Inspiration and advice for your building project
The complete guide to working out whether solar panels, heat pumps, etc, are right for you.
The advent of Feed-in Tariffs (FiTs) in April 2011 and the forthcoming Renewable Heat Incentive have changed our perception of renewable energy. With the guaranteed annual income these schemes provide, renewable energy has become a financial decision as well as an environmental one. It is now possible, with proper thought and the right circumstances, to make a profit from renewable energy systems.
The FiTs scheme is paid for by the big six energy companies, with the RHI paid for by the Government. Ultimately, of course, these bodies get their money from you and I: the energy buyer and taxpayer. So ultimately it is the people that do not install renewable energy systems that pay.
All of which puts the imperative on the homeowner – particularly when building new or renovating a house – to strongly consider installing one, or several, of the key renewable technologies. Not least as there are many local operators using ‘cashback’ schemes as an advertising mechanism, it pays to understand how the schemes work and how you can benefit.
In this article we outline the key schemes, how the individual technologies rate as cash generators — and finally, suggest how you might want to use them in common situations, and how the figures stack up.
The Green Deal
Due to be introduced in October 2012, the Green Deal entails low-cost finance being made available to householders to improve the energy efficiency of their homes. The maximum amount available is £6,500 per household, which will be repaid through their energy bills. Details are yet to become clear but it is suggested that the big six energy companies will be involved, as will companies like Marks & Spencer, Tesco and B&Q. Each will offer their own package and it will be up to the householder to pick the one that suits best.
There are two key rules for the Green Deal:
1. The repayments must not exceed the value of the energy saving. This is so the householder always sees a net financial benefit.
2. The improvements are pre-approved by a qualified assessor, and therefore the funds will be used appropriately.
Why is this important? To qualify for Renewable Heat Incentive (RHI) payments, the house must meet current standards of energy efficiency. There is a cost to adding that level of insulation — and the Green Deal is a cheap way of meeting the upfront costs.
Renewable Heat Incentive (RHI)
The Renewable Heat Incentive (RHI) was scheduled to start in October 2012 and pays homeowners for heat energy generated from renewable sources. Qualifying technologies are heat pumps (although there is a question mark over air-source heat pumps, as they have been left off the allowances for large-scale installations which were introduced in July 2011), biomass (wood pellet, wood chip or log) and solar thermal. There are other technologies, like biogas, which are unlikely to trouble a homeowner.
The scheme was due to start in April 2011 and it is mooted that the delay is because the Government has not yet worked out how to calculate what to pay — essentially should the homeowner get paid for a ‘deemed’ heating energy consumption or should it be a requirement that heat meters be installed? That, and the final decisions on the tariff rates, are not now due until mid-2012.
RHI Premium Payment
The Renewable Heat Incentive (RHI) Premium Payment is effectively a grant replacing the old Low Carbon Buildings Programme. The pot is said to be worth around £15m but is only available to the first 25,000 householders who apply after 1st July 2011. Applications need to be made to the Department of Energy and Climate Change (DECC) and the following grants are available: Solar Thermal £300 per system; Air-Source Heat Pumps £850 per system; Biomass Boilers £950 per system; Ground-Source Heat Pumps £1,250 per system.
To qualify, the system and the installer both need to be Microgeneration Certification Scheme (MCS) accredited; the house must first be brought up to 2010 Building Regulations levels of insulation; and the homeowner must agree to provide feedback on how the equipment performs. It is suggested that this is to enable some of the currently eligible technologies to be taken off the list.
Households who get a grant will still qualify to receive the RHI payment once these tariffs are introduced — as will anybody who has installed an eligible system since 15th July 2009. These tariff payments will start alongside the Green Deal from October 2012 to allow a more whole-house approach to heat production and energy saving.
Feed-in Tariffs (FiTs) were launched in April 2011 and pay homeowners an annual income for electricity generated from renewable sources and for electricity exported to the National Grid.
To qualify for the scheme, the system must be an ‘eligible’ technology (solar PV, wind, hydro or CHP); the equipment must be Microgeneration Certification Scheme (MCS) approved and installed by an MCS-approved company.
There are in fact two tariffs: one for the electricity generated, which varies with the technology, and the other is for electricity exported to the Grid, currently 3p per kWh (kilowatt hour).
Applying to be included in the scheme is a very simple process and usually dealt with by the installer. The homeowner applies to any of the big six energy companies, who are all obliged to accept a qualifying system.
