ENGIE backs HNIP to ‘unlock the potential’ of district energy in the UK

16th October 2018

ENGIE, the UK’s largest provider district energy has publicly backed the launch of the Department for Business, Energy and Industrial Strategy’s (BEIS) £320 million Heat Networks Investment Program (HNIP), as announced during Green Great Britain Week.

The HNIP has been introduced to inject capital funding into heat network projects, which offer a viable and long-term solution to decarbonised heat. This investment signifies a ‘step change’ in the UK’s approach to heat networks, according to ENGIE, which has pumped £2 billion world-wide into the district energy sector in the last two years.

Andrew Hart, Managing Director for ENGIE’s UK Urban Energy business, said: “District energy is a tangible and established solution to decarbonisation and this significant Government program could be the catalyst for real change. The availability of grants and loans for this sector will support further schemes that couldn’t previously be developed, due to poor returns.”

ENGIE’s UK business has invested £250 million in local authority centric district energy schemes and are actively supporting Council’s to form partnerships and develop schemes. It is hoped that the new capital funding will unlock a number of these projects and allow both ENGIE and local authorities to invest significantly in further district energy schemes.

ENGIE currently manages some of the most technically complex district energy schemes in the UK including the Queen Elizabeth Olympic Park in London, Birmingham, Coventry, Leicester and Southampton.

He continued: “There are many ambitious local authorities that have seen the potential of heat networks and have taken sizeable steps to deliver such schemes, but the risk was ultimately too great.  With the Government showing a commitment to develop this arena, local authorities can utilise new funds to develop partnerships with specialists like ENGIE, who can support with managing and sharing risk.”

But while the HNIP will be an enabler of future schemes, ENGIE agrees with the recommendations of the recent ADE Task Force review and CMA report; in that the industry needs the same level of support that is available to other utilities if it is to succeed in these efforts.

ENGIE’s own targets are aligned with the UK Government’s ambition to increase the amount of heat generated in the UK from 2% to 17% by 2030.  The business is also continuing to invest considerably in research and development around the decarbonisation of both existing and new schemes; including the introduction of zero carbon technologies.

Andrew concluded: “Through the HNIP the Government has reaffirmed its dedication to the sector and this, in turn, encourages companies to invest in resource so we can deliver on these schemes. It is hoped and envisaged the HNIP will support the development and integration of these technologies into the energy networks of the future.”

Claire Perry, Minister for Energy and Clean Growth, said: “The UK has led the world in cutting emissions whilst growing our economy -  with clean growth driving incredible innovation and creating hundreds of thousands of high quality jobs. Ten years on from the Climate Change Act, the first ever Green GB week is a time to build on our successes and explain the huge opportunities for business and young people of a cleaner economy. I’m delighted to see how many more businesses and organisations such as ENGIE are seizing this multi-billion pound opportunity to energize their communities to tackle the very serious threat of climate change.”