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By ADE Director, Tim Rotheray
As part of the Comprehensive Spending Review last November, the Chancellor announced an extension of the budget for the Renewable Heat Incentive. The good news in the announcement is that the extension helps keep heat firmly on the policy agenda. The bad news is that defining the objective for heat around renewable deployment rather than carbon reductions will drive perverse impacts.
The UK’s 2020 renewable targets are based on the Renewable Energy Directive, which defines renewable as those heat inputs which are not “man-made” (or anthropogenic if you like your syllables). So zero carbon waste heat captured from data centres, industrial manufacturers and power plants is not considered renewable. Logical you think? Not when this waste heat offers some of the lowest cost forms of carbon saving; yet it is not eligible for subsidy under the RHI. The lost opportunity is significant. The UK’s wasted heat, lost up through the cooling tower, is worth more than £3 billion a year, the equivalent of £116 on every householder’s bill!
In contrast, heat pumps use electricity to concentrate heat in lower temperature sources like the air, lakes, the sea and the ground. For every one unit of power they use they can generate between 2.5-4 units of heat and can be a great way of producing low temperature heat. However, in the European Renewable Energy Directive, heat pumps are considered renewable even if all their power comes from fossil sources. So a coal-fired heat pump is renewable!
So to review. A coal-fired heat pump? Renewable but high carbon than gas. Capturing waste heat from a data centre? Zero carbon* and not renewable.
But it gets worse... a heat pump that concentrates ambient air temperature to make heat, such as by capturing the air from a refrigeration system vent, can boost its efficiency and save more carbon by using warmer air sources. Yet if the heat pump does this, it is no longer classed as renewable. So by making a heat pump more efficient with lower carbon emissions you make it ineligible for renewable subsidy. I am a fan of heat pumps - they are clever ways of increasing efficiency but we are currently making sure we minimise their efficiency!
The (unintended) consequence is a policy that penalises efficiency.
DECC is currently reviewing the RHI and its focus, with an aim to reform it to improve value for money. Given the European rules on renewable heat support, DECC needs to consider what constitutes a good outcome for its reforms.
I would suggest that a good outcome would achieve two aims:
- Least cost achievement of our renewable target. We have a 2020 target we are bound to meet, and we should always do so at least cost. Spending money unnecessarily is bad value for the taxpayers that fund it. This means considering everything on the basis of pound of subsidy per MWh of renewable energy, supporting the lowest cost options first.
- Tie the RHI support to carbon abatement. The point of renewables is to reduce the carbon impact of energy, and we must ensure the RHI actually achieves this aim and at lowest cost. The RHI should ensure that only good value carbon abatement is procured.
What would these proposals look like in practice?
It means that there should be a clear measure in any Impact Assessment of the cost per kWh of renewable heat generation and cost per tonne of carbon abated for each technology supported (off and on the gas grid). It would also mean a carbon abatement price ceiling – perhaps £200/tonne – to prevent subsidising the most expensive forms of carbon abatement. DECC should also develop proposals to see how heat recovery could receive equitable support as technologies classed as renewable.
Decarbonising heat, which is half our energy use, is already set to be a difficult task, so we must do it with a very sharp eye on cost. The current RHI provides support for carbon abatement in excess of £800/tonne. This is poor value for customers. The government's review offers the chance to ensure that taxpayers get better value for their money to deliver what we’re actually trying to achieve: A lower carbon economy.
*zero carbon as the heat has to be removed and will be rejected. Capturing and using that heat has no net increase in emissions.
By Hanaé Chauvaud de Rochefort, Policy Manager at the ADE, as featured in the February issue of Energy in Buildings and Industry. Visit www.energyzine.co.uk to get your copy.
For many years, the traditional approach to generating energy centrally has dominated, with the vast potential for local authorities to play a role the UK’s low carbon energy transition overshadowed. Yet forward thinking local authorities, from Aberdeen to Southampton, have quietly begun to develop and operate their own energy projects.
In the November 2015 Spending Review, Government announced £300m in funding will be made available for up to 200 heat networks, providing a starting block for district heating opportunities across the UK. With the right policy framework in place, district heating could revolutionise the way Britons heat their homes and other properties in the years to come.
District heating is the provision of heat and hot water to multiple properties from a single community energycentre. The energy centre houses the heat generators and the electrical pumps which pipe the hot water to connected properties via a network of insulated pipes. Any source of heat can be connected to district heating with common options including gas-fired combined heat and power (CHP), biomass boilers, energy from waste and large heat pumps. District heating can help consumers access more local, lower carbon and more cost effective sources of heat.
Heat networks are not new in the UK, with the majority of existing schemes developed in the 1960s. The rise of the individual gas boiler in the 1970s and 1980s saw the number of new schemes decline, until now where they are growing in prominence once again.
According to government estimates, just short of half a million UK households are already connected to district heating systems with the figure predicted to rise to as many as 4 million by 2030. But it is not just homes that can be connected; commercial properties, public buildings, schools and swimming pools can all receive their heating and cooling needs from heat networks. The value of the total UK district heating market is estimated to be £400 million in 2012, and district heating delivers additional value through carbon savings.
District heating is already delivering at scale in cities such as London, Nottingham, Edinburgh, Sheffield or Exeter and is in planning in excess of 150 local authorities thanks to strong planning regulations and recent Government backed feasibility studies funded through the Heat Networks Delivery Unit (HNDU).
In London alone, Mayor Boris Johnson has committed to ensuring that 25% of London's energy is delivered by decentralised energy by 2025. The mayor's office actively supports a programme identifying potential district heating opportunities and helping the boroughs implement them through planning policies that encourage or even require decentralised energy use in new developments.
Increasingly, local authorities are seeing district heating as a key tool to control energy costs and tackle fuel poverty while reducing carbon emissions and providing jobs for local people. Seizing the opportunity of decentralised energy generation can provide new long-term income streams for communities and councils, particularly in an environment where local government budgets are under pressure.
The ownership and operation of heat networks often fall upon two or more stakeholders from various backgrounds such as local authorities, private companies, building developers, contractors and investors. Resources to bring together these stakeholders, and the time and energy to learn new skills to deal with the necessary planning and financing of a district heating project, often come as a challenge which deters many Council officers and Councillors.
The introduction of HNDU to provide resources to local authorities in the early stages of planning has helped get the ball rolling on over 180 projects, with 15 now ready to attract circa £112 million in investment. The total pipeline of projects created through HNDU could attract over £2 billion in capital infrastructure investment, thus placing the UK in pole position to develop the local supply chain and create more jobs.
But the successful deployment of district heating in the coming years will rely on the implementation of policies that will continue to address the barriers that prevent the multiplication of heat networks and ESCo businesses.
The £300 million funding is great news for this fledgling industry, but the question now is how to spend the money cost effectively to progress from plans to pipes. We have identified three key policies to ensure the opportunities from this new funding are maximised:
1- HNDU needs to be pursued to ensure strong coordination that helps bring interested stakeholders together. The Unit's role should be continued and extended to support development all the way from securing planning agreement through to commercialisation and financial close. This recommendation is central to maintaining a pipeline of investable projects. Investors will only develop internal knowledge in district heating if concrete investment opportunities exist. This recommendation is central to maintaining a policy pipeline.
2- A Government guarantee on heat demand for a pool of local authority projects is key to getting larger, better-value schemes into development at low cost to taxpayers.
Uncertainty over the timing and scale of new heat users connecting to the network is often cited by infrastructure investors as a barrier to their market participation. For investors to secure returns on their long-term investment, contracts must address the risks inherent to the project and allocate risks to the stakeholders that can better manage them.
Local authorities willing to leverage long-term finance can take some of the offtake risk, which they can mitigate by connecting public sector buildings to the network, such as civic buildings, schools and affordable housing.
