Energy services company (ESCo) Egni (Wales) is working on what could be the first district heating project in the UK where a whole village is “retrofitted” with a wood-fuel burning system. If the proposal – now in the planning stage – is successful, the 175 homes in the small Welsh village of Abergynolwyn will be included in the project.

Phil Potter, project director at Egni (Wales), said the scheme, which will burn low value timber from local woodlands and co-products from local sawmills, will provide the villagers with access to cheaper energy. He estimates that wood fuel will reduce energy costs by around 10%.

In addition, the cost will increase only by the rate of inflation during the contract period.

Egni (Wales) will supply the heating system, the fuel and maintain the boiler – and sell the heat – but the villagers have formed a community development company Cwmni Egni Abergynolwyn to provide the infrastructure.

The £2.5m project has already attracted £1.1m from the Welsh assembly and also support from Welsh Development Agency and Snowdonia National Park. Other grants, such as objective one funding from the EU, are being sought. At present a lot of the houses are heated by open fires or electric storage heaters and it is hoped that grant funding will meet the cost of installing radiators.

“We hope to use it as a model for other communities,” said Mr Potter.

Egni (Wales) is waiting to hear whether its bid to heat Prince Charles’s home at Highgrove House has been successful and has applied for objective one funding for “biomass fuel supply structures that would be capable of supplying most of Wales”, he said.