Find out more on all of these schemes at DECC.GOV.UK
PV (photovoltaic) systems are a good choice for people with no other options. They are the most expensive and least productive (pound for pound) technology, but fit in a higher proportion of properties and have a long and largely maintenance-free life.
There are a few different types of PV, the main options being monocrystalline and polycrystalline. There is a difference in efficiency but this is largely taken up in the capital cost, so that the return on investment works out broadly the same.
Planning consent is not usually needed but it is wise to check. A solar array does not need to be mounted on the roof but it needs to be as close to south-facing as possible (within 45°) and inclined as close to 30° as possible. Obviously the array needs to be free from shadows and not likely to be hit by cricket balls or other hard objects.
More than any other technology, checking out the supply company is the principal requirement. Obtain references, follow them up and make sure the company has a good track record. And do NOT lease your roof space to someone else. They will make the money and you will not.
The unit cost reduces with the increasing size of the system. So a 2kWp (kilowatt peak, a measure of the peak output of a PV system) array may cost £7,500-8000 installed, where a 4kWp array might cost around £9,000-10,000. That is because the cost of the other things – inverter, control gear, scaffolding, installation work – remains largely the same. As a result, generally schemes below 2kWp are difficult to justify in financial terms.
As of the 1st of August 2012, the FiT rates are as follows:
|Band (kW)||Standard generation tariff (p/kWh)||Multi-installation tariff (p/kWh)||Lower tariff (if energy efficiency requirement not met) (p/kWh)|
|<4kW (new build and retrofit)||16.0||14.4||7.1|
Note: The standard generation tariffs apply to homes with an EPC (Energy Performance Certificate) band D or above. If a home is band E or less it is only eligible for the lower tariff rate.
There are many PV installers in every area of the country, to all of which due diligence must be applied. To make a start in your search, check out the Solar Trades Association (solar-trade.org.uk). Also try Solar Century (solarcentury.co.uk).
Biomass divides itself into wood pellets, logs and chips. Pellets are clean, easy and expensive. Logs are cheap, more messy and more work. Woodchip is generally for big – 50kW plus – boilers, it’s messy and it needs a lot of space.
Both pellet and log machines are available as boilers or stoves with back boilers, the principal difference being that pellet stoves/boilers work as a principal heat source but log stoves/boilers don’t. The reason is that pellets have a standard calorific value and are fed in a slow continuous trickle to the burner. Therefore, a given level of heat output can be maintained. Logs are thrown into the stove willy-nilly and heat output will vary with the quality of the logs and the amount of wood in the stove.
A gasifying log batch boiler works well as a principal heat source for houses that need a reasonably high level of heat, but they do require logs to be loaded manually. Wood pellet boilers are far more automated but the equipment is more expensive, as is the fuel.
Efficiency is generally up to 90% and biomass boilers tend to have a long life — in excess of 20 years.
Log batch boilers start at around £4,500 plus installation and could reach £10,000 for more sophisticated machines. Pellet boilers always need a fuel silo, adding to the cost, and prices tend to start at around £10,000. Fuel for a wood pellet boiler will cost in the region of £200 to £250/tonne — which equates to around 5p per kWh. Logs can cost from £30 to £100/tonne depending on quality (hardwood or softwood, and how long they have been dried) and supplier. This broadly equates to 1p to 3p per kWh, depending on locale.
Not yet decided but so far there is no distinction between pellets, logs and chips. Biomass is likely to attract a rate of 9p/kWh but only for 15 years.
Biomass is suited to houses with a big heat load. So we’ll assume a demand of 20,000kWh per year for heating and hot water. This gives a return of £1,800 per year against a running cost of £250 for logs or £800 for wood pellet.
Solar thermal systems are robust, effective, have a long life and are relatively cheap to install. Every home should have one and there is really no reason not to install a system in a new build.
There are two types: flat plate and evacuated tube. Flat plate systems are cheaper to install and evacuated tube systems more efficient. If the roof is close to due south then flat plate will be as good, and cheaper, than evacuated tube. Solar thermal can typically be installed under Permitted Development (i.e. without planning) — except in sensitive areas, such as Conservation Areas or near listed buildings. They don’t work with most combi boilers as they need a large hot water storage tank to store the energy produced.
Flat plate systems will cost £4,500-5,500 for a typical home with four to five people living in it. Evacuated tube systems should cost £5,000 to £6,500. Suppliers offering higher prices should be avoided.
