The Future of Community Heat: Lessons from Germany

20^th August 2013

ResPublica's Caroline Julian reports on the third week of her Winston Churchill Memorial Trust Fellowship to Germany

With so much focus on the Energy Bill and reforms to overhaul the electricity market, the provision of our heat is often relegated to the side-lines. But nearly half (44%) of the energy we use in the UK is for heating – whether this be for industry, businesses or our houses – and must therefore be just as central to discussions regarding our decentralised and low carbon future. It is just as crucial, however, that communities are considered to be key partners who could play a central part in the future of heat.

Last week, I visited BürgerEnergie St. Peter, a co-operative district heating network. St. Peter, just 20 km East of Freiburg, is a BioEnergy village. BioEnergy villages produce more renewable electricity than is consumed by their residents, source more than 50% of heat consumption from from renewable sources and work with renewable generation facilities that are mostly citizen-owned. The inhabitants of St. Peter co-own a number of local wind turbines with a private developer and many private households and public buildings own the solar panels on their rooves; but the village has recently become even more of a pioneer for the way in which it sources its heat.

With a desire to care for their environment and become independent from oil purchased from other countries, and its fluctuating market, a group of 11 members of the community came together in 2008 to discuss an alternative proposal: to establish a co-operative district heating network powered solely by biogas. The idea was publicised across the community, through flyers, newspaper articles and a series of public information and Q&A sessions hosted across a series of three or four evenings. Following the sessions, each of which attracted around 150 people, 196 people signed up to become members of the new co-operative – BürgerEnergie St. Peter – and 167 buildings were listed to become connected to the new grid. Another 40 buildings will be connected in the next year.

Members include land-owners – particularly farmers, who benefit from selling and delivering wood chips to the biogas plant – households, hotels, the local swimming pool, town hall, school, church (St. Peter), tourist information centre and the village’s small businesses. All consumers are members of the co-operative and benefit directly from the products of the business. Since BürgerEnergie St. Peter started providing heat to the community in November 2011, members have saved around 25% on their annual heating costs, and as a community, a total of 850,000 litres of oil and 3700 tonnes of CO2 per year. In total, the biogas plant has a capacity of 180 kW of electricity and 270 kW of heat.

This is not a cheap enterprise, but a total of 1.4 million euros was raised through local investment, for which the co-operative model provided the ideal legal form. BürgerEnergie St. Peter now has a total annual turnover of 1 million euros: 550,000 euros from supplying heat and 450,000 euros from selling electricity.

This is a small rural community, surrounded by plenty of land and the Black Forest, so what is the realistic potential for the UK? The Department for Energy and Climate Change’s (DECC) report on the future of heating, published in March of this year, highlights district heating networks as one potential area for growth. Dependent on resources and structure, the development of such networks could deliver both carbon reductions and greater efficiencies. What is missing from this strategy, however, is the active role of communities – the places in which the district heating networks would operate and the households, business and public buildings that would receive the heat. Households and other recipients are passively addressed as consumers, and studies cited within the report regarding consumers concern only whether they would be for, against or indifferent to the idea of district heating.

As DECC works with public and private sector partners to develop and establish such networks, all partners must ensure that the direct community is involved, and even open up the possibility – as has been the case with a number of wind farm developers – of community ownership of such schemes. As with the case of St. Peter, communities could benefit directly from both the production and supply, and help gather momentum for a citizen-led heat revolution, rather than a transition based on electricity alone. Due to the growing interest in community energy, particularly energy co-operatives, and the recently introduced Renewable Heat Incentive, some communities are beginning to pioneer such projects, such as the JCC Community Woodheat Co-operative and Woolhope Woodheat. Some housing associations, which are already using a mutual or co-operative model will also have the opportunity to lead on similar initiatives with their tenants. Government and local partners must ensure that communities across the UK are presented with such opportunities, and thereby the opportunity to be part of the future for heat.