3-Exempt district heating networks from punitive business rates: District heating networks do not have the same status as gas and electricity networks. Heat network customers are subject to business rates not applicable to gas and power infrastructure. These costs increase heating bills by as much as 20%. These punitive costs can be particularly damaging when projects are aimed at cutting fuel poverty. This is the most immediate issue facing district heating networks.
By implementing these three policies capital costs will fall enabling heat projects to compete fairly with other infrastructure, and stimulate the level of investment needed to realise Government’s ambition to secure a low carbon and secure energy system in the most cost effective way.
As Combined Heat and Power (CHP) systems continue to grow in popularity, Edward Garside, Project Engineer at Bosch Commercial and Industrial, explains how to stay compliant with power generation legislation.
“As a CHP module is effectively a power supply embedded within a building that is connected to the national grid, there are parameters surrounding its safe installation. Set out by the Energy Networks Association, G59 is a set of provisions ensuring the module will operate in a safe manner compatible with the National Grid.
“To combat inadequacies in the electrical infrastructure, G59 regulates generator applications so they cannot be connected to the grid without the knowledge and permission of the local electricity authority.
“The legislation, specifically ‘G59/3’, is programmed into a device called a G59 protection relay which has the ability to automatically disconnect the CHP unit in the event of a power cut or fault on the network, and as such keeps the wider supply safe and secure. Any generator rated above 16 Amps per phase and connected to the national grid must be fitted with a G59 relay in order to comply with G59/3 legislation.
“Put simply, the protection relay monitors the quality and stability of the mains electricity in accordance with the District Network Operator (DNO) and assesses the voltage, frequency, and phase angle. Should any of these areas go outside the predetermined limits, the relay will cause a protective circuit breaker to open and thereby disconnecting the generator from the grid.
“As part of the connection process of a CHP module or power generation source to the National Grid, there are a number of aspects the DNO will consider. The result feeds into what is called a G59 Parallel Running Agreement document, which permits the operator of a CHP system to generate electricity with the National Grid. It is important to remember that this agreement is needed regardless of whether or not a generator will export electricity.
“Often the DNO will wish to see proof of G59/3 compliance in the form of a witness test, whereby a representative of the DNO, a G59 test engineer and CHP engineer attend the site and to observe the testing of the G59 relay.
Importance of pre-planning
“After a G59 application has been submitted the DNO has up to 45 working days to send out the results of their network study and provide a formal quotation for any fees required. If the DNO requests a G59 witness test, this will have to be booked following payment of any fees listed on their quotation. They typically attend the site for a witness test within a few weeks of notice however, there is no set notice period and with limited availability of staff it is advisable to book well in advance.
“There can be a lot to take into account when installing CHP modules, but by working closely with those involved in the supply and installation of a CHP system, compliance with regulations such as G59 needn’t be a mystery.”
For more information on Bosch Commercial and Industrial and its market-leading range of CHP systems, visit www.bosch-industrial.co.uk or call 0330 123 3004. Alternatively, follow Bosch Commercial and Industrial on Twitter (@BoschHeating_UK) and LinkedIn (Bosch Commercial and Industrial UK).
Press Enquiries to:
By Gareth Jones, Managing Director of FairHeat
The Heat Networks: Code of Practice, developed by the Association for Decentralised Energy (ADE) and Chartered Institute of Building Services Engineers (CIBSE), was launched to much fanfare last year. The timing couldn’t have been better. Largely prompted by the new Heat Networks (Metering & Billing) Regulations, there had been much discussion, then angst, over what ‘normal’ levels of network losses were. As those discussions continued there seemed to be a dawning realisation that we haven’t been particularly good at doing heat networks in the UK, with network losses of over 50 per cent being fairly common place.
As such, it was taken as very welcome news that there was a better way of doing things and the Heat Networks Code of Practice was widely seized on as being the solution.
Now some of the party euphoria has dissipated and people are starting to grapple with the issue of how to make it all work in practice, the question needs to be asked: Is the Heat Networks Code of Practice actually going to make a difference?
Having just worked on several projects in which the Code of Practice has featured heavily, I am pleased to report that the answer appears to be “yes”.
The PI problem and the Code
One of the key reasons that the Code of Practice is having an impact, is that it provides a counter balance to the pressure from professional indemnity (PI) insurance to be conservative.
Historically there have been a number of factors that have prompted M&E designers to take a conservative approach when designing heat networks (read: “designing systems that are grossly oversized”). However, the single most significant factor in oversizing has been concerns over PI insurance.
As one person put it “no one ever got sued for delivering too much heat to the furthest flat in the network”.
That might be about to change.
In the introduction to the Code of Practice, there is some welcome wording about how the Code of Practice’s Minimum Requirements have been set to achieve minimum acceptable standards. This effectively flips the whole PI issue on its head.
If I, hypothetical chartered engineer, design a heat network that does not meet the minimum requirements of the Code of Practice, then I am effectively failing to meet “minimum acceptable standards”, as set out in black and white by the authority on building services engineering.
Given that much of the Heat Networks Code of Practice is focused on ensuring that systems are efficient, engineers who design systems that deliver “abundant heat” to the furthest flat of a heat network without taking into consideration overall efficiency may well find their PI insurance getting a work-out, as disgruntled clients sue them for the cost of elevated losses over the lifetime of that heat network.
While this has not yet been put to the test in the courtroom (to my knowledge), it is already influencing behaviour.
The Code as substitute for missing Employer’s Requirements
As an example, earlier this year FairHeat (the specialist heat network consultancy I co-founded) was engaged by a private developer in London to assist them on a project where they felt that the design was oversized. Apparently the process had reached an impasse, with the client demanding change on one side, but with the consultant holding their ground on the other side and simply pointing to their PI insurance.
The starting point was to review the client’s Employer’s Requirements. Unfortunately these were substantially absent from a heat networks perspective and as a consequence there was no real contractual lever in place.
There was, however, the draft version of the Heat Networks Code of Practice in circulation (this was in February). So we produced a report that set out the implications of the “minimum industry standards” wording in the introduction (as it was in the draft), then produced a table showing all of the Minimum Design Requirements (Part 3) from the Code of Practice, along with an assessment of whether the consultant’s design met those requirements.
Which it didn’t.
To the consultant’s credit, they assessed the situation, took the points on board and entered into constructive dialogue, with the result being that the final system will be significantly more efficient, have lower operating costs and cost less to build (smaller pipes cost less).
The most interesting feature of this whole process was the fact that, from a contractual perspective, the Code of Practice effectively stepped into the breach for the missing Employer’s Requirements and provided a lever for ensuring compliance to “minimum industry standards”.
Specifying the Code
However, while acknowledging that the Code of Practice stepped into the breach in the case above, it is no substitute for a tight set of Employer’s Requirements. While the Code of Practice provides an excellent framework for guiding behaviour, it requires further structure for it to be useful within a contractual framework.
Recently FairHeat has been assisting a number of private developers and social housing organisations in ‘specifying’ the Heat Networks Code of Practice.
Rather than trying to replicate existing documents, we have worked with each client to produce a ‘Design Supplement’ for heat networks on their developments. This Design Supplement acts as a bridge between clients’ existing Employer’s Requirements and the Heat Networks Code of Practice.
The great thing about having the Code of Practice as a framework is that it has allowed our clients to focus on the key questions and determine what approach they want to take in relation to those specific issues, with the remaining bulk of issues being covered by the Code of Practice minimum requirements.
It has also helped to focus attention on the fact that it is not just the design approach that needs to change, but rather the whole end-to-end process. Indeed, we have found that getting the design right has proved to be the easier part of the equation. The real challenge is in assisting clients to put in place the requisite processes and organisational structures in order to ensure that designs are implemented correctly. This is as much about organisational change management as it is about engineering.
