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Heat 2015

by Liz Warren, SE2

There has been much talk recently about devolution: greater powers for nations and increased budgetary control and scope for cities and counties too. But what are the implications of devolution for heat?


 

Let’s consider the story of Scotland: in June 2015, the Scottish Government published its Heat Policy Statement, which aims to remove almost all carbon from the heat system by 2050. Figures announced in October 2015 show that renewable heat generation has increased by 36% in just one year, with almost 10,000 micro renewable heat systems up and running.

Nationally driven policy and programmes have certainly helped. The Home Renewables Loan Scheme, the Low Carbon Infrastructure Transition Programme and support from Resource Efficiency Scotland are all driven by the Scottish Government. If anything, UK policy uncertainty is putting the brakes on further development.

Scottish Energy Minister Fergus Ewing, quoted in Holyrood Magazine, said: “We are committed in helping support households and business across become more energy efficient and use more low carbon and renewable heat sources.

“There is however continuing uncertainty about the Renewable Heat Incentive, which the UK Government have not commitment to beyond March 2016. We will continue to press for commitment to the long term sustainability of the RHI beyond next year to provide confidence for funders and stimulate investment in renewable heat technologies.”

Elsewhere, devolution discussions carry on apace. In Greater Manchester, district heating is already very much on the agenda, with several authorities undertaking development work supported by the national Heat Network Delivery Unit, an example of a national programme supporting heat in a devolved future world.  The devolution of health budgets to Greater Manchester could provide an interesting link into the rollout of affordable and lower carbon heat sources particularly to fuel poor households or those more at risk from living in cold homes.

Cornwall is at the vanguard of county-level devolution discussions. Alastair Mumford of Regen SW told us:

“Overall devolution should enable Cornwall to develop initiatives better fitting with local resources and issues, developing synergies between council and government priorities. The devolution package states agreement by government and the council to investigate how local and neighbourhood plans can support local ownership models, including heat networks.  The deal references a ‘community heat pilot’ and the council has an excellent track record in supporting community renewable electricity.

“The deal should help the council in setting up a Low Carbon Enterprise Zone which aspires to develop geothermal, an important priority for the area, and other renewable technologies.  The scheme could see new build and retrofit heat networks as well as attracting in industries with high heat demands.”

Devolution is not the same as divorce: Mumford believes that while devolution helps councils to shape policies that best fit their geography, there is also opportunity for closer engagement with Government Departments. And there are things which are best driven at the national scale. Says Mumford:

“Change in basic infrastructure such as the way we generate heat does require an overall national framework to drive down costs and risks. If we end up with regions pushing forward with initiatives that are specific to their area and don’t join up, they won’t create an overall market that the supply chain can react to and invest in. Whilst devolution is a positive opportunity for renewable heat, therefore, we do not think government can simply wash its hands of the need to provide that framework.”

As Scotland and Cornwall are both demonstrating, a clear ambition and policy statement can make all the different. Alastair Mumford explains:

“Devolution can dramatically improve low carbon heat in an area but it needs to go hand-in-hand with a detailed strategy.  This strategy needs to be developed with the community and reflect best practice within and outside the region. The strategy needs to enable the supply chain to develop its skills and capacity.”

Greater Manchester meanwhile has carried out extensive citywide heat mapping and through its Energy Plan has identified how changes in energy generation and supply can contribute to the City-Region’s ambition to reduce CO2 emissions by 48% by 2020 compared to 1990.

The future of heat is local – district heating networks and local renewable heat generation are starting to feature more and more in our energy mix – though they have a long way to go! Devolution can help place the power to deliver change in the hands of local communities, though it will be interesting to see how this is balanced with national enthusiasm for developing fracking and our ongoing commitments to a robust and interconnected gas network.

How will all the pieces of the puzzle fit together? Join the debate at the Heat Conference on Wednesday 25 November to have your say. You can book your place at www.heatconference.co.uk.

