's by an aggregator or by someone that can share that value with the customer.


[00:29:30.610] - Helen

Yeah, I think there's way to capture as much value as possible so that we can share enough with the customer for it to be worth their while and that there's enough leftover for other people. But I think there's kind of certain market set ups which don't necessarily lend themselves very well to that being the case. So where you've got a supplier responsible for the energy consumed, but actually it's going through the network operators, wires and how all that pricing works. It's not necessarily conducive to creating tariffs and situations that actually benefit the customer or kind of the scenario where you've got customers exporting, for example.


[00:30:18.330] - Jon

Yeah. Lots of different bits of the value chain to bring together.


[00:30:23.070] - Matt

Our view is that you've got to bring those customers along, otherwise the whole thing doesn't work. I drive an EV as well as having a heat pump, and there's that slight understanding needed that you won't always be 100% fully charged. I probably would need to charge 10 hours a week on average. And that's a lot of flexibility you can bring, but not if you want to just drive away straight away after coming home from a long drive and plugging in. So there's got to be a little bit of user acceptance. Same with the heating. You might understand that your heating will be turning on and off at times that you wouldn't normally think. And it's the end users really that have got to adapt to that and understand that, and therefore they should be given the lion's share of the benefits or certainly need an energy pricing that works.


[00:31:15.210] - Jon

What I quite like about the approach that you're taking with Homely is it's a standalone proposition for heat pumps. And if it works, if it works with heat pumps and is an attractive proposition for customers, then that in itself will get the intelligence into the heat pump operation and then you can build out more from there. I think it's hard for people who are looking to sell a home energy management system as a standalone system. If it works for heat pumps and your customers, then that's a really nice entry point.


[00:31:51.370] - Helen

Yeah, absolutely. Currently, our biggest challenge, I guess, is more the adoption of heat pumps and the kind of changing way people use their heating to kind of the emphasis at the moment, certainly from other smart thermostats manufacturers, is only turn it on when you need it, individual radiator and zone control. Whereas if you have a heat pump running that way, it massively impacts the efficiency and increases the cost to run. That is counterintuitive and difficult to convince people of. But that's kind of what we're working on, getting that message out there with Homely.


[00:32:27.200] - Jon

Yeah. Well, time is getting the better of us. So let's bring out the talking new energy crystal ball and set the dial this week to 2030. So I'd like to ask each of you to share your view from your own perspective on how heat pump operation will be optimised not only for comfort, but for the wider electricity system in 2030. You can have whichever perspective or context you like think about home energy management as well. So if I could ask each of you to share your thoughts on optimising heat pumps and more for the wider electricity system and what that will look like in 2030 - 8 years time. If I could ask you to keep it brief for time, let's go with Karolis, Matt, Arthur and then Helen. Karolis, do you want to start kick us off?


[00:33:21.770] - Karolis

Yes. So 2030, that was actually when I was doing my PhD thesis. That was the year that I had to do it for. And I was using the future energy scenarios of the national grid for 2030. But yes, in that day, I would assume that we'll have a tariff that is not necessarily exposing you to every single variation of the price the electricity supplier. But electricity supplier is making that less complicated. So as an example, there is an electricity price for the rest of your appliances in the house, 20p per kilowatt hour. And then your heat pump gets to 15p per kilowatt hour. And there's someone in the background trying to control to make that happen, to reduce the cost of running the heat pump and taking advantage of the demand side response, taking the signals from the national grid and the network operators reacting to the changes in the renewable power generation and wholesale prices. The balance system as well. It will be a fraction of those customers. There will also be a fraction of those customers where they'll be sustaining themselves just by trying to utilise as much power as we can from self generation.


[00:34:43.340] - Karolis

So your battery, your heat pump, your PV and your EV are all going to be talking together and your home management system is going to be predicting where the rest of the house consumption is going to be. So that it's optimised.


[00:34:59.470] - Jon

Yeah. Okay. So I like that first example in particular because it's simple for the customer, simple on the outside, but probably complex on the inside, but that's where the Homely brains and intelligence will come in. Thanks, Karolis. Matt, how about you?


