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David Sheales

David Sheales

Heat Conference 2016 site developer

By Ian Marchant FEI, President, Energy Institute


The simplest questions are usually the best. By many measures, heating accounts for around half our total energy use. The cost of that energy has gone up significantly in recent years. Less than 5% of our heating is from renewable sources.

We all know the problem, how to get the first two of these measures down and the third one up. So here's where the simple question comes. What is the one thing we should focus on?

It would be tempting to use this opportunity to lobby on the political environment and support mechanisms or to wax lyrically on new technologies but I don't believe that either of these important areas are the one big thing. So what is it? I believe it’s Behaviour. 

Let me explain. The reason why we don't insulate our homes or set our thermostats and time clocks correctly is behavioural or to put in bluntly, we can't be bothered.  The reason why district heating is so hard to get going in the UK is because we all want our own boilers in the corner of our house. The reason that biomethane struggles to make inroads is that we don't regard organic waste as a valuable fuel and just throw it away. The reason we don't install new technology such as heat pumps is because the old ways are easier. 

We don't need more engineers and lobbyists taking part in the heat debate we need behavioural economists, anthropologists, psychologists and socialists to work out how to get us off our backsides and actually do something.

 

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We’re delighted that Matthew Pencharz, Senior Advisor on Environment and Energy to Mayor of London Boris Johnson, will be joining us at Heat 2014. We took some time to catch up with him ahead of the event:

How did London go about placing heat as a specific issue in the energy policy debate?

London’s high use of public transport means that a great proportion of our CO2 emissions come from buildings; nearly 80 per cent, in fact. With expected decarbonisation of the electricity grid, the greatest impact in CO2 emissions is to be found in addressing buildings’ energy efficiency and the use of fossil fuels in heating.

Retrofitting these buildings is a priority for London. To maximise CO2 emissions reductions in the most cost-effective ways, the Mayor’s approach is to retrofit these buildings with energy efficiency and energy supply measures through programmes such as RE:NEW, RE:FIT and the decentralised energy programme of work.

Increasing concerns over the affordability and security of London’s energy supply have focussed attention on delivering an energy future for London with a triple bottom line: to be more secure, more affordable and lower carbon. Our research shows that placing heat at the centre will deliver the greatest benefits.

London has 32 Boroughs and the Corporation of London, a lot of stakeholders and Westminster watching on. How do you manage the dynamics between citywide policy and delivery, the national policy landscape and local delivery?

A major concern is the fall in national electricity generating capacity; we have an alarming lack of energy capacity headroom and therefore an unacceptably high risk of brownouts. This capacity crunch has been further exacerbated by the unplanned outages of a number of power stations and the intended closure of others.

The Mayor is doing all he can to increase the level of local generation that will take the stress off upstream generation, including initiatives such as Licence Lite (LL). LL is a junior electricity supply licence aimed at overcoming the cost and market barriers to distributed generators wanting to sell their power output at rates reflecting its true retail value. With Ofgem’s oversight, we intend to pilot the new licence that will allow local generators a better price for their electricity, which should help decentralised generators proliferate, further reducing stress on the national power system. He is also working hard to deliver smart systems in London to manage demand better and incentivise consumers – both commercial and domestic – to avoid the hours of peak demand.

London’s electricity distribution infrastructure has served the capital well. However, electricity demand is now increasing 1-4 per cent a year and a large number of the capital’s substations are, at times, at or near their maximum capacity. The current regulations severely limit strategic investment in electricity distribution infrastructure ahead of an immediate request for a connection. The Mayor is working with developers, the Government and Ofgem to investigate how the current regulations could be reformed to allow a much more strategic approach to investment in electricity distribution infrastructure while protecting consumers from any risk.

A lot has happened to deliver efficient, affordable, sustainable heat in London over recent years. How’s the market looking? 

The Mayor has a small development team that directs consultancy support to help others develop and deliver their larger-scale decentralised energy projects. The team has developed a DE project pipeline valued at over £300m, almost a third of which is expected to be brought to market by summer next year. The projects are characterised by their technical variety and disparate stakeholders. This points to the important role of the specialist energy development team in helping identify and structure projects with the stakeholders. Examples include

  • Supporting the London Borough of Camden to capture 2 MWth of unused heat from a new gas-turbine CHP installation at the Royal Free Hospital to heat their housing stock at Gospel Oak utilising a new heat network.
  • Supporting the London Boroughs of Enfield, Haringey and Waltham Forest establish a North London area-wide heat network. Enfield has established the Lee Valley Heat Network company that will initiate the start of the project based on heat from the Edmonton energy from waste project.
  • Supporting developers in the Vauxhall Nine Elms Battersea Opportunity Area to approach the ESCO market to invest in interconnecting heat network and provide heat supply services centred on the New US Embassy.

