Talk title: Challenges & Opportunities in Heat Network Delivery
Speaker: Kevin Waters, Scottish Futures Trust
Event: CIBSE Scotland Conference 2026: Heating the Future, 27 May 2026
Video: https://youtu.be/uZq88rP60nU

[00:00] I recognise quite a few faces in the room, so for those of you who don't know me, I am Kevin Waters, Associate Director at Scottish Futures Trust. Before I get into the guts of the presentation, I wanted to start by getting you guys involved, warm you up before the workshop, just by asking a few questions, which will hopefully make sense as we get into the presentation. And if it doesn't, then that's on you guys, because you gave the wrong answer. So I suspect I know what the answer might be, having recognised a few of you, but just wanted to get a feel for, by a show of hands, how many of you have been involved in projects that considered heat networks for a heating and cooling solution when doing your buildings and projects? Okay, so unsurprising given, as I said, I recognise. But second question, a little bit more tricky perhaps, is that of those projects, how many resulted in a heat network being the heating?

[00:55] And cooling solution for your buildings? Okay, so a smaller number, which is what I expected, and I'm going to keep coming back to that. So that's why I think that, you know, the heat networks need to be in the first conversation, not an afterthought, not when the solution has already been predetermined, and it's too late. That's going to be my key message for today, and something that I'm going to keep coming back to, and hence why I wanted to get you guys involved.

[01:25] So we're going to have a couple of questions to start with. I think it's important that this becomes the norm that heat networks are considered. As James and others have said earlier, it won't always be the best solution, but it will often be the lowest cost route to decarbonisation. However, if we don't consider it in that first conversation, then the opportunity could be lost, at least for the lifetime of the replacement solution, but potentially forever. So as I said, I'm Kevin Waters, I work in the net zero building team at Scottish Futures Trust, I've been there for almost three years now, which was quite scary to see when people started using it. So, if you're interested, you can check out the link in the description below, and I'll put that in the description. And I will also be a part of the discussion about the topic of the future. So if you're interested in the future, to say it out loud come from our project and program management background predominantly in the public sector having delivered major infrastructure and energy projects including the leading on the amids heat network project that's been referenced earlier whilst I worked at ramshire council it's part of my role at sft work alongside colleagues in scottish government so james who spoke earlier and colleagues in zero waste scott on this part of the heat network support unit which you've already heard about and I'll touch more on later in the presentation okay so next slide why are heat networks part of the first conversation regarding

[02:33] Union replacement heating systems well zollos have already outlined james mentioned earlier they're widely recognized as a key solution for decarbonizing our buildings and achieving our net zero emissions as I said they won't always be the best solution and but they're crucial to our net zero ambitions and we won't reach them without it and as james outlined earlier they are well supported from a regular estate and funding perspective again as we mentioned our technology agnostic the means they can connect a wide range of low carbon heat sources so as we've already heard it can be waste from industry energy from waste water source heat pumps which can take heat from our sewers our rivers our locks and the sea of which we've also got plentiful supply here in scotland we should also acknowledge though that the low carbon heat is expensive we should also acknowledge though that the low carbon heat is expensive we should also acknowledge though that the low carbon heat is expensive we should also acknowledge though that the low carbon heat is expensive we should also acknowledge though that it's capital intensive but in the economics improves significantly at scale which is why heat networks are one of the most cost effective solutions for decarbonizing our heat

[03:35] I'll touch on this later you know they facilitate flexibility as ken mentioned as well once the pipes on the ground we can we can introduce further technology and other heat sources more easily than we can when it's individual solutions as well in terms of sharing the decarbonization what I mean by that is heat networks help share the heat networks help share the decarbonization as well in terms of sharing the decarbonization what I mean by that is heat networks help share the heat networks help share the decarbonization as well in terms of sharing the decarbonization amongst buildings and owners and occupiers which is particularly value again has been mentioned earlier where buildings are hard to treat maybe they don't have the space for your source heat pumps or they're in a heritage environment or residents and landlords often don't have the capital to or the appetite for individual upgrades and again as we have already heard from you know anchor loads underpin networks because heat networks require that significant upfront capital securing anchor load commitments is critical to help underpin them there's no getting away from that the greater the demand assurance the more anchor loads that we can secure early in the process the stronger the viability and crucially the wider the network can

[04:40] Grow and that's another key point about heat networks is that it can result in the decarbonization of more homes and buildings across our community as those heat networks grow we've got a strong public sector estate in scotland councils nhs buildings universities and they can act as excellent anchor loads to help the demand assurance that I mentioned so hopefully you'll recognize that heat networks offer a cost effect of route to decarbonization for our buildings however delivery does remain challenging and we've heard of some of those challenges and I'm going to try and touch on a few of those and now before coming back to what we're doing and what you can do to help with those challenges so I've got a slide with a bigger version I wasn't quite sure the screen would be that big so perhaps I don't need it but I'll go into this in a bit more detail so we've developed this diagram which we affectionately refer to as our trilemma and that it just illustrates the key challenges

[05:40] We face and heat network heat network delivery right now and I suspect you know many of you recognize the kind of objectives and the tensions that we see in there and I'll talk through each of these elements at the moment so as you can see we've got objectives in each corner of the trilemma so we're trying to deliver at pace and scale we're trying to deliver clean heat and we're trying to deliver heat that's affordable and the problem being that at the moment we can only typically get two of the three the technologies there we've heard earlier the ambitions there the cost isn't quite there yet without significant subsidy or scale and that's where the tensions come in and that's where we're trying to deliver heat and we're trying to deliver heat and so we take each of the road signs starting on the left we could push for faster delivery with lower carbon which is required to meet targets but with the result as expensive heat and you could argue that this really isn't an option because who's going to pay more than they're currently paying or certainly the current prices of low carbon heat so investment whether

