Despite continued advocacy since the turn of the century, there has been negligible adoption of combined heat and power (CHP) for district heating (DH) in Britain. This paper summarises the treatment of the option and suggests a framework for explanation. The long neglect of CHP/DH can be explained neither as the result of a conspiracy among existing energy institutions, nor in terms of an unfavourable but rational assessment of its economic potential. It requires instead a historical and structural analysis of the context: the energy sector and its broader social and economic role. The activity on CHP/DH that can be traced must be situated in the development and relations of key organisations – the electricity industry and central and local government. The paper thus addresses both the apolitical and technocratic character of much energy policy writing, and acontextual accounts developed in certain recent contributions to a ‘new sociology of technology’. If you need to write a paper on economics, our Writing service online will help you.

It is inherent in the process of producing mechanical and hence electrical energy from a heat engine that much of the energy input is released as relatively low temperature heat. By various techniques it is possible to produce reject heat at a temperature useful for space heating or industrial process heating, giving a much higher overall efficiency of conversion and saving fuel over separate production of electricity and heat. Heat from combined heat and power plant, or from another central source, can be piped in the form of hot water or steam to users’ premises, in ‘district heating’ networks.

The basic techniques of CHP and DH were devised at the end of the last century. Many of the technical and economic problems, the economic and social merits and disadvantages, and the different ways of assessing them, were rehearsed by early this century. It is well known that large scale DH with CHP sources is used extensively in other Northern Hemisphere countries, notably in Scandinavia, Eastern Europe and the USSR.Yet in Britain, only a limited number of mostly small heat-only DH schemes are found, and CHP/DH is virtually non-existent. Electricity production and the provision of heat are almost entirely separate activities, physically and institutionally.

This paper explores the social processes which have led to the virtual absence of CHP/DH in Britain. It has two objectives: first, to give a brief account of the treatment of the CHP/DH option in the country; and second to argue for a particular approach to explaining this absence.

Before the study on which this paper is based, no comprehensive account of the history of the option in Britain existed. That reflects a general tendency in historiography and contemporary depiction to rationalise actual social arrangements as somehow natural and inevitable, and to ignore alternatives which remained undeveloped. For similar and more specific reasons an even stronger determinism operates in accounts of technological developments. Thus CHP/DH has been almost entirely written out of histories of the British energy sector.

CHP became topical again in Britain in the 1980s, and indeed found itself at the intersection of a number of debates and advocated by a variety of groups. Yet there has still been little attempt to understand and learn from the long and sorry history of its neglect, and implicit explanations remain inadequate. Advocates of the technique, frustrated and unable to understand why such an obviously sensible technology has not been taken up with enthusiasm, have often resorted to accusations of a deliberate plot on the part of the energy industries and related sections of government to suppress it. On the other hand, government and the electricity industry have taken the line that they have never been opposed to the option, but that its economics has been assessed rationally and that if there is little in existence, that is nonetheless the economically optimum level; particular circumstances in the country must mean that it is unsuitable.

There are valid elements in both views, but, as we shall see, they do no more than scratch the surface. Neither a positivistic view of economic rationality, nor a conspiracy theory, are adequate. I shall try to demonstrate that an explanation of the neglect of CHP/DH requires instead a historical and structural analysis of its context: the energy sector and its broader social and economic role. The little activity on CHP/DH that can be traced must be situated in the organisational and technical development of the key institutions – the electricity industry and central and local government – and developing relations between them. These characteristics and relations must in turn be linked to the specific character of the British economy and state. Somehow CHP seems to have found only a limited role and precarious existence in very specific circumstances in the interstices of the sector – or simply fallen in the gaps between the existing institutions. That it should have been left to such a fate and never established a firm institutional base, itself needs explaining.
A number of points could be drawn out of this account and argument for energy policy and for political action to achieve change in the sector. The relation between the institutional structure of the sector and the fate of alternative technologies and other initiatives, should have been an important focus for research in the wake of the 1970s energy crisis. It ought to become such again as countries try to tackle the implications of the greenhouse effect. For this audience, however, I want to concentrate on the framework of analysis.