There’s some great work under way, but what are the ongoing challenges for London in terms of heat?

If London is to achieve its target of supplying a quarter of London’s energy from decentralised sources by 2025, then the supply of heat from CHP, waste heat and natural sources by means of heat networks will have an important role to play.

London’s complicated governance structure and the multiplicity of stakeholders mean that it is challenging for an individual private sector player to drive forward large-scale DE projects. We intend to use the planning, convening and influencing power of London’s public authorities, combined with expert support from the GLA, to drive forward market competitive projects, resulting in an energy supply for London which is more affordable, secure and lower carbon.

Finally, what are the key plans for the future? What should the heat industry know about what’s coming in London?

London is set to exceed its record level of population within months and risks losing its premier position unless a major programme of infrastructure investment is put in place.

The London Infrastructure Plan 2050 is the first attempt to set out the full range of infrastructure requirements for the capital over the next half century, during which time the population of London is forecast to increase by 37 per cent to more than 11 million people.

The plan builds on the Mayor’s campaign for greater fiscal devolution to cities allowing for investment in much-needed local infrastructure and boosting the whole of the UK’s economy. The Mayor believes that the model for investment set out in the plan could also be suitable for all of these cities, and others, providing a blueprint for how they might invest in locally-decided priority infrastructure needs.

Thanks to Matthew Pencharz for his contribution here. You can hear more from Matthew – particularly about the dynamics of cities operating in a national and local landscape – at Heat 2014 on Wednesday 5 November. To book your place now, visit www.heatconference.co.uk

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Energy, and in particular electrical power, is closely linked in all countries to political power and the history of the UK energy industry, especially the electricity industry, is closely tied with social and political history.  Mass deployment of electricity in the UK – which took what had been a luxury for a few and turned it into an every day necessity for all – took from the 1920s to the 1960s.  In that period the dominant models were centralization and large-scale generation which fitted the economics of electricity as well as the over-riding social model and politics of the time – characterized by: “big is best”, “government knows best” and “take what you are given”.  Since the 1970s, and accelerating in the last few decades, we have been living through simultaneous social and technological revolutions that are fundamentally changing the foundations on which the energy industry was built.  In 1980 the futurist Alvin Toffler coined the phrase “prosumers” and although it is now sometimes used in different ways the original meaning was “people who blurred the line between consuming and producing by actively collaborating to improve or design the goods and services of the marketplace, transforming it and their roles as consumers”.  Given this phrase was coined well before the internet it was prescient, on-line developments such as Wikipedia are examples of prosuming and with technologies such as 3D printing we are now seeing examples of prosuming in physical products emerge.

Many of the perceived problems of the energy system in the UK actually result from separation of producer and consumer – the “big 6” suppliers, the National Grid, the DNOs – are all remote (even if your pension fund owns shares in some of them).  Energy generation and use are remote – you just flick a switch and expect something to happen – you get a bill – you deal with a call centre that nowadays may be in another continent.  The whole system is remote. 

It wasn’t always that way.  Prior to the nationalized British Electricity Authority being established in 1948 there were over 600 electricity companies, most of them owned by local councils.  With the growing interest in community energy and municipally owned energy companies, as well as innovations in technology around small scale distributed generation, interconnection through the internet and innovations in finance like crowd funding, the question is are we likely to revert back towards local energy companies and rebuilding the connections between production and consumption?

Back in 2013 the BBC reported on a community project to install high-speed fibre optic broadband into a rural village in Lancashire, a project crowd funded by the community.  Telecommunications, like energy, is a highly technical and regulated industry so this is an interesting model of what is possible. On a recent visit to Bavaria I saw a 6km gas pipe from a farmer’s Anaerobic Digestion plant to the local village.  The project was planned and actually constructed by the farmer and then tested by the appropriate authorities.  The Danish examples of community owned wind farms and district heating are well known.  The last few years has seen a growing interest (and actual investment) in community energy schemes in the UK, although most of these are dependent on subsidies through Feed-in Tariffs for renewables.  We should not expect continuation of subsidies for any form of energy – it is not sustainable – but we should expect and demand more community engagement and ownership of the energy system.  Many local authorities are evaluating the possibility of municipally owned energy companies and the leading authorities are now implementing their plans. 

