The comments came as the council announced plans to scrap a proposed extension of the network which already provides hot water through insulated pipes to hundreds of low-income households – eliminating the need for gas boilers or electric heaters.
A senior opposition councillor warned the authority should continue to be prudent – lest it finds itself in a position like Nottingham Council, which had to write off more than £20m in bad debt last year for its now-defunct Robin Hood Energy company.
Leeds City Council’s executive member for environment Coun Helen Hayden told a meeting of senior councillors this week that a recent decision not to extend the Leeds District Heating Network (DHN) to an area south of the city centre would help to keep the scheme financially viable.
She said: “I am really proud of the DHN and what it has achieved. We have 2,000 council flats benefiting from district heating and civic buildings online – nine more organisations have come forward.
“We are progressing better than we forecasted and it’s been a real success story. I’d like to thank everyone who has been involved.”
As part of the council’s efforts to regenerate the south bank of the River Aire, it approved plans back in 2020 to extend the DHN into the area, and even secured a multi-million pound grant from the Heat Networks Investment Project (HNIP) to help make it happen.
However, the council now claims that the plans put too great a financial strain on the network, due in part to a lack of demand.
Coun Hayden added: “The extension (plan) was brought forward in July 2020, it is proposed we no longer go ahead with it – partly down to even better building development proposals from developers, and increased carbon reduction techniques and the need for less heat.
“We don’t want to pose this as a risk to Leeds PIPES in totality.”
Leeds PIPES DHN is formed by a series of insulated pipes which carry heated water heated by the Recycling and Energy Recovery Facility in Cross Green.
Water is heated by steam created at the plant by burning non-recyclable household waste. It is then taken via two insulated pipes, with one carrying the hot water to homes, and the other returning the water to the plant.
It is currently connected to 2,000 homes and numerous civic buildings in Leeds.
Coun Barry Anderson (Con) said: “I think this is good moving forward. It’s good to see it is coming into profit quicker.
“We don’t want this to turn into another Nottingham. There is no indication that it is, but we need to safeguard ourselves in case that might occur.”
Nottingham Council set up Robin Hood Energy in 2015 as a council-owned not-for-profit company to help tackle fuel poverty in the city.
RHE made huge losses over the years, leading Nottingham Council to write off a debt of £24m last year, before the plug was eventually pulled on the company.
Coun Hayden said: “(We are) managing the risks and taking it incrementally, not just ploughing ahead with something that might put the whole project at risk.
“It tackles fuel poverty and food poverty and puts money back into the pockets of our most deprived neighbourhoods.”
The 10-kilometre district heating network was installed in Leeds back in 2019, and provided heat to Leeds Playhouse and council tenants in multi-storey flats.
According to a report from Leeds City Council officers, “at least nine new buildings” connected to the network in the past year. These include Leeds Town Hall, Civic Hall, City Museum, Art Gallery and Library.
It added: “Ongoing discussions, with a range of potential customers who are interested in connecting in the next few years, ensures that the network is set to establish itself in the city and become one of the largest networks being developed in the country.
“The increasing number of early adopters connecting to the network will result in higher annual levels of carbon savings across the city and ensure the DHN can play a key role in contributing to the council’s climate emergency ambitions of becoming net zero by 2030.”
The report added that, while the south bank extension may not be workable at the moment, there may be opportunities in future to expand the network into that area of the city.
Despite this, councillors agreed to to commit to further investment supporting a new bid to the HNIP to build an extension to the pipes to the Wellington Street area of the city.