District Heating Strategy Support. Proposal for HNP support for Local Authorities
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- Vernon Booth
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1 District Heating Strategy Supprt Prpsal fr HNP supprt fr Lcal Authrities
2
3 District Heating Strategy Supprt 3 Cntents Intrductin 4 1 Prgramme Cntent Mdule 1 - Team Structure and Capacity Building Mdule 2 - The Natinal Heat Map Mdule 3 - Planning Plicy Mdule 4 - Financial structure Prject Definitin and Delivery Prgramme Plan 10
4 Intrductin The Heat Netwrk Partnership (HNP) prvides advice and supprt t rganisatins wishing t identify and develp District Heating (DH) pprtunities. The HNP brings tgether the Scttish funded agencies with expertise in delivering DH prjects and cmprises Zer Waste Sctland (Resurce Efficient Sctland (RES) prgramme), Scttish Futures Trust (SFT), Energy Saving Trust (EST), Scttish Enterprise and Strateg. The aim f this dcument is t describe a systematic apprach t prducing a lcal authrity DH strategy dcument that will enable the participating lcal authrity t prgress develpment f DH schemes. Withut a rbust DH strategy and prcess in place, lcal authrities are at risk f adpting a piecemeal, reactive apprach t individual energy supply pprtunities which fail t realise the full envirnmental and ecnmic benefit f a single integrated system. The HNP will deliver a prgramme f supprt that will guide the participating lcal authrity thrugh the prcess f develping a DH strategy and will utilise the expertise f the varius agencies abve. The supprt will be delivered in mdules t lcal authrities in reginal clusters. Key deliverables are scheduled thrughut the prgramme ver an anticipated timeline f 6 mnths. The HNP will prvide cnsultancy supprt t deliver wrkshps and ne t ne supprt at key stages f the prgramme. Templates and guides will als be prvided as the fundatin f the prgramme. The main benefits t the participating authrity are: Access t HNP advice and supprt; One t ne cnsultancy advice n strategy develpment and lcal issues; Heat map guidance; Strategy template dcuments; and Knwledge sharing and prblem slving.
5 1 Prgramme Cntent 1.1 Mdule 1 - Team Structure and Capacity Building This first mdule lays the grundwrk fr the rest f the prgramme. Internal stakehlders are identified; buy-in is sught; and aims, apprach, cmmitments and respnsibilities are agreed. The initial actin is t establish the necessary structures and wrking grups within the lcal authrity in rder t pursue district heating (DH) pprtunities and t ensure that key fficers have the necessary awareness and understanding f DH. There is als a need t ensure plitical supprt and stakehlder cmmitment, s that influential decisin makers understand and are cmmitted t prgressing DH pprtunities. Required Resurces Prject Lead - central t the develpment f a successful strategy and will be the primary cntact fr the prgramme. A Deputy Prject Lead wuld als be advantageus t bth share the lad and augment the skills required. The prject leader will be a fcal pint fr the Prgramme, crdinating and managing all the activities: leading the cre team (see belw), bringing them tgether t crdinate activities, reviewing prgress and reprting. Prject Spnsr assists t set the scpe and targets fr the Prgramme and then mnitrs prgress and remves bstacles shuld they ccur. The prgramme will cut acrss rganisatinal bundaries, s the PS will als need t actively engage peers acrss the rganisatin t build invlvement in the DH strategy. Executive Spnsr - champining the DH strategy within the rganisatin, engaging with the prject leader t raise the prfile f the strategy. Cre team - the cre team will ensure peple acrss the key areas f the rganisatin are fully engaged. The cre team shuld include: Finance Champin - a senir finance pint f cntact fr the Prject Leader. Officers frm nminated departments, e.g. planning, sustainability / climate change, GIS, husing, ecnmic develpment, educatin, leisure, estates. Other public sectr bdies: NHS, Higher Educatin, Natinal parks and Husing authrities Elements f capacity building will include: Building the structures - the internal netwrks and relatinships. The delivery f DH schemes in a lcal authrity requires clse wrking relatinships between different departments ver a sustained perid f time; Securing resurces - ensuring adequate budget and /r staff time resurces t prmte r deliver DH pprtunities, described in mre detail belw; Imprving technical understanding - imprving relevant fficers knwledge f DH and renewable technlgy, develpment pprtunities fr DH, using the natinal heat map, and related issues; Raising awareness - ensuring the benefits and pprtunities fr DH are understd by key fficers thrugh the authrity. This will als include external stakehlder engagement, encuraging early discussins between the cuncil fficers and the wners/managers f existing DH netwrks, ptential heat custmers r generatrs f waste heat that might supply a DH scheme; and Building plitical supprt - develping supprt fr DH amngst influential decisin makers t gain their cmmitment t prgressing DH pprtunities.
