Heat Networks Delivery Plan: review report 2024

3 Progress against our targets

3.1.1 Whilst the data we currently have about heat networks has significant limitations^[10], we previously estimated that in 2018, 1.15 TWh of heat was supplied via heat networks in Scotland. Our current best estimate for 2022 is 1.35 TWh of heating and cooling supplied via heat networks^[11]. This equates to just under 2% of non-electrical heat consumption in Scotland^[12].

3.1.2 Noting the limitations of the data, caution should be applied in using this data for wider purposes. However, we think there is value in providing a broad overview of the current state of the heat networks sector in Scotland.

3.1.3 There are over 1,090 known heat networks supplying heating and cooling to domestic and non-domestic properties and industry in Scotland. Across these networks:

• 66% (720) were communal heating schemes and 30% (332) were district heating networks (4% unknown).
• 33% (454 GWh) of the heat supplied was via communal heating, and 66% (898 GWh) supplied by district heating.
• over 30,000 homes and 3,000 non-domestic properties are connected to heat networks.
• the data suggest that heat networks in Scotland generate 1.7 TWh of heat and supply around of 1.35 TWh of heat.
• 45% of heat networks supplied 10 or fewer customers (both domestic and non-domestic). Where bulk sale occurs, which can involve one customer, such as a council, buying heat and then selling it on to individual households, such as social housing tenants, these figures may underrepresent the total number of final customers.
• 4% of heat networks supplied 100 or more customers (both domestic and non-domestic).

3.1.4 More accurate data is expected to be collected about heat networks via the UK consumer protection and authorisation scheme as well as via the Technical Standards. We continue to work with the UK Government and Ofgem so that Scottish Ministers have access to such data for statutory reporting purposes and to support evidence based policy making. In doing so, we aim to reduce the risk of operators being asked for the same data via different processes and of data being required by two sets of regulations (under the Energy Act 2023, and the 2021 Act). Chapter 7 of the 2022 HNDP sets out detail on the information about heat networks and the sector as a whole that we think will be valuable for Scottish Ministers to be aware of to support regulatory and policy development to achieve our ambition and developing vision.

3.1.5 Future data gathering and reporting should allow us to produce a better estimate of how the deployment of heat networks in Scotland has contributed to meeting emissions reduction targets.

3.1.6 During the reporting period, we estimate an increase in supply of 0.2 TWh. This is based on the data available to us with its significant limitations.

3.1.7 One of the limitations of the data is that it doesn’t allow an estimate of the emissions reductions associated with existing district heat networks that provide heat to newly connected buildings during the reporting period. Additionally, we expect significant emissions reductions from existing networks, the majority of which use natural gas, will come from their decarbonisation. (This will be tackled as part of the consenting and licencing regime, see Section 4). As such, our emissions reductions during this reporting period are broadly estimated to be low to negligible.

3.1.8 However, it is also worth reporting that through our funding programmes we know that low emissions heat networks are being deployed and whilst at this stage it is difficult to align these with the data, it is worth documenting them to demonstrate the growth that is taking place. The following schemes, part-funded by Scottish Government, have all become operational since January 2019:

• Glenrothes Energy Network - utilises steam produced from the RWE combined heat and power biomass plant to provide heat to a range of customers. The project demonstrates the potential of unused existing infrastructure, with heat from the RWE Markinch Biomass plant recovered and used for district heating.
• Stirling Renewable Heat Demonstration Project - combines a fuel cell, heat recovery system from Stirling Wastewater Treatment Plant (WWTP) and heat pump to supply heat for the new district heat network.
• Queen’s Quay – its energy centre housing two 2.65 MW water source heat pumps which extract heat from the adjacent River Clyde basin. The project provides socioeconomic benefits for more than a thousand new and existing homes (social and private housing) and local businesses.
• NG Homes - an air source heat pump system installed in six high rise blocks in Springburn with each building comprising its own heat generation plant.
• AMIDS District Energy Network - Renfrewshire Council is developing a state-of-the-art, low carbon district heat network at the Advanced Manufacturing Innovation District Scotland (AMIDS). The first of its kind in Scotland, the fifth-generation renewable energy network works by directing treated water into a new energy centre and heat pumps are used at each building to upgrade the heat.