The canals of the West Midlands may seem an unlikely source of warmth, but these waterways could soon be used to heat hospitals and tower blocks under a plan to harness Britain’s hidden heating sources.

The government has promised to spend more than £20m on nine schemes across the country to exploit cheap, renewable heat from canals, old mineshafts and in London tube lines.

It will spend another £70m to build some of Europe’s first plants to generate green hydrogen gas for homes and factories, including a project in Grimsby that will use the clean electricity generated by offshore wind turbines to make the low-carbon alternative gas from water.

Zero-carbon hydrogen injected into gas grid for first time in groundbreaking UK trial Read more

Kwasi Kwarteng, the minister for business, energy and clean growth, said cleaning up emissions from industry and housing was a big challenge, and an important part of “eliminating our contribution to climate change by 2050 while also growing our economy”.

The government’s hunt for alternative renewable sources of heat has gained pace after ministers pledged to ban gas-fired boilers from newbuild homes from 2025. Officials estimate that the latest funding could provide a local renewable energy resource to 250,000 people by 2030, which would cut their energy bills by half while helping the UK to meet its climate targets.

Birmingham’s canals have been picked to play a role in the UK’s green heating revolution by GreenSCIES, which is also working on a proposal that uses “waste heat”from the London underground to warm hundreds of homes in Islington, north London.

The consortium, led by London South Bank University, plans to use the government funding to grow the GreenSCIES project and install water source heat pumps in the canal, which runs through Sandwell near Birmingham.

The heat pumps work like a refrigerator in reverse, using a coolant gas to transfer heat from the water to be piped into a council tower block of 1,200 residents, many of whom are fuel poor. An extension of the project could be used to warm Birmingham City hospital.

Heat pumps will also be used at another government-backed project in Rugeley, north of Birmingham, where a defunct coal-fired power plant is to be turned into a sustainable village of 2,300 homes, warmed by local canals and geothermal heat from disused mineshaft.

Once at full scale, the Islington project will provide heat to an estimated 33,000 residents and nearly 70 local businesses. It will also help to reduce carbon emissions by an estimated 80% compared with traditional gas-fuelled heating systems while also addressing fuel poverty.

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Government officials also plan to throw their support behind two schemes, on the banks of the Mersey and near Aberdeen, to produce low-carbon hydrogen by splitting traditional heating gas and capturing the carbon dioxide that is released before it can contribute to global heating.

Hydrogen was injected directly into a UK gas network for the first time this year. A 20% blend of hydrogen in the national gas grid could reduce carbon dioxide emissions by about 6m tonnes a year – the equivalent of taking 2.5m cars off the road.

• This article was amended on 19 February 2020. An earlier version said that hydrogen had been injected directly into the UK gas grid, when it was actually into a private gas network. This has now been clarified.