Electric Heating
Low carbon electric heating is ready for wholesale market reform and greater grid flexibility
The UK is electrifying all areas of its economy to reach 2050 net zero goals, and one of the areas set to change most drastically is commercial and residential heating.
T
he Climate Change Committee (CCC) parliamentary report states that to meet the goal, half of heat demand must become low carbon by 2035. The other side of the electrification coin is a squeeze on other carbon-intense technologies, like gas – in fact, the 2025 Future Homes Standard will soon make low carbon heat a requirement for installers.
Yet, some of the most significant changes to come will be from greater national grid flexibility measures and reforms to the electric wholesale market. As these developments unfold, electric heating will become one of the future-proof heating methods already prepared to embrace the changes.
Changes to the mix and wholesale markets require electric heating now UK electricity is changing in two respects. First, the mix is becoming less carbon intense. 2022 was a record-breaking year as 40% of electricity came from renewables, and in May, the total mix of renewables in our electricity was 73%. Second, the UK government announced and concluded its Review of Electricity Market Arrangements (REMA) last year. The review, touted as the “biggest electricity market reform in a generation,” aims to enhance energy security and cut electricity costs as the UK moves to a cleaner energy system.
The most significant consequences of the REMA review will be a decoupling of the gas and electricity markets. Currently, the highest gas prices set the price of electricity, which drives higher electricity prices, including renewable electricity, which should be significantly cheaper. Decoupling will see the price of residential and commercial electricity drop significantly, especially as the renewables mix continues to increase past
40%. This would make electrical heating one of the least carbon intensive forms of heating, as well as the least expensive. Making the most of this by deploying electrical heating is important to ensuring future-proof heating in commercial and residential buildings.
Varied buildings and a flexible grid demand low carbon direct electric options
Direct electric and heat pumps are the two types of low carbon electric heating suitable for the UK’s building stock. New homes built after 2025 and spacious, two-storey buildings are suitable for heat pump installation. However, large portions of the UK building stock are made up of smaller, older, and multi-storey buildings where heat pump installation is impractical. According to research from electrical heating specialist, ThermoSphere, 54% of construction professionals say that the best low carbon heating solution for smaller homes, flats, and multi-storey buildings is direct electric heating because it’s smaller and doesn’t require external
hardware to install.
The future REMA reforms will also lead to “increases [in] the participation of low carbon flexibility technologies”, including more electricity storage and wider use of demand side response (DSR). UK homes have recently experienced this with the limited roll out of the National Grid ESO Demand Flexibility Scheme, a residential DSR technology ending in March 2023. As demand side activity increases, giving domestic and commercial properties the ability to receive financial rewards for temporarily reducing their electricity consumption, buildings with low carbon electric heating have the potential to receive the most benefit as they have the most capacity to shut down.
In addition, direct electric heating can manage shutdowns with greater control as it does not operate on a central heating system, unlike gas or air-to-water or ground-source heat pumps. This enables more zone-specific and localised heating and shutting down. When shutting down is required, buildings that don’t use centralised heating systems can choose to turn off specific areas and keep others heated. What’s more, with new underfloor heating products, on average it only takes approximately 20-30 minutes to heat a room, meaning temperature and comfort levels can be quickly restored after a shut off. Changes to the energy mix, market reforms, and more grid flexibility means UK commercial and residential heating will electrify further. Direct electric solutions are the future-proof option that can endure these changes, especially for large sections of the UK building stock where other options are impractical.
16 | electrical wholesalerMay 2023
ewnews.co.uk
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