(59a) Decarbonising the UK Heating Sector: A Whole-Energy System Analysis

The decarbonisation of heating is crucial in reaching the ambitious emission targets adopted by many countries, including the UK, which aims to reach net-zero emissions by 2050. While the electricity sector has received much attention from policymakers, private companies and researchers and considerable progress has been made on the decarbonisation of power generation, the heating sector has seen only little change. The majority of heat in the UK is still generated from conventional, unsustainable sources, with more than 85 % of households using natural gas boilers as main heating technology [1]. On top of that, 57 % of the commercial heat demand and 51 % of the industrial heat demand are provided from natural gas; with electricity, oil, solid fuel (coal) and biomass & waste also being significant contributors [2]. Consequently, emissions associated with heating are high. Residential combustion of fuel, mainly for heating purposes, alone accounted for 18 % of the UK’s carbon emissions in 2019, and commercial and industrial heating add to that total [3]. It was estimated that in 2009, 38 % of the UK’s carbon emissions could be attributed to heating [4].

Decarbonisation of heating is challenging due to the systems typically being distributed. Millions of devices in people’s homes, commercial buildings and industrial facilities need to be replaced by low-emission heating technologies. These technologies typically rely on carbon-neutral fuels since carbon-capture at the end-user is impractical. Heat pumps and resistive electric heaters can utilise low-carbon electricity for heating, and hydrogen boilers can combust low-carbon hydrogen generated from e.g., methane-reforming with carbon-capture and storage (CCS) or water electrolysis without carbon emissions at the end-user. Solar-thermal collectors directly use a renewable energy source. Another potentially attractive option, especially for urban areas, are low-emission district heating networks that can benefit from centralised low-carbon generation and economies of scale. Additionally, improved building insulation and other energy conservation measures can be valuable as they decrease the demand and therefore reduce the required generation capacities. Various studies presented in literature show that no single technology is clearly superior to others, and most likely a combination of different technologies is most suitable for heating decarbonisation.

We present a newly developed heating sector optimisation model to identify optimal decarbonisation pathways. The model is a deterministic generation-expansion and unit-commitment optimisation model that simultaneously optimises technology portfolios and their operation. It is implemented as mixed-integer linear-programming (MILP) model in GAMS, using Python for data pre- and post-processing. A graphical user interface is also available to make the model accessible and easy to use. The model uses a similar formulation as the Electricity Systems Optimisation (ESO) model [5,6]. Starting from today’s technology portfolio, the model optimises the evolution of the heating sector, considering investment decisions every five years. Build-rate constraints limit the deployment of technologies to technically feasible rates. For each of the decision years, the operation schedule of the technologies is optimised. Regarding emissions, the model can consider end-point constraints (e.g., net-zero in 2050), interior-path constraints and cumulative carbon budgets. So far, the model considers residential heating demand in form of representative households, commercial and industrial demand is to be added later. Modelled technologies are vapour-compression heat pumps, electric heaters, gas and hydrogen boilers and solar-thermal systems, and it is planned to include additional technologies such as thermal heat pumps, co-generation plants and district heating in future.

The emissions and fuel costs of electric and hydrogen heating technologies depend strongly on the respective generation mixes. A representation of the hydrogen industry is included in the heating sector model. Considered are generation from natural gas using methane reforming with or without CCS and from electricity via water electrolysis. Large-scale hydrogen storage is also included in the model. To determine the costs and emissions associated with electricity use, it is planned to connect the heating sector model with the existing ESO model. The result will be a comprehensive model of the UK electricity and heating energy systems that allows a simultaneous optimisation of technology capacities and dispatch in both sectors. The integrated approach allows to reduce the model externalities and necessary assumptions. The model can be a powerful tool to e.g., determine the optimal degree of heating electrification, prioritise the use of hydrogen for heating or electricity generation and to consider potential synergies such as co-generation or electricity load-shifting with heat pumps and thermal storage tanks. It can also be used to investigate the effectiveness of different policy measures. Guidelines on how to best support and facilitate the transition towards low-carbon heating and electricity provision can be developed. We present an analysis which robustly quantifies and qualifies the role and value of a range of technologies for providing low carbon heat.

References

[1] Committee on Climate Change, “Heat in UK buildings today” 2016. [Online]. Available: https://www.theccc.org.uk/wp-content/uploads/2017/01/Annex-2-Heat-in-UK-....

[2] Department for Business Energy & Industrial Strategy, “Energy consumption in the UK (ECUK) - End use tables.” 2019, [Online]. Available: https://www.gov.uk/government/statistics/energy-consumption-in-the-uk.

[3] Department for Business Energy & Industrial Strategy, “Final UK greenhouse gas emissions national statistics: 1990 to 2019.” 2021, [Online]. Available: https://www.gov.uk/government/statistics/final-uk-greenhouse-gas-emissio....

[4] Department of Energy & Climate Change, “Overview of UK’s greenhouse gas emissions from heat related activities” 2012. [Online]. Available: https://www.gov.uk/government/statistics/uk-emissions-from-heat.

[5] C. F. Heuberger, I. Staffell, N. Shah, and N. Mac Dowell, “A systems approach to quantifying the value of power generation and energy storage technologies in future electricity networks” Comput. Chem. Eng., vol. 107, pp. 247–256, Dec. 2017, doi: 10.1016/j.compchemeng.2017.05.012.

[6] C. F. Heuberger, E. S. Rubin, I. Staffell, N. Shah, and N. Mac Dowell, “Power capacity expansion planning considering endogenous technology cost learning” Appl. Energy, vol. 204, no. August, pp. 831–845, 2017, doi: 10.1016/j.apenergy.2017.07.075.