Aberdeen, UK

Home energy use is responsible for over a quarter of UK carbon dioxide (CO₂) emissions, and fuel poverty, due to poor insulation, expensive fuel and low incomes, is a key government concern. Many multi-storey housing blocks were built in the 1950s-60s with poor insulation and electric heating via storage heaters. The blocks are usually owned by the local authority and tenants have low income. Combined with a high fuel cost and poor insulation, the effect on CO₂ emissions and fuel poverty is high.

In 1999 Aberdeen City Council (ACC) developed a strategic approach to district heating for existing property upgrades (Energy Saving Trust, 2011). Their approach consisted of:

1. Initial surveys of all the buildings led to an understanding of total costs for repair, maintenance and like-for-like replacement over a 30 year period.
2. In addition to the individual building assessment, an appraisal was made of buildings in close proximity to each other. This allows consideration of connecting buildings to a centralised heating plant if they were close enough together to form a heat network.
3. All potentially viable upgrading options were investigated. The predicted running costs and CO₂ emissions were also considered when selecting the most effective option.
4. A financial strategy was developed to fund and deliver the optimal solution.

One of the clusters appraised was identified as the most appropriate for the development of a CHP scheme. This cluster, Stockethill, comprises 288 flats in four multi-storey blocks. The flats had electric storage heating, which had been installed in the 1970s. 70% of the residents of these dwellings were estimated to be in fuel poverty. The tenure of these properties was 98% council tenants and 2% owners.

The most attractive option for improving the buildings was CHP with external insulation. However, external insulation would have been prohibitively expensive in capital terms for ACC. Instead they decided to opt for CHP only. This would improve energy efficiency and reduce both tenant heat costs and CO₂ emissions by approximately 40%. The heat is distributed to the four blocks via pre-insulated underground pipes, which comprise the heat network. Each unit has a new heat exchange unit for individual control. Approximately 47% of the electricity produced by the CHP is also sold on-site.

From the initial feasibility report it was recommended that ACC set up a separate not-for-profit company to develop and manage CHP schemes across Aberdeen. A contract between ACC and the company Aberdeen Heat and Power Limited (AH&P) provided £215k (€271k) a year and allowed AH&P to access additional capital through loan funding. Central government funding also supported the capital investment^[1]. Profits from the scheme are used to develop new CHP district heating schemes in other areas of the city.

The scheme has grown since the initial projects and now supplies around 1,530 flats in 22 multi-storey blocks and 9 public buildings. CO₂ emissions from these buildings have reduced by 45% and typical fuel costs to tenants have been reduced by 50% over the previous heating systems (Aberdeen Heat & Power, 2014).