Achieving this change is vital if we are to deliver efficient heat networks.
In work that Guru Systems (FairHeat’s sister company) is carrying out as part of a Government-funded project to improve the efficiency of heat networks, we have identified that approximately 50 per cent of the ‘efficiency gap’ on schemes we have reviewed has been due to poor design (mainly oversizing), with the other 50 per cent due to issues with implementation – e.g. failure to properly insulate, poor HIU commissioning, etc.
As such, we (as an industry) need to work on getting both the design and the process right.
Which is why the Heat Networks Code of Practice encompasses the whole end-to-end process.
Pleasingly, I can report that the Code of Practice is providing a good framework for implementing change. Indeed, several developers and social housing organisations we are working with are making fairly radical adjustments to the way they are tackling new developments thanks to the Code of Practice.
Thinking back only two years, this represents such a seismic shift in attitude that I can’t help but feel confident that the Code of Practice will end up providing the enabling framework that we have needed for delivering highly efficient heat networks in the UK.
So, unlike a number of other initiatives that have faded away into the ether, it looks like the Heat Networks Code of Practice is living up to its star billing.
Written by Dr Steven Fawkes and kindly republished with his permission.
For more fantastic articles on energy efficiency/productivity and finance check out Steven's blog onlyelevenpercent.com where this article was originally published.
For those of us who have worked in energy efficiency a long time it sometimes seems as if the moment has come, the moment when the world has finally recognized the value of improving efficiency, the fact that there is huge potential which is economic today using today’s technologies with no subsidies, and that improving energy efficiency brings with it massive non-energy benefits such as job creation, productivity and improved health and well being. All, and I say all lightly as it is no small task, we need to do now is work out how take advantage of that huge economic potential that we know is out there. We are advancing quickly on that journey with projects like the Investor Confidence Project, the continuation of the work of the Energy Efficiency Financial Institutions Group (EEFIG) on establishing a common under-writing framework for energy efficiency (supported by the EU), and new business models. An increasing amount of capital is committed to finding ways of investing into efficiency – now we just need to make if possible for that investment to flow by breaking down the institutional and cultural barriers.
In the UK the energy policy reset has dealt with supply options (mainly promoting new nuclear and shale gas) but remains silent on efficiency. For the record I am against new nuclear (especially with unproven French or Chinese technology) because of cost and security concerns. I am in favour of shale gas on energy security grounds assuming we can exploit it cheaply. In any event, these supply options will take at least a decade (almost certainly more in the case of new nuclear) to take effect. Meanwhile we are sitting on a huge reserve of very cost-effective energy efficiency potential that is not being exploited and which could be unlocked very quickly. Almost every day we see cases of buildings, in some cases very new buildings, making savings of 10 to 30%, often with little or no investment. Everyone talks about the declining cost of solar but we also need to recognize the declining cost of delivering efficiency. We need to build on that base of activity and accelerate demand, supply and financing of efficiency and hence rebalance the emphasis on supply options.
One way of doing that may be to stop using the term energy efficiency all together. Having worked in the field for so long, and finally having the subject get more recognition, this may seem like a strange proposal but energy efficiency has all kinds of problems as a label. It is a confusing technical term, it is boring to most people, it still has negative connotations of saving and getting by on less, it threatens energy suppliers, it is invisible, it does not lend itself to photo opportunities and big political announcements, and it leads to all kinds of pointless, endlessly resurfacing, debates based on the Jevons paradox.
We need to truly reset energy policy and focus on energy productivity –the amount of value we create out of a given amount of energy (GDP/energy input). Productivity is positive. Improving productivity generates wealth. No-one can be against improving productivity. Of course for any particular country energy productivity is made up of two elements, the overall structure of industry and the economy, and the level of actual energy efficiency.
In the UK tackling the country’s poor productivity record is core to the Chancellor’s economic strategy – we need to make sure energy productivity is part of that discussion and so far it clearly isn’t.
In July the Treasury published a document, “Fixing the Foundations: Creating a More Prosperous Nation”. Chapter 6 is called “Reliable and low-carbon energy at a price we can afford”. This does start by talking about “improving productivity in energy generation, production, supply and usage” (a good start). It then goes on to talk about more competitive markets and introducing the ability to switch suppliers within 24 hours. Competitive markets are generally good but the problem we have is that energy efficiency cannot compete with energy supply – there is no market for efficiency, only markets for stuff that results in efficiency. We now have the technology to meter efficiency and California is moving towards a market where efficiency can be measured, metered and truly compete in the energy market. We are developing new business models based on this idea. Personally I fail to see how 24 hour switching contributes to productivity. The rest of the points in this chapter mention supply, oil and gas, shale, new nuclear, and the EU’s Energy Union. In a strange final bullet point printed in red the now on-going review of business energy tax was flagged. It is almost as if they ran out of ideas and this chapter wasn’t quite finished.
So, apart from the statement “improving productivity in energy generation, production, supply and usage” there is no mention of productivity and no linkage to overall energy productivity – and no mention of energy efficiency. Efficiency is mentioned in the chapter on Planning and housing – flagging the decision not to proceed with zero carbon homes and saying they will keep energy efficiency standards under review. The energy chapter is the old 1970s style supply side dominated model in new clothes - “the economy will grow and we will provide whatever energy we need” – rather than focusing on improving energy productivity.
We need to start talking about energy productivity at the macro and the micro level, recognize the economic benefits that come from improved energy productivity (arising from energy cost savings, improved energy security, improved health, reduced need to invest in new supply options etc etc), and set national targets for energy productivity. To support that we need to aggressively promote energy efficiency (that is to say energy productivity at plant and building level) and really start to exploit the massive cost-effective energy reserve the efficiency potential represents, a reserve which is cheaper than any supply-side option, faster to bring on-stream, and by far cleaner than any other option.
So maybe we shouldn’t forget about energy efficiency all together, just rename it energy productivity.
Fixing the Foundations can be found at:
Information on the Investor Confidence Project: europe.eeperformance.org
The EEFIG report can be found at:
By ADE Director, Dr Tim Rotheray. Originally written for Good Energy as part of their COP21 industry expert opinion series available here.
A negative decision in Paris could bring enormous changes to Britain’s political consensus, both on energy policy and its approach to the European Union, and investment certainty hangs in the balance.
We have seen quite a bit of uncertainty of late. Government changes to policies, each with its own three letter abbreviation (LECs, FITs, CCL, CCAs etc).
Some of these changes will have a major impact on UK firms but it is still, on the global stage, very parochial. After all, UK emissions are about 3% of the global total.
The one area where the UK has done something really internationally significant is passing the 2008 Climate Change Act. This law is the lynchpin of UK political consensus for acting on Climate Change at the UK level.
It is repeatedly cited by international commentators as a vanguard for climate politics.
Why the outcome matters
So what does this Act have to do with Paris? After all it is a UK law. But the outcome of the Paris climate negotiations could upend the UK energy policy consensus.
The reason is that the Act has far more 'openers' than most people realise. The carbon budgets set by the Committee on Climate Change with the required emissions cuts, can be amended by the Secretary of State if there have been 'significant developments in.... European or international law or policy'.
Simply put, a weak deal or no deal in Paris would create the opportunity to change the carbon budgets. And that would be a disaster.
In all the weathering that energy policy has taken, the Climate Change Act has stood untouched. This signal is vital for investors indicating that, whatever the colour of government, the policies may change but the direction of travel is permanent.
The door is opened to that changing if world leaders are unsuccessful in Paris.
Sending a clear signal
So from my perspective, as someone working for a more local efficient and low carbon energy system in the UK, the international talks in Paris are still vitally important.
