The Department for Business, Energy and Industrial Strategy (BEIS) has launched the £288 million Green Heat Network Fund, which will support the development of low-carbon heat networks out to 2025.
The fund is the successor to the Heat Network Investment Project, which has provided more than £250 million of funding to 20 heat network schemes across England and Wales since 2018.
Unlike its predecessor, the Green Heat Network Fund will only support heat networks that are fed by low-carbon heat sources such as heat pumps, thermal solar panels and geothermal wells.
Energy minister Lord Callanan said: “Heating in buildings forms a significant part of the UK’s carbon footprint, so changing how we warm our homes and workspaces is vital to meeting our world-leading climate change commitments.
“Heat networks are an effective way of reducing carbon emissions and this fund will enable us to accelerate the roll-out of these cutting-edge and green technologies.”
Lily Frencham, chief executive of the Association for Decentralised Energy, said: “We’re delighted that the government is invigorating the transition to zero-carbon heating across the UK that uses good old-fashioned pipes and water to transport heat from green energy centres to homes and businesses.
“Heat networks offer the most cost-effective tried and tested way of decarbonising our towns and cities and it is great to see government’s continued support for the sector through the launch of the Green Heat Network Fund.
“Heat networks have a critical role to play in the UK’s net zero future – and 2022 will be a crucial year for the heat networks sector.”
The fund will open to applications on 14 March.