A lot of people talk about disrupting the energy industry but then go on to talk about models that sound strangely similar to the existing system.  Real disruption would involve creating new mechanisms to facilitate individuals and communities to be able to design their own energy services system – based on sound technical and economic analysis rather than reliance on subsidies and technology fantasies.  Such a system would be far more diversified and de-centralized than our current energy system.  We should always remember that no-one actually wants to buy energy – they want to have the benefits of energy services - comfort, light, sound, mobility.  A shift towards prosuming energy would almost certainly encourage true services models that provide a combination of efficiency, demand response, storage and energy supply – a combination that probably changes in real-time to match the current conditions.

It is finally being recognized that improving energy efficiency brings many co-benefits such as improved productivity, better health and economic development and work soon to be published by the International Energy Agency demonstrates these co-benefits in many areas.  Community involvement, the rise of “prosuming”, in the energy system, would provide many co-benefits other than just energy savings or reductions in emissions, not the least of which would be improved individual and social engagement, a greater sense of ownership and control.  That could be considered priceless.

Producer and consumer, divorced by the industrial revolution, are reunited in the cycle of wealth creation, with the customer contributing not just the money but market and design information vital for the production process. Buyer and supplier share data, information, and knowledge. Someday, customers may also push buttons that activate remote production processes. Consumer and producer fuse into a "prosumer." (Alvin Toffler, Powershift, 1990: 239)

Dr. Steven Fawkes


 

Steven Fawkes has over 30 years experience in energy efficiency and is actively involved in energy efficiency financing programmes in Europe and North America.  He is the author of “Energy Efficiency”, published by Gower and the blog: www.onlyelevenpercent.com

 

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So last week our wait was over and we were able to meet old friends and enjoy the Heat Conference 2013 jointly held by the Combined Heat and Power Association and the Energy Institute.  This was the second year it had been held and I'm sure it'll become a firm fixture. There was a marked focus on the customer to the extent that previously familiar diagrams were turned upside-down or back-to-front or even inside-out to ensure the customer was at the start of our thinking process. As they should always be, of course.

The first session was chaired by the former SSE Chief Executive Ian Marchant and we kicked off with the Chief Executive of the Committee for Climate Change David Kennedy’s and his adroit overview of where we are.  To summarise it's not getting better, although he managed to add a positive spin. 

He was swiftly followed by Louise Strong from Which? who pounded us with a “customer reality check”. If we didn’t know who was the most important person at the start of her presentation, we had no doubt by the end.  Amongst the excellent points made she emphasised that presently customers connected to heat networks are afforded no protection from Ofgem or even the Energy Ombudsman.  I didn’t know that.  Part of her reality check was the results of a consumer survey on trust.  Possibly there was no surprise that at the top of the “Don’t trust” table were the energy companies not so closely followed by the car salesmen.  That’s right car salesmen!  And after five years of being the master villains, banks and financial services now seem to have completed their penance and transformed their relationship with consumers to be verging on warm and cuddly relative to the energy sector.  So when it comes to heat, if you think customers will welcome an organisation they don’t trust, to sell them something they don’t know about and can’t do without then probably you’ve got another think coming.

With most of us suitably chastened the mood of the conference was then lifted by Rt Hon Gregory Barker MP, Minister for Energy and Climate Change who gave an accomplished presentation of the Government’s achievements on Heat.  Yes, it has moved up the agenda.  Yes, there is still much more to do. But the question everyone wanted to know the answer to was what was he going to do about £139m tax hit on  CHP plant.  For reasons I won’t go into but more information is here, CHP plant used to receive a small incentive to reflect its low carbon credentials.  That disappeared a couple of years ago and then with the introduction of the Carbon Price Floor it now finds itself worse off than equivalent electricity only plant which has a much lower efficiency.  This double whammy is having a serious impact on existing CHP plant and future plant is being shelved left, right and centre.  So what was he going to be doing about it?  Well, no answer was forthcoming but the Minister coyly hinted that there might be something in the Autumn statement. 

There then followed a series of questions from audience, one of which the Minister openly stated he didn’t know the answer to. He then asked the audience to be a patient whilst he read the lips of one of his advisers. Well that was honest I thought.

During his presentation the Minister had emphasised the need to take an integrated approach to energy as well as expounding the virtues of Electricity Market Reform.  I couldn’t let him get away with that and so I held up my hand.  Unfortunately the smell of coffee and croissants wafting down the aisle and had an overpowering effect on most of the audience and Ian Marchant sensing the mood, ended the session and my opportunity to ask a question. 