The history of CHP and DH in Britain falls reasonably neatly into four periods: up to 1940; the 40s and 50s; the 60s and up to the mid 70s; and from the mid 70s onwards. The character of activity in these four periods was markedly different, and this was in turn dependent on sharply differing conditions in the sector.

I: Early History
British technical journals around the turn of the century carried discussion of American experiments in DH and accounts of the early US city steam networks. Some British engineers had visions of combined heat and electric lighting stations capable of supplying whole neighbourhoods, and expressed frustration at the lack of opportunities and the perceived reluctance of local authorities or property owners to take up the general idea or specific proposals. Some pressed their case to official bodies like the Royal Commission on Coal Supplies in 1903. There are scattered references in journals and public records to proposals and occasionally to actual schemes for heat supply using either engine waste heat or live steam taken from boilers at times of low electrical load. Thus in 1917, St Marylebone Electricity Department in London was supplying the Public Health Committee’s ‘disinfecting baths’ for ‘verminous persons’ with steam from its power station boiler house, the former finding the arrangement ‘remunerative’ and the latter saving itself ‘considerable expense and trouble’. But such schemes remained curiosities – notable because they were exceptional.

Manchester Corporation developed the earliest significant supply scheme, providing steam from its city centre power stations to nearby office blocks and factories from 1911, first taking ‘live’ steam from the boilers and later bleeding steam from the first condensing turbines installed in WW1. The use of the stations declined in the 20s, particularly when none were ‘selected’ for inclusion in the Central Electricity Board’s national coordinated generation scheme; supply was nonetheless maintained for some years by live steam, and in the case of Bloom Street, for several decades with special heat-only boilers.

Manchester also experimented early on in the suburbs of Blackley and Gorton with central supply of hot washing water, as the provision of ‘working class dwellings’ grew rapidly in the 20s. Beset by technical problems and with disappointing economics, these schemes were abandoned after a few years in favour of individual boilers. Local authorities’ housing programmes in the 20s might also have been expected to provide opportunities for early attempts at networks for space heating. But the single coal fire was the rule, and the one significant example of DH, the exception. Dundee Council installed two schemes in its first housing estates, providing an unusually high standard of heating and hot water.But the economics of the schemes came in for criticism early in their life, and the controversy continued for decades. They were virtually the only examples to which people interested in DH could turn for operating experience and actual costs, while they arguably had permanently to bear the consequences of mistakes in planning. A case could have been made that the economics, if itself marginal, was promising for other schemes, and that they had been technically reasonably successful. But the Dundee experience did not persuade other local councils to follow its lead.

Fuel shortages and rationing after WW1 produced a spate of interest in CHP among British engineers and government officials. Efficiency of fuel use was the dominant concern of government inquiries in the sector in the interwar years. While in industry the practice of utilising engine exhaust heat grew, and a number of small group heating schemes were introduced in hospitals, military bases and other institutions, little was done to encourage them; instead the widespread view was that private electricity generation would probably and rightly disappear in favour of supply from the growing public system. The cooperation necessary between authorities which might supply heat and those with a potential use for it, seemed difficult, and success rare and short-lived.

Clues to the failure to take up CHP more seriously can be gleaned from the deliberations of engineering institutions, with distinct divisions apparent by the 1920s. Electrical engineers, most in the employ of electricity undertakings, argued strongly and almost exclusively for the trajectory of increasing electrical efficiency through larger turbines with improved steam conditions. Many small generating stations were being scrapped and supply consolidated into larger public stations, a process encouraged during WW1 and which underlay the approach of the committees tackling the reorganisation of the supply industry.Some engineers professed sympathy for the idea but stressed practical problems and doubtful economics; others explicitly regarded CHP as a ‘retrograde policy’. Many felt they had enough problems without taking on a dubious second function, incidental to their main activity. The Electricity Commission, an agency set up in 1919 to coordinate and attempt to rationalise the chaotic structure of the industry, with its multitude of small private and local government undertakings, barely ever mentioned it.

