As the UK races towards the 2050 Net Zero target, rural communities risk being left behind. But the LPG sector’s infrastructure investments are shaping a renewable-ready sector for off-grid homes and businesses, explains Megan Healy
A mixed-technology future for off-grid heating
While the majority of net-zero headlines and the clean energy debate centres around electrification, for the UK’s 1.5 to 2 million homes off the gas grid the transition is more complex. For many of these homes, often older, rural, and hard-to-treat, the adoption of heat pumps presents multiple barriers.
According to the Department for Energy Security and Net Zero (DESNZ), 20% of rural homes are technically unsuitable for heat pumps.1 Independent research commissioned by trade association Liquid Gas UK suggests that up to 36% may face additional technical and financial barriers,2 such as a potential £32,000 retrofit cost for heat pumps in some off-grid properties.3
Other issues include capacity limitations with the electricity grid, particularly in rural locations. An aging infrastructure, much of the grid dates from the 1960s or earlier and has long lead times for grid expansion – planning approval and construction for grid reinforcements can take 7-14 years, creating a backlog of projects. With the demand for electrification expected to double by 2050,4 there is a strain on distribution and transmission, particularly during peak usage periods.
The UK’s LPG sector is one industry stepping up to provide a solution for these off-grid properties, having committed to a renewable future.
Across the sector, there’s growing momentum in the demand for renewable liquid gases, particularly those readily compatible with existing supply chains like bioLPG.
Produced from sustainable carbon rich feedstocks including used cooking oil, agricultural residues and municipal waste, bioLPG offers an immediate and low-disruption route to decarbonisation.
Achieving up to 90% reduction in carbon emissions compared to conventional LPG and heating oil , these ‘drop-in’ gases are chemically identical to traditional LPG, making them a straightforward heating alternative for off-grid properties and applications that are unsuited to electrification.
Advancing the renewable readiness of the liquid gas sector relies not just on the fuels themselves, but on the infrastructure that enables their storage, movement, and availability.
Major LPG suppliers such as Flogas Britain are laying the groundwork for a renewable-ready transition by upgrading key distribution hubs, expanding storage capacity, and making strategic investments that will shape the energy mix for decades to come.
Ivan Trevor, Managing Director at Flogas Britain, says: “Achieving net zero requires a balanced approach.
“Electrification is a key piece of the net zero journey but is not a viable solution for hard-to-abate properties and high-heat industrial applications. Renewable liquid gases provide a flexible and scalable lower carbon solution that works with existing boilers, tanks and appliances, and alongside other technologies.”
To facilitate this transition, pivotal investments are being made at two major storage and import facilities: Avonmouth in the Southwest and Teesside in the Northeast, demonstrating the industry’s commitment to a net zero future.
Storage at Avonmouth
At Avonmouth, Flogas has successfully repurposed a former liquid natural gas (LNG) peak-shaving facility – where excess natural gas is stored to meet peak energy demands – transforming it into the UK’s largest above-ground LPG storage site.
Capable of handling 34,564 tonnes of LPG, the redevelopment has already seen the conversion and commissioning of a 17,000-tonne tank, with plans underway to recommission a second tank for further storage. Additionally, a new jetty will be built at Bristol Port, and a 6km pipeline will be laid to facilitate seamless upstream transfers of imports and storage to the site.
Due to the chemical similarities of bioLPG with traditional LPG, the facility is readily-capable of storing and distributing renewable fuels with minimal technical changes.
“The facility is ready to take bioLPG today, and future-proofed in terms of handling other low-carbon fuels, such as rDME and potentially ammonia, with minimal technical modifications,” Mr Trevor explains.
Importing energy security
With limited domestic production of bioLPG, currently around just 3,000 tonnes annually, imports will play a critical role in scaling up the UK’s renewable supply, says Mr Trevor.
“Avonmouth’s future import capacity of up to 500,000 tonnes per year opens the door to global markets, particularly the United States, which has a more developed bioLPG industry and abundant feedstocks.
“With a different pace towards their own energy transition, producers in the US have a growing interest in co-production and a stronger financial incentive to focus on exports,” he explains.
Mr Trevor highlights that while bioLPG imports from the US will be key, the UK is looking to diversify its sources.
“There are other places in the world where bioLPG can be produced—anywhere LPG or oil refining occurs could potentially produce bio,” he says.
“We’re focused on expanding our options and enhancing access to global bioLPG markets to meet growing demand.”
Supply at Teesside
A tripartite deal between Flogas, Exolum and North Sea Midstream Partners (NSMP) has enabled the Teesside facility to redirect previously exported North Sea propane inland to unlock LPG and bioLPG blends for customers across the UK.
By recommissioning storage, and transporting excess supply to the Avonmouth facility, Flogas is using the Teesside site to provide up to 90,000 tonnes of LPG each year to rural off-grid customers in both domestic and industry settings.
Renewable blends are also expected to become integrated into the Teesside supply in the future.
“Avonmouth is a game changer in terms of winter resilience due to its strategic location and storage capacity. Teesside, meanwhile, is bringing product that was once unavailable back inland to the UK market, improving energy resilience with groundwork being laid for blending bio into that stream,” explains Mr Trevor.
“Together, Avonmouth and Teesside form a complementary model, combining long-term storage and import capabilities at one end of the country with newly accessible domestic supply at the other.
“With these two sites working in tandem, a significant portion of the UK can be reliably supplied with LPG and bioLPG, bolstering our energy security and strengthening the resilience of our off-grid energy sector,” he says.