So what was my question? Well if he so strongly supported an integrated approach to energy why is there no reference to heat in the Draft Energy Bill?  In fact, other than the movement of nuclear fuel, transport is not referred to either.  I am sure he would have had a good answer or, if not, he would have read the lips of someone who did.

We then moved into the remaining sessions, all of which were very good but I am just going to focus on three. The first of these was from Alasdair Young from Buro Happold looking at the role for heat networks with a particular focus on London.  The potential is large and there’s a mass of documentation covering studies which are available here.  These include wasted ( I always add the “d”) heat from range of sources including sewers, metro tunnels (London Underground), electricity infrastructure, commercial buildings and so on.  The estimate is that about 75% of London’s heat needs could be met by wasted heat.  That’s about 50 TWh and, on the assumption it displaces gas, about 10 Mt of CO2. Not to be sneezed at I’m sure you’ll agree.

The second presentation was by Marcus Stewart from National Grid. He presented the results of their Future Energy Scenarios (available here) but with the focus on how the UK is to meet the heat challenge.  The process used by National Grid in constructing the scenarios is impressive and involves wide scale consultation and engagement via a number of workshops held across the country. I think most would agree that National Grid has gone out of its way to be inclusive in the development of its scenarios.  But I couldn’t agree with their conclusions on heat as they saw almost no role for district heat networks.  According to National Grid in 2050 heat is delivered predominantly my heat pumps supplemented by some gas and bio energy. But no district heat networks. I need to get to the bottom of this and was pleased that Marcus was happy to discuss their analysis in more detail and so hopefully my questions will be answered soon.

The final session I want to touch on was a presentation from Stewart Reid of SSE on the Northern Isles New Energy Solutions (NINES) project. There’s some information here but in brief, Shetland has no electricity connection with the mainline, has no gas, plenty of wind and relies on an ageing oil fired power station which needs to close.  But they’re not just going to replace it with another.  Instead they are looking at arrange of solutions which include demand side management with “Smart” storage and water heating, extension of the existing district heating system as well as the installation of the largest battery in Great Britain.  Underpinning all of this will be active network management.  I think there could be a lot the mainland could learn from this fascinating project and I will certainly continue to follow it closely.

In the interests of political balance, the conference closed with a key note speech from Jonathan Reynolds MP, Shadow Minister for Climate Change. Recently appointed, I thought he did rather well covering Labour’s approach to heat, energy efficiency as well as displaying faux concern that Greg Barker looked a little bleary eyed.  Was this to do with his statement that he wouldn’t be sleeping if he didn’t have 10,000 signed up to the Green Deal at the end of the year? He probably won’t be sleeping much next year either.  

He spoke about Labour’s price freeze and then spoke briefly about the reforms Labour would make to the energy market, including going back to the Electricity Pool.  I was a little gob smacked by this.  So all the arguments used by the Labour Government back in the late 1990’s to go from the Pool to Neta have been turned on their head to justify going back to the Pool. Perhaps he doesn’t know that it cost about £600 million and took 5 years (see here).  In my opinion it was a waste of time and money then and it would be waste of time and money now.  The one theme that kept being repeated throughout the conference was the need for policy stability.  Read my lips, Shadow Minister, don’t do it.

Conference presentations are available here  and if you have any comments you can Tweet me @rcsansom.  

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In my role as President of the Energy Institute, I chaired the first session of the major annual heat conference that we host in partnership with the CHPA . In my foreword to the conference programme I described heat as the Cinderella of the energy industry, not because electricity and transport are ugly sisters but because heat always gets forgotten or left behind in policy debates. The panel discussion I chaired focused on the consumer view of heat and the representative of Calor Gas made the crucial point that decisions on heat are usually made in a rush. When the central heating boiler breaks down and needs to be replaced we don't have the luxury of time to consider alternative technologies such as heat pumps, we simply want our house and family to be warm again. That isn't helped by our lack of knowledge. Research by Which? showed that most of us haven't heard of the alternative technologies anyway.

Against this background the Climate Change Minister, Greg Barker, then gave a keynote address setting out what Government was doing to stimulate the decarbonisation of heat. He described the three levels at which interventions could be targeted and where decisions are made. They are:

1. The individual household where the choices of solar thermal and heat pumps are available.
2. The local level at which district heating schemes are an option.
3. The national level where greening the gas supply by injecting biogas can be deployed.

I decided to do an unscientific straw poll of the audience; the 'heat choir' if you like, and the result was quite striking. I asked which of the three levels could have the biggest impact on the achievement of the UKs targets and where Government effort should be targeted.  5% opted for the national route;, 15% voted for the individual household but an overwhelming 80% selected the local level. The clarity of the result surprised me and certainly had an impact on the Minister.