6 Mdule 1 The mdule 1 wrkshp will launch the prgramme and brings participants tgether fr the first time. Prir t the event the participants will be issued with an infrmatin pack cntaining key dcuments that will be used thrughut the prgramme. These will include: Prgramme plan and timeline Strategy dcument template Intrductin t the prgramme advisr (cnsultant) Intrductin t the HNP (cntacts) Intrductin t Strateg SE master-planning guide Public sectr analysis The agenda will cver: Intrductin and pening cmments (SG/HNP) Strategy template intrductin (Advisr) Knwledge sharing delegate brief intrductins Case studies Wrkshp Delivery plan Mdule utput Each participating LA will leave with a draft engagement plan 1.2 Mdule 2 - The Natinal Heat Map The bjective f this mdule is t identify fcus areas where there is high ptential fr district heating schemes using the Natinal Heat Map. The heat map is a pwerful tl that helps visualise and assess the need fr heat, where surces f heat might cme frm and hw these can be cnnected in an efficient way t reduce the cst f heat supply and the carbn intensity f heat generatin. It can als be used, in cmbinatin with ther spatial datasets, as a tl t illustrate the sci-ecnmic benefits f changing existing paradigms f heat supply. Each Scttish lcal authrity has access t the heat map t supprt lcal energy planning. The heat map dataset is very flexible and uses a GIS interface which allws analysis with ther spatial datasets. The Scttish Gvernment has issued advice n the rle f planning authrities in the transitin t efficient, lw carbn and renewable heat. This advice describes hw the heat map can supprt planning authrities in develping plicy, strategic develpment planning and at determinatin stage. This mdule will guide authrities thrugh prject priritisatin and the implementatin planning prcess t help prgress the DH pprtunities identified using the heat map. Each LA will develp interventins required and the assciated actins dependent n whether shrt, medium r lng term interventin is required. An implementatin plan will be develped fr the main fcus areas including a list f actins required t prgress the DH pprtunities identified. A reprt discussing the apprach, analysis and results f the prcess will be prduced as part f this mdule.
7 Mdule 2 Mdule 2 will bring tgether the prgramme c-rdinatrs, GIS leads and planning in a sessin designed t ensure that the heat map is a live tl imbedded in the planning prcess f the lcal authrity. In advance f the wrkshp, each Lcal Authrity must have full access rights t the heat map and cmplete all framewrk agreement dcumentatin The agenda will cver: Intrductin and pening cmments (SG/HNP/Strateg) heat map guidance and demnstratin (Advisr) Use f the heat map and Layers Criteria fr identifying heat clusters and ptential netwrks Wrkshp practical sessin n LA specific prject Mdule utput Each participating LA leave with an identified prject fr mre detailed feasibility and a methdlgy fr appraising future pprtunities. 1.3 Mdule 3 - Plicy Establishing a supprtive and rbust plicy framewrk is an essential element fr the successful delivery f the DH prjects. It is imprtant that plicies n DH are cnveyed acrss all relevant Lcal Develpment Plan dcuments t ensure a cherent message and rbust supprt fr DH delivery. Lcal authrities may als wish t cnsider develping plicies in ther lcal strategies, fr example husing, public sectr estate, ecnmic develpment r cmmunity planning. The Scttish Gvernments guidance n Planning and Heat, Natinal Planning Framewrk 3 (NPF3) and Scttish Planning Plicy (SPP) plicies will frm the basis f this mdule. Bth plicies strngly supprt the rll-ut f heat netwrks and the develpment f renewable energy. These planning dcuments state that develpment plans shuld seek t ensure an area s full ptential fr electricity and heat frm renewable surces. Lcal develpment plans shuld use heat mapping t identify the ptential fr c-lcating develpments with a high heat demand with surces f heat supply. Develpment plans shuld als supprt the develpment f heat netwrks in as many lcatins as pssible, even where they are initially reliant n carbn-based fuels if there is ptential t cnvert them t run n renewable r lw carbn surces f heat in the future. Mdule 3 The mdule will cver the fllwing tpics: Energy and Heat Hierarchy Energy Assessments Existing and New Decentralised Energy Netwrks Requirement t Cnnect Future Prfing Nn-Cnnecting Develpments CO2 Emissin Targets DH Targets DH Netwrk Perfrmance Specificatin
