Baxi Heating has partnered with Energy Systems Catapult to pilot selling ‘heat-as-as-service’ in a move that experts believe will pave the way for the low carbon retrofit revolution.

Energy Systems Catapult created a heat-as-a-service offering – called a ‘Heat Plan’ – where instead of buying units of energy (kWh), consumers buy hours of warmth in their home – called ‘Warm Hours’. As part of the trials, Baxi sold a Heat Plan that bundled a new heating system, servicing, maintenance and energy for a fixed monthly price.

Trials were conducted via ES Catapult’s Living Lab, where 100 homes spread among Newcastle, Manchester, the West Midlands, Gloucestershire and Bridgend in Wales are fitted with ‘smart heating systems’ that provide room-by-room temperature control and a wealth of data on consumer behaviour and the thermal performance of the home.

Explaining the decision to develop this Heat-as-a-Service offering, Dr Matt Lipson, consumer insight business lead at Energy Systems Catapult, says: “Our research clearly shows that people care more about heating outcomes – such as getting warm and comfortable – than which device or system delivers the heat. To overcome this impasse, we developed Heat Plans, designed to let people schedule and budget for a specific number of ‘warm hours’ at a fixed price.

“When it comes time to replace their gas boiler,” says Lipson, “they will be more confident of switching to a low carbon heating system like a heat pump, district heat network or hydrogen boiler.”

Jeff House, head of external affairs, Baxi Heating UK, adds: “As society continues to adopt service-based offerings in other sectors it is clear that Heat-as-as-Service has the potential to revolutionise the heating industry.

“In part this model can help to defer the up-front capital barrier associated with many low carbon heating options thereby aiding decarbonisation efforts, importantly it also can help to streamline the customer experience when dealing with their heating provision.”

The households participating in Baxi’s Heat Plan trial were offered a bundled heating system where warm hours instead of kilowatt hours were sold at a fixed price based on data about the thermal efficiency of their home and the number of hours of warmth needed by the customer each week. The price stays fixed no matter what the weather brings, and consumers can see precisely how much it will cost to achieve the comfort they want.

On average in the UK, one in every 20 households need to replace their gas boiler each year. As such, the trial offered 20 households in the Catapult’s Living Lab a Baxi Heat Plan.

Each of the 20 Living Lab households already had smart heating controls installed and were familiar with the concept of ‘Heat Plans’. The results were:

  • 13 wanted to discuss the offer
  • 10 said they liked it and were enthusiastic
  • 1 accepted the offer and had a boiler installed (the only one of the 20 triallist who had an old, inefficient boiler they were ready to replace).

Energy Systems Catapult also tested the performance of hybrid heating systems that combine traditional gas boilers with an electric heat pump.

The performance of these systems was trialled to understand how the system worked with smart controls as part of a Heat Plan and whether consumers could achieve the same comfort levels.

Highlights from the hybrid heating system trial included:

  • More than half of households asked in the Living Lab had never heard of heat pumps
  • Heat pumps were installed in 5 of the 100 homes in the Living Lab, creating a hybrid system
  • Hybrid heating systems achieved the same temperatures and levels of comfort as the gas boiler had done by itself
  • Heat pumps delivered between 6% and 63% of the heating across the 5 different homes (6%, 17%, 44%, 59% and 63%) depending on how each household used their smart controls
  • The household utilising the heat pump only 6% of the time, increased that figure to 51% with some simple advice on reducing the number of manual overrides to their heating schedule, which would force the boiler to frequently kick-in
  • 4 of the 5 homes trialling the hybrid system were open to removing their gas boiler and relying entirely on a heat pump if they could buy their heat as a service, such as a ‘Heat Plan’.