I was left wondering whether district heating really was Cinderella's glass slipper! 

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There has been so much activity on the district energy front this year in London that it pays to look over these once again ahead of Heat13.

At the start of year (well - strictly speaking mid-December 2012...), the London Borough of Islington formally inaugurated the Bunhill Heat & Power scheme. An innovative council-led initiative, which brought forward the development of a 2 MW gas-fired Combined Heat and Power (CHP) engine connected to a kilometre of new district heating network, supplying heat to more than 700 local homes and two leisure facilities.  In these times of austerity, this was a bold development by Islington, which is both owned and operated by the council, providing affordable heat and power to local residents as well as generating income by the sale of electricity to the grid. More please!


Around the same time, and a little less than five minutes walk away from the Bunhill site, Hackney Homes inaugurated the Shoreditch Heat Network. This was a major renovation of an old and tired district heating network, involving the addition of a new gas-fired CHP and thermal store. 


Following close to a year's work, the GLA launched a draft of its District Heating Manual for London in February. This is a comprehensive guide to developing district heating in the capital and is a further innovation by London government following the creation of the London Heat Map. Outline planning guidelines for Croydon’s major town centre regeneration were also approved this month, which include plans for a significant area wide district heating network.


March saw the Government set out actions to help deliver low carbon heating as part of its national Heat Strategy, which included the creation of a new Heat Networks Delivery Unit (HNDU). The unit will work with local authorities providing specialist expertise on district energy, emulating in large part what the GLA's own Decentralised Energy Project Delivery Unit (DEPDU) has been doing in London since 2009.


In April press reports emerged of E.ON's involvement in the evolving district energy network around the Greenwich Peninsula. There was also considerable media coverage on the highly innovative ‘fatberg’ CHP system planned to operate out of Beckton gasworks in Newham – which the developers are calling a Combined Heat and Intelligent Power’ (CHiP) plant! 


July saw the publication of a detailed district heating feasibility study for the massive Vauxhall Nine Elms Battersea (VNEB) development, which will involve the construction of a significant new district energy network across the site, but will hopefully also re-open the mothballed heat pipeline under the Thames which used to provide heat from Battersea Power Station to the Pimlico District Heating scheme!


Also released in July was a £5.7m tender by Camden for the proposed decentralised energy network, which had previously received planning approval by the council, connecting four residential estates to a major new state of the art medical research facility, all along Euston Road.


Also over the summer, a review by the GLA on the Implementation of the London Plan energy policies indicated that, over the past three years, environmental planning requirements in London have led to the approval of  the connection of 110,000 new dwellings in forthcoming developments to district heating networks, anticipated to be built out over the coming years: 53,000 of those were approved in 2012 alone (the latest figures). 

The GLA published in September a highly innovative study looking at London's secondary heat resource which found that “by using heat pumps to deliver heat at 70°C, the total heat that could be delivered from secondary sources in London is of the order of 71 TWh/yr which is more than the city’s total estimated heat demand of 66 TWh/yr in 2010”.

Further details were announced this month of the imminent launch of  London's first 'energy from waste' district heating scheme using heat from the SELCHP energy from waste plant to nearby estates in Southwark. About time!

In October the Elephant & Castle redevelopment, where district energy will play a huge role in helping bring about what the developers say will be “some of the most sustainable, energy efficient and occupier-friendly places to live in Britain” was recognised by the C40Cities initiative with ‘Climate Positive’ status.

And coming right up to date, and also full circle by returning to colleagues at Islington, last week saw the announcement that the council would be using waste heat from the tube – and heat captured from electrical substations – to be delivered through the Bunhill district energy network to heat hundreds of nearby homes.

In addition to all of the above, details are also emerging of other major district energy schemes being explored in London, which include those on the South Bank, in Wembley, and Lewisham, as well as the Upper Lea Valley and the extension from the Olympic Park district heating scheme. The Mayor's Decentralised Energy programme is supporting many of these projects, and others, which in total are worth close to £70m investment.

It’s great to see that this action being taken forward by local authorities and London government is now being recognised by national government. DECC is finally setting out a strategy for the wider deployment of heat networks, and their recent announcement establishing a £6m heat network fund to provide expertise to local authorities is to be applauded and should be supported by the industry.

There’s clearly a huge amount of activity going on and 2014 will hopefully build on this to further London’s district heating renaissance, helping set the capital on a lower carbon pathway. 


