Great British Energy Makes First Solar-Thermal Investment in Naked Energy

Great British Energy, the UK's publicly owned energy company, is investing £7.5 million through its £1 billion Energy Engineered in the UK programme to support the UK's solar supply chain. Barclays Climate Ventures is also participating in the funding round as an existing shareholder. The investment marks Great British Energy’s first major solar-thermal investment. 

Naked Energy, a British renewable heat technology company, has secured a combined investment of £8.875 million and plans to establish a UK-based automated manufacturing facility for its solar thermal technology. Naked Energy’s ‘Virtu’ technology, which will be manufactured at the new facility, uses modular solar collectors to heat water up to 120°C. According to Naked Energy, the solar thermal technology saves three times more carbon per square metre than standard solar photovoltaic (PV) panels. The company also offers a solution that integrates solar heat generation with more widely adopted rooftop photovoltaics, so that both heat and electricity can be generated from the same rooftop footprint. Naked Energy says that this design means that 85% roof space can be used for energy generation compared to 50% for conventional solar panels. 

It has not yet been confirmed where the Crawley-headquartered company will construct the manufacturing facility. Once operational, the facility is expected to reduce Naked Energy’s production costs and support its continued growth in domestic and international markets.

Manufacturing this technology in the UK will provide a welcome boost to its energy security and highlight the UK’s commitment to a future powered by clean, abundant energy. One of Great British Energy’s goals is to onshore supply chains where possible, particularly in emerging technologies. The automated manufacturing facility will bring production in-house, reducing unit costs and bolstering the UK's clean energy supply chain. The facility is expected to create up to 40 direct skilled manufacturing jobs and around 100 indirect roles as well as creating new export opportunities. Naked Energy is also developing a wider renewable heat platform beyond its core hardware, including digital tools for system design, performance monitoring and Heat-as-a-Service solutions.

The recently appointed energy secretary Miatta Fahnbulleh commented: 

“Homegrown, clean power is an opportunity to reindustrialise Britain as we’re backing UK supply chains to help deliver the energy transition. Great British Energy is supporting well-paid manufacturing jobs for communities, while providing cheaper and secure energy for households and businesses.”

Naked Energy’s solar thermal systems are already cutting bills and reducing the use of gas at some of the UK's most iconic institutions, including the British Library and the All-England Lawn Tennis Club, Wimbledon. Great British Energy and Naked Energy also intend to work together to explore how Virtu could be deployed across suitable public-sector buildings, including potential financing models that would enable organisations to adopt renewable heat without having to pay the full cost upfront.

Christophe Williams, CEO of Naked Energy, said: 

“Heat is too often overlooked in the energy debate, despite accounting for a major share of fossil-fuel consumption. This investment will help us bring renewable heat to more hospitals, hotels, public buildings and industrial sites in the UK and internationally, while creating skilled jobs and export opportunities here at home.”

In many buildings and industrial processes across Britain, gas continues to be widely used for hot water, space heating and process heat, including some higher-temperature applications that can be more challenging to serve efficiently with conventional heat pumps. Heat decarbonisation is still one of the most technically and commercially challenging components of the UK’s net zero commitments. Energy used for heating accounts for more than half of the UK's total energy consumption, with a significant proportion still supplied by fossil fuels. Cutting reliance on gas is an important step towards lower bills and stronger energy security.

Naked Energy’s Virtu technology can help to address this reliance on gas as it generates renewable heat directly at the point of use, reducing gas demand without adding pressure to the electricity grid and providing businesses with a more predictable alternative to volatile fossil fuel pricing.

Dan McGrail, CEO of Great British Energy, said: 

“Cutting our reliance on gas is one of the biggest challenges we face, both for energy security and for keeping bills down. Naked Energy has developed a technology that tackles this head on and when you see it working at iconic UK institutions like the British Library and Wimbledon, you understand what is possible. 
At Great British Energy we are backing UK innovators like Naked Energy and helping to create skilled jobs. Through our Energy Engineered in the UK programme we are helping them to manufacture here at home and go further, faster.”

Jonny Williams, head of operations and maintenance at Naked Energy, thinks that energy resilience must cover more than electricity.

Much of the discussion around energy still focuses on electricity. With businesses looking to control costs and manage rising grid charges, solar PV is understandably receiving significant attention. It can lower electricity bills, reduce reliance on energy bought from the grid and provide a source of clean, renewable power. For businesses with large roof spaces and high daytime electricity demand, the benefits can be especially compelling.

Electricity is only one part of the energy system and it’s currently being put under a lot of pressure. National Grid expects electricity demand to rise significantly over the coming years as transport, heating and industry become increasingly electrified, alongside growing demand from sectors such as data centres.

Electricity is only one part of the energy system, and demand on the grid is expected to increase substantially.

This will lead to the need for significant upgrades which will be expensive but there’s an even greater reason why we cannot rely on electrification alone. Periods of extreme weather can place additional pressure on the electricity system, reinforcing the need for investment in generation, networks, storage and flexibility as electricity demand grows.

The answer for the UK is not to slow down electrification but to recognise that a more electrified economy will need more than a larger grid. It will need a more distributed, flexible and resilient energy system, where more energy is generated, stored and used at the point of demand.
We need to think bigger than the grid and turn our attention to heat. Heat has historically accounted for around a third of UK greenhouse gas emissions but has been consistently neglected in favour of electrification. This is particularly important for industry, where a large proportion of energy demand is for heat.

Although electrifying heat can substantially reduce emissions compared with conventional gas heating, industrial heat remains particularly challenging to decarbonise. Businesses often face a heating 'trilemma' when deciding on the right heating system: is it sustainable, affordable and secure? For large industrial sites, switching to low-carbon heating can require substantial capital investment, potentially running into millions of pounds.

This is where technologies such as solar thermal can play an important role, helping buildings reduce emissions and gas consumption without increasing electricity demand. Naked Energy's solar thermal system at the British Library in London is expected to generate 216 MWh of heat annually for space heating and hot water. 

Great British Energy’s investment in Naked Energy is about more than expanding the UK’s solar supply chain. It highlights the important role renewable heat could play alongside electrification in reducing the UK’s reliance on fossil fuels and strengthening energy security.

Solar PV, batteries and an expanded electricity grid will remain essential to the energy transition, but electricity alone cannot meet every energy need. Technologies such as solar thermal offer businesses and public-sector organisations another way to reduce their dependence on gas, particularly where there is significant demand for hot water and process heat.

By bringing the manufacture of its Virtu technology to the UK, Naked Energy has an opportunity to reduce costs, create skilled jobs and make renewable heat more accessible. If the technology can be deployed more widely across commercial, industrial and public-sector buildings, it could demonstrate how generating renewable heat alongside electricity from technologies such as solar PV closer to where energy is consumed can contribute to a more diverse, resilient and lower-carbon UK energy system.