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District Energy Scheme benefits

Gateshead district energySince 2011 Gateshead Council, with support from WSP I Parsons Brinckerhoff, has been developing a district energy network to serve the town centre and Gateshead Quays area. The new, low carbon, energy centre will export both heat and power for sale directly to customers via a new underground network of heat pipes and high voltage 'private-wire' electricity cables to be funded and owned by the Council.

The scheme is based on a gas fired Combined Heat and Power (CHP) energy centre located in Baltic Business Quarter. Gas CHP can generate electricity, whilst capturing and supplying waste heat to buildings, in a process that is twice as efficient as conventional power stations.

The initial scheme will supply energy to the following buildings (where buildings marked with * are to receive heat and power, and the rest, heat only):

  • Gateshead Civic Centre*
  • Homes managed by the Gateshead Housing Company
  • Gateshead College*
  • The Sage Gateshead*

The scheme will be fully funded and owned by Gateshead Council and operated through a new Energy Services Company, which will also be owned by Gateshead Council.

Construction of the Energy Centre began in June 2015, with a planned completion date of Summer 2017, when all of the initial buildings will be connected and supplied with heat and/or power.

The Council's objectives for the district energy scheme are as follows:

  • To provide low cost heat and power to existing homes, organisations and businesses in the urban core of Gateshead, reducing their running costs and improving their competitiveness
  • To create new business growth in Gateshead, by offering low cost, low carbon heat and power to new commercial development
  • To reduce Gateshead's carbon footprint, by providing heat and power with half the carbon emissions of grid energy supplies
  • To help fuel poor households reduce the cost of heating their homes.

What are the potential benefits to developers?

While connection to the district energy network will be a planning requirement for most large developments, connection also offers many commercial advantages to developers, which will be missed if development progresses using conventional heat and power supplies.

The benefits of connecting to the district energy scheme are as follows:

  • Cheaper construction costs - where the connection cost to the network will be much lower than the cost of  conventional heating plant and utilities connections
  • Reduced plant space allows greater lettable floor area in developments
  • Cheaper and easier for developers to meet prevailing building regulations, Code for Sustainable Homes, BREEAM and the emerging zero carbon homes
  • Reduced heating and power costs for building occupants, of at least 5% and potentially more, compared to prevailing market rates of heat and power costs
  • Flexible energy supply contracts, offering dual fuel, heat only or power only connections
  • Developers have the option to secure further discounts on heat and power costs, by choosing to pay a higher upfront contribution
  • Reduced exposure to green/carbon taxes and levies (for example Carbon Reduction Commitment, CRC, and Climate Change Levy, CCL)
  • As well as energy savings, buildings could avoid ongoing heating plant maintenance, servicing and replacement costs
  • The resilience built in to the Energy Centre and network is as good, if not better, than conventional heat and power supplies
  • Opportunity to participate in a scheme which will deliver significant carbon savings to wider Gateshead.

How can I connect to the scheme?

Icon for pdf The network plan [894.4KB] shows the current and future extent of the heat and power network. The network is sized to be able to provide heat and power connections to all development proposed for Gateshead Quays and Baltic Business Quarter. Provision is also made for heat supply to approximately. 1,000 homes, in the Exemplar Neighbourhood area.

However, with extensions being planned through the town centre, and to the south, towards Gateshead Stadium and Gateshead Leisure Centre, the Council is happy to take enquiries from any potential customer within a 2-3km radius of the Energy Centre on Quarryfield Road.

How does district energy work?

District energy schemes are a means to generate heat and power locally for customers, that is more efficient than conventional power stations.

They require a centralised energy centre, to generate heat and power for customers. The heat is distributed via an underground network of super insulated heating pipes.

The Gateshead scheme is 'heat-lead', which means our energy centre runs to provide customers with their heat requirements, first and foremost. When heat is being provided from the gas CHP engines, electricity is also generated.

In most schemes, this electricity is exported into the national grid. However, in Gateshead, the electricity is supplied direct to customers through a network of "private wires". This allows us to provide electricity at a lower cost to customers, reducing the costs and losses of exporting into the national grid.

The Gateshead scheme has a full set of back up facilities. The CHP engines do not run continuously. When customers do not need heat, or when the CHP engines are being serviced, heat is provided from conventional gas boilers, which operate as back up. Also, when the CHP units are not running, or when our customers use more electricity than we can generate, we import 100% renewable electricity from our own grid connection.

In this way, the scheme is as resilient, if not more so, than a conventional building with a gas boiler and grid connection.

District energy scheme diagram

This project is being supported by a grant from the England European Regional Development Fund (ERDF) as part of the European Structural and Investment Funds Growth Programme 2014-2020.

ERDF funding logo

Contact us

For more information or an informal discussion please contact:

Jim Gillon - Energy Services Team Leader
0191 433 3923

Peter McDermott - Energy Services Officer
0191 433 3449

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