As the UK debates how to secure energy investment and a growing call for policy stability from across the sector, a strong Paris deal to anchor the UK's consensus for decarbonising the economy will send a clear signal to the investor community.
Of course, there is a clear moral and ethical case for acting on climate change. But, a strong deal in Paris also is the necessary global framework to enable local change; aligning the macro-economic case for action with individual investment decisions.
Last week, Bill Watts at M&E practice Max Fordham wrote a passionate rant against CHP and heat networks on the Construction Manager website.
The crux of Bill’s message is that real world losses on new build projects are higher than losses calculated using manufacturers’ specs and SAP. How much higher? Bill’s not sure – he says that only ESCOs know how well or how poorly heat networks are working. But in any case “much higher than we’ve been led to believe.”
A few days after the original article appeared, Construction Manager ran a follow up piece in which people from the building industry try to rebut Bill’s argument. In general the respondents make the case that CHP and DH have an important role to play in decarbonising heat, with several highlighting that the Heat Network Code of Practice should improve the performance of new networks.
But in my view the industry respondents missed the key point.
It’s clear Bill really really dislikes heat networks. You can hear it in his melodramatic language about government seeing DH as “the panacea to all our future energy woes” or claiming that policymakers just “don’t care about costs or losses.” This is an emotional argument with few numbers to back it up.
And there’s the problem: Bill makes his argument based on dogma, not data. And if you’ve read much of this blog, you’ll know that that really gets my goat.
At this point you might say: of course he’s making an emotional appeal; with no data, what else could he do? Bill despairs that only ESCOs have data on how heat networks are performing. He laments that “if the CHP and district heating industry fails to indicate what [DH] losses are, it makes predicting the viability of these systems very difficult.”
But performance data isn’t locked up in some ESCO vault. We’re not denied access to data by the CHP and DH industry. The data is right there on site – in every heat meter in every flat. It’s in the check meters in the plant room and on network branches: a little stash of gold dust building up each day from the moment the meters are installed. Including on those heat networks designed by Fordhams, of which there are plenty.
Fordhams is “working with existing systems, designing them themselves, and reviewing reports and designs by other consultants.” How? In an information vacuum? With no clear performance targets and verified results? If the engineers are blind to how the systems perform, how on earth can they know whether their designs are any good? How can they improve?
The solution is simple: you just have to get the data out of the meters and start using it, preferably from the very first day the heat is turned on, long before commissioning and handover. The data should be used to verify that the quantifiable performance targets laid out in the spec have in fact been achieved. And all this can be done from a desk, without an engineer travelling to site!
Never mind ESCOs. Who is better placed to ensure that performance is measured and data is used to verify results than the M&E engineer, the client’s trusted advisor? Who is better placed to ensure the client got what they asked for than the good engineers at Fordhams themselves?
But instead of taking steps to measure and improve outcomes, it appears that Bill would rather throw his hands up in despair.
As Gale Snoats wisely said, I’d rather light a candle than curse your darkness. So to finish on a constructive note, here are some recommendations for any M&E engineer working on heat network projects:
- Put clear and measurable performance targets in the spec. Efficiency figures don’t make good targets. Instead use targets like bypass flow rates, flow temps and deltaT. Make sure bidding contractors know exactly what’s expected of them.
- Draw up the commissioning plan at spec stage based on your performance targets and make sure the winning contractor knows they’ll be held to it. Miss the targets? No practical completion til it’s put right.
- Make sure heat meters are installed and commissioned with a working internet connection as early in the project as possible. These meters are the foundation of your measuring system and the ADSL means you can spot problems from your desk.
- Don’t accept commissioning certificates at face value. Verify performance using system data.
- Use the data to improve your next design. Was your last network oversized? Might you have saved the client money on pipes and plant? Did you really need those bypass valves that caused such trouble? Maybe wet towel rails weren’t such a good idea. Etc.
A new report from Greenpeace shows how a tripling in fossil fuel and renewable CHP would help the UK meet its power decarbonisation goals in a way that would be technically, socially and economically viable.
The report is based on an advanced modelling process to design, test and iterate a 2030 energy scenario that can demonstrably overcome the specific technical, infrastructural and engineering problems associated with migrating to a radically decarbonised power sector.
Most importantly, the Greenpeace report shows how both fossil fuel and renewable CHP, alongside demand side management, can help deliver a nearly-decarbonised UK electricity system at least cost in 2030.
Greenpeace's scenario focuses on CHP used by community heating schemes and calls for an installed capacity of 21.5GW in 2030, 64% of DECC's technical potential estimate for 2030 and a 350% increase on today's installed capacity. In addition it assumes that 23% of this will be renewably fuelled (in comparison to 11% today). Greenpeace conclude that this contribution falls "well in line with official forecasts and expectation".
Greenpeace also recognises that while some CHP can be run flexibly, many CHP sites are heat-lead and unable to follow demand, a welcome recognition of CHP’s primary role as a heat-led technology.
A key feature of the scenario is its exclusion of CCS and a requirement for a considerable reduction in domestic heat demand (by some 57%). Each available technology is categorised into a phase. Heat led CHP would be one of the first technologies to be called upon, along with renewable generation and base load nuclear and phase one. Interestingly, the use of industrial DSM is the last method called on to balance the grid in Greenpeace's scenario. While domestic DSM is called upon in the third phase, non domestic DSM is one of the final solutions to be used, being called upon in phase five.
Demand Side Management (DSM)
The scenario favours the use of domestic demand side management enabled by the installation of smart meters. Greenpeace's decision was to explore the most onerous DSM requirement on households. Existing research suggests that frequent requests for reductions above 10% are likely to prompt a negative response from householders. Greenpeace sought to model how frequently these types of requests would be required in order to create a 'worst case scenario' for domestic DSM. By placing domestic DSM within phase three, above other solutions, householders would be required to participate much more than if they were placed at the bottom.
The report concluded that 'Prospering Suburbs household' (a detached property with an above average gas bill) would experience the most onerous participation within DSM, being required to reduce consumption by more than 10% on 4.7 % of July/August weekdays, with a further 17.2 % of those days requiring a shift in demand of less than 10%. For 'prospering suburbs household', a 10% reduction would equate to around 60 watts - the equivalent of turning off a high power laptop.
The extent of the role of non domestic DSM would be contingent on the success of the proceeding phases' technologies to balance supply and demand.
Time to tap in to an underused energy source: wasted heat
Millions of people worldwide can’t afford to keep their homes warm, but few realise the heat wasted in our energy system could provide the answer.
We need to do more to prevent valuable energy being lost to the environment as heat. It’s not just draughty buildings – power stations lose a vast amount of heat through their cooling towers or dumped into waterways, equivalent in the UK to a third of final energy use, while UK industry wastes enough heat to warm more than two million households. Storing this heat can even help us manage renewable energy – at lower cost than batteries.
A 2013 study by Buro Happold showed that tapping into the waste heat rejected into London’s environment could provide enough warmth for the whole city. What’s needed is a strategy to “join the dots” between waste heat sources and demand for heat using new infrastructure. Early initiatives are currently underway, looking to capture waste heat from the London Underground and from transformers on the power network to heat homes.
In Scandinavia and Eastern Europe, communities often share their heat sources, with customers connected to a “heat network” carrying hot water in well-insulated pipes. Instead of having boilers in individual buildings, they have heat exchangers which pass heat from pipes buried under the street outside to heating systems inside. For example, in Warsaw individual boilers were replaced with a network during post-war reconstruction leading to big reductions in local air pollution.
In the UK, cities such as Sheffield and Nottingham have pioneered these networks to distribute heat from waste incinerators. Burning off household waste produces a lot of heat, and putting this energy to use helps the cities to tackle fuel poverty and reduce their carbon footprints. Sheffield already has 50km of heat pipes in its city centre, and a new power station fuelled with locally sourced waste wood will generate renewable electricity and also energy to feed into an extended heat network.