 

 

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By Professor Jim Skea CBE FEI, President – Energy Institute, Research Council’s UK Energy Strategy Fellow and Professor of Sustainable Energy at the Centre for Environmental Policy, Imperial College


 Energy decision-making is widely varied. There are mega-decisions about nuclear reactors, gigawatt-scale offshore wind farms and interconnectors that criss-cross the North Sea. Then there are the literally millions of decisions, each modest in itself, which collectively shape energy needs and markets. Policymakers and headline writers love the big stuff. Nevertheless, it is the more humble things which will shape out the energy future and which really challenge policymakers.

“Heat” has become a catch-all term to describe all forms of energy use that are not electricity and not transport – and that’s a very large share of energy demand. There is a tendency to describe heat as a “sector”. Winston Churchill once famously said that India was no more a country than the equator was. Well India is certainly a country now but, in my view, heat is no more a sector than a kettle of boiling water is. And talking about heat markets is also bizarre. There may be some district heating schemes where heat is priced and traded but, for the moment, heat largely stays within the premises where it is generated and used.

It is also odd that the energy labelled “heat” in commercial buildings is more often used to keep us cool. Hence, the not entirely facetious title of this blog – we could really do with a catchy term, which covers the energy needed to keep us comfortable, whether it involves nudging temperatures up or down. “Heat” makes it sound as though policy is all DECC’s job. Something round “buildings” or “built environment” would make it clear that other government departments, notably Communities and Local Government who look after building standards have a rather important role to play.  Suggestions welcome!

One of the consequences of regarding heat as a sector on par with real sectors, such as electricity, is the temptation to mimic policy mechanisms that work well where there are functioning markets, c.f. the complexity of the Green Deal. Smaller consumers do not make decisions with the same degree of sophistication as finance officers in major utility companies – and nor should they. If we want to promote energy efficiency and renewable heat then simple, understandable rules and incentives are needed. I was talking to a Swede yesterday who pointed out that Scandinavians value simplicity in all things from furniture design to energy policy. They look with bemusement at the elaborate mechanisms that the UK uses to shape electricity markets and energy consumption patterns.

So where does this rather grumpy rant take us? First, I think we need a holistic approach to keeping people comfortable in indoor environments. It is basically about minimising energy use and maximising inputs from environmentally sustainable energy sources. Second, a joined-up vision of where we are going would help. Top-down views of UK low carbon energy futures suggest a big role for heat pumps for example – but it is fair to say many energy professionals remain sceptical.  Every time an old boiler is replaced by a modern combi boiler we lose the hot water tank – the cheapest form of energy storage for buildings – that would be needed to get heat pumps installed. Are we locking ourselves out of a low carbon future in the longer-term for more incremental gains in the short term? Finally, we need rules and incentives that match the needs of households and businesses and the way they make decisions. When DECC presses control-alt-delete on energy policy after the Spending Review is concluded, let’s hope “heat” is one of the areas that gets the attention it deserves.

 

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We asked Lesley Rudd, Policy and Public Affairs Manager of the Sustainable Energy Association, for her views on the policy landscape for renewable heat. The Sustainable Energy Association (SEA) is a member based industry body offering innovative policy solutions that link up building-level technologies and the wider energy system to achieve a low carbon, secure energy future for the UK, benefits for UK consumers, and commercial growth for businesses working in the sector.


 Over the last few months - as disappointing announcements relating to the low carbon sector have been made - we have had calls from concerned members asking for advice.  Policies causing immediate impact on business include:

  • The end of further funding to the Green Deal Finance company
  • The scrapping of the Zero Carbon Homes scheme
  • DECC consulting on ending Renewable Obligation support for solar farms
  • DECC consulting on huge reductions in Feed in Tariff payments and huge reductions in the overall budget.

These announcements have caused considerable uncertainty in the market place and are having an immediate impact on business, with both investors and potential customers getting cold feet (excuse the pun)!

