Hammond’s gas heating policy ‘lacks route to endgame’

The chief executive of Northern Gas Networks (NGN) has expressed “disappointment” about Philip Hammond’s proposed ban on fossil fuel heating systems in new homes from 2025.

During an event held to showcase progress on the HyDeploy project in London on Wednesday (3 April), Mark Horsley said it was “unfortunate” that the chancellor of the exchequer had announced the policy decision on the future gas heating before a “real route” existed to achieving it.

The ban will be enshrined in the new Future Homes Standard unveiled by Hammond in last month’s spring statement.

“It is disappointing that we have moved to an endgame without mapping the route to how to get there,” said Horsley, adding that customers’ heating preferences must taken into account.

Simon Fairman, director of safety and network strategy at Cadent, warned that not connecting new homes to the gas heating network will prevent households from taking advantage of hydrogen fuel cell technology, which could enable gas and electricity to be supplied from the same source.

“Customers need a voice in this,” he said.

Horsley also said that it may make sense for the strategic regulation of gas and electricity networks to be examined in tandem because they are increasingly likely to function as a single system.

“We really need to be looking at whole system solutions,” he said, suggesting that Ofgem should continue to run separate regimes for electricity and gas networks’ “business as usual” activities.

But “more holistic” regional energy plans, covering both the gas and electricity gas networks, could be developed for more forward looking investment.

The NGN chief executive said the upcoming 2021-2026 price control period is a “critical time” when the “building blocks” for decarbonising heat must be put in place.

And he warned that the UK cannot risk its gas infrastructure being viewed as unattractive to investors.

Matt Hitchens, a senior policy adviser at the Department for Business, Energy and Industrial Strategy (BEIS), said that blended hydrogen could help kick-start wider take up of the low carbon fuel.

By providing guaranteed demand for hydrogen, blending could go some way to solving what he described as the “chicken and egg” problem of hydrogen whereby supply will not ramp up until there is demand and vice-versa.

Hydrogen could be created via the electrolysis process using renewable electricity that is “free or cheap” at times of excess supply, said Hitchens.

The fuel could then be released to provide energy when supplies of renewable power is low, thus coupling the electricity and gas grids more effectively.

He said that as well as UK projects like HyDeploy, BEIS is looking “closely” at the Magnum project in the Netherlands into the feasibility of converting gas networks to run off hydrogen.

Hitchens, who works in BEIS’ hydrogen economy team, said support for the deployment of the low carbon fuel would be considered in a policy paper on carbon capture and storage, which is due to be published in the summer.

He said that BEIS is assessing how blending hydrogen compares with other measures for decarbonising the gas grid and that it said that it has an “uncertain but potentially quite substantial role to play in decentralising the energy system”.

NGN is collaborating with Cadent on the HyDeploy initiative, which is testing how hydrogen can be blended with natural gas.

HyDeploy involves a series of pilot projects to test the blending of hydrogen in gas networks, the first of which uses Keele University’s private gas network.

This will be followed by two more pilots on Cadent and NGN’s networks in the north west and north east respectively, involving around 750 homes each.