[00:35:16.270] - Matt

Yeah, I see it well on the way to full electrification of heat and transport and I think that it will have to be very simple and have to be automated. I think that automation is going to have to have a level of learning. It wouldn't go so far as full artificial intelligence, but certainly machine learning. So thermostat in a building would take a while to figure out how long it takes the building to heat up, cool down, different weathers, different usage patterns. It will take a little while to learn all of that. When you plug your car in, how you do all your other things and it will gradually build up this picture, then they will have a similar picture for the whole of the UK and the electricity supply and how that filters down to the regions that will filter into the price of electricity at different times by some unknown mechanism. There's 20 or 30 different ways you could do that, but at some point it has to end up as a price signal to the people living in the property. And then your automated system has learned everything about the property, the vehicle and the people that live in it will take the price signal and every day and work out the best way to run everything.


[00:36:27.020] - Matt

So I don't see the world where people go. It's going to be windy tonight and cheap. Therefore I'm going to put my washing machine on a timer and I'm going to run my heat pump later. I don't see it as being individual user interactions. I see it's all automated.


[00:36:42.260] - Jon

So the need of lots of data scientists and computer engineers to work in the energy sector.


[00:36:46.700] - Matt

Lots of data scientists, a lot of computer engineers lots of cloud computing.


[00:36:51.850] - Jon

Thanks, Matt. Arthur, how about you?


[00:36:54.790] - Arthur

Just talking about numbers, actually, we are predicting that there will be 25 million heat pumps installed in Europe in terms of number of homes, 35 million EV charge points at home, 20 million PV system, two and a half million batteries, and 10 million home energy management systems by 2030. So if you imagine the world in Europe in 2030, there will be a completely different way the energy system is being operated. So how to optimise all of this together, how to exchange electricity between homes, how to provide flexibility to the grid? You will need to have a high level of connectivity, which works really well for heat pumps, for charge points, et cetera. So the world of the future will be very different, very interconnected, and hopefully this can accelerate this whole decarbonization of the industry. That's the way I would think about it. Like it's massive electrification across Europe.


[00:37:52.750] - Jon

Thanks, Arthur. Those numbers bring it to life. And I guess those numbers are a snapshot of a curve that's pointing ever more upwards as the years go by. Last but not least, Helen, how about your 2030 vision or thoughts?


[00:38:06.610] - Helen

Yeah, my thoughts are at a housing estate level. So in terms of having everyone with an EV, everyone with a heat pump and more solar and stuff, we're going to need more smart solutions for network management because we've got the grid flexibility and energy prices. But we've also got the wires that take that electricity to your individual homes and making sure that we're kind of balancing those estates so that the devices on those estates are working in such a way that's kind of harmonious and together so that we're not putting stress on those networks. We recently wrapped up a project called Project Dyno, which looked at this at quite a high level, and we can do some really clever things with monitoring and modelling and control. But the commercial models for dealing with that just don't exist yet. So, yeah, progress on commercial models around smart networks, definitely.


[00:39:06.730] - Jon

Okay. So while it's easy to think about balancing the system at a national level, we need to balance it at a very local level as well. We better leave it there. That's been a fascinating discussion and some really interesting perspectives from different parts of the industry. So thanks, everyone, for your time and your thoughts. Thanks, Karolis.


[00:39:31.620] - Karolis

Thank you for having me.


[00:39:33.320] - Jon

Thanks, Matt from Kensa, thanks.


[00:39:36.310] - Matt

Good to take part.


[00:39:37.380] - Jon

Thanks, Helen. Also from Evergreen.


[00:39:40.490] - Helen

Thanks very much.


[00:39:41.670] - Jon

And thank you, Arthur.


[00:39:43.410] - Arthur

Thank you Jon.


[00:39:45.830] - Jon

Thanks, as always to everyone for listening. We hope you enjoyed the episode and it shed some light on that interplay between smart thermostats and heat pumps and the need for more and more of that interplay in the future. And look forward to welcoming you back to the episode next week. Thanks and goodbye.


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