With the right hot water storage tank and control systems running underfloor heating, there is a good argument for increasing the size of the solar thermal array by 50%. The impact will be to make a larger contribution to space heating and allow the boiler to shut down from late spring to early autumn, rather than just the summer.
Not yet decided — the rates being discussed vary from 8.5p to 18p per kWh. The payments will be for 20 years.
If the lower RHI figure is taken then the net return for a typical system will be around £170 per year (excluding energy saved).
Your first port of call should be the Solar Trades Association (solar-trade.org.uk). There will be many solar thermal installers in every location to which, again, due diligence must be applied.
Next to solar thermal, heat pumps are the most commonly used technology but still mired in controversy. Do they work? Are they efficient? Do they reduce CO2 emissions? The answer to all these questions is yes — if they are used in the right way.
The argument revolves around the COP (Coefficient of Performance) and whether advertised figures are accurate and maintainable. In brief, a COP of 4 implies an efficiency of 400%, i.e. 1kW electricity in and 4kW heat out. An advertised COP will be based on a flow temperature of perhaps 35°C — suitable for underfloor heating but not radiators or domestic hot water. If the heat pump is used for anything other than underfloor heating then the COP will fall. In the case of air-source heat pumps, the COP is also affected by the outside air temperature, so it’s lower in winter when the most heat is needed. There is evidence that some air-source heat pumps, used on their own, emit more CO2 and cost more to run than an equivalent gas boiler.
To maintain a good COP, and for the heat pump to work at its best efficiency, you need a well-insulated, relatively airtight house and a supplementary heat source. Ideally this will be a solar thermal array, but a simple immersion heater running on dual-tariff electricity is a cost-effective alternative. For air-source heat pumps some local authorities are asking for a noise attenuation test. Check the requirements of your local authority.
Air source is cheaper than ground source, which can be very expensive on smaller ground areas (when a borehole is specified). A 200m2 well-insulated house will need perhaps a 6kW heat pump. Air source will cost around £5,000 and ground source around £6,000, both plus installation.
In addition will be the cost of the supplementary heating system. An immersion heater will be less than £100, but a solar thermal system considerably more.
Not yet decided, but likely to be 7p/kWh for ground source for 23 years and 7.5p for air source (if it remains on the eligible list) for 18 years.
An example well-insulated 200m2 house will need around 7,000kWh of space heating energy. Return will be £490 per year for the ground-source heat pump against a running cost of £220 per year (assuming a COP of 4 and average electricity prices).
The first stop for anyone looking at heat pumps should be the Heat Pump Association (feta.co.uk/hpa).
Good wind is obviously the key factor in determining the viability of a wind turbine on your project — and it is not just a matter of wind speed, but lack of turbulence as well. Generally the annual average wind speed needs to be over 5 metres per second (m/s) for commercially viable production and the turbine needs to be sited away from buildings, trees, etc. to ensure clean wind.
The national wind speed database will give a rough indication of annual average wind speed for a given postcode and is available at decc.gov.uk/en/windspeed.
Better yet, install an anemometer and get out the wind speed for the exact site. The Power Predictor is a reasonable machine and available for around £300 from bettergeneration.com.
Planning consent is still needed for wind turbines and the cost of obtaining it needs to be factored in — as should the cost of connecting the turbine to the Grid, which can vary from hundreds to tens of thousands of pounds depending on the location and size of the turbine. Get a quote from your Grid operator before making any commitment. Find your local Grid operator at nationalgrid.com.
In some areas a bat or bird survey may be needed, or indeed an environmental impact assessment. Check the requirements with the local authority and get prices before committing.
Prices will vary with quality as well as size. The smallest that would make a sensible contribution would be around 2kW. A machine like the Skystream – rated at 1.8kW – should cost less than £12,000 installed and should produce around 4,000kWh per year with a wind speed of 5m/s. Beyond that the sky is the limit. A 5kW or 6kW machine will cost in the order of £25,000 and could produce 11,000 to 15,000kWh per year.
Wind turbines attract a rate of 28p per kWh for machines of 1.5 to 15kW rated capacity.
A 1.8kW machine will produce a return of £1,180, assuming 50% of the electricity is used in the home, equating to a 9% return on investment. A 6kW machine costing £25,000 will produce a return of around £2,640 per year, assuming 4,000kWh is used in the home, equating to a 10.5% return on investment. An 11kW turbine will cost around £65,000, will produce around 30,000kWh per year (average wind speed of 5m/s) and return some £8,800 per year, equating to a 14% return on investment.