A handful of heating engineers and a few remaining general engineers questioned the wisdom of the dominant trend and continued to advocate CHP throughout the 1920s and 30s, by lobbying central and local government and through the professional institutions and the press. They stressed the advantages to be gained: fuel saving, labour-saving, smoke abatement, and improved living conditions, and they were able to publicise the early experience of US, continental and Soviet schemes. They continued their efforts through the war years and beyond. They finally began to make some impact through participation in central government advisory bodies, which relied heavily on outside expertise for many subjects, and in acting as consultants to local authorities in their planning for postwar reconstruction.

II: The 1940s and 1950s
The period of planning for reconstruction, from the mid war years on, provided the context for both widespread interest in CHP/DH in Britain and good opportunities for its introduction. Support had grown for greater state intervention in the economy, and to provide better living conditions. Wartime controls and planning mechanisms accelerated long-term trends in the growth of state powers and responsibilities. 1945 saw the return of a Labour government committed to a programme of building a mixed economy and welfare state. Physically, the destruction of city centres, slum clearance programmes, and plans for new towns and suburbs, presented opportunities to introduce innovative and improved infrastructure and services. In addition, severe fuel shortages made efficiency in energy use a major concern.

To trace the treatment of CHP/DH we need to follow the actions of government departments, especially the newly constituted Ministry of Fuel and Power, small but initially keen to take on coordination of the energy industries, and the Ministry of Health, with overall responsibility for the new housing programme; the electricity supply industry and other energy industries; local authorities, responsible for public housing and for the implementation of much of the welfare state apparatus decided and directed centrally, and with new planning powers and duties; and advocates of CHP and DH among heating engineers, who catalysed early efforts to introduce the option. And we need to focus on several arenas, overlapping and to a great extent containing the same groups and often the same key individuals and variants of the same arguments. These were expert committees; legislative processes; professional and public debate; negotiations over specific schemes; and importantly, since none of the major actors were monolithic in their approach, internal debates and processes in each organisation.

In advance of government initiatives on CHP and DH, major ambitious proposals were put forward by local authorities, for London – three schemes, for the City, the South Bank, and the north bank area of Pimlico – large new suburbs of Birmingham and Manchester, and the centres of Bristol and Coventry. The schemes ranged in maximum demand from 25 to 400 MWh. Likewise usually prompted by heating engineers acting as consultants or serving on advisory committees, another seventy local authorities elsewhere at least considered schemes for specific areas between 1940 and 1955. Many were stimulated by initially positive pronouncements from central government in 1946. Of these about 35 reached the stage of preliminary plans and costings. Several – such as those at Swindon and Darwen as well as the major city plans – originally envisaged CHP sources, often because of the proximity of a power station but in some cases involving building and running their own, and others anticipated an eventual link up to a larger CHP/DH scheme. Schemes were considered for six new towns.

Each of the major schemes ran into criticism as costs escalated, and underwent major revisions in an attempt to keep them afloat. They hit difficulties with the electricity supply industry over CHP sources. One by one, for a variety of contingent reasons, they were cut back to more modest pilot ventures. With local authorities’ still rather weak planning powers, city centre schemes were crucially dependent on decisions outside their control on major commercial and institutional heat loads.

Since local authorities had no general powers for DH or for generating electricity, they had to promote Local Bills in Parliament. Some 30 councils had obtained powers by 1955. Though standard provisions were worked out over the first few examples, the process remained long and discouraging. The end result was a reasonable compromise in terms of the demands of the contending interests, but in effect a further deterrent: it included provisions for strict accounting to prevent any hint of subsidy (largely at the insistence of the gas industry, which vigorously opposed the Bills, and arguably far more stringent than the energy industries themselves were ever subject to), central sanctioning of the scheme and control of technical specifications, and often restricted and fragmented areas of supply, ironically pressed for by neighbouring authorities.

