Solihull Lands £9 Million from National Wealth Fund to Power Town Centre Heat Network

Solihull Council has secured vital funding from the National Wealth Fund (NWF) to advance its pioneering town center energy network, a bold step toward a greener future. This ambitious project will deliver low-carbon heating, hot water, and electricity to public and private buildings, reducing fuel costs and ensuring long-term energy resilience in an evolving landscape.

This initiative marks a historic first. It is the maiden heat network to receive backing from the NWF, with a £9.6 million loan provided via its Local Authority function. This low-cost, long-term financing paves the way for installing critical infrastructure in the project’s initial phase, laying the foundation for a sustainable urban energy system.

The project is fully aligned with the NWF’s clean energy mandate and the UK Government’s ambitious goal—to expand the use of low-carbon heat networks from today’s 3% to 20% by 2050. Buildings remain the nation’s second-largest source of carbon emissions, trailing only transport. By scaling up district heating solutions, initiatives like Solihull’s will play a crucial role in decarbonizing the UK’s urban landscape.

Phase one of the network will channel renewable heat and electricity to various public and private sector customers, including Council-owned buildings and educational campuses. Future phases aim to extend coverage to additional structures across the town centre, seamlessly integrating with planned commercial and residential developments under Solihull’s Town Centre Masterplan.

Tasked with bringing this vision to life is Vital Energi, a national leader in heat networks and low-carbon energy solutions. The company will be responsible for the system's design, construction, operation, and maintenance. With a portfolio of high-profile projects such as Leeds PIPES and Mersey Heat, Vital Energi brings expertise to Solihull’s transformative energy network.

Securing this funding milestone was no small feat. The project’s initial capital was provided by the Government’s Heat Networks Investment Project (HNIP) in partnership with the West Midlands Combined Authority, ensuring a strong financial foundation from the outset.

With work underway, Solihull’s energy network is set to become a flagship example of sustainable urban development, demonstrating how collaborative investment, infrastructure, and bold leadership can redefine the UK’s approach to clean energy and climate resilience.

Minister for Energy Consumers Miatta Fahnbulleh said: "Heat networks like this one, which will provide buildings in the heart of Solihull with low-carbon, affordable heat, and electricity, will play an essential role in the clean power transition. By helping homes and businesses in Solihull to stay warm in a cheaper and more efficient way, this investment will help more people feel the benefits of our drive towards clean power as part of the Plan for Change."

Lorna Pimlott, National Wealth Fund Managing Director, Local Authority Advisory & Lending, said: "Heat networks have a key role to play in the nation’s transition to net zero, and we’re pleased to support Solihull Council in this important project. The NWF’s lower cost of finance will enable the council and Vital Energi to deliver the first phase of the heat network on time and within budget, enabling consumers to cost-effectively decarbonise their buildings while providing greater energy price resilience in the future."

Councillor Andy Mackiewicz, Portfolio Holder for Climate Change and Planning, said: "For individual buildings, decarbonising heat is expensive and often disruptive to occupants. A town centre energy network enables existing buildings and new developments to benefit from centrally based low carbon heat generation with minimal disruption and in a cost-effective manner benefitting from economies of scale. It also provides opportunities to install rooftop solar panels that can supply the energy network customers, utilising roof space and ultimately protecting the green belt."

"The real beauty of this scheme is that it can expand through subsequent phases to meet growing demand and link into new buildings and developments. As we progress with the scheme, we anticipate signing up many more customers who will be able to see the obvious benefit it can provide."

"Before embarking on this exciting scheme, we undertook detailed financial modelling as part of the business case, the favourable loan we have been able to secure from the NWF improves the financial case for the scheme which will recover all of its capital investment costs over its lifetime."