Sutton Decentralised Energy Network FAQs

1. What is a decentralised energy network?

A network of locally generated heat, and in some cases electricity.

2. Why is Sutton Council creating a decentralised energy network?

Sutton Council is trying to help the UK to reduce carbon emissions and our dependency on fossil fuels by constructing a decentralised energy network. This supports the policies of both government and the Greater London Authority. An Energy Recovery Facility (ERF) has been commissioned by the South London Waste Partnership to replace the landfill site in Beddington. Heat is produced by the ERF, and , Sutton Council wants to harness it to provide low carbon heat to homes and businesses in South London. The key objectives of the SDEN scheme are to:

  1. Reduce carbon emissions and environmental footprint (One Planet Living principles)
  2. Increase fuel security
  3. Ensure new commercial sites have the opportunity to be more sustainable by joining the SDEN
  4. Deliver infrastructure investment in the borough
  5. Raise Sutton’s profile as a sustainability champion

3. How common are decentralised energy networks?

There are at the time of writing 180 decentralised energy networks projects, across 115 local authorities, under development. These schemes are supported by the Department for Business Energy and Industrial Strategy (formerly the Department of Energy and Climate Change).

4. How will the SDEN increase fuel security?

Using energy from a source that does not use fossil fuels will reduce our dependency on energy from the national grid and increase fuel security for Sutton’s residents.

5. How will the SDEN scheme work?

SDEN will use renewable and low carbon fuel sources to support the Council’s ambition of achieving ‘Zero Carbon’ emissions. Initially, SDEN will use waste heat from the existing landfill gas engines in Beddington. Then, once the Beddington Energy Recovery Facility (ERF) is constructed, it will feed off the heat produced by the plant. This heat (in the form of hot water) will be transported through highly insulated pipes to customers who are likely to be in new developments. There is the potential to serve some existing developments if it proves cost effective. Phase One of SDEN is planned to serve the new Felnex development in Hackbridge which is being developed by Barratt Homes.

6. How long will the ERF be able to fuel the Felnex estate?

We expect the ERF to be operating over a longer period than the initial contract with SDEN. One of the benefits of the SDEN network is that it can connect to other energy sources over time, so the ERF does not have to be the only source of heat over the longer term. The buried heat network is a long life infrastructure asset which we expect to last for at least 50 years.

7. When will homes on the Felnex site be built?

The Felnex site is owned by Schroders Unit Trusts Limited and they have appointed a residential development partner, Barratt Developments, to deliver the scheme.  They plan the first dwellings to be ready in early 2017.

8. How much will residents of the Felnex development pay for their heating and hot water?

In short, a price that is and remains competitive with the energy market.

SDEN will offer price parity with the cost of gas in an individual boiler from other energy suppliers as well as the cost of running, maintaining and replacing that boiler, as properties served by an SDEN will not need boilers. The heat price that will be charged to residents has not yet been agreed.

9. Have you reviewed the ‘Which?’ report on District Heating and have you taken its recommendations into account in the SDEN?

SDEN have reviewed in detail the ‘Which?’ report. It highlighted two key issues:

  1. The price residents pay for heat, and
  2. Many District Heating providers do not have a single point of contact for customers.

We have addressed the price issue through our price parity policy mentioned above. We will also ensure that there is a single point of contact for SDEN’s customers.

10. Will heat be available 24 hours a day, 7 days a week to residents and businesses?

Yes. Heat supplies will also be 100% resilient, with top up and back up boilers providing security when the sources of low carbon heat (such as the ERF) are not available during maintenance periods.

11. Will the pipes heat the soil in Beddington Farmlands, damaging the ecosystems and wildlife habitats?

No. The heat will be transferred in highly insulated pipes buried at a depth of around one metre to ensure any heat loss is minimised. Heat loss between the ERF/ Landfill Gas Engines and the Felnex development will be minimal and will not affect the ecosystems in Beddington Farmlands.

12. How will the council fund the laying of the piping to deliver hot water from the Energy Recovery Facility (ERF) to the Felnex estate?

The Council will obtain a loan from the Public Works Loan Board (PWLB). PWLB offer much more competitive rate than commercial organisations. The loan will be repaid using SDEN’s energy charges.

13. Will the council profit from the scheme, and if so where will this money be invested?

Any profits from the SDEN will be paid to the Council, as shareholder. This money can then be re-invested into Council services.

14. Will there be disruption while the pipes are being laid and the Felnex estate is being developed?

The pipe route is largely contained within Beddington Farmlands, with the exception of a small stretch near Hackbridge Railway Station. We expect there to be minimal disruption to residents.

SDEN Common misconceptions

1.Will residents using SDEN be locked into expensive contracts?

This is a misconception. SDEN will offer price parity in the energy market with alternative methods of heating – see FAQ question 8. The SDEN means that boilers are not required in homes served by it. Therefore in producing a price parity figure we will look at the cost of an individual gas fired boiler in each dwelling as well as the costs to operate, maintain (in line with statutory gas safety regulations), repair and replace this boiler over the life of the SDEN heat supply. This is the industry standard method of determining price parity as set out by the Government sponsored Heat Trust Calculator.

To maintain price parity, we will charge a combination of a fixed and variable rate – the same as any other energy supplier. The variable rate will track wholesale gas prices, so that pricing is fair to the consumer. We recognise that for this to be viable – to developers and users – it has to offer a competitive rate to purchasers and the rental market, that’s why our intention is to offer price parity with the market.

2. Is it expensive to retrofit the SDEN supply?

It can be, however, SDEN is primarily looking to supply heating and hot water to new developments. If large scale existing developments are interested in joining, then SDEN will consider the business case on a case by case basis.

It could be cost effective for existing developments with a centralised heating system, such as a single boiler for each building, to connect. For example a sheltered housing scheme with a centralised boiler.

3. Given the amount of investment involved, why is the council only predicting a £1.5m profit over 25 years?

The council set up the SDEN to help the borough lower its emissions by offering an alternative source of energy to fossil fuels that is competitive within the energy market. Any surpluses that SDEN makes will be re-invested into Council services.

4. Can the SDEN really supply heat and hot water to 19,000 homes?

SDEN has the potential to supply heating and hot water to meet an energy demand equivalent to 19,000 homes. This is an illustrative figure to show the total heat that is available from the ERF, in a form which can easily be understood.