Gateshead district energy project earns £1 million boost on demand

A district heat and power project in Gateshead has unlocked a £1 million boost to its revenue after becoming a partner of demand response company, Flexitricity.

Gateshead Energy Company is the operator of the Gateshead District Energy Scheme, which will provide low-cost, low-carbon heat and power to homes, public buildings and businesses across the centre of Gateshead. The scheme is currently being commissioned, and will be fully operational by mid-2017.

Becoming part of Flexitricity's demand response network means the publicly-owned project will receive in excess of £60,000 per year over the next 15 years, simply by using its flexibility to smooth out peaks and troughs in national electricity demand.

Gateshead Council own both the District Energy Scheme and Gateshead Energy Company. Leader of the Council, Martin Gannon, said: "Once we realised that we could bring more revenue into the project by providing capacity to the National Grid - without changing our day-to-day operations - the decision was made for us.

"It's win-win for ourselves and our customers. Not only does it support our business model of providing low cost, low carbon energy to homes, organisations and businesses, but Flexitricity's system works seamlessly with our own, meaning we can provide heat and power to our customers while supporting critical national infrastructure."

Gateshead Energy Company's combined heat and power (CHP) system will add 4MW of electricity generating capacity to National Grid. Within Flexitricity's portfolio, the Gateshead CHP will form part of a virtual power station that's big enough to make a real difference to bills while helping to keep the lights on nationwide. 

The system also helps the Grid absorb periods of excess supply from renewables, putting wind and solar energy to good use and supporting district energy schemes like Gateshead at the same time.

Dr Alastair Martin, Chief Strategy Officer at Flexitricity, said: "District heating projects like this are an exciting low-carbon way of keeping everyone's lights on without impacting on service provision.

"Agreeing this partnership with Gateshead Energy Company is another step towards improving the country's energy security while helping deliver lower-cost energy and heat for its customers."

Flexitricity already works with other district heating providers across the UK, allowing them to add to their revenue streams by harnessing their flexibility to provide additional security to National Grid.