Making energy storage easy… with heat
Industrial processes rarely produce heat at the right time to meet demand, but energy can be stored in these heat networks by using large, well-insulated hot water tanks that can hold the energy for several days. Boreholes deep underground could store heat between whole seasons. After all, energy stored as heat costs far less per unit than electricity stored in batteries.
Energy storage would be part of any plan for Sheffield to make use of industry’s wasted heat, but the benefits could extend much wider than the city itself. As increasing amounts of intermittent renewable energy are fed into the national grid, large heat stores for power stations with a heat network allow for flexible electricity outputs. At times of excess electricity production from renewables, this energy could be taken from the grid and stored as heat.
Since heating uses up 44% of the UK’s energy, and a similar amount in the US, heat networks with energy storage can play a major role in making national energy systems more efficient and sustainable. Even in warmer climates, there is a growing market for district cooling systems which operate on similar principles.
People working in energy policy are only just beginning to think in a more holistic way by considering how best to provide heat and electricity. So much energy is needed for heating that we won’t meet our emissions targets without a joined-up policy. A more efficient energy system, where heat is valued, preserved and put to use, can lower people’s bills while at the same time reducing carbon emissions and air pollution.
(Click image to enlarge)
Whilst a lot of attention has rightly been given to the most effective and affordable ways of decarbonising the power sector it is also important to fundamentally change the way we heat our homes if the UK is to make the transition to a low carbon future.
Around 20% of the nation’s carbon emissions are generated by domestic heating. Much of the UK’s housing has a low standard of energy efficiency and up to 90% of our 26 million homes could still be around in 2050.
However, whilst improving the efficiency of homes is important, this alone will not deliver the emissions reduction we need. It sounds a daunting task, but we believe measures that substantially reduce heat demand can be a cost-effective system investment – if applied selectively to around 25% of the UK’s housing stock. What’s needed though is a holistic plan, combining these efficiency measures with low carbon heat sources.
The ETI believes there are two main solutions depending on local circumstances, one delivering low carbon heat through heat networks at a local area level and one focussing on individual home systems using electricity for heating.
To deliver these solutions it will be necessary to implement a system level framework to package known but underdeveloped technologies into integrated solutions. This then needs to be translated into local energy strategies taking into account the different needs of different locations.
These strategies need to consider the geographical layout, house types, individual consumer preferences, availability of local energy resources and natural features and constraints. Without having such a strategic framework and design tools in place it would be impossible to build a coherent transition pathway or gain the essential consensus of local consumers.
Recognising this vital requirement, the ETI is developing a set of tools, under the brand of EnergyPath, along with processes which act together to support the systematic assessment of future solutions for local areas.
It will be far from easy to establish new heating solutions that substantially remove natural gas from domestic home heating systems, so compelling consumer propositions and business models will need to be created, and affordability needs will remain a key element of any transition planning.
If changes are to be implemented on such a large scale it is vital that those are not forced on householders but instead their views, preferences and concerns are considered and influence final decisions.
Over the last 18 months we have researched the views of over 2,500 consumers which showed that most don’t want to change how they heat their homes simply because it would reduce carbon emissions.
They did however want to optimise their heating systems before replacing them, and it was clear that different households have different priorities. People want better control of the time, effort and money they spend on their home. They don’t simply want to minimise their running costs.
When contemplating changes on such a scale proper planning and preparation is needed, especially over the next decade as rapid implementation will be required from 2025 to meet the 2050 targets.
During that 25 year period around 26 million homes will require new low carbon installations at the rate of 20,000 per week – the equivalent of upgrading every home in a town the size of Milton Keynes 10 times over each year.
So the real challenge is not so much technology based – but lies around gaining public consensus and trust in the change that is needed.
If we are to successfully deliver near-zero emission homes, it is important to integrate the transition of the energy system into local planning processes to form coherent strategic local plans that link to national objectives.
The importance of the ‘preparedness and confidence building phase’ cannot be over emphasised as a lack of market confidence and delay in building the necessary momentum will inevitably lead to higher costs driven by harder pressed resources, along with missed targets and business opportunities.
Through its SSH programme, the ETI is continuing to invest in building the understanding of consumer needs and the development of energy system product and design tools. Working in partnership with a small group of local authorities it is intended to demonstrate real solutions in real local areas to help inform policy and support the introduction of local strategic energy system plans, consumer products and business models that can help generate the momentum required to achieve 2050 climate goals.
Jeff Douglas is the Strategy Manager for The Energy Technologies Institute.
This blog was kindly replicated with permission from The Energy Technologies Institute. For more information on their project 'Smart Systems and Heat: Decarbonising Heat for UK Homes' click here.
District heating is making a comeback! These heating systems are winning support from the Government, landlords and planners alike as we look for energy-efficient alternatives to conventional heating systems. Casey Cole, Managing Director at Guru Systems, explains how modern-day technology is helping to reignite enthusiasm for district heat.
District heat is enjoying a renaissance.
Having been all but confined to history after the demise of the ‘streets in the sky’ building programme of the 60s and 70s, many are now turning to modern day district heat networks as a long-term solution to providing low-carbon energy to our housing stock.
It is more than 50 years since the concept was first introduced in the UK, and the mistakes of the past have been well documented.
Today, however, the landscape couldn’t be more different.
New technology, with the support of Government financing, means that district heat is now a reliable source of energy that is increasingly easy to monitor and manage.
The Department of Energy and Climate Change estimates that 14% of UK heat demand could be cost effectively met by heat networks by 2030, with the figure rising to 43% by 2050. While in the capital, the Mayor of London has set out plans for 25 per cent of heat and power used in London to be generated through the use of localised decentralised energy systems by 2025.
Planners are similarly championing its use in new housing developments, particularly in London, as they promote an “eco-first” approach to planning permission.
Robin Feeley, Director of L&Q Energy, which manages 2,000 homes on 33 district heat networks across London and the south east, said: “In London in particular, district heat is no longer a choice, it is a necessity and as developers, housing association are having to adapt and fast.
“The technology developed to monitor these networks has come on leaps and bounds in the last few years and in many ways housing associations are leading the way in implementing these advancements and pioneering new technology, including smart meters.”
The 21st century district heat schemes benefits have been widely publicised, as energy is distributed from a central hub, rather than from boilers in individual properties, heat networks are more energy efficient than conventional heating systems and allow landlords to supply low cost heat to their tenants.
Heat networks are notoriously difficult to administer, especially as landlords are not allowed to make a profit from the energy they sell to their tenants. If they charge too much they face legal challenges, if they charge too little they could lose money every time a tenant turns on their heating.
In most cases landlords will set tariffs based on the expected performance of the system – not on real world data that shows how well the network is actually working. This means that if initial assumptions are inaccurate, or there is a sudden dip in efficiency through a fault in the network, costs for landlord could spiral rapidly.
At Guru, we have seen cases of a 100-home scheme losing £65k in 14 months, simply because their tariff had assumed a much better efficiency than was achieved in practice.
The landlord billed their residents every month according to aggregate consumption, but they had not had access to performance data and so did not know their tariff was wrong.
With landlords having to take on the unfamiliar role of energy provider – and facing a raft of technical and legal ramifications – housing professionals are mixing traditional ideas with new technology to bring district heat into the modern age.
Robin Feeley continues: “We spent five years refining our district heat networks to the point where we have a produced a technical specification for our networks. At first, like I am sure many housing associations were, we relied heavily on contractors to specify what we needed.
“Since first installing district heat networks, technology has transformed the way we deliver and monitor the energy we provide to our tenants, to such an extent that we are now revisiting earlier developments to install smart meters where previously we had old-fashioned prepayment meters.”