The precarious economics of all the schemes was reflected in marginal political support in the councils as each came up repeatedly for reevaluation. The local authorities sought stronger guidance from central government and guarantees against losses, but failed to obtain either. Most schemes were abandoned, and it is debatable whether they were killed off from within or outside.

While some of the earliest initiatives on CHP and DH came from central government, especially from Fuel and Power, its role was characterised by ambivalence – reflecting conflicting interests and opinions within government and among advisers – and a steady retreat from any idea of a strong coordinating role in the sector.

A committee set up by the Department of Scientific and Industrial Research in 1942 started a major study looking at the national potential of the option and intensively investigating technical and economic details. The final report could have been an important stimulus to pursuing the adoption of CHP/DH in a truly national instead of piecemeal programme. But with long delays caused in part by differences between electrical and other engineers in the group, it did not appear till 1953. By that time most of the major proposals had already been shelved, including those it took as models. Though impressive in technical analysis, the report lacked any sense of strategy, and its exhortation to push ahead urgently with pilot schemes must by then have seemed to different parties either painfully ironic or quaintly anachronistic.

Signals on DH from the Ministries to local authorities were inconsistent. The Ministries’ weak support, and all sorts of actions and inactions on their part, contributed to the difficulties of the plans and pioneer schemes – like their lack of technical guidance as the DSIR deliberations dragged on, their refusal to underwrite the ventures, their acceptance in Local Bills of strictly separate accounting, their reluctance to promote general legislative powers, and later cutbacks in the housing programme. Early pronouncements from the Ministry of Fuel and Power and to a lesser extent the Ministry of Housing actively encouraged proposals. But government records show that Housing’s enthusiasm for DH declined sharply as shortages of materials, money and labour bit hard in the late 40s. After sanctioning a dozen schemes by 1947, it then decided to stick to that number as a limit, and by 1948 had an unofficial policy of actively discouraging further proposals. The Ministry of Town and Country Planning, in control of new towns, dropped its support for DH in 1950.

The newly nationalised electricity supply industry initially had open-minded discussions at the highest level on the possibility of its own CHP stations, but had no time to formulate an explicit policy before it was caught up in responding to local authorities’ proposals and their Local Bills. The British Electricity Authority did its own feasibility studies, and genuinely pursued a few promising possibilities, albeit as a side show. As late as 1957 it evaluated, at first very favourably, a major scheme from Bankside on the south side of the Thames. Publicly the BEA remained mildly pessimistic but was prepared to consider ideas brought to it. Privately, its attitude slowly hardened as the implications of CHP stations outside its ownership, or of CHP operation of its own stations, became clear. Its action became consistent though it never declared a firm policy; it treated each proposal ‘on its merits’ – essentially, however, physically and in policy terms as an adjunct to its main activities and strictly without subsidy. It could thus argue that it had discharged its responsibility under a weak and ambiguous provision under its establishing Act to ‘investigate’ CHP.[25] It was able to depict poor progress on CHP, usually quite legitimately, as a result of poor economics, but ignoring of course the context and difficult conditions surrounding such projects and its own role in setting those.

Interest in CHP, and increased pressure to introduce it, came at a time of fundamental rationalisation and reorganisation of the industry, and the option suffered because it got caught up in three overlapping issues of major importance to electricity supply development in Britain: coal shortages and conservation; the need for an urgent programme to build generating capacity, after inadequate construction and maintenance in wartime and with rapidly increasing demand; and above all the process by which the BEA, like the other nationalised industries, worked out its terms of operation and particularly its working relation to its nominally controlling Ministry. It sought to flesh out the vague mandate of the Electricity Act on its own terms: to establish its independence, a pattern of increasingly commercial terms of operation, and freedom from socially defined obligations.
Central government showed a reluctance to interfere with BEA plans and negotiations, part of a general retreat from around 1948 from what had been envisaged as an active planning, policy setting and coordinating role. This policy of non-intervention found more open expression after the election of a Conservative government in 1951. The extent of this reluctance actively to plan and coordinate the sector – indeed antipathy within the permanent bureaucracy – can be seen most clearly in its dilution and avoidance of recommendations in the already ambivalent and inconsistent Ridley report of 1952.

