Vital Energi

A Message from Lord Pickles and Lord Blunkett, followed by Vital Energi's best practice article

The ability to listen and learn from one another has always been vital in parliament, in business and in most aspects of daily life. But at this particular moment in time, as national and global events continue to reiterate, it is uncommonly crucial that we forge new channels of communication and reinforce existing ones. The following article from Vital Energi is an attempt to do just that. We would welcome your thoughts on this or any other Parliamentary Review article.

Blunkett signature Rt Hon The Lord David Blunkett
Pickles signature Rt Hon The Lord Eric Pickles

www.vitalenergi.co.uk

1VITAL ENERGI |
BEST PRACTICE REPRESENTATIVE
Group Sales and Strategy
Director Nick Gosling
Vital Energi’s head office,
located in Blackburn
Heat networks are recognised by both government
and the energy sector as a commercially viable and
sustainable way of decarbonising heat, and Vital Energi
is at the forefront of delivering these networks. Over 30 years
ago, Vital Energi’s senior management team began delivering
some of the UK’s first and largest district heating schemes in
Nottingham, Sheffield and London. It has since grown to be
UK market leaders not just in heat networks, but in integrated
energy generation, energy distribution and energy management
solutions. Group Sales and Strategy Director Nick Gosling tells
The Parliamentary Review
more.
Government support has been instrumental in the selection of heat networks as
a preferred technology, and with confirmed backing the market will continue to
grow. Our team has grown each year to meet this demand, and we now have
more than 460 employees, who create and support the design, construction,
operation and maintenance of our energy solutions.
With the largest heat network design team in the UK, now comprising over
70 individuals, we provide complete energy solutions that are bespoke to the
requirements of each project, producing financially and environmentally viable
schemes to benefit our clients and the end user.
Making our mark
We uniquely operate in a wide range of markets, such as towns and cities; further
education; healthcare; retrofit, new build and mixed-use residential; commercial
FACTS ABOUT
VITAL ENERGI
»Managing Directors:
GaryFielding and Ian Whitelock
»Group Sales and Strategy
Director: Nick Gosling
»Founded in 2000
»Located in Blackburn and
London, with offices in
Scotland and Ireland
»Services: Design, installation
and service delivery of energy
generation, distribution and
reduction management
»No. of employees: 460+
»Named in the Sunday Times’
2018 Top Track “Ones to
Watch” list for companies
with sustained growth
Vital Energi
THE PARLIAMENTARY REVIEW
Highlighting best practice
2| VITAL ENERGI
and industrial; as well as power
generation.
Some of our key achievements include:
»Connecting over 78,000 properties
to district heating networks
»Installing 97 combined heat and
power engines
»Providing 130 energy centres
»Managing over 30,000 residential
heat meters
»Installing 140,000 metres of district
heating pipe in the last three years
alone
Developing and delivering solutions
using technologies that can reduce
carbon emissions is critical to tackling
climate change. We continue to adapt
our solutions through assessing the
viability and sustainability of renewable
technologies to maximise the use of
recovered heat, and we increasingly
look to utilise electricity to generate
heat. An example of this is the water
source heat pump project at the £250
million regeneration of Queens Quay
in Clydebank, a first of its kind in
Scotland.
A sector that is benefiting greatly
from energy efficiency and renewal
of inefficient energy generation
assets is healthcare. We have worked
with 24 hospitals to improve energy
generation and measure, manage and
reduce consumption, both of which
generate energy cost savings and
reduce carbon emissions. Our energy
performance contracts for the health
sector guarantee to save the NHS £300
million in energy costs over the course
of the agreements.
Positive steps for heat
networks
The district heating sector is in a period
of change. There are positive factors,
which we are confident will support
sector growth; however, there are
aspects that have the potential to stifle
this growth.
The government’s recognition that
heat networks play an important role in
decarbonising heat and tackling climate
change is clear. The Department
for Business, Energy and Industrial
Strategy is encouraging the adoption
of heat networks through both its
Heat Networks Development Unit,
which provides funding and support
for feasibility studies, and the Heat
Networks Investment Project, which
offers support by way of grants or
low-interest loans to catalyse projects
that would not be commercially viable
without some financial support. This
has helped otherwise unviable projects
to break ground.
The Competition and Markets
Authority published findings of a
study into the district heating sector
in July 2018, which showed that many
heat networks offer prices that are
the same as or lower than those paid
by traditional energy customers with
comparable levels of service. Some
customers on privately operated
networks, however, were found to
be receiving poorer deals in terms of
price and service quality. This is why
we welcome the recommendations of
the 2018 Industry Task Force report,
which suggest introducing regulation
to ensure protection for heat network
customers, while also providing policies
to ensure sustained growth of the
sector.
The University of
Northampton’s energy
centre
Developing
and delivering
solutions that
use
technologies
that can reduce
carbon
emissions is
critical to
tackling climate
change
3VITAL ENERGI |
BEST PRACTICE REPRESENTATIVE
BEIS’s response to the Competition
and Markets Authority and Task Force
reports provides useful insight into the
direction of travel for heat networks
regulation. We believe this is a positive
step, although it is important that the
duty of regulation is fairly balanced
with policies that are designed to
continue to help the sector to grow.
In many parts of the country, gas boilers
have been the heating technology
of choice for residential property
developers, primarily because they are
cheaper to install than a heat network.
In order to increase the use of low
carbon district heating, we agree with
the Committee on Climate Change’s
recommendations that gas boilers
should not be installed in new build
residential properties from 2025 in
favour of low carbon technologies.
Opportunities for improvement
Planning policy could do more to
support heat networks on a national
basis. Misalignment between policies
in different parts of government means
that planning policies encourage
district heating in some parts of the
country, but not in others. More
consistency in policies, to encourage
both new-build and existing properties
to connect to heat networks in areas
that are most suited to district heating,
would be welcomed.
Business rates is another area of
challenge. Although district heating
systems are being encouraged by BEIS,
business rates being levied on district
heating schemes can be significantly
higher than rates that would apply
for conventional utilities. This can
hinder the economic viability of heat
networks.
Building regulations are expected to
be modified imminently, which could
inadvertently make district heating a
less attractive technology to property
developers
A final challenge is the uncertainty
of existing and future low-carbon
incentives. The Renewables Obligation
and the Renewable Heat Incentive
have been instrumental in encouraging
growth of renewable low-carbon
generation for a number of years. With
the former already ceased and the
latter set to finish in 2021, developing
complex district heating projects will
become increasingly difficult without
long-term visibility of similar incentives.
Looking forward
As the grid continues to decarbonise
due to the growth in renewable
electricity generation, the selection of
technology to supply heat networks will
be impacted, along with the alternative
technologies against which district
heating is compared. It is important for
technology to continue to adapt and
develop so that it can generate further
carbon savings to sustain and increase
heat network viability.
A push for sector regulation and
consistent policies will assist the future
of the market and make positive steps
towards increasing the standards and
good practice of heat networks.
The heat network market has made
great progress over the years, and we
are optimistic that with a continued
positive policy framework, the sector
will continue to grow.
We agree with
the Committee
on Climate
Change’s
recommendations
that gas boilers
should not be
installed in new
build residential
properties from
2025 in favour of
low-carbon
technologies
Helping to reduce
public and private sector
energy costs and carbon
emissions