[06:43] It's public or private sector isn't going to stack up without customers that's where future regulation that james touched on earlier might you know we're not going to be able to do that without the right hand side we've got faster delivery and cheaper heat but the consequence is higher carbon and is that a trade-off that we're willing to take in order to get pipes in the ground as ken and others mentioned earlier and lastly at the bottom you could prioritize lower carbon and cheaper heat but as we all know it currently requires significant subsidy and there's limited amounts of that going around so the consequence of that is slower delivery and less projects that can be funded so again we will not meet targets and the time scales that we need to with that route and the warning sign playing on the infrastructure and road theme here is deliberate you know this isn't a comfortable place to be as it reflect but it reflects the real tension and uncomfortable truth facing us all right now you know so question what route would you choose and be willing to make

[07:48] And you don't have to answer because we're but you can answer later so you know I think one of the ways to escape this dilemma and to move forward all three is to start that network conversation earlier that's why the heat networks have to be in that first conversation in terms of what's happening kind of nationally you know some of this has been touched on already I'll spend a few minutes highlighting some of the activity that seemed to address in some of these delivery challenges not necessarily solving them all scottish government are undertaking a strategic review of their approach to heat network development across scotland and this I've touched on a few of these so regulation james mentioned earlier about zoning and designation and consenting and license regimes and some of you may have already contributed to consultation that's on license that's out right now and closes shortly there's standardized delivery models so many of you I hope will be familiar with fst sft's published report on delivery models and we're working with scottish government to figure out how to

[08:50] Improve their approach to heat and the role of the government on their strategic outline case which aims to help understand the roles and responsibilities in the medium to long term and the impact that different levels of public sector ownership will have and lastly in terms of the government review there's a supply mix assessment again some of you may have been involved in the state codes and engagement with that but what that work aims to do is just evaluate the effect of different heat supply technologies and carbon emissions have on the heat networks in scotland for example increased gas fractions may improve the cost of heat but as we said earlier the trade-off is in terms of carbon emissions is that an acceptable meanwhile trade-off mostly we feel well with the heat network fund james already mentioned I'll not go into that in detail and again the heat network support unit of which is a large part of my role and colleagues here in scottish government and zero waste scotland are here but I'll touch briefly on some of the things that we've did to pivot the support that's been available we've got strategic support which aims to build on the l he's that's already been mentioned

[09:54] And that's taking a sort of programmatic strategic look at heat network deployment across local authority areas we're also supporting sosie and the precinct gallery and scottish borders council building on the prospectus that was shown earlier so that's looking at how do we help rural heat networks get to market so taking them from the sector so we're hopefully developing an opportunity to share later on this year if and when that comes to fruition we're also looking at feasibility including local generation and our feasibility recognizing that you know projects are difficult to stack up at the moment due to that high carbon cost it's a high cost of low carbon heat so what difference does solar make for example one of the projects that we looked at managed to reduce the piece of heat sales price from 13 pence to just under 10 pence which is going in the right direction but it already adds a layer

[10:56] Of complexity to an already complex problem which is delivering heat networks so additional work and feasibilities how do you fund the solar how do you model the solar in your in your feasibility in business cases and similarly for waste heat the project that we looked at for that was a large bakery but the heat the waste heat offtake was too small to make a real difference in the heat sale price and again at these similarly similar complexities the capital costs of converting that waste heat how do you do that without impacting on in this case a shortbread factory we don't want to mess with that the shortbread is good and we don't want that to be blamed for another problem in scotland okay so lastly before I move on to concluding how you can help address the challenge collaborate you know it's not be surprising for anyone to do that and you know engage with your local authorities and stakeholders early to understand what's planned in the area many are building on their lts which we've already heard about

[11:58] To develop heat network programs they're not delivered alone by a single organization it requires everyone to work together and they're built on partnerships and those early partnerships form the securing of the anchor loads for example that I've already mentioned plan early ask the question at reba stage zero and one not wait until reba stage four as thomas mentioned earlier good planning equals good results so planning early is definitely important challenge the default so every time a gas boiler individual heats heat pumps specified challenge it ask whether a heat network's been considered I'll touch briefly on flexibility in future but flexibility is more of a why than a how but it's linked to the next point a heat network is not technology it's an infrastructure it's pipes in the ground so it can start on one source it could be gas chp as ken mentioned earlier and once the pipes and again further technologies and waste and in low carbon heat can be introduced more easily than it would

[13:01] Be in an individual decentralized solution but future proofing is also important so maybe there's not a heat network in the horizon for your building but you can still future proof I was talking to jonathan at the break and he was telling me about the high school and fife that put tails in and the knowledge that a heat network would probably come along and similarly colin at alberta university has put tails in their library with knowledge that again a future heat network will come so there's things that can be done that are much cheaper and much easier when you're building something than retrofitting so it's worth keep bearing that in mind it can be also a network things like we did at amids we put ducks under roads so anything you can do to make heat networks more deliverable in the future is absolutely worth doing and to conclude hopefully on time before I get Tanja's x in summary you know we've talked about the strategic heat networks being a strategic infrastructure we've acknowledged that there's

[14:03] A delivery challenge we've talked about the support that is there and is evolving to help deliver heat networks in scotland and we've talked about very quickly why buildings and their engineers and designers have a critical role to play if the conversation starts early enough and if I could ask just for one take one thing for you to take away from today and again this plays on vince's first point about pay it forward so I'm asking you to pay it forward is that if you could bear in mind the text in green so the next time you start a project a master plan a planning application a feasibility so say ask the question put heat networks in the question at that early stage.