The majority of landlords have no way of knowing how well their networks are running as the data is collected monthly, rather than being logged minute-by-minute. While many recognise the need to provide cost-effective heating to their residents, the majority have no way of reviewing efficiencies on their networks.
Although older heat meters provide essential data, most of it remains unused due to antiquated data collection systems. Some operators of district heat networks rely on customers to provide readings or send an operative with a radio receiver to collect readings from each meter, while others are using the 20-year-old technology to transmit data on usage from individual homes.
These basic methods mean that if landlords are calculating their tariffs incorrectly or networks are not running efficiently, they can suffer huge financial losses in the months between meter readings.
Today housing associations can monitor key information on how the network is performing – from the central plant right through to each individual’s home – meaning landlords can quickly identify any issues in the network long before costs mount up.
By delivering real-time information on energy usage and payments, smart meters allow registered providers to identify and focus resources on vulnerable residents who are in fuel poverty and in immediate need of support.
The technology to manage and monitor heat networks is constantly advancing. Guru Systems recently won funding from the Department of Energy and Climate Change to develop an algorithm to evaluate the efficiency of schemes.
Using innovative algorithms that build on techniques developed for Big Data applications, the technology will be able to recognise patterns in performance data and identify the likely source of any inefficiency on networks.
As well as identifying the problem, the new system will also propose solutions ranked by cost-effectiveness, while machine learning will ensure the algorithm’s accuracy continues to improve the more data it analyses.
Guru Systems has seen its technology installed on 35 schemes across the UK for landlords including, L&Q, Affinity Sutton, Octavia Housing, and Peabody Trust, and private developers, such as Berkeley and Telford Homes.
Casey Cole is Managing Director of Guru Systems, which provides smart payment and energy-efficiency technology systems for local energy networks
This feature was originally published in the April edition of Housing Association and Building Maintenance Magazine. To read more great articles, visit www.habmonline.co.uk
The introduction of the Non-Domestic RHI in November 2011 helped to trigger significant growth in small scale district heating. REHAU realised this potential and it was one of the drivers in our decision to invest in UK district heating pipe production in the Spring of that year.
Since then, a small scale district heating market which has been until now, dominated by sub 200kW biomass boilers has recently broadened to include CHP solutions (gas and renewable), anaerobic digestion and heat pumps as well, showing just what a wide range of heat source options are possible.
Moving forward, the likely reduction in the 200kW small biomass tariff on 1st July 2015 may actually have a positive effect on best practice system design, discouraging possible over/under sizing of the plant. I’m certainly hoping to see more projects sized more appropriately in the future regardless of the heat source chosen, with the emphasis shifting from tariff banding to optimum efficiency.
Polymer district heating pipe can easily accommodate up to ca. 2MW in a single 160mm pipe, making it the material of choice for many of these small to medium scale schemes. Steel pipes are ideally suited to large, city-wide projects which require bigger pipe diameters (eg 500-1000mm), whereas polymer pipes offer significant installation savings on the small to medium sized projects.
The emphasis needs to be on reducing flow/return temperatures since this is what makes schemes more efficient in terms of heat losses, and reduces capital costs because it allows the smaller pipe sizes to be used. This message was reinforced recently in the CIBSE Code of Practice which encouraged specifiers to focus on the importance of good system design. Training courses on this Code of Practice and manufacturer-led training such as CPD courses and design courses are key to ensuring best practice in this growing industry.
Personally, I hope that more community-based heat pump schemes are installed as they are ideal in terms of efficiency and pipe sizing because of the lower flow temperatures which heat pumps demand.
Obviously, there is understandable concern in the industry about the possible changes to the RHI after 2016 and what impact they might have on future deployment of district heating in the UK, but I remain confident that, with the right focus on efficiency and cost effectiveness, it will still have a major role to play in the UK heat market.
A well installed and correctly operated CHP can give thousands of pounds in energy savings and significantly reduce carbon emissions.
The Association for Decentralised Energy’s case studies show that CHP can reduce energy bills by up to 30%, and see quick investment paybacks. As energy bills continue to rise, CHP investments help users hedge against rising prices and control their energy costs.
These benefits are leading to significant growth in small-scale CHP, located in office buildings, hospitals, leisure centres and care homes, all across the UK. Industry surveys estimate at least 100 MW of new small-scale (<2 MW in size) CHP capacity was installed in 2014, and we expect continued strong growth in 2015.
Each of these hundreds of energy users saw an opportunity to make significant cost savings while also using CHP’s higher efficiency to reduce their carbon emissions.
However, CHP only provides these benefits if it is sized and installed correctly and ultimately operated properly. A CHP solution needs to be based on a number of considerations including technical, financial and operational factors, not just to meet planning or building regulation requirements.
Contractors, consultants and customers may have limited experience with CHP, and so it is important they understand the key steps necessary for successful CHP installations. By including the supplier in the early stages of the project’s design all the players involved can ensure the value of their investment is more secure and that their reputations are protected.
Data is king
When first considering whether CHP is the right investment for you or your customer, it is important to collect as much information about the site's requirements including energy demand and heat to power ratio, opportunities to export, and alternative energy efficiency options to create a detailed model.
If you do not take care at this initial stage, there is a significant risk you will oversize your CHP plant, it will run inefficiently and potentially lose you money, instead of saving it.
It is important to begin consulting a CHP supplier even at this very first step, as they can provide you with support to make sure you invest in the right equipment.
Don’t just drive away
For most energy users, expecting to operate a CHP without support is akin to jumping into a race car without any instruction. You might move forward, but probably not at the speed you hoped. And you may even cause some very expensive damage.
That is why it is important contractors and their customers secure operation and maintenance contracts, to help protect the long-term investment and make sure the CHP is run optimally.
In order to make sure you make the right investment decision, consider life cycle cost instead of just capital cost. A cheap CHP might cost you a lot more in the long run.
Three key operational principles
Some key operation requirements to keep in mind when designing and operating CHP is to:
- Ensure a large difference between flow and return temperatures.
- Operate your CHP in preference to boilers for a higher overall efficiency.
- Consider a thermal store to help manage demand and take advantage of price signals.
Once your CHP is installed, get a performance test sheet to check your CHP meets the original performance specification. Also make sure your CHP continues to meet the standards of the CHP Quality Assurance (CHPQA) scheme, as most CHP financial incentives require continued CHPQA accreditation.
Installing metering can also help monitor performance and confirm your investment is delivering, and you can change its operation if not.
People are important too
Make sure relevant staff are trained properly and made aware of the importance of operating your new CHP correctly. For contractors and consultants, this means making sure there’s a careful handover process, so that the energy centre operator will understand their investment. Small changes to a CHP's operation can have a big impact on its efficiency. For example, making sure staff do not over increase boiler temperature in response to cold weather as this will impact flow and return temperatures and overall efficiency.
By getting advice from experts and making sure you are involving the operator and the CHP supplier at the early stages, consultants, contractors and customers can ensure their CHP investments deliver the expected carbon and cost savings. The Association for Decentralised Energy’s new advice note for contractors, consultants and customers is designed to help users make sure they avoid some of these key pitfalls when installing and operating CHP, and maximise the benefits. You can download the full advice document here.
by ADE Director, Dr Tim Rotheray
As we near the general election, the Association for Decentralised Energy reviewed the parties’ manifestos to better understand what they will mean for the decentralised energy sector and energy users.
The first thing the jumps out is the continuing focus on the supply side rather than appropriately balancing demand and supply.