First of all, try the British Wind Energy Association (bwea.com). You could also try Next Generation Turbines (nextgenerationturbines.com); C&F Green Energy (cfgreenenergy.com); Gaia Wind Turbines (bettergeneration.com).
Average wind speed data is absolutely critical in determining how much power a wind turbine will produce. This data was provided by the supplier of a smaller wind turbine (the Windsave):
The wind speed data given for each grid reference (at decc.gov.uk/windspeed) is at three different heights, being 45m, 25m and 10m above ground level. Note that the higher you go above ground level (agl), the higher the average wind speed. For instance, for my own address the figures are: 6.4m/s at 45m agl; 5.9m/s at 25m agl; and 5.1m/s at 10m agl. This tells us that the higher you go, the more wind energy there is available and the more electricity you will be able to generate.
Micro hydro technology is available that lets the individual homeowner (with a stream) generate their own power. Consider this: a hydro turbine of just 500W will produce enough electricity through the year to meet the annual consumption of an energy-efficient home. You could pick up and carry a turbine that size with one hand. What’s more, pound for pound, it’s the most efficient of all the renewable technologies.
There is a national shortage of Microgeneration Certification Scheme (MCS) accredited installers due to a muddle in the accreditation process in 2010, still to be properly resolved. So even if you have a good stream it can be difficult to get a scheme installed.
Low head schemes (under 5m head, SEE BELOW) are less productive and more expensive than medium to high head schemes, and are often uneconomic. A stream with 10m head still needs a good flow rate, but is always worth investigating.
A hydro power scheme is a piece of engineering designed and built specifically to the needs of a particular stream. It will, therefore, have a long life. It will need a bit of low-level maintenance in the first 10 to 20 years, and bits might start to fail thereafter. But bits can be replaced and the whole system kept live for very little annual cost. Looking at a total life in excess of 40 or 50 years would not be unreasonable.
The paperwork is tricky. You will need planning consent, Environment Agency approval and probably an environmental impact assessment — fish and other flora and fauna need to be protected. The usual process is to get an installation company to do a feasibility study first. That will set out the rough costs and the paperwork needed.
Unlike all the other technologies, hydro is not a blister-packed product. Each scheme is specific to the stream and the price can vary hugely. The cost of the turbine and generator is usually only a small proportion of the overall cost, so generally hydro schemes usually involve equipment installation as much as the stream can take, rather than as much as the homeowner wants.
Hydro schemes up to 15kW attract a rate of 21.9p/kWh for 20 years.
A 5kW-rated scheme will produce about 30,000kWh per year. If we assume an installation cost of £35,000 and that 5,000kWh is used in the home, then the return is £7,020 per year or 20% return on investment.
Try the British Hydropower Association (british-hydro.org), who has a good range of case studies as well as suppliers. Also try Highland Eco-Design (highlandeco.com); Turbine Services (turbineservices.co.uk); Powerpal (powerpal.co.uk).
The key question is: how big does the stream have to be? And in this the issues are ‘head’ – the vertical distance between the highest and lowest points of the stream – and ‘flow’, which is the amount of water passing a point, measured in litres per second.
So why are we not all doing it? Most obviously because we don’t all have a stream. Less obviously, because most people with a stream think that: a) it is not big enough, or b) hydro power will be too expensive. Whether the stream is big enough or not can only be established with a site survey. That may cost £300 or £400, but could be a very worthwhile investment.
At the moment the only systems available in this technology area – that produces electricity as a by-product of heat – are engines (internal or external combustion) that drive a generator, but there is a great deal of development using fuel cells. Whether this will ever reach the market at a domestic scale is debatable.
There are a few machines for big applications needing lots of heat but only one for the typical domestic application — the Baxi Ecogen.
The problem with all these machines is that they have to run for a long time each day – upwards of 18 hours – to take full advantage of the Feed-in Tariffs rate. That means they produce a lot of heat. In many ways, they are most effective in older homes with higher heat loads and mains gas availability, where they can replace gas boilers.
Typically £5,500 plus installation and possibly a new hot water cylinder.
CHP schemes up to 2kW currently attract a rate of 11.0p/kWh.
If the machine is run for 18 hours per day then it will generate a return of £650 per year for 10 years — a total return of £6,500 against a purchase price of £5,500 plus the cost of installation.