Thus a joint BEA / Ministry of Fuel and Power working party on CHP which operated from 1952 to 1955 steered completely clear of questions of national potential or policy.[27] It carefully considered the few proposals still alive by then, and costed some of its own. When the BEA did come under some pressure from the Ministry – partly because of the eventual release of the almost forgotten DSIR report on CHP/DH – to embark on a handful of industrial schemes, like the CHP turbines eventually installed at Spondon to supply steam to British Celanese, it reacted with annoyance. Chairman Walter Citrine handed back to the government a decision on policy – whether the BEA should be subsidised to run operations which might be justified in terms of coal savings for the nation but were uneconomic for the organisation. Such a decision never came; indeed the Ministry finally withdrew from active promotion and subsequently deferred to the BEA on the matter. The BEA was able to continue to handle CHP case by case with the sort of stringent economic appraisal that was not applied to its mainstream activities till years later. CHP was seen as marginal to the main thrust of the growth and operation of the supply industry in large centralised condensing stations, increasingly remote from major heat loads. As that paradigm became entrenched, CHP could only be contemplated or accepted if it did not interfere with the main business – to the extent that such alternative forms of generation could exist in the physical and organisational interstices of the growing industry, in a specific combination of conditions that became ever more unlikely.
The eventual outcome of the visionary plans for heat networks in major cities and the many smaller proposals around the country was a pathetic handful of DH schemes. Many were much reduced from their planned size. They were fated to run into severe technical and financial problems, criticism for their somewhat paternalistic mode of operation and lack of consumer control, and escalating costs to operating authorities and users. Few further schemes were contemplated in the 50s and 60s, and fewer installed. The coal and gas industries which had opposed the schemes, anticipating competition in the domestic market, were little affected. A few small networks were installed by the Ministry of Works at military bases and in public building complexes; ironically one of the most successful economically was an 11MWh scheme serving government buildings in Whitehall itself. The electricity supply industry ran a couple of industrial heat supply schemes. Of the major city plans the only remnant was the Pimlico scheme, supplying a set of housing estates across the Thames from a small back-pressure turbine tacked onto Battersea power station. Completed in the 60s, it was, as one observer suggested, best ‘regarded as the seizing of a convenient opportunity rather than a typical development’. For years the only CHP/DH scheme to which those interested could turn for experience, much studied and visited, Pimlico was actually a continuous headache for the BEA and its successors, committed as it was to a 30-year supply. Both the Authority and the controlling Westminster City Council were reluctant to provide operating costs or otherwise discuss its merits in public.

III: The 1960s and Early 1970s
The mid-60s saw a revival in the fortunes of district heating in Britain, remarkably in a period of little concern over energy conservation or socially defined objectives in the sector.[31] The reasons for the resurgence of interests can be found in two developments. The first was a new wave of housing construction, often as system-built and high-rise blocks, as well as planning for a further batch of new towns and expansions of existing towns to accommodate city overspill. DH seemed to fit the times: it appealed to architects and local authorities as part of rationally designed services; it offered the higher heating standards being widely advocated; would help combat air pollution; it could alleviate pressing refuse disposal problems; and it promised cheaper heat after poor initial experiences with, for example, electric underfloor heating. The second factor was the changing pattern of the competitively structured domestic energy market – providing commercial incentives largely within the existing organisational structure – and here we find the attitudes and roles of some of the fuel industries markedly changed. There was little political impetus and none of the upheaval in the sector which characterised period II.
There was indeed little central government involvement except in cooperating to remove some minor financial and administrative obstacles and tidying up the legislative framework. The Ministry of Public Buildings and Works gave something of a technical lead and again evaluated DH for new towns; Housing and Local Government responded to demand from local authorities with advice; and Power made favourable noises. The spread of DH had little to do with the primary concerns of government energy policies at the time. It was indeed a time of optimism – so misguided as it turned out – with an exclusive emphasis on the production side, to ensure ‘ample efficient and cheap’ supplies of fuel for continued economic growth and prosperity. The main problems anticipated were in adjusting the mix of ‘four fuels’ to ‘exploit the new opportunities’ of cheap natural gas, oil and nuclear power ‘to the greatest benefit of the country’, and in avoiding social dislocation – particularly from the run-down of the coal industry.