Building momentum on the way to decarbonisation
Flogas Britain, who are members of Liquid Gas UK, the trade association for the LPG and renewable liquid gases industry, is one major name at the forefront of driving the shift towards renewable liquid gases, however the momentum is a cross-industry partnership.
Member organisations are clear that collaboration is a key component of success, with parent companies SHV Energy (Calor) and DCC (Flogas) signing a memorandum of understanding to promote the renewable fuel development.
This partnership, alongside the Teesside tripartite deal, shows the industry is using joined-up thinking across the supply chain.
George Webb, CEO of Liquid Gas UK, says: “To achieve net zero, a balanced approach is needed, one that includes renewable liquid gases, which provide a flexible, cost-effective solution that works with existing systems and meets the needs of industry and consumers alike.
“Our members are committed to helping the UK transition to renewable energy, supporting hard-to-decarbonise sectors with significant investment and future-proofed infrastructure.”
With 80% of the national gas grid expected to be decommissioned by 2050, natural gas energy prices could rocket, impacting urban homeowners too, meaning transitionary fuels have a role to play beyond the off-grid sector, according to Mr Webb.
“Some homes and entire British high-heat industries risk becoming stranded without affordable heating alternatives in the future.
“This puts the investments from the LPG industry firmly in the spotlight, as there is potential for 50% of renewable liquid gas demand to come from on-grid homes transitioning away from the national gas grid due to the combination of increased fossil fuel costs, and high installation costs of heat pumps,” he says.
Future proofing through policy
However, the transition to renewable liquid gases isn’t just about switching fuels; building the infrastructure must go hand in hand with a supportive policy framework to enable large-scale adoption.
Mr Trevor explains: “You’ve got customers who want to decarbonise, and we are creating the ability to transition them from fossil to renewable liquid gas by importing and storing both gases through the same facility.
“This means we are not only improving national energy resilience, we’re delivering the potential for a more seamless energy transition for those customers at the same time.”
In addition to supporting and safeguarding the energy supply for rural homes and businesses, the future of the LPG industry includes economic growth with the potential to support a total of 12,500 jobs as the industry matures.
To this end, industry leaders are calling for clear recognition of renewable liquid fuels within the UK’s future energy mix, similar to how sustainable aviation fuel (SAF) has been backed to decarbonise aviation.
“If the government provides certainty that renewable gases will be part of the fuel mix, it gives confidence for future investment in production and infrastructure,” says Mr Trevor.
“The sector is ready to step up – the infrastructure is being built, the supply chains are forming, but to maximise the full benefits of energy security, affordability and emissions reduction, the government must ensure a level playing field for all technologies.
“This will create a more just energy transition, stimulating greater demand for bio, which has a lot to offer the economy,” he says. Mr Webb adds: “Net zero won’t be achieved with a one-size-fits-all mentality, and government must support rural communities, who often face the steepest barriers.
“The UK’s renewable readiness is no longer a future goal – thanks to sites like Avonmouth and Teesside it’s already underway – what’s needed now is alignment between industry progress and supportive policy to drive it home.”
Notes
[1] Department for Business, Energy & Industrial Strategy (BEIS). (2021). Impact Assessment on phasing out fossil fuels. Retrieved from https://assets.publishing.service.gov.uk/media/616d7b4d8fa8f5297cc02b5c/domestic-offgg-ia.pdf
[2] Liquid Gas UK, The Industry’s Journey to 2050. Available at: https://www.liquidgasuk.org/uploads/DOC6731E0CED6BBA.pdf#page7
[3] Ecuity, The Role of LPG and bioLPG in Large, Rural Off-Grid Homes, November 2020, Liquid Gas UK. Available at: https://www.liquidgasuk.org/uploads/DOC5FB3DC4186E72.pdf and The Role of LPG and BioLPG in Large, Rural Off-Grid Homes – Infographic, Liquid Gas UK. Available at: https://www.liquidgasuk.org/uploads/DOC5FB3DC703795E.pdf.
Report is based on real EPC data, using a case study of Conwy Cottage, a typical detached, pre-1945, solid-walled rural property with low fabric efficiency. The research models the consumer journey and retrofit costs of switching from an oil boiler to an air source heat pumps in these properties, illustrating the financial and technical challenges, and highlights the potential cost savings of using bioLPG in a mixed-technology approach for decarbonisation.
[4] “Ofgem, the UK energy regulator, expects an increase of generation capacity from 120 GW to 300GW by 2035. The Climate Change Committee’s Balanced Pathway scenario for delivery of net zero by 2050, which has informed the Government’s plan for delivering the Sixth Carbon Budget, projects annual electricity demand to be around 50% higher than pre-Covid levels in 2035 and 100% higher by 2050.” (Environmental Audit Committee, Enabling Sustainable Electrification of the Economy, Sixth Report of Session 2023–24, House of Commons, 24 May 2024, available at: https://publications.parliament.uk/pa/cm5804/cmselect/cmenvaud/278/report.html)
[5] World LPG Association (WLPGA), 2020. Supporting businesses in the energy transition: The role of LPG and bioLPG in Europe. Available at: https://www.worldliquidgas.org/wp-content/uploads/2020/11/LPG-bioLPG-FAQ.pdf. Greenhouse Gas Reporting Conversion Factors available at https://www.gov.uk/government/publications/greenhouse-gas-reporting-conversion-factors-2019