The Conservative Party’s manifesto has very little on demand, and includes a lower ambition on household energy efficiency than in the last parliament. Likewise Labour's focus on efficiency while more ambitious and developed than the Conservatives, stops at homes. Both Labour and the Liberal Democrat manifestos commit to energy efficiency as an infrastructure priority, which is a welcome proposal for the sector, but given that the evidence points to cutting waste as key way to ensure least cost emission reductions, there remains limited detail. Unfortunately, energy waste reduction remains an afterthought in energy policy.
Despite loud concerns over the past two years from businesses on their growing energy costs, there is nothing from any of the parties manifestos which shows the importance of improving industrial and business energy productivity or managing their costs is on their radar. It appears to be a real missed opportunity for all the major parties.
Energy costs and the energy market
The Conservative's focus on the cost of energy will be welcomed by users, but the promise to remove relatively low-cost onshore wind subsidies risks undermining this claim.
In addition to a 20-month price freeze, Labour's commitment to resetting the market raises the spectre of yet more regulatory uncertainty, although the proposals will be well received by some in the local energy sector who find the current electricity market inaccessible. It does not seem clear if Labour is aware of the weariness of change that exists in the sector or in the amount of effort and time which such changes require. I remember former energy minister Charles Hendry promising that establishing certainty required a short period of uncertainty, suggesting a period of six months. That was the start of EMR. The EMR process is now almost finalised, five years since it started, and it has not actually reformed the mechanics of the market at all. Labour commits to doing this in 20 months -- I remain sceptical that 20 months will be long enough to effect the change they are calling for.
The Liberal Democrat manifesto reflects their experience gained in government and their aim to own the green energy file in comparison to the other main parties, and it shows. They have the most well thought through positions. The legacy of being in government is clear, however, as commitments to new nuclear (without ‘subsidy’) and a celebration of EMRs successes may ring a little hollow to industry insiders. That said, the focus on efficiency and as the only manifesto to properly consider heat is encouraging to see.
It will be interesting to see how these well-thought through proposals could be implemented if they are able to gain a place in a new administration.
The other parties
Of the other parties, the one most worth a focus is that of the Scottish Nationalists, due to their likely influence in a new Labour government. Their manifesto has an understandable focus on Scotland, but their concerns on Scottish transmission charging costs will face significant challenges considering the industry just reviewed this issue in 2014. A new northern generator transmission discount could be envisaged but that would hugely impact on Ofgem's requirement to for network costs to be ‘cost reflective’ and could result in competition concerns from generators in England and Wales.
Interestingly, as heat and efficiency are entirely or significantly devolved, these areas of policy remain untouched as areas that are already addressed by the Scottish Government. The SNP has a very strong focus on encouraging renewable electricity investment, due to the Scottish wind and tidal resource. This focus almost inevitably sets up areas of tension on the cost of energy policy for the major parties, between the other parties’ interest in driving down decarbonisation costs and the SNP’s desire to support the Scottish renewables industry.
What will we get?
All in all, there is high level agreement on meeting our decarbonisation targets and on further investments in household efficiency, although in both cases the scale vary quite greatly. With so little detail from the Conservatives there appears the most potential agreement will come from the Lib-Lab-SNP pledges, although the devil is in the detail.
Given the current polls showing a minority parliament, it looks like a clear direction on energy policy could be very challenging after May.
The ADE member ENER-G have curated a fantastic collection of articles and guides over the past year creating a sizeable resource for learning more about combined heat and power in different settings. Here is a comprehensive list of topics they have covered! Click the title to read more.
By The Association for Decentralised Energy director, Dr Tim Rotheray
The way we have developed the UK energy system is based on a centralised view.
Power is generated far from its users. Production is managed up or down to follow changes in demand. The energy user, by and large, is a passive recipient. The producer has no relationship with the user, and the user has little control over their energy.
Energy for heat is also by and large centralised - gas (the major source of heat in the UK) is procured and delivered in GB wide network to broadly passive users.
But the system is changing. In fact, the system has been changing for a long time. The change is driven by users wanting to take greater control of their energy, principally to manage their costs. These local actions – be they investing in decentralised generation, efficiency measures or actively shifting energy demand – are individual decisions, hidden from view.
A new report published by the renamed Association for Decentralised Energy seeks to quantify the cumulative value of all of these discrete, individual actions. The report examines what energy demand would have been if we used as much energy for every pound generated in the economy as we did in 1980.
The results are staggering. The collective impact of all those individual decisions and investments is worth £37bn in avoided business energy costs every single year. Our annual gas imports would have been three times what they are today. That is 771 supertankers of avoided gas imports. The UK would also have needed to build 14 additional large power stations and Our annual CO2 emissions would be higher by nearly half a billion tonnes.
These demand side investments have made the UK leaner, greener and more secure. It is only by seeing the enormous total value that we can fully understand the case for doing more at the local level.
Our energy system struggles to encourage local solutions. Heat networks to capture local waste heat, lifting the vulnerable from fuel poverty. Combined heat and power to make business more competitive and cut the vast amount of energy wasted from our power stations. Businesses’ investment in energy management and demand side services, allowing them to reliably keep our lights on for less cost, and allowing participation in our energy system right across the country.
This is not about pitting one system against another. There are no silver bullets. It is about creating a system that can accommodate and value all options. Centralised and decentralised, supply and demand.
To achieve this end, we require a new way of thinking about the UK energy system. Not thinking of a system which dictates to the user, but thinking of one in which the user and producer are in partnership. By exploring all options equally we can find the best way to meet the UK’s energy needs by managing both production and demand, and crucially, by cutting waste first.
Using Government's own estimates, the Invisible Energy report shows that there are many more 'demand side' opportunities. By 2020, we could cut business energy cost by a further £5bn and save enough power to run the London Underground for 30 years.
We see the role of the newly renamed Association for Decentralised Energy as helping bring together the policies necessary to support that opportunity, and help create a more local, user-led, efficient energy system.
Our focus will remain on shaping policy and regulation to ensure the UK is seizing upon its decentralised generation, demand response and demand reduction opportunities. Currently, demand side policy is fragmented, with little integration to ensure that it works for the user. Our vision is for the energy system to be designed around the user, enabling them to take control. If we are to make the successful transition to a low carbon economy, we must capture the opportunities to make business and industry more efficient and competitive, heat homes and businesses with technologies and infrastructure suited to their location, and ensure our transition to a low carbon economy is done as cost effectively as possible.
A competitive, secure and low carbon energy economy is achievable, but only if we explore the options at all scales to help us get there.
A quick snap taken by our Communications Officer as she cycled to work through the Olympic Park. As you can see, on this frosty morning the biomass boiler in King's Yard was firing to provide heating and hot water through the heat network to the residents and businesses on the site.
Ian Hopkins, Director at ENER-G takes us through what you should consider when sizing your combined heat and power plant so that it runs just as well in half an hour, as it does in ten years time. Key questions include whether the site is heat led or electricity led, what the demand profile looks like hour to hour, week to week and month to month, and if the site's load will stay the same over time.
CHP won't deliver for every development and detailed analysis and modelling is required to assess feasibility and then to ensure that it is sized and specified accurately to provide maximum efficiency - both in the short and long term, where energy demand patterns might change.
In conventional power and heating applications, plant capacity is usually dictated by maximum demand, resulting in the system operating predominantly at part load. To gain the efficiency and economic viability of CHP plants, high utilisation is required; hence it is essential to understand the minimum energy demands during the running period, as well as the maximum demands.
Sizing a future-proof CHP unit requires accurate measurements today and a measure of how the balance between heat and power baseloads might shift. It is important to ask careful questions about what the CHP system will need to do in both the next half hour and in the next ten years.
The process should start with an audit of current and future demands of heat and power.
Site demand information will show how demand profiles peak and fall with:
- Time of day
- Day of the week
- Season of the year
When a CHP system has been sized against the building’s normal patterns of consumption, it is always wise to compare the economics and environmental benefits with those of a larger and smaller plant.
