It’s a remarkable time to be working on the energy transition, especially at a company like Gasunie, where much of this comes together. Think of the transition from natural gas transport to hydrogen, the transport and storage of CO2, and the transport of heat. Today, I want to focus on the latter. Gasunie is building the world’s first open heat transport network, called WarmtelinQ. WarmtelinQ transports residual heat from the Port of Rotterdam to heat distribution companies in The Hague and Leiden.
For the past two years, I’ve been working as a change manager within the Business Readiness team of WarmtelinQ. From my role, I’m dealing with the question: ‘How do we manage this heat network once it’s built?’ This change affects almost all aspects of current operations, including: establishing asset management policies, monitoring and controlling heat transport, and safely operating and maintaining the pipelines and installations.
The heat transition was initially overlooked in public debate (compared to the agricultural transition), but has consistently made headlines in recent months. Often, the reporting has a negative undertone, particularly related to costs for the user and uncertainty surrounding the implementation and timelines of the Collective Heat Act (Wcw). Driven by a desire to dispel this ignorance, I’m happy to share my experiences and thoughts on the usefulness and necessity of a heat network with you.
The main reason for building WarmtelinQ is to make the heat demand in the Province of South Holland more sustainable. By 2050, the Netherlands aims to be CO2-neutral. This means a massive transition: in agriculture, in aviation, but certainly also in built-up areas. This means that 8 million homes in the Netherlands must go ‘off gas’. Currently, the heat demand in the Netherlands is still heavily dependent on natural gas, which, with the closure of the Groningen field, is mainly imported. The war between Russia and Ukraine painfully exposed our dependence, resulting in enormous natural gas price increases. Some households could no longer pay the bill. In addition to savings in reducing gas consumption, there was also massive insulation to reduce costs. And LNG terminal projects in Europe sprouted like mushrooms. Gasunie also built the Eemshaven Energy Terminal in record time. However, LNG is not the path to a sustainable future. So what opportunities and challenges do we see on the way to a sustainable built environment?
The CO2 savings of heat networks are significant.
WarmtelinQ, for example, has an 88% CO2 reduction compared to the traditional gas boiler. And by 2050, a 100% reduction, when the residual heat comes from production processes without emissions, such as green hydrogen. The residual heat from factories often goes into the air now, an enormous waste.
Residual heat is a way to close the energy import gap.
With the definitive closure of the Groningen field, we’ve become even more dependent on energy imports. And suppose we all switch en masse to a heat pump, then the electricity grid will be under extra pressure, with the average demand for electricity for individual households rising from 2500 kWh per year to 5700 kWh per year. The simultaneity of this demand in particular becomes challenging. And as you can see here, grid operators are already struggling with congestion issues.
Heat networks have the lowest societal costs if we want to get off gas.
In a recent study by Berenschot, the national additional costs compared to the gas boiler for an individual heat pump are 40% higher than a heat network (in 2030). The big challenge, however, is that societal costs are not equal to the costs an individual pays. For example, the construction of the electricity grid is socialized, while the construction of the heat network is charged to future users. And while the government fortunately does step in with subsidies for the construction of the networks.
However, heat companies face great uncertainties.
The Collective Heat Act (Wcw) has been in the making for a while and should replace the Heat Act. Last June, the Wcw was presented to the House of Representatives, but the previously communicated implementation date of January 1, 2025, seems unrealistic. In the latest proposal, the Wcw mandates that the designated heat companies must be more than 50% owned by public parties. This decision brings great investment uncertainty and business risks that heat companies cannot justify, resulting in delays. Especially ‘as long as the law isn’t passed’, the great uncertainty causes delays, including for ongoing projects.
And residents face uncertainty regarding costs and possible designation.
Heat networks often make the news due to high bills for users. The Wcw also includes a proposal for tariff changes, where the price of heat is no longer linked to gas, but to a ‘cost-based tariff’, regulated by the supervisory authority Consumer and Market Authority (ACM). This doesn’t mean that heat suddenly becomes cheap. The energy transition costs money, a lot of money. We need to be transparent about this and not create false expectations. Additionally, work is being done on the Municipal Instruments for Heat Transition Act (Wgiw), in which the municipality gets the authority to designate neighborhoods to connect to a heat network. By connecting as many houses as possible within a neighborhood, the construction is less expensive, the network is better utilized, and this will ultimately be better for the end user’s wallet. This is particularly interesting for densely built neighborhoods with many older houses, where it would cost a lot of money to make a house ‘heat pump ready’.
If we add up the transition visions of the municipalities, the goal is to connect 25% of homes in the Netherlands to a heat network. This means that from today, for 26 years, approximately 1000 homes per day would need to be connected to a heat network. With WarmtelinQ (WLQ), we’re taking a big step in the right direction.
WLQ brings residual heat from the Port of Rotterdam to heat networks in The Hague and Leiden. It’s designed for growth, and the idea is to connect 120,000 homes through the heat companies. This film explains what WarmtelinQ does. About 1.5% of homes in the Netherlands will ultimately be connected to residual heat. This involves directly usable heat, leading to 180,000 tons of CO2 reduction per year, 100,000 kg of NOx nitrogen reduction per year, and a saving of 110 million m3 of natural gas. To put it into perspective, this equals 1100 soccer fields of solar panels. Together with a dedicated team, we’re working on the Business Readiness of WarmtelinQ. And with my fellow nlmtd’ers, also on other New Business Projects of Gasunie such as Porthos, Eemshaven Energy Terminal, and Hydrogen Network Netherlands.
