Heat network developer 1Energy has secured £21m of investment from the government for a city-wide heat network in Oxford.1
The company says it plans to initially invest an additional £100m of private capital2 to develop, build and operate the first phase of the Oxford Energy Network.3 Over time, 1Energy said its investment into the project could amount to more than £500m as the network expands to connect more buildings.
Alongside engaging major institutions in the city – Oxford City Council, Oxfordshire County Council, the Zero Carbon Oxfordshire Partnership (ZCOP)4, Oxford Brookes University and the University of Oxford – 1Energy said it is working to advance the network, with plans to begin construction in 2026 following engagement with the local community and securing planning consent.
By initially targeting organisations with high heat consumption, the project could reduce Oxford’s fossil-fuel gas demand by up to 10 per cent,5 said a statement from the group. The group also projects that the network will reduce carbon emissions by 15,000 tonnes a year – approximately two per cent of Oxford’s entire annual emissions – by cutting emissions from connected buildings by up to 81 per cent.
The project will enable the city to decarbonise heating, a major source of air pollution and carbon emissions in the UK.6 Some of Britain’s most iconic, grade-one listed buildings in the city could soon be warmed by low carbon heat rather than gas boilers.
The group said its approach complements the environmental leadership shown by Oxford and ZCOP, aligning with the city’s ambitious plans to decarbonise while respecting its architectural character and historic setting. The network intends to help lay the foundations for a healthier, cleaner future for its residents.
“As well as helping Oxford achieve its climate goals, the project expects to improve the lives of those who live and work in the city by reducing air pollution, improving public health.7 The network is projected to reduce the amount of air pollutants that can cause respiratory problems8 by five per cent before 2030.9 1Energy has established a community benefit task group – that includes major institutions in the city – that is exploring how the network can support community projects, tackle fuel poverty and boost local employment.”
Andrew Wettern, CEO of 1Energy, said: “Oxford is already at the very forefront of city decarbonisation and low carbon energy through the work of the University, and the Zero Carbon Oxfordshire Partnership and its constituent members. We are thrilled to add to this success by enabling the city to decarbonise heat through the Oxford Energy Network.”
“Oxford has more than 1500 listed buildings across the city, so the decarbonisation challenge for Oxford is much harder than many other cities. The Oxford Energy Network matches perfectly to the challenge because it will be invisible and silent, it will supply the temperatures required by these historic buildings to maintain their warmth in the winter, and it will be easier and cheaper for customers to connect to the network than to create their own low-carbon heat onsite.”
“By using the Oxford Energy Network as a model for other historical cities and towns, we can deliver heat decarbonisation in a way that preserves our heritage, across many more cities and towns at pace.”
Civic progress
Home to the Oxford Leading Sustainable Corporations Programme and Oxford Institute for Sustainable Development, the city has some claim to a leadership role in the global conversation around sustainability. World-renowned organisations across the city have also set ambitious air pollution targets and climate goals that require them to rapidly move away from gas boilers.
According to 1Energy, “heat networks offer the lowest-cost, simplest, fastest route to decarbonising heat in cities and towns, requiring the fewest building-retrofit measures.”10
“As this low carbon heat is transferred via underground, water-filled pipes, they also preserve the aesthetic of our historic city centres.”
The firm said it has ambitions to deploy £1bn within the next 8 years into new low carbon heat networks across the UK.
Commenting on the project, Ken Hunnisett, Head of Public Sector at Triple Point Investment Management, one of the partners in its delivery, said: “Momentum is building as private and public sector stakeholders combine to create a truly thriving heat network market. 1Energy’s transformative project in Oxford is a brilliant example of what this kind of collaboration can achieve — delivering significant volumes of heat, improving air quality, and connecting communities, while decarbonising some of the UK’s leading institutions and a University of world renown.
“We are delighted to announce today’s £22 million worth of GHNF support to help get the project off the ground, and we are looking forward to seeing its progress in the coming years as Oxford develops more sustainable living and working spaces.”
Notes
[1] 1Energy secured this investment from the UK Government’s Green Heat Network Fund (GHNF) to assist with the development and construction of the first phase of this network. This public investment represents less than 17% of the anticipated cost of delivering the first phase of the network.
[2] From the DHUK UK Fund operated by Asper Investment Management, an ‘Article 9’ (the highest level of ESG) fund under the Sustainable Finance Disclosure Regulations.
[3] After completing phase one of the Oxford Energy Network, 1Energy plans to expand the network to provide low-carbon heat to the majority of Oxford by 2050, ultimately requiring more than £500mn of investment.
[4] ZCOP is a partnership of leading institutions and employers working to achieve a zero carbon and resilient Oxfordshire by 2050.
[5] Low-carbon heat for the project will come from multiple sources, including heat pumps which will extract heat from Oxford’s air, concentrate it, and turn it into useable heating (like a refrigerator, but in reverse).
[6] Heating accounts for over 21 per cent of Britain’s air pollution (ECIU; Airly) and more than a third (37 per cent) of total carbon emissions (Energy Systems Catapult).
[7] More than 1,100 people a year in the UK are developing the most prevalent form of lung cancer as a result of air pollution (Guardian).
[8] Carcinogenic nitrogen oxides (NOx) and sulfur oxides (SOx).
[9] The network could save 168 tonnes of these air pollutants over a 20-year period, which is equivalent to taking 7,000 domestic boilers out of use.
[10] While not every network is the same, Innovate UK estimates that connecting to a heat network could cost 60-80 per cent less than installing individual building-level heat pumps and running costs could be 30-40 per cent lower (Innovate UK: p.31).
[11] Funding that qualifies as ‘Article 9’ under the Sustainable Finance Disclosure Regulations. The most stringent classification, these funds are required to have sustainability as their primary objective. Less than 5% of institutional investor funding is ‘deep green’.
