FS02: Community Heating Study

by Blog

This work has been commissioned by the Carbon Coop as part of their ongoing work with their members and the wider community to encourage low carbon energy interventions.

Potential financial returns from low carbon energy generation are a key concern, since the Carbon Coop’s model for financing of Whole House Retrofit relies in part on cross-subsidy as well as ‘Pay as You Save’ financing to achieve the full 80% reduction by 2050 retrofit target (17 kgCO2/m2.a and 120 KwH/m2.a.).

The purpose of this study is to understand whether sufficient financial returns could be made from the retrofitting of community heating systems to help cross-subsidise low carbon retrofit measures. This was prompted by informal industry reports of double-figure returns on district heating following the introduction of the Renewable Heat Incentive (RHI). The aim was also to develop a methodology to assess the viability of retrofit community heating schemes in primarily residential contexts, so that the Carbon Coop could use this as part of future work on carbon reduction in neighbourhoods across Greater Manchester and beyond.

However, the Carbon Coop do not see financial returns from the Renewable Heat Incentive as a priority that excludes consideration of fuel poverty, improved energy efficiency and overall reduced carbon emissions. This report therefore considers the implications of community heating networks for these issues too, so that the Carbon Coop and others can make a more informed decision when considering investment in community heating networks. Using real-life case study examples, the potential for retrofitted community heating networks has been explored in different contexts; a relatively recent high density mixed use development, high density mid-20th century apartment blocks, small terraces and larger suburban semi-detached housing.