27 May 2024
by Weronika Dorociak

DESNZ looks to incentivise heat reuse and export through the UK ETS

The Department for Energy Security and Net Zero (DESNZ) is seeking views on the inclusion of heat reuse and export in the UK Emissions Trading Scheme (UK ETS).

This initiative aims to incentivise the use of clean heat sources by introducing various measures, such as free allowances or reductions in ETS obligations.

DESNZ is seeking feedback on the best incentive mechanisms, the scope of applicable heat types, and potential unintended consequences of these incentives.

The Call for Evidence consists of five questions:

58. Do you agree that the UK ETS should be used to support heat offtake through the ETS? (Y/N) Please outline your reasoning and provide evidence to support your views.

59. Do you have a view on what incentive mechanism (e.g. free allowances, subtraction of a number of allowances from the UK ETS obligation, etc.) would work best to encourage the export and utilisation of heat? (Y/N). Please provide as much detail as possible to support your answer.

60. Do you think that policies to incentivise heat offtake should apply to surplus or waste heat, as well as heat produced for the purpose of export? (Y/N). Please provide as much detail as possible to support your answer.

61. If an incentive is provided, how should the level of incentive be determined e.g. should it be linked to emissions that are offset by exporting heat, the volume of emissions associated with the production of heat, etc.? (Y/N) Please provide as much detail as possible to support your answer.

62. Do you have a view as to whether incentivising heat offtake through the UK ETS could have any perverse consequences? (Y/N). Please provide as much detail as possible to support your answer.

Submissions

The Call for Evidence concludes on 18 July 2024. techUK will be responding, and members are welcome to share their views either at the next ESG+ Working Group meeting on 13 June, or in writing by emailing [email protected].


techUK has recently published a report on the topic of data centre heat export which outlines the industry’s position on this issue. 

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This techUK report underscores the industry's eagerness to actively contribute to heat networks, showcasing members’ success stories and highlighting ongoing initiatives.  

It also entails an in-depth exploration of the practical challenges related to exporting data centre heat that must be addressed to ensure effective and sustainable integration. This includes addressing issues associated with seasonal changes, infrastructure proximity, varying occupancy levels, emerging technology, and potentially counterproductive sustainability outcomes.  

The report was submitted alongside our response to the government’s consultation on the proposals for heat network zoning in England.  


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Weronika Dorociak

Weronika Dorociak

Programme Manager, Sustainability , techUK

Craig Melson

Craig Melson

Associate Director for Climate, Environment and Sustainability, techUK

Lucas Banach

Lucas Banach

Programme Assistant, Data Centres, Climate, Environment and Sustainability, Market Access, techUK


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Visit our Climate Action Hub to learn more or to register for regular updates.

By 2030, digital technology can cut global emissions by 15%. Cloud computing, 5G, AI and IoT have the potential to support dramatic reductions in carbon emissions in sectors such as transport, agriculture, and manufacturing. techUK is working to foster the right policy framework and leadership so we can all play our part. For more information on how techUK can support you, please visit our Climate Action Hub and click ‘contact us’.

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Contact the team

Weronika Dorociak

Weronika Dorociak

Programme Manager, Sustainability , techUK

Craig Melson

Craig Melson

Associate Director for Climate, Environment and Sustainability, techUK

Lucas Banach

Lucas Banach

Programme Assistant, Data Centres, Climate, Environment and Sustainability, Market Access, techUK

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Authors

Weronika Dorociak

Programme Manager - Sustainability