Centralised: LMAM owns and operates the heat network
LMAM generates heat centrally (via heat pumps, CHP, or other sources), distributes it through a pipe network, and charges customers a Heat Supply Agreement (HSA) for delivered heat (£/kWh or standing charge). LMAM bears capex, opex, and regulatory/technical risk on the network. Customer relationship is long-term and asset-backed.
Decentralised: LMAM supplies electricity; customer deploys own heat system
LMAM's role is upstream: providing the last-mile electricity connection to the customer's premises. The customer procures, installs, and operates their own heat pump. LMAM's revenue is from electricity distribution/supply (£/kWh, connection charges). Lower complexity for LMAM but thinner margin; customer bears heat system performance risk.
Air Source Heat Pump (ASHP) — Extracts heat from ambient air. COP typically 2.5–3.5 (lower in cold weather). Lowest capex, highest variability in output. Most common in residential/small commercial. Noise and siting constraints relevant for dense urban deployments.
Ground Source Heat Pump (GSHP) — Extracts heat via ground loops (horizontal) or boreholes (vertical). COP typically 3.5–5.0, more stable year-round. High upfront capex (drilling/trenching). Strong fit for greenfield sites with land availability. Less affected by ambient temperature.
Water Source Heat Pump (WSHP) — Uses rivers, lakes, aquifers, or mine water as heat source. Very high COPs possible (4–6+). Requires proximity to water body; abstraction licencing from Environment Agency. Mine water (e.g. Scottish coalfields) increasingly relevant for urban district schemes.
Large-Scale / District Heat Pump — Industrial-scale units (often >1MW) serving district heat networks. May use waste heat from data centres, sewage, industrial processes. High engineering complexity; typically requires anchor loads (hospitals, social housing blocks) for viable base demand.
Hybrid System (Heat Pump + Gas Boiler) — HP handles base load; gas boiler tops up in peak/cold conditions. Lower capex than full electrification; maintains gas connection. Regulatory position evolving — may not qualify for full heat decarbonisation incentives. Transition technology rather than long-term infrastructure bet.