The Association for Decentralised Energy
An article by Cecilia Keating at Business Green
BusinessGreen reports from Citigen, the tri-generation plant which supplies low-carbon heat to some of London's most iconic buildings
Hidden inside a historic building facing the colourful arches of Smithfield Market in London is a marvel of modern-day energy engineering: a power plant that supplies heating, cooling, and electricity to more 30 buildings across the City of London, including the Barbican arts centre, the 800-year-old Guildhall, and the offices of social media giant Snapchat. The energy is transferred through a network of pipes and wires laid underneath some of central London's busiest streets, providing a template for how urban heating could be decarbonised at scale without increasing demands on the electricity grid.
But the thousands of commuters pass through Farringdon everyday would be forgiven for having not noticed the neighbourhood power plant, which is tucked inside a building emblazoned with the wording 'Port of London Authority'. The only external clue to its existence is a chimney stack which peeks above the city's rooftops.
The Port of London Authority left the premises years ago, and it has been a long time since the chimney stack spewed coal fumes into the air. That is because the power plant inside - which once burned the dirtiest of fossil fuels to power the meat market and refrigerate animal carcasses in a nearby ‘cold store' - now runs largely on fossil gas, backed up by a trio of heat pumps which draw heat from an aquifer 200 metres beneath the city's street. Waste heat is recovered throughout the system, helping to reduce its overall costs and emissions.
Now operated by energy company E.ON, the plant - named Citigen - is the epicentre of a heat network which stretches across the city's financial district, supplying heating and cooling to the equivalent of 11,300 homes and helping to reduce buildings' climate footprint to the tune of 5,000 tonnes of carbon a year. As such, the power plant is playing a major role in the City of London's efforts to decarbonise, while providing a valuable case study for the many other cities and local authorities now considering their own low carbon heat networks.
District heating networks come in all shapes and sizes. Some, like Citigen, are powered by fossil fuels or electric heat systems. Others tap an existing source of waste heat, like a data centre, waste or sewage plant. But whatever the source, the general premise remains the same: heat can be provided significantly more efficiently and with a lower climate impact using a single central source than through each building hosting its own boiler. If the central energy source is renewable - a large heat pump, for instance - the carbon savings are even more significant.
The Citigen plant is a tangle of complicated looking machinery, chunky pipework, tanks and boilers, stretched across a warren of rooms and a number of floors. On the top floor, a control room monitors not only this heat network, but the 70 others across the UK managed by E.ON. The two combined heat and power (CHP) systems, which rumble away from the building's centre, provide the bulk of the plant's output. But they have been recently supplemented by the newest additions to the energy centre, which can be found in a dank basement. Three heat pumps - each about 10 times the size of your typical domestic installation - were installed in 2021, extracting heat from water drawn from an underground aquifer under the city streets.
On a recent tour of the energy centre, sales manager for city energy solutions at E.ON, Apostolos Melas, described the Citigen site as a "museum of the energy transition", as he detailed the plant's decades-long journey from coal, to diesel, to fossil gas, and now to heat pumps. "This is a historic building, it has stood here 250 years," he said. "And the building itself has been hosting equipment for energy generation - mostly heating, but also electric power - at every stage of its evolution."
Buildings that plug in to E.ON's heat network benefit from lower-cost, lower-carbon energy, thanks to the operational efficiencies of connecting to a single centralised heat source and the low-carbon energy supplied by the heat pumps. Citigen customers also benefit from the flexibility provided by a 25-metre-high water tank, which has been installed in a cavernous room that once served as the power plant's diesel store. On top of providing backup power in case of a system failure, the thermal store works as a giant battery, enabling E.ON to adjust the power plant's consumption of grid electricity to when prices are competitive, and sell back power back to the grid when prices are high.
And yet despite these benefits, Melas said it can be hard to convince local businesses to connect to Citigen. While companies and real estate owners are enthusiastic about the space freed up by not needing to host a boiler or heat pump on their roof, they are deterred by the logistics involved in opening up London's congested roads to lay fresh pipework to connect to the existing network.