 

 Syed is the Director of www.energyforlondon.org 

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I grew up before energy efficiency was discovered - or rather it just wasn't necessary.  We had one heated room and that was it. The rest of the house was cold and so were we. Insulation would have been pointless as it was nearly as cold inside as it was outside. In fact it often felt colder.  On a sunny morning it wasn’t unusual for me to open my bedroom window to let the warm(er) air in.

That all changed with Economy 7. Introduced in the 1970s to allow electricity to compete with North Sea gas it offered the prospects of ending winter misery with the installation of a new technology called storage heaters. It was very simple; you put half priced electricity in at night and somehow it came out during the day. I can remember waking up to warm bliss. Wearing my coat indoors was no longer necessary and I could eat my breakfast without gloves. It was great. But arriving home in the evening I was disappointed to find the house cold again. Not as cold as it used to be but not much better. A little later we discovered another drawback: cost. The electricity may have been half priced but it still cost a lot.

Talk to others with experience of storage heaters and you’ll get similar tales and perhaps that is why there isn't much enthusiasm for them. There are still over 6 million storage heaters and I would expect for many they are probably not the best heating solution. But does that mean that storage heaters have no future? I am not so sure.

Modern storage heaters are said to be more efficient and “smarter”. With a decarbonized grid they offer a low carbon heating solution along with demand side management potential, thereby providing a major source of much needed flexibility.   In terms of capital costs, they are a lot lower than alternatives such as heat pumps but also the impact on upstream infrastructure is substantially less as  they can avoid peak demand. Running costs are likely to be higher due to their lower efficiency but for well insulated households with low heat demand they could be an attractive option suitable for large scale deployment.

I’m pleased to see that we have one session in the conference where storage heaters are discussed. Let’s put any prejudices we have aside as we might be surprised with what they can offer.


Robert Sansom is a Researcher at Imperial College London funded by UK Energy Research Centre.

Recent Comments - Show all comments
  • la
    la says #
    I have a storage heater in my flat and I am cold ALL of the time and yet also seem to be paying a lot for the privilege. This is
  • Paul
    Paul says #
    Interestingly SAP 2012 see's the recognition of 'high heat retention' storage heaters which are classed as storage heaters with no
  • william orchard
    william orchard says #
    Robert agree storage heaters valuable for storing heat. Suggest even better from exergy point of view if the electricity is used
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This week in our #Heat13 blog, Paul Woods from AECOM asks are we getting the best value for money from green subsidies?

If all subsidies were given at the same rate – i.e. a fixed sum per tonne of CO2 saved and for the same period of time then we could reasonably expect that the market would deliver the most cost-effective solutions. But the proliferation of ROcS, FiTs and RHI have left us with a huge range of effective costs to save a tonne of CO2.

A minimum figure of around £100/tonne is seen for onshore wind (and a similar level has been agreed for new nuclear albeit for 35 years) but solar PV is around £200/tonne and heat pumps receive over £400/tonne.

Bizarrely, gas-fired CHP receives nothing except at a domestic scale where there is a relatively high subsidy of £500/tonne (stirling engine type).As gas-fired CHP is the most common supplier of heat for district heating (DH) it is unsurprising that DH still supplies only 2% of our heat market.

So what kind of incentive could work? 

Whilst an incentive for gas-fired CHP would be welcomed it may be better to incentivise DH through a DH Incentive that would make payments retrospectively on an annual basis according to the amount of CO2 saved. This would encourage DH operators to develop lower CO2 forms of heat production and design efficient networks. In return for the DHI they would have an obligation to provide data on their scheme on energy and CO2 emissions which would be made publicly available to aid designers and policy makers.

An RHI set at £100/tonne could be sufficient to convert marginal projects into standalone projects financed by the private sector. However a higher figure could easily be justified when compared to other technologies which compete with DH such as domestic air-source heat pumps. Is there any reason why gas-fired CHP and DH should not receive the same level of incentive as heat pumps?”


Paul is Technical Director of District Energy and Sustainability at AECOM. 

Paul's recent presentation on a district heating incentive can be viewed here

 

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So at last, we have a decision on nuclear.  There will be some that think this is excellent and others the contrary.  But what does it mean for district heating?  Does it confirm the view that as far as DECC is concerned the future for heating remains an all-electric one with a heat pump in every home?