8 Mdule utput Each participating LA leave with the delivery plan sectin f the strategy dcument cmpleted 1.4 Mdule 4 - Financial & cmmercial structure This mdule will prvide the lcal authrity with an verall summary, in relatin t district heating investment, n: lcal authrity pwers and regulatry cnstraints; prcurement strategies; funding and financing mechanisms; and cmmercial delivery structures, including energy services cmpanies (ESCOs). Scttish Future Trust has prduced a range f guidance dcuments n these tpics, which will frm the basis f this mdule. Each prject will have unique characteristics which will determine the mst apprpriate financial and cmmercial structure. Supprt in develping this structure will be prvided thrugh Scttish Futures Trust. A suitable funding strategy and cmmercial delivery structure fr a prject shuld be develped in parallel. This is usually an iterative prcess, influenced by a number f factrs: As a general guide, key factrs affecting the financial and cmmercial structure will include the fllwing: 1. The authrity s verall bjectives (and thse f any partners, e.g. fr cllabrative public sectr prjects); 2. The authrity s desire fr cntrl, and appetite fr risk (and thse f any partners); 3. The prject s internal rate f return; 4. The authrity s in-huse capacity and capability; 5. Availability f funding and access t finance; 6. Regulatry cnsideratins including trading pwers, public prcurement and state aid; and 7. Exit strategy. Mdule 4 will be based n SFT s suite f guidance n DH, and will address the fllwing tpics: Lcal authrity pwers Public prcurement and ther regulatry regimes Cmmercial delivery structures The rle f ESCOs Financing structures and surces f finance (public and private) Tpics will be illustrated by case studies. Mdule utput will be a statement defining hw each participating authrity will develp a suitable financing and delivery strategy fr individual prjects. 1.5 Mdule 5 - Prject Definitin and Delivery This mdule will fcus n the prcess fr develping individual prjects identified frm the ver-arching strategy as having the mst ptential t succeed. The prject develpment prcess includes carrying ut feasibility studies, develping an utline business case and mving twards prcurement and delivery.
9 A feasibility study is nrmally a necessary prerequisite t the develpment f a business case fr a lcal authrity t take a mre direct and invested rle in the delivery f a DH pprtunity. HNP and Lw Carbn Infrastructure Transitin Prgramme (LCITP) can prvide supprt n early stage feasibility n a c-funded basis. The feasibility study will prvide infrmatin as t the technical feasibility and financial viability f a prject, as well as a helpful analysis f the risk prfile. Frm this stage, if the authrity wishes t develp a business case fr the prject, further funding and cmmitment f internal resurces will be necessary. Funding may be available frm internal budgets where there is strng internal plitical supprt. Alternatively, the authrity may need t apply fr external funding supprt, available frm EU funds r frm current and emerging UK lw carbn investment schemes. If the business case is apprved, the authrity will then prepare fr prcurement and delivery f the prject, which requires careful planning and risk management. Mdule 5 Mdule 5 will bring the participating authrities tgether fr the final time and will cmplete the final sectin f the strategy dcument. Each Authrity will be tasked with submitting the final dcument within a 4 week perid after this mdule. This mdule will cver the fllwing tpics: The prject develpment prcess Resurces, prject and risk management Cmmissining feasibility studies Develping a business case Mving twards prcurement and delivery Mdule utput Each participating LA leave with a strategy statement n hw each Lcal Authrity will engage with supprt agencies and develp heat netwrk prjects.
10 District Heating Strategy Supprt Prgramme Plan ID Prgramme Stage Start Finish Duratin 1 Prcure cnsultancy supprt frm Framewrk 12/01/ /03/ d 2 Develp template and guidance materials 24/02/ /03/ d 3 Enrl participating LAs (10) 05/03/ /04/ d 4 Mdule 1 wrkshp - prgramme intrductin and capacity building 28/04/ /04/2015 1d 5 Cnsultant ne t ne supprt 04/05/ /05/ d Nv 2014 Dec 2014 Jan 2015 Feb 2015 Mar 2015 Apr 2015 May 2015 Jun 2015 Jul 2015 Aug /11 16/11 23/11 30/11 7/12 14/12 21/12 28/12 4/1 11/1 18/1 25/1 1/2 8/2 15/2 22/2 1/3 8/3 15/3 22/3 29/3 5/4 12/4 19/4 26/4 3/5 10/5 17/5 24/5 31/5 7/6 14/6 21/6 28/6 5/7 12/7 19/7 26/7 2/8 9/8 16/8 23/8 30/8 6/9 6 Mdule 2 & 3 Wrkshp 26/05/ /05/2015 2d 7 Cnsultant ne t ne supprt 26/05/ /06/ d 8 Mdule 4 & 5 Wrkshp 16/06/ /06/2015 1d 9 Cnsultant ne t ne supprt 15/06/ /07/ d 10 Final wrkshp and strategy delivery 30/07/ /08/2015 7d
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