SHEAP Prepares for Transition as Lerwick Power Station Shifts to Standby

Shetland Heat Energy and Power (SHEAP) is bracing for significant adjustments as the nearby Lerwick Power Station (LPS) prepares to enter standby mode in 2026. This transition follows the connection of the local grid to the Viking wind farm and the subsea High Voltage Direct Current (HVDC) cable. Currently, LPS provides between three and five percent of SHEAP’s annual energy needs through excess heat, which has been vital during peak demand periods, especially in winter.

The impending shift will not leave SHEAP in the dark. A new 68 MW battery park is under construction in Lerwick, designed to provide backup power during potential outages in the electricity supply system. The managing director of SHEAP, Derek Leask, emphasized the role of LPS in the organization’s energy mix, stating that the additional heat has been a “useful top-up,” particularly when the Gremista energy recovery plant (ERP) is offline for maintenance.

Strategic Upgrades and Future Prospects

SHEAP is proactively planning network upgrades to enhance the efficiency of heat utilization from the ERP. Leask noted that these upgrades include transitioning certain areas of town to lower-temperature loops, which effectively reduces overall heat demand. He characterized this initiative as a modest investment that yields significant benefits.

Despite the upcoming changes, LPS will maintain an operational role by firing up once a year during grid maintenance. This operational strategy aims to coincide with ERP shutdowns, ensuring that waste heat can still be utilized, minimizing energy loss.

Looking to the future, SHEAP is engaging with renewable energy companies interested in establishing new infrastructure in Lerwick. Leask expressed optimism about these potential collaborations, stating, “The hope is that in time these projects will give us additional streams of waste heat for the network, which will make it even stronger and more sustainable.”

Regulatory Insights and Community Benefits

In a related development, SHEAP is hosting a visit from Ofgem’s heat networks regulatory team. This visit is part of preparations for new UK-wide regulations for heat networks, set to be implemented in 2025 under the Energy Act 2023. The framework will bring heat networks under Ofgem’s regulatory oversight for the first time, introducing stronger consumer protections, fair pricing standards, and improved service obligations.

Leask highlighted the significance of this visit, indicating that it will give the regulator first-hand insight into SHEAP’s operations, the benefits of district heating for the local community, and the implications of forthcoming regulations for both consumers and operators. As SHEAP continues to adapt to these regulatory changes and energy landscape shifts, it remains committed to fostering a resilient and sustainable energy network for the Shetland community.