Well, the problem with current forms of low carbon generation is that they are either inflexible or intermittent and the more we have, the greater the need for flexibility.  Today flexibility is mostly provided by coal and oil plant but with much of this gone by 2020, it will need to come from elsewhere.  We’ll still have our pumped storage and interconnectors and of course there’ll be plenty of CCGTs to prop up the system.  Then there is demand side participation which should have a major role to play. However, its commercialisation into a viable and an attractive option that offers value to customers has some way to go.  To make matters worse heat demand is very peaky with large variations throughout the year and within day.  This is in itself will increase the need for flexibility.

So what can district heating do?  Well firstly it offers huge potential for flexibility. Tanks the size of our old gasometers, a feature of most towns and cities until a few years ago, can store vast quantities of water very cheaply.  With heating provided by very large electric heat pumps, for example, heat load be can be rapidly adjusted to support the system as well as smoothing out variations in heat demand.  Thermal CHP plant can also provide flexibility by varying heat production thereby increasing or reducing electricity production.  And finally, in the future with a well- developed heat network serving a sizeable load, there is no reason why nuclear could not also provide heat as well as electricity, although I doubt it features prominently in EDF Energy’s plans at present!

So is nuclear the end for heat networks?  I don’t think so. It may actually help.


 

Robert Sansom is a Researcher at Imperial College London funded by UK Energy Research Centre.

Recent Comments - Show all comments
  • Claire Wych
    Claire Wych says #
    The GLA's recent study - London's Zero Carbon Energy Resource found that total available heat for capture from all sources across
  • Robert Sansom
    Robert Sansom says #
    Completely agree. I heard somewhere that in London there is enough wasted (I prefer to add the d) heat to meet all of London's he
  • Rob Raine
    Rob Raine says #
    Heat networks, as you say, can help provide flexibility in managing the future energy system. Also important is the way in which h
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The vast majority of British homes have central heating which comprises a boiler with radiators. This has become the system of choice due to a combination of factors, which include the British climate and our housing stock.

Most new heating systems are distress purchases. Your boiler breaks down so you call someone out to repair it only to find out you need a new one. The priority then is to get it done quickly and for the least money. At this time you are totally dependent upon the trusted expert – the installer – and will normally go with their recommendation. For any policy to succeed it must be deployable through this market model.

If you try to get the consumer to buy something different, from someone different and at a much higher cost then you will struggle to effect any worthwhile change. It has to be easy to do, hassle-free, easy to understand and cost effective.

Calor has seen the impact of successful policy interventions, such as the boiler scrappage scheme and mandating condensing boilers, on energy consumption. In the past 10 years our average central heating customer has reduced their fuel usage by over 20% on a weather adjusted basis. The same has happened to natural gas demand in urban areas and we believe this decline is set to continue.

The priority has to be to maintain this downward trend and the good news is that gas technology still has an enormous amount to offer. For example, two thirds of properties still have older non-condensing boilers and therefore still have significant savings available. We are also seeing a raft of exciting new technologies coming on to the market which will further accelerate the decline in energy consumption and carbon emissions and can be used in off gas grid areas as well. These include Flue Gas Heat Recovery, mCHP (micro combined heat and power) and Gas Absorption Heat Pumps – a renewable gas technology.  Repeatedly, carbon reduction methods have been applied without any sensible cost benefit analysis.

So gas technology still has a way to travel and offers the best value for money for both the bill and tax payer.

Low carbon industrial policy

The UK is the largest gas boiler market in Europe and has a huge domestic industry with sector leading companies based here in Britain employing many thousands of people, plus the more than 100,000 heating installers working in peoples’ homes.

Policies which directly support these established British manufacturing and service industries will have the greatest beneficial impact on the economy at large and have the best chance of success. We saw this at first hand with the boiler scrappage scheme which gave a boost to both British manufacturing and the order books of British installers, plus had the added benefit of substantially reducing energy consumption and carbon emissions.

For a policy to work it needs to work with the market rather than try and buck it!


 

Paul Blacklock is Head of Strategy and Corporate Affairs for Calor Gas Ltd

Since 1935 Calor has supplied LPG to homes and businesses to some of the most remote parts of the country.

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As large energy suppliers announce household gas prices will go up by around 8%, just days after Ed Miliband’s price freeze promise, it is questionable as to whether regulated competition adequately protects customers and delivers value for money.

 A small but growing number of customers have their heat demand met by suppliers not covered by the gas or electricity regulations, with no role for Ofgem or the Energy Ombudsman in customer protection. In the UK, 97% of householders currently heat their homes and water through individual gas boilers, but around 2% of demand, is now served by heat networks. Heat networks (also called district heating) deliver heat from a local energy centre through a system of insulated pipes to homes and businesses. With radiators and thermostats heat network customers have the same experience as they would have with an individual solution, but with the advantage of not needing to purchase, maintain or insure a gas boiler or electric heaters. 

