Posted: 31 July 2014
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An uncertain future

The shifting demand for energy from homes, businesses and industry in the coming decades could have profound implications for the UK. But how will the demand picture change and what are some of the biggest factors to consider? Nigel Fox, National Grid’s Energy Demand Manager, explores the challenges ahead.

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An uncertain future

An uncertain future

Nigel Fox, National Grid Energy Demand Manager.

And what of heat pumps? This is a technology that holds a lot of promise to reduce demand but it is clear that we need a significant shift in thinking for this to become reality.

Nigel Fox, National Grid Energy Demand Manager


By 2010 85% of homes in Great Britain used gas for heating, 9% used electric, 4% used oil and just over 2% used solid fuel, LPG, district heat or other sources.

Source: National Grid UK Future Energy Scenarios 2014

To understand how our energy demand might look in 2035 – or even further into the future – it’s useful to examine the influence of Government policy to date but also to take into account the effect that each of us, as consumers, can have on the UK’s overall energy consumption.

Government policy and incentives are one part of the equation – the savings made in heat through successful campaigns to offer subsidised insulation is a prime example. However, the choices that we make as consumers and our lifestyle preferences will have just as much of an impact on future energy demand. Affordability will be the other key issue.

The heat is on

Looking at residential demand in more detail, between 2000 and 2012 the UK saved something like 35TWh/yr in domestic heat demand through Government-backed boiler replacement and insulation schemes. If we fast-forward to 2035, the success or otherwise of two other high profile programmes will be equally important.

ECO (the Energy Company Obligation) requires the big six energy companies to help customers save on their energy bills, while the Green Deal helps householders to understand the energy savings that can be made and provides access to grant funding and finance. Both of these schemes will need to bear fruit if the UK is to meet its stated environmental targets.

We’ve also looked at what could be achieved in future through better insulation of homes in the UK via our four Future Energy Scenarios.

Gone Green, the most ambitious of these scenarios, projects a higher uptake of solid wall insulation out to 2035. At the other end of the scale – our No Progression scenario – there is a lower uptake of insulation generally. The other two scenarios, Slow Progression and Low Carbon Life, fall somewhere in between.

The most striking heat saving going forward is likely to be the replacement of 1.5m gas boilers per annum with A-rated condensing units. These savings have been locked in since 2005, thanks to Building Regulations that make it mandatiory to replace gas boilers with energy efficient units.

A glimpse into the future

We expect to see about 3.7 million new houses built in the UK by 2035, but how many of these will be ‘green homes’?

There is a way of measuring this called the Passivhaus standard, which assesses the energy performance of a home through better building design. In two of our scenarios – Gone Green and Slow Progression – the UK reaches this standard by 2030, but the underlying message is really that building regulations are the key to delivering savings in heat demand in new build homes.

And what of heat pumps? This technology holds a lot of promise to reduce demand but we need a significant shift in thinking for this to become reality.

The uptake of heat pumps will depend on how much disposable income people have, but also on Government incentives such as the Renewable Heat Initiative. In our Gone Green scenario, some ten million UK homes have heat pumps fitted by 2035, whereas each of the other three scenarios sees uptake remain much lower.

Elsewhere, our scenarios also study the role of district heating, where currently in the UK we have about 80 schemes serving around 200,000 residential properties. Our Low Carbon Life case sees this figure rise to around 1.2 million properties, driven by higher economic growth, while the other three scenarios see growth remain relatively flat.

Seeing the light

Changes in the way we light our homes make for interesting reading and particularly the rise in the use of halogen lighting in recent times – perhaps driven in part by the myriad home makeover shows on our television screens.

This is actually a really good example of where there is tension between consumer preferences and policy intervention because, unless manufacturers really champion the benefits of lower-energy LED lighting, the consumer love affair with halogens is likely to continue. Certainly this is the picture painted in our Low Carbon Life scenario, where use of halogens continues to grow between now and 2035. The alternative path is presented by Gone Green – a world where halogens tail off completely by 2020 to be replaced by LED lighting.

Does the type of lighting really make that much difference in terms of demand? The short answer is ‘yes’. Setting the right pathway can deliver massive savings in lighting demand – as much as 10 TWh/yr by 2035.

Our love of appliances

Another important factor affecting residential demand is household appliances, which account for about 60% of total demand. How energy efficient will these appliances be in the future? How strong will our appetite be to buy more and more ‘stuff’? Will economic growth give people more money in their pockets? These are all elements we’ve considered in our four scenarios.

The largest differences between the scenarios are driven by ‘cold and wet’ appliances, such as fridge freezers and dishwashers. Our projections show that energy demand from appliances would be at its highest in our Low Carbon Life world, where a greater number of homes and the purchase of larger cold appliances help to increase demand. The lowest demand is represented in our Slow Progression scenario, where lower disposable income and affordability limit the number of additional appliances.

Number crunching

So, when we add up all the numbers, how do our demand scenarios compare?

Adding together domestic, commercial and industrial demand, gas demand is at its lowest in our Gone Green scenario, due to the greater uptake of heat pumps, while in the other three scenarios efficiencies balance out the growth in gas demand.

In terms of power demand, electrification of heat and transport sees a growth in power demand beyond 2025 in our Gone Green world, while the highest power demand of around 375TWh/yr is in our Low Carbon Life scenario, again driven by electrification of transport.

So, in conclusion, for the UK’s environmental targets to be met we need to see continued improvements in energy efficiency, a change in consumer behaviour and the adoption of new technologies, plus electrification of heat and transport, alongside decarbonisation of generation.

Read more:

Gary Dolphin, National Grid’s Market Outlook Manager, National Grid, analyses the
UK’s 2020 target for renewables
and looks ahead to the future.

Richard Smith, Head of Energy Strategy and Policy, National Grid, offers his perspective on the UK Future Energy Scenarios 2014.

Ten things you need to know about National Grid’s Future Energy Scenarios 2014.

Alice Etheridge, National Grid’s Strategy Development Manager, explains what each scenario might mean for the UK as a whole and for consumers.

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