The Ecogen is available from Baxi (baxi.co.uk/ecogen)
PVT is the best of the combined technologies. PVT looks like a standard PV array but produces high quantities of hot water as well as electricity. Extracting the heat makes the PV element more efficient, increasing electricity production. When combined with a heat pump it gives good year-round performance.
As with PV, the angle of inclination and the orientation are more important to maximise production.
A well-insulated 200m2 house would need a 4kWp system costing around £20,000 installed, including a heat pump and hot water cylinder.
PVT qualifies for FiTs and RHI. FiTs will be 37.8p for new build and 43.3p/kWh for retrofit. RHI rate is yet to be decided — it’s likely to be between 8.5 to 18p/kWh.
A 4kWp system will produce around £1,900 per year or 9% return on investment.
New Form Energy (newformenergy.com)
A detached Victorian villa-style house with solid brick wall construction under a slate roof. In all, some 150m2 floor area over two floors. Insulation has been upgraded within the constraints of the property. Space heating and hot water are deemed the priority but there is a south-facing roof elevation, and the idea of PV is attractive. All the chimneys have been blocked except the lounge, where a woodburning stove is to be installed. Peak heat load is 9kW and heating distribution is radiators to all rooms.
Space heating: 10,500kWh; Hot water: 2,000kWh; Electricity: 4,000kWh.
There are limited options due to the constraints of the property and its surroundings. A wood pellet stove with back boiler would work but is not considered acceptable; there’s no garden space for a ground-source heat pump; air source is possible as the higher running cost is offset by its low capital cost and convenience. PV is also an option but doesn’t address the heating issue.
Use a Thermodynamic solar system, incorporating a heat pump. A four-panel system will cost some £7,500 installed and has a maximum capacity of 7.2kW. The shortfall will be met by the woodburning stove on the coldest days. This system will occupy 3m2 of roof space, allowing a 2.2kWp PV array to be installed.
Upfront Costs Capital cost for Thermodynamic solar and PV around £17,500; Running Costs Total running cost for the house £725; Income Total income likely to be £1,218.
A stone barn of 300m2 over two floors. Insulation is good but airtightness poor. The barn stands on a four-acre plot in a windy location. Underfloor heating to ground floor with heat recovery ventilation and towel radiators only to first floor. Woodburning stoves to be installed to the lounge and the snug.
Space heating: 18,000kWh; Hot water: 4,000kWh; Electricity: 8,000kWh.
A ground-source heat pump is possible as there’s plenty of room for the ground array, but the heat load is a little high. The roof has a south-west-facing elevation, not ideal for PV or PVT. Air source is not favoured due to perceived noise levels. The average wind speed has been established at 5.4m/s.
The owner’s idea was to install a wind turbine and use the electricity to run a heat pump. The trade-off price (3p selling price against 12.5p buying price) makes this less attractive.
It is intended that logs for the stoves in the lounge and snug will be used and there is a local, reliable supplier. The low capital cost and low running cost of a log boiler is therefore attractive. The decision is to install a Woodpecker gasifying log boiler and a larger wind turbine. The option to install a solar thermal array remains and will be reconsidered at a later date when funds allow.
Upfront Costs Capital cost of log boiler £6,500; Capital cost of 6kW C&F wind turbine: £25,000; Running Costs Space heating and hot water from logs at £40/tonne = £250 each year; Buy 4,000kWh electricity from Grid at 12.5p = £500 a year; Total running cost = £750; Income Biomass RHI at 9p = £1,710 per year; FiTs for 12,000kWh electricity = £3,446 a year; Total income = £5,156 a year for 20 years.
A 200m2 house over two floors; SIPs construction, airtightness of 5m3/hr, underfloor heating and mechanical ventilation. To be built on a standard building plot in a suburban location.
Space heating: 7,000kWh; Hot water: 3,000kWh; Electricity: 6,000kWh.
A ground-source heat pump is not an option due to space constraints in the garden. Replacing the intended woodburning stove in the lounge with a wood pellet stove-boiler would work but the effort and mess perceived in loading fuel and emptying ash is not acceptable. The house has a large south-facing roof and solar energy is an option. Mains gas is available locally but not yet on site.
Use the roof space to install a 3.5kWp PVT array with a heat pump in the utility room, and a 240-litre hot water storage tank. The system will meet the whole of the hot water and heating demands and leave a shortfall of 2,000kWh in electricity consumption.
Capital Cost will be £21,000; Running Cost for the house will be the electricity shortfall of £250 per year; Net Income (total income minus running cost) is £1,480 a year for 25 years.