Recent estimates forecast investment in heat networks of about £500m in the coming years, which could mean that 14% of heating and hot water needs will be met by heat networks by 2030. This investment is likely to attract new suppliers and it is therefore a useful point at which to consider how to ensure that heat customers, who cannot switch suppliers, will receive appropriate standards of service and protection. With a one-in one-out approach to regulation established by this Government’s red tape challenge, is there an alternative to statutory protection for heat customers?

The district heating industry has been working with consumer representatives since 2012 and has drawn up proposals for a form of self-regulation. The Independent Heat Customer Protection Scheme proposals, launched for consultation last week, set out quality standards that suppliers must attain across all aspects of their domestic and micro-business heat supply agreements and supports this with proposals for an independent adjudication service; dispute resolution at no cost to the customer.

Price and price transparency are key concerns for all energy consumers. Under the Independent Heat Customer Protection Scheme proposals suppliers must provide customers with transparent heat charge calculations, indicate how prices might change in the future and provide an industry-wide heat charge comparator. The comparator would illustrate, for the heat network customer’s demand, what their costs would have been if they had a gas boiler or electric storage heater. The proposals also specify that suppliers must have alternative arrangements in place to ensure that customers continue to receive heat in the event that the supplier fails.

The consultation seeks views on whether these heat customer protection proposals are appropriate for a fledgling industry and whether they go far enough in terms of customer protection. Will the proposals help reduce perceived risks in the minds of heat network investors, thereby reducing the cost of capital? And will this, in turn, help to secure affordable heat for future network customers, putting consumers at the heart of the energy system, and delivering a better deal than state regulated electricity and gas markets?

Join us at Heat 2013 to have your say or submit your views through the consultation; open until 29 November. 

 


Nicola is the Policy and Development Manager at the Combined Heat and Power Association. The CHPA convenes meetings and provides secretariat to the Independent Heat Customer Protection Scheme. 

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Posted by on in Heat 2014

The gaps in our renewable heat infrastructure are known but we are not sure whether we have a solution for them.

One gap is how to make use of the large amounts of untapped heat produced from water treatment plants, heat from the air, or heat from the ground to keep us comfortable in our homes and workplaces.

According to the recent Greater London Authority study, in 2010 the ‘...total amount of heat available in London from secondary sources is equivalent to...76% of London’s total heat demand’. Over 60% of the heat delivered from these secondary sources could be achieved by using ground source and air source heat pumps, and the heat collected from water treatment plants.

The heat pump industry in this country is, understandably, largely focused on installing systems into social housing projects where the carbon reduction requirements and the need to help tenants stay out of fuel poverty are driving the business.

Outside of social housing, the challenge for heat pump manufacturers is to educate an army of installers in how to correctly install heat pumps into homes. The test for the UK government, if they are to meet their carbon emissions targets, is to provide a good enough incentive to the 26 million households to invest in having energy efficient technology installed.

Our continental neighbours, meanwhile, have been much more ambitious with their heat pump projects to keep their citizens comfortable. In Switzerland, 75% of new-build family homes have a heat pump installed.

Motivating UK householders to install heat pumps is a big challenge, but using heat pumps in district heating schemes is another approach which the country has been slow to adopt.

District heating schemes using heat pumps are common in Denmark. But, in Drammen, Norway, they have taken network heating a step further. 6,000 households are being heated by extracting heat from a nearby fjord using heat pump technology developed by Glasgow-based Company, Star Refrigeration.

The combination of rising fossil fuel prices, the need for investment in infrastructure in the UK to boost the UK economy, and our basic need to keep warm offers an opportunity to rethink how we use the abundant heat in our existing environment to provide us with comfort in our homes.

By thinking ambitiously about how we can use heat pumps in the UK, householders will have more comfort for less money and the economy will get a long term boost by delivering renewable heat.


Join us in our power of integration session at Heat 2013 to discuss the points raised in Will's article and see how heat pumps can play a bigger role in an integrated energy system.  


Will Hawkins is the Online Editor of Heat Pumps Today, and writes about the developments in the burgeoning UK heat pumps industry and the challenges it faces as it moves into the mainstream of renewable energy technology. Particular topics of interest are district heating and community energy projects. 

Heat Pumps Today is the UKs only magazine focused on the heat pump industry in the UK. Published quarterly and online daily, the Heat Pumps Today helps installers, contractors and specifiers keep up to date with latest technology, news, legislation and industry matters.

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