District heating schemes in London are being cancelled because the cost of installing pre-insulated pipes has rocketed

CityWest Homes has abandoned a plan to connect eight properties to the Pimlico District Heating Undertaking because the estimate from utilities contractors was 拢1.7m, 70% higher than expected.

John Green, building services manager for CityWest, said the price hikes were caused by the cost of the pipes and a lack of competition among installers. 鈥淭here was competition for digging the trench, but not for the pipeline. The cost is restricting the growth of district heating.鈥�

David Wickersham, a technical adviser at CityWest, said: 鈥淥ur schemes have failed because we went outside the money we set aside and now we鈥檙e scrambling to get back on course.鈥�

The scheme was to have linked to the government鈥檚 Whitehall district heating system, which heats 18 government offices.

I can understand the frustration about how competitive that market is

Dominic Bowers, Parsons Brinckerhoff

Meanwhile, Southwark council was looking to pay 拢2.5m to refit several kilometres of pipes to residential properties. The price they were quoted was 拢4m.

Bob Fiddik, energy strategy manager at the council, said prices had suddenly risen. Dominic Bowers, director of energy solutions at Parsons Brinckerhoff, said: 鈥淏idders looking to the market are likely to get one or two bids. I can understand the frustration about how competitive the market is.鈥�

He said competition would increase if government plans to increase the amount of properties on district heating networks were followed through.

London鈥檚 Climate Change Action Plan has a target of meeting 25% of the capital鈥檚 energy needs from decentralised sources by 2025.

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