The proposed considerable reductions in the feed-in-tariff for solar PV is impacting businesses in the low carbon heating sector as  there is a knock-on effect which pervades other business activities and other businesses.  Customers are unwilling to close orders because those announcements already made have created a pessimistic outlook for them, pending new policies being announced on heat policy and energy efficiency (both of which Amber Rudd has indicated will not be concluded until after the Chancellor’s Autumn Statement).

Businesses are now facing the  very real prospect that customers, with whom they  have been in contractual discussions for some time, are considering pulling out as they are concerned that the Renewable Heat Incentive scheme (RHI) will close before contracts are in place, leaving their  investment facing fiscal uncertainty.

The SEA supports the Government’s aim to ensure value for money for the taxpayer and avoid cost overruns in its policies.  However, we believe that the cuts proposed to the FIT regime and rumoured to the RHI will be counterproductive for the Government’s long term economic plan.  We agree that subsides should be phased out over time and should only be in place for a period necessary to allow new industries to compete effectively.  However, there is a real risk that if the investment in a permanently lower future cost base for the provision of our country’s energy is removed before the transition to competitiveness is complete, not only will we lock the country in to a higher energy cost than necessary for the long term, but we will also render stranded the good work and public funds that have been invested so far. The RHI is a national investment which will lead to a more cost effective heating market tomorrow. Removal or significant cuts to the RHI now will hinder our efforts to reduce costs and negate much of the Government and industry’s investment to date.

We believe bringing industry and Government together to find a solution is the way forward.  To this end, the SEA has carried out a significant amount of modelling to assess the value for money delivered by government policies such as the RHI compared to other alternatives and to identify ways in which the scheme could be improved to cost less and deliver more.  

Much has already been achieved by industry and Government working together to develop a market and a supply chain for renewable products - so let’s finish the job. As the market develops, volumes increase, costs and emissions reduce, customers get cheaper energy and the UK gets a sustainable industry with lower costs locked in for the future, thereby permanently reducing future needs for imported fossil fuels, and providing the most cost-effective way of meeting the Conservative manifesto commitment to meet the carbon budgets set under the Climate Change Act.  A win-win!

 Our thanks to Lesley Rudd, Policy and Public Affairs Manager at the Sustainable Energy Association.


 

 You can have your say on renewable heat at the Heat Conference on Wednesday 25 November - click here to book your place.

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Posted by on in Heat 2015

By Casey Cole, Managing Director of Guru Systems

At the beginning of this year we were given the green light to conduct feasibility studies into technology to improve the energy efficiency of district heat networks.

Nine months on and we have successfully moved beyond proposals and concepts, and in May were awarded a share of a £7 million fund to put our plans into action by the Department of Energy and Climate Change (DECC).

It was a pivotal moment for the company and the team.

Our core team has worked for many years in the decentralised energy sector and we were champing at the bit to put our plans into action.

As a company we have worked with landlords and developers across the UK to ensure they can monitor their networks and bill tenants correctly for the energy they use. For tenants, the Guru Hub works as a pay as you go and energy monitoring device, whereas for developers it provides a way to measure incoming energy, heat produced and used across the networks – as well as being able to see any drops in efficiency.

Our DECC project takes our diagnostic capabilities to the next level.

Heat network operators have generally suffered from a lack of data about how their networks are performing. And in those cases where they’ve managed to extract data from their systems, it’s often been difficult to interpret. As a result, good practice in the UK heat market hasn’t evolved as quickly as it should.

We’re attempting to radically speed up the development of the market by building tools for operators to understand and analyse their own energy performance data and, importantly, share that data with each other.

Using innovative machine learning algorithms to analyse the large data sets that come from heat networks, our systems will put the power back in the hands of operators and lower the cost of tenants’ bills thanks to the improvements that can then be made in the networks’ efficiency.

Early results from the four heat networks where we’re trialling the technology have been hugely positive. Working with operators, we’ve used the outputs of our system to identify cost effective changes that are significantly improving network performance. By the end of the project, we expect to have reduced input fuel use on the trial sites by between 33 and 51 percent. This can equate to an average saving of £179 per home per year.