Theory says a well-designed CHP system will use all the heat and power produced, but a larger CHP plant generating surplus heat may show greater economy and environmental benefits in future. The chief considerations are:
- Planned energy efficiency measures that would reduce the current demand for heat and/or power.
- Planned changes to the business, the building or the occupancy that will increase or reduce energy demand.
For example, in a sports centre, is a swimming pool planned? In a hotel, will the fabric of the building be insulated, or will double-glazing be installed? For any business, will the staff numbers grow?
Many CHP installations are oversized because the energy demand profile has not been assessed properly. To get the full benefits of CHP, the unit needs to run all day every day, and all the power and heat produced has to be fully utilised.
Ideally, the demand information would be based on heat and power consumption measured every hour for one year. Annual or monthly electricity and gas meter make no allowance for seasonal variations, particularly in heat. As such, it is important to get as close as possible to hourly or even half-hourly consumption figures.
Electricity usage profiles can be obtained by looking at half-hour meter data from your electricity supplier. Heat usage profiles are more difficult to assess, so you may need to utilise some temporary metering. Monthly fuel bills will indicate some degree of seasonal variation. For weekly and daily profiles it is important to understand the operating pattern of the building and to add to that a short-term monitoring exercise or audit.
Once you have established the demand profiles you can calculate the electricity and building's heat baseloads.
The useful output from a CHP gas engine is typically about 40% electricity, 45% heat. From the current and projected demands of the building and the business, you need to establish whether the CHP sizing will be based on the electricity or heat demand.
A heat-led sizing will meet the site’s heat demands. It may produce surplus electricity that can be exported or leave a need for top-up power. The economics of exporting power then becomes a priority issue. A power-led sizing could produce excess wasted heat, so it may be worth considering a smaller unit.
Once a CHP unit has been sized on a current heat-to-power ratio, future considerations need to include an assessment of how the heat-to-power ratio of the building’s demand might change over time and to incorporate these scenarios into your planning..
Download the ENER-G guide: CHP project planning: How to determine site heat and power demands
Ian Hopkins is a Director of ENER-G Combined Power Ltd. He is a technical sales and marketing professional and business leader with more than 15 years’ experience in delivering energy efficiency projects and strategy in Europe and the United States.
Further information: www.energ.co.uk/chp
Thomas Briault and Stuart Allison from Arup explore our tendency to over-simplify how we think about the price of heat, and show some findings from recent work which shed light on the facts behind the figures.
We have been working with a number of clients recently to look at the price customers pay to keep warm using individual gas boiler systems.
Our first finding: most people do not make a distinction between heat and gas.
What we pay for gas is around 4p/kWh with an £80 per year standing charge (source: uSwitch for a dual fuel energy bill from the six largest suppliers).
But the supply of gas alone does not get customers heat. To calculate the true costs of heating – with a guaranteed heat supply, all year round - we need to take into account their boiler efficiency, maintenance of that boiler and the replacements costs when it comes to the end of its useful life, typically every ten years or so.
In terms of maintenance, the cost of gas boiler maintenance cover, with zero excess, is typically £150-£200 per year. The consumer rights group Which? has carried out research suggesting that a boiler maintenance package with zero excess is not the cheapest solution for householders, who could save money by using their local plumber to fix repairs whenever needed. However, this means that the resident does not have a guaranteed supply of heat, since a plumber could take days to arrive with the correct parts and would not pay you a penalty charge for any delay in arrival.
Although all residents hope they will not have to replace their boiler while in their property, on average boilers need replacing once every 11 years, often at a high capital cost. Even a social housing provider ordering in bulk would struggle to keep the installed cost below £1500, meaning the annualised cost of boiler replacement is likely to be between £110-£220, depending on size and complexity.
When all of these costs are factored in, we begin to get a picture for the price of heat, rather than simply the fuel utility costs.
The graph below shows the total bill for a two bedroom apartment using around 3,500kWh/yr (assuming design standards for a new Code for Sustainable Homes Level 4+ building). The actual cost of heat is not 4p but closer to 14p/kWh.
Some elements of these costs are fixed and do not vary between customers. These account for some £330 of the overall bill, regardless of how much heat the customer uses.
District Heating systems are another way to provide guaranteed, year round, uninterrupted heat, and they can do this at a discount to the figures shown above for individual gas boilers. Performance and prices are linked: if heat is down for more than 24 hours, the district heating operator will often pay a penalty charge to their customers.
In many cases, the discount on the price of heat is achieved with a developer contribution towards the capital cost of the district heating network and/or energy centre. Although communal gas boiler solutions are often cheaper when including the capital costs, they do not provide the necessary carbon reductions to enable developers to meet their planning and building regulation requirements without incurring additional capital investment in measures such as solar panels.
Currently gas fired CHP is the cheapest way to roll out technology-agnostic district heating, but it does inherently have a carbon impact and this will worsen as the grid decarbonises. We are therefore now working on is assessing the best option to replace the gas fired assets, and there are a wide variety of options being explored.
Chris Marsland, Technical Director for ENER-G Group explains how combined heat and power could play an integral part for more renewable energy to be brought onto the grid. But the added complexity of doing so is costly, so who should pay?
Strange as it may seem, the UK gas combined heat and power (CHP) fleet, in addition to reducing carbon emissions by generating our energy more efficiently, is also providing invaluable support for the growing renewables industry.
This is great, you might think, as we need to move to a new order of sustainable energy and reduced carbon emissions. But what extra cost burden will the increase in wind and solar supply add to CHP generation in the near future, and who should pay for it?
You might be familiar with the European Union's work on grid codes. New codes are being put in place and are designed to prepare and improve the EU wide electricity network for the future.
Several of these new codes deal with the need to provide certainty of supply and manage the grid, addressing the increasing penetration of intermittent renewable energy sources.
Firstly, most of the country's renewable energy supply (which accounted for 15% of total supply in 2013) is intermittent and dependent on wind or sunlight, and so dispatchable power supplies are necessary as back up.
A further little-known challenge of increasing renewable penetration is the concept of system inertia. Traditional power stations have large rotating lumps of copper - the generator. These have rotating momentum which helps stabilise the network when power output from other sources fluctuates. Renewable energy sources tend to connect to the grid using high tech electronics, which have no rotating mass and cannot provide this inertia.
So intermittency and loss of inertia require those in control of the system to request more and more capabilities from our CHPs, to help ensure a secure and stable network. It is a big responsibility for CHP, but our sector is more than capable of providing these essential system features to even out supply. Indeed, we have been doing so successfully for many years in response to market and system financial signals.
The big shift found in these new EU codes is the possible mandatory requirement for CHP to have significant technology features fitted before they are allowed to connect to the grid. These new requirements are potentially increasing the cost and complexity of CHP.
These technology requirements include improved control systems, larger/different generators and an ability to permit greater interaction with and control by the system operators. These aren't merely technology tweaks – they would require major capital costs, R&D, and engineering and manufacturing investment that could add large extra costs to CHP developments and threaten the competitiveness of the industry.
It is right and necessary that we move to a low carbon energy system, but we need all the tools in place to facilitate it. Energy users subsidise the wind and solar technologies that are necessary to meet our climate change commitments. However, the new EU proposals are recommending that the CHP industry pays for the challenges such a new system brings.
Without CHP (with their rotating mass), which provide the technical ability to manage grid stresses when faults occur in the system, the massive growth of wind and solar generation would not be possible.
CHP providers, owners and operators should be proud that we are playing our part in helping to bring about the rightful change to a sustainable energy system. But is it right that we, as a major contributor to carbon reduction, should pay the cost for problems that we solve? Surely the network owners and operators should instead be paying generators for the cost of helping them keep the system stable.