Decarbonizing heating for a net zero energy system

As a nation we need to decide how we will decarbonise heat in the 2020s if we are to achieve a net zero energy system by 2050. As the ESO we are uniquely placed to comment on decarbonisation of heat from the perspective of the electricity system and, through our collaboration with National Grid’s Gas System Operator in areas such as their Future of Gas work, on gas-electricity interactions.

In this thought piece we will explore the big questions on ‘clean heat’ from a system operation perspective.

What are the options for the future of heat?

In our Future Energy Scenarios (FES), we explore a range of outcomes for the future of heat, with the differences driven by the speed of decarbonisation and the level of societal change. Different clean heat solutions require different levels of change from the consumer.

Of the net zero scenarios, Consumer Transformation is a highly electrified world in which heat pumps dominate and there are higher levels of insulation, System Transformation relies heavily on hydrogen for heat, while Leading the Way sees a mixture of heat pumps and hybrid heat pump-hydrogen boiler systems. In the Steady Progression scenario, the net zero target is not achieved by 2050 and there is only limited decarbonisation of heat.

In scenarios where heat is mostly decarbonised via hydrogen, that hydrogen could come mainly from electrolysis using renewable electricity (‘green’ hydrogen) or mainly from natural gas reforming with Carbon Capture Use and Storage (CCUS) (‘blue’ hydrogen). In scenarios where heat is mostly decarbonised via electric heat pumps more electricity system flexibility will be required, that flexibility could mainly come from supply or demand.

How to make sure that the lights stay on and homes stay warm?

To keep electricity and gas flowing year-round there are security standards that the networks are tested against to ensure resilience. These standards have served the nation well, with the GB gas and electricity networks being some of the most reliable in the world, however changes driven by the shift to clean heat will mean that these also need to change.

In a scenario with lots of electric heating there will be a greater link between temperature and electricity demand and the demand testing of the electricity standard may need to have more emphasis on peak demand in extreme winters. In a scenario with lots of hydrogen heating gas security standards may need to have more emphasis on gas compositions.

What are the external factors that could affect clean heat pathways?

Two areas of interaction with heat are particularly important: demand side electricity system flexibility and the production and use of hydrogen.

Our net zero compliant scenarios in FES 2020 have much more variable renewable generation and so need much more flexibility across the energy system to help manage this. Scenarios with more electric heating could see higher peak electricity demand which will also require greater flexibility to manage.

We expect electric vehicles to act as the gateway to consumer engagement in energy flexibility. The addition to a household of an electric car - a major flexible electricity load – and the rise of automation and smart technology could lead to the adoption of time of use tariffs by consumers. This could pave the way for greater DSR participation from heat pumps, particularly when combined with thermal storage.

As highlighted in the FES 2020 key messages, deployment of hydrogen and CCUS technology is essential for net zero, and the two are closely linked; effective CCUS could allow scaling up ‘blue’ hydrogen production from reformed hydrocarbons with the carbon emissions captured. Alternatively, electrolysers can use renewable electricity to produce ‘green’ hydrogen. Both blue and green hydrogen could be used in industry, rail or HGVs, which may affect the availability of hydrogen for heat.

How to collaborate for whole system clean heat solutions?

We know that no one party has a monopoly on the decisions that will enable clean heat or on addressing the challenges that it will bring. The ESO needs to collaborate with other system operators on issues that affect the operation of multiple energy systems and the interactions between them. Increased collaboration and work on interoperability standards between system operators, networks and energy market participants will be key to unlocking many of these future challenges.

What are the next steps needed to deliver clean heat?

The future of heat may be uncertain, but there are already things we know today that can help us make the right decisions for the long term. FES 2020 shows that across all three of our net zero scenarios we can expect big changes to have taken place by 2030, with serious deployment of key technologies starting in the late 2020s. Heat pump deployment is projected to accelerate from the early 2020s, hydrogen production from electrolysis is expected to start scaling up from 2026, and methane reformation from 2027 with hydrogen playing a role in home heating from 2030.

We are actively working to make these changes possible such as by leading industry working groups on whole system strategy and cost benefit analysis and through collaborative innovation projects.

Read this thought piece in full