If this technology was rolled out to heat networks across the UK we could save £400 million in reduced energy costs in 10 years.

These figures are astounding and give an indication of just how much value there is to be had in improving performance of heat networks.

Not only are we looking to save tenants money, we are also working with leading developers and affordable housing providers to help them anonymously share key performance data – including return temperatures and peak loads – while complying with the Data Protection Act and our own strict data sharing policies.

It was important for us, as part of this project, to encourage a flow of information. Not just between operators, but with suppliers and consultants as well.

For example, many designers of heat networks never see their systems in action and have no idea of how well (or poorly!) they perform in real life. For this reason, we believe it’s just as important to share data with network designers as it is to share with operators. Otherwise, they don’t learn from real world outcomes and improve design on their next project.

It’s an exciting time for the innovation of heat networks and we are just one of eight schemes receiving this funding from DECC

This year in particular has been a landmark one for the sector, with CIBSE and the ADE publishing a Code of Practice which will ensure minimum standards on new networks. But standards aren’t enough on their own.

The old maxim that you can’t improve what you don’t measure is especially true in the heat sector. The evolution of the UK heat market will depend on the effective extraction, analysis and sharing of data by heat network operators and other stakeholders and we hope to do our part in making this happen.

 

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  • Marko Cosic
    Marko Cosic says #
    Nice one Casey; cracking results there. :-) Do we get to find out who dropped the biggest clangers then? Was it the designers (M&
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Last year, the innovative combined heat and power and ground source heat pump system installed at Notre Dame Primary School was celebrated at the ADE's annual awards dinner.  One year on, we spoke to Bob McNair from Glasgow City Council to find out more about how this innovative system has benefitted the school's community.

In 2013, Notre Dame Primary School and Ellie Nursery installed five mini combined heat and power (CHP) units, to work in tandem with a ground source heat pump (GSHP) and thermal storage. This past year, the ground source heat pumps were at 50% of the heating and hot water capacity, with the CHPs running for around 4500 hours.

Having a flexible system and using complimentary technologies have been and will be a real benefit to the school in the years to come.

"Over the last two years occupancy hours have increased by over 50%, and the CHP system has been able to facilitate these changes with ease....With small scale CHP there is no need to modulate the engine output, the system runs in response to the heating controls without any issues."

The ability of the CHPs and the GSHPs to work in tandem was critical to the success of the installation.

"Last winter all five CHP units were readjusted to run continuously up to 23hours per day to ensure a consistent supply of heat and hot water. Now that RHI metering is in place, the school can reduce the heat input from the CHPs by 40% and in turn increase the use of the GSHP. This small change in how the heat and hot water is produced means the school will benefit more from the Renewable Heat Incentive without changing the level of comfort."

Generating its own heat and power gives the school a certain level of future proofing against rising gas and electricity prices.


"When gas prices increase, in the years to come, this school need not rely on the “standby” gas fuelled boilers installed in the school. It can generate is own heat and electrical power without using either boilers or GSHPs.  Conversely, when the renewable level of electricity production reaches a peak, the GSHPs can contribute more heat and hot water than the CHPs."  

Carbon emissions are also an important metric for the school.

"Despite the change in occupancy hours the carbon emissions from the school have been below that of other well managed schools in Glasgow. With the changes made for next year the CO2 levels at Notre Dame Primary School and Ellie Nursery will be far lower.”

Finally, the school community love the new refurbished old school and new 5 storey extension and are proud of the low carbon system!

"The kids and parents love the school with its renewable system. The school is Victorian and even has the same cast iron radiators, albeit refurbished, that their great, great, great grandparents saw in 1894."

 

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  • Bob McNair
    Bob McNair says #
    Just one slight error - the GSHPs contributed 50% of the GSHP capacity and not 50% of the heat required for the building as mentio
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