What increasing UK electricity demand means for specifiers of home heating and hot water systems
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The UK has a commitment in law to achieve net zero carbon emissions by 2050, along with an aim to reduce 2035 emissions by 78% when compared to 1990 levels. With a backdrop of increasing electricity demand and a continuing requirement to balance to the energy grid, the housing sector has a large part to play in getting domestic energy right.
In both new build housing developments and in retrofit upgrades of existing housing, specifiers can make wise and future-proof choices that not only meet or exceed legislative requirements, but that also enable new ways for householders to use and store energy.
In this article, Andrew Ogden, Head of the Technical team at Kingspan Water & Energy, outlines how the UK’s demand for electricity is set to increase, and what that means for specifiers of home heating and hot water systems in new build and refurbished homes.
Increasing demand for electricity
The UK’s annual electricity demand currently stands at 320.7 TWh but is forecast to increase to between 550-680 TWh in 2050, depending how net zero is achieved.
This increased demand is expected to come from the transition to clean electricity as an alternative to fossil fuels such as oil and gas, specifically from:
- A move towards low-carbon electric-based heating systems instead of gas and oil
- A transition to electric cars and vans
- Electrification of heavy industry and hydrogen production
These first two points are particularly relevant to domestic housing specifiers.
The UK energy grid
Against the context of a significant uplift in demand for electricity, power generation will increasingly come from intermittent renewables such as wind and solar. In fact, renewables are forecast to account for up to 84% of Great Britain’s electricity generation by 2050, according to the National Grid’s Future Energy Scenarios (FES). This makes the UK energy grid more challenging to balance to the 50Hz standard frequency (with 1% tolerance) that’s required to keep it stable, a process that’s managed by the National Grid.
Why more challenging? Simply, solar and wind are less easy to control within a very short amount of time, meaning that additional factors – demand side response and increased energy storage – come into play to keep the grid balanced, at the right frequency, and running as it should.
The role of demand side response
One method to help keep the grid stable is through demand side response (DSR), which typically uses data and digital technology to help manage energy demand.
From a household perspective, we’ve seen this in action in England, Scotland and Wales over the last two winters through the Demand Flexibility Service, where energy companies give points or money off bills to householders who avoid using heavy energy-consuming appliances during pre-defined time periods. As an example, The Demand Flexibility Service half-hour period on 23rd January 2023 resulted in a 324 MW reduction in demand.
Another DSR mechanism is smart energy tariffs for electricity. These are flexible tariffs where the consumer price of electricity per kilowatt Hour (kWH) varies depending on demand across the grid. Consumers can see hour-by-hour pricing using their energy providers’ app and then plan when to use high energy-consuming appliances accordingly. At some times of day electricity can be free, or householders can even get paid to use it!
Another variant of a smart energy tariff is the Smart Export Guarantee (SEG) tariff, where homes with solar panels or other renewables that can generate energy can export surplus energy to the grid to earn money. We’ll get into more detail about generating and storing energy shortly.
What does all this mean for specifiers? In all these scenarios, consumers can only benefit if they have a smart meter installed. In the case of new builds, specifiers should make sure they’re familiar with the BEIS publication, “Smart Meter Guidance for Domestic New Builds”. In retrofit applications, some households – for example blocks of apartments – may not currently have smart meters installed; meaning it’s something specifiers should factor into their refurbishment plans.
The role of increased energy storage
Energy storage is another mechanism that will be increasingly used to help keep the UK energy grid stable. The good news for householders and specifiers is that having products that can store energy can help with household bills, EPC and – potentially – SAP ratings.
Storing energy is a key component of National Grid’s Future Energy Scenarios (FES)5, which sums up the trends that will support achievement of the UK Government’s 2050 net zero target.
The FES forecasts that energy storage capacity by 2050 will increase more than ten-fold compared to today; from 3 GW (in 2022) to (up to) 47 GW.
Energy can be stored (and smart tariffs accessed) through various smart technology-enabled home heating and other products that housing specifiers can consider in new build developments or refurbishment projects. These include:
- Smart hot water cylinders
- Solar panels
- Heat pumps
- Heat batteries
- Electric vehicles (in conjunction with a household charging port)
The results of a 2022 government consultation agreed that a future “smart mandate” will require heat pumps, electric storage heaters and heat batteries to have smart functionality, with an indicative implementation date of 2026-27.
In addition, regulation is now in place for all electric vehicle charge-points sold in England, Scotland and Wales to have smart functionality.
The Hot Water Association’s (HWA) Connected Homes report highlights a variety of smart home heating and hot water technologies already available. Examples include our very own Range Tribune MXi hot water cylinders that connect to a solar PV system. Powered by Mixergy technology, these cylinders use top-down heating to heat only the percentage of hot water that’s required, meaning householders only pay for what they need. Surplus solar PV energy can connect to the grid to benefit from smart tariffs and can also be stored for future use.
The HWA report also makes a case for the specification of smart technologies to be reflected in an improved SAP rating for new build properties.
We’d encourage specifiers to consider how smart technologies can be scoped into new build and refurbished housing now, given the raft of products on the market that can already deliver this technology.
The future is smart
Smart technology trends for home heating and hot water are also echoed in the Government’s Future Homes Standard (England only), whose latest consultation recently concluded.
Technology continues to evolve, but the future home could be heated by a heat pump and/or a solar PV solar installation all hooked up to a smart hot water cylinder, with smart energy tariffs and Smart Export Guarantee tariffs becoming the norm.
In summary, we’d encourage specifiers to consider smart connected home heating and hot water systems now, to be ready and ahead of an increasingly legislated route to net zero in the future.