www.vitalenergi.co.uk

This article was sponsored by Vital Energi. The Parliamentary Review is wholly funded by the representatives who write for it. The publication in which this article originally appeared contained the following foreword from Rt Hon Michael Gove.

Rt Hon Michael Gove's Foreword For The Parliamentary Review

By Rt Hon Michael Gove

This year's Parliamentary Review comes at a momentous time for parliament, as we collectively determine the destiny of the United Kingdom. 

On October 31, the UK will leave the European Union. The successful implementation of this process is this government's number-one priority.

Three years after a historic referendum vote, we will deliver on the decisive mandate from the British people. Trust in our democracy depends on it. Until that final hour, we will work determinedly and diligently to negotiate a deal, one that abolishes the backstop and upholds the warm and close relationship we share with our friends, allies and neighbours in the EU. But in the event that the EU refuses to meet us at the table, we must be prepared to leave without a deal.

As the Chancellor of the Duchy of Lancaster, it is my job to lead on this government's approach, should that scenario happen. Preparing for Brexit is my department's driving mission. But while I am leading this turbocharged effort, the whole of government is committed to this endeavour.

Ministers across Whitehall are working together to ensure that every possibility is considered, every plan is scrutinised and every provision is made. A daily drumbeat of meetings means that we are holding departments accountable, so that preparations are completed on time.

The chancellor has confirmed that all necessary funding will be made available. And we have mobilised thecivil service, assigning 15,000 of our most talented civil servants to manage our exit from the EU.

We will make sure that on November 1, there is as little disruption to national life as possible. Our trade relationships will continue to thrive, thanks to agreements with countries around the world worth £70 billion. Our country will remain secure, thanks to nearly 1,000 new officers posted at our borders. And the 3.2 million EU nationals now living and working among us can remain confident, with absolute certainty, of their right to remain in the UK.

Above all, our goal is to be transparent. Soon, we will launch a public information campaign so that citizens, communities and businesses are ready and reassured about what will happen in the event of “no deal”.

In my first few weeks in this role, I have travelled to ports and tarmacs, borders and bridges, all across the UK –from the seaside of Dover to the rolling green hills of County Armagh. I have heard from business owners and border officials, farmers and hauliers. They are ready to put an end to uncertainty. And they are ready to embrace the opportunities ahead.

Our departure from the EU will be a once in a lifetime chance to chart a new course for the United Kingdom. Preparing for that new course will be a herculean effort. But this country has made astounding efforts before. We can do it again.
Rt Hon Michael Gove
Chancellor of the Duchy of Lancaster