Other prospective clients with net zero targets to meet are put off by the Citigen plant's ongoing use of fossil gas, according to Melas. But this type of thinking fails to put the carbon emissions of the plant in the broader context of its energy efficiency, he argued. After all, the alternative solution for building owners serious about decarbonisation - standalone heat pumps - require more power to operate, place more demand on the stretched electricity grid, and leave occupiers exposed to the whim of wholesale energy prices and power cuts. "The narrative for everybody right now is to achieve the lowest carbon you can - this is the main driver for most people," he said. "We have natural gas in our mix, so we will have higher carbon in our building than a standalone system with heat pumps and some cooling equipment ... But the problem is, this doesn't answer the whole question. The discussion should be about how you produce your energy. What is your resilience? What is your demand for electricity? What's the impact of electrical grids in the area, what it the price for offering this? People don't really think about this - they think in isolation."
Besides, Citigen's history attests to the fact the scheme is unlikely to stay hooked on gas forever, Melas said. It may run on the fossil fuel for now, but the CHPs will be replaced when they reach the end of their life in 15 or so years. "This energy centre will be decarbonised at some point, we are not going to keep the CHPs for eternity," he said. "We are already decarbonising - that's why the heat pumps came in."
For its part, the UK government is sold on the benefits of expanding district heating networks across the country and encouraging those networks that do exist to transition to greener sources of heat where possible. As part of measures set out in the Energy Act, which passed into law last autumn, Ministers are consulting on the introduction of new heat network zoning regulation that would incentivise buildings within a certain distance from a district heating network plug in to the system and make it easier for developers to install heat network infrastructure. Advocates have argued the zoning regulation will provide demand assurance to energy developers that can help drive much-needed investment in networks and ensure they can go from supplying three per cent of the UK's heat to the 18 per cent the Climate Change Committee (CCC) has estimated is required to achieve the country's net zero goals.
The proposals have been borrowed from heat network leader Denmark, which has employed a form of heat network zoning since 1979 where municipalities identified zones where district heating could be optimised. Today, roughly two thirds of all private Danish households are connected to district hearting systems, giving the Scandinavian nation its reptuation as one of the most energy efficient countries in the word.
Caroline Bragg, interim chief executive officer at the Association of Decentralised Energy (ADE), told BusinessGreen it was an exciting time to be working in the UK heat network sector. "We think it's about to take about £60bn to 80bn to get to 2050 in terms of investment in heat networks," she said. "We're talking quite considerable amounts of money. The exciting thing that has happened over the last six months - as we are seeing regulations and zoning being legislated for - is we've had quite significant new investments coming into this sector that we've not really had at this scale before."
Major projects are underway in Leeds, Bristol, and Birmingham, and the heat zoning regulation could lead to projects "of a different level of magnitude", she said.
"We're moving from a sector that is quite project-based with higher returns than you would expect for other types of infrastructure, to one that is attracting finance and has a lower risk profile, something that's much more akin to broadband, for example, or gas and electricity," Bragg explained.
For Citigen, the heat zoning legislation is significant. E.On is already in discussion with owners of a number of buildings about a possible connection, including the Museum of London which is set to move in to the general market and poultry market buildings at Smithfield Market, and St Barts Hospital. The latter mooted partnership could also provide a new source of waste heat into the network's mix, which would further reduce its emissions. It is hoped the zoning regulation could see a swathe of new customers register their interest in connecting to the power plant, which currently has significant capacity to spare.
Increased demand should in turn fast-track investment in additional low-carbon generation at Citigen, Melas said. "It goes both ways," he said. "If we have to connect everybody, and we still need to meet the zero carbon targets for the Council and for the government, we will need to show how we will improve [as we expand the network]. It will put the onus on us to keep increasing our capacity and keep decarbonsing our energy centre."
Citigen has had no shortage of reincarnations over the years, with its recent history testament to the ongoing transformation of the UK's energy system. Clearly, its process of transformation is not over yet.
