Scheme Summary
This scheme is a retro-fit community energy network using Combined Heat and Power (CHP) to service over 700 dwellings on an East London estate, a nearby leisure centre/swimming pool and the local primary school. The scheme has been awarded the Transco Industry Award for Best Use of Gas, in recognition of its environmental goals and energy efficiency.

Scheme Details

Tower Hamlets Council and London Electricity Services worked in partnership, over three years, to develop an innovative approach to delivering the Energy Services. Heat, hot water and electricity will be delivered to four high rise and several low rise blocks that were mainly built in the 1950/60's. The 1.4 MWe CHP engine is sized to the winter heat load to allow a higher energy generating capacity.

The scheme is being implemented in two phases: Phase 1 provides both heat and electricity to 539 homes from February 2001. Phase 2 (from the end of 2007) will add around 160 homes to the scheme when individual boilers reach the end of their useful life.

The CHP unit is located in a refurbished energy centre on the estate. The energy centre dates back to the turn of the century and was used until the 1960's. This project has secured the conservation of a heritage building. A small visitor centre within the Energy Centre gives visual access to the plant and monitoring equipment.

The Barkantine Heat and Power Company has been established as a subsidiary of London Electricity Services to construct and operate the energy network and deliver energy services over a 25 year contract term.

Energy Efficiency

The new CHP-based system will be 30.4% more efficient than if the estate's heat and power needs were met using individual central heating systems and the national grid. It will help reduce the residents' total carbon dioxide emissions by 30% or 2,942 tonnes per year.

A computerised fault monitoring system will assist the operator in maintaining a reliable supply. Two large hot water storage cylinders at the Energy Centre are used as a heat 'dump' to enable the CHP unit to generate electricity at times when there is no hot water demand from the customers. The hot water stored in the cylinders can meet later heat/hot water needs.

In place of a wall-mounted boiler, residents have a heat board comprising a heat connection, programmers and meters. Hot water supplied to the board is directed to the radiators and the domestic hot water cylinder. Remote reading of meters enables individual billing according to consumption.

The energy services scheme was introduced towards the end of a five year Estate Action refurbishment programme which comprised roof and wall insulation work, window renewal, concierge and heating improvements. The refurbishment work improved the thermal performance of the homes and reduced residents heating costs.

The addition of the heat and power network will secure additional savings to residents' total annual heat and power bills.

Management and Costs

The Council set the electricity tariff in the service contract. The tariff charged by the Barkantine Heat and Power Company must be at least 20% less than the average of the cheapest ten alternative electricity suppliers to the area.

To ensure an accountable and reliable service for residents, an elected residents consultative committee is in process of being established. An Operating Committee comprising Council and Company representatives will deal with technical and service issues.


Tower Hamlets Council secured funding for the initiative from the Department of the Environment, Transport & Regions as a Pathfinder to demonstrate using the Private Finance Initiative (PFI) for Energy Services schemes.

The financial viability of the scheme is secured by ensuring enough properties are connected to support operational costs through heat and power sales and by exporting surplus power to the national grid.

Developer's Comments

This scheme was progressed in support of the Home Energy Conservation Act. Whilst the Act provides no new money or powers, it does require Councils to focus on a domestic energy use reduction strategy.

In 1996 Tower Hamlets' strategy demonstrated that protection, modernisation and extension of its community heating asset (adding CHP/renewables where possible) was one of the most effective ways to reduce environmental damage and assist Fuel poverty.

The whole scheme emerges as a highly sustainable solution for this mixed inner-city estate, and one that is highly replicable now that a 'path' has been found through the PFI regulations. The PFI deal was signed with London Electricity Services in March 2000 and construction started in June. The communal heating network came on-line in November 2000 and the CHP was energised by February 2001.

Tower Hamlets Energy Efficiency Unit,
Lesley Muggeridge

London Electricity Services,
Mark Hearn