DH this time was caught up in the manoeuvring of the energy industries over the domestic market, among the competitive advertising, discriminatory tariffs and connection charges, or threats and accusations of such, which as some commentators observed, verged on the absurd and produced irrational results. Once again, the chances of the option succeeding, as with other marginal projects, were crucially dependent on the particular terms of appraisal applied, and hence on the detailed financial conditions of the industries’ operation. These relied increasingly on economic theory but at the same time were manipulated by government in trying to tune the economy in ways which often conflicted with that theoretical basis.

The National Coal Board, worried about the loss of its dominance of the domestic market, helped rekindle discussion on DH in the mid-60s, and started offering heat services to large consumers – designing, installing and managing solid fuel based systems. The oil companies quickly followed suit, and from 1966 a spate of heat service companies competed to offer local authorities and other institutions a complete and tempting package.[34] The revival was helped by technical developments particularly in piping which reduced heat losses and improved reliability. Between 1956 and 1973 a further 19 authorities obtained DH and electricity generation powers in Local Acts, including the Greater London Council to cover all the outer London Boroughs, and in 1976 the government finally passed general powers superseding these.

Some of the early schemes were sizeable, like the 14MWh Billingham centre project on Teesside, and the Nottingham scheme, a prototype joint public sector venture which used coal and refuse sources totalling 75MWh and included a small CHP component.Several university and hospital schemes had loads of over 50MWh. Besides these, there were several hundred district or smaller ‘group heating’ networks. The rate and extent of DH introduction is difficult to estimate, mainly because contemporary accounts often optimistically mixed proposals with actual installations, and little reliable data was produced on the latter. Many plans were cut and some abandoned. Introduction peaked in the mid-70s. For the coal industry DH barely made a dent in the steady fall in its domestic sales.

Many of the multitude of scattered schemes ran into problems, in terms of both technical performance and operating costs and charges, often attributed to limited experience and cost-cutting in design, installation and maintenance. With cheap natural gas as an alternative, the conditions in which DH remained truly economic were again probably exceptional, but a dearth of systematic data on performance makes this hard to assess. Unreliability, technical failings and costly repairs; high charges and accumulating debt; the additional tasks and problems for housing managers in administering the only utility not vested in another state body; and lack of consumer control and of an acceptable heat meter; all combined to engender widespread dislike of DH among consumers and authorities. It produced, as one observer commented, equally fervent opponents to match the advocates of the technique. The resurgence of the technique in Britain had declined by the early 80s. The worsening economics and unfavourable reputation turned local authorities away from it – ruling out further schemes and dismantling some existing ones – just at the time that the idea of city-wide CHP/DH of a national scale was revived in the wake of the oil crisis of the mid-70s.

The electricity supply industry again found itself under pressure in this period to consider CHP. Set in its ways of building large remote stations, now often nuclear, the CEGB never seriously considered CHP as more than a sideline. It made few initiatives of its own. It was sometimes dismissive, but on the whole it dutifully, if cautiously and conservatively, considered proposals brought to it from outside. Stung by its experience with Spondon and Pimlico, it saw itself perfectly justified in continuing to insist on strict and demanding economic criteria which it found few schemes could meet. Few ideas reached the stage of detailed evaluation, and fewer still were published. For schemes to be run outside the public supply system and exchanging power with it, the Board was keen to avoid any extra cost, and its terms of buy-back were often perceived as discouraging and unfair; while it insisted that its offers had not significantly worsened the already shaky economics, critics maintained they had tipped the balance.

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