heat-policy

There are a few interesting things that have come up but overall the RHI is quite successful, and is spending not at it’s total budget level but is showing steady growth. This might just be the scheme getting itself off the ground and investors and installers getting comfortable with it.

The scheme is split into non-domestic and domestic. The non-domestic side has been up and running for a bit longer.

This is what non-domestic has delivered…..almost a gig of capacity:

Accredited installations Capacity of accredited installations     Number % of total MW % of total     Small Solid Biomass Boiler (< 200 kW) 4,392 84% 512.101 56 Medium Solid Biomass Boiler (200-1000kW) 506 10% 288.717 32 Large Solid Biomass Boiler (> 1000 kW) 18 0% 98.716 11 Small Solar Thermal (< 200 kW) 142 3% 2.329 0 Small water or ground source heat pumps (< 100 kW) 160 3% 4.635 1 Large water or ground source heat pumps (>100 kW) 12 0% 3.282 1 Bio-Methane 3 0% 0 0 Biogas 2 0% 0.376 0 Air Source Heat Pumps 0 0% 0 0 CHP 0 0% 0 0 Deep Geothermal 0 0% 0 0 Total 5,235 100% 910.156 101

Interestingly the Southwest (including my spiritual home of Cornwall) is doing very well with around 20% of all non-domestic accreditations, more than the whole of Scotland! Despite it’s ‘economic’ importance, the capital city has just 30 accredited installations. The rate of non-domestic installations continues to increase and according to the data, most of the installations are to do with food and ‘accomodation’.

The domestic scheme has delivered around 7,500 new installations split like this in terms of number of installations:

 

Again the South West is the region with the most accreditations, 18% of the total. This could be down the the prevalence of off-gas-grid homes in the Southwest as this is where returns under RHI should be the highest. The Southwest is 72% on-gas compared to 76% in Scotland and 78.5% in Wales (http://www.consumerfocus.org.uk/files/2011/10/Off-gas-consumers.pdf).

Interestingly though, DECC records what the new renewable systems are replacing and in some cases, gas is being displaced. This is interesting for two reasons. Firstly, because the RHI returns are based on using off-grid costs (oil) as a counterfactual, returns will be lower where gas is already being used. However 20% of heat-pumps are being installed displacing gas!

The second interesting bit is linked to the first. If people are replacing gas with heat-pumps (ground source or air source) this is likely to increase the overall emissions of that household. This is because although heat pumps have efficiency factors, the carbon intensity of the electricity of the grid may be so high that these efficiency factors (COPs, these may be around 3 (300%)) may not counteract the fact the energy from gas is much lower carbon than energy from the grid.

So, if natural gas has a carbon factor of about 0.18 kgco2e and electricity which will be fuelling the heat pump has a carbon factor of 0.5kgco2e (Defra 2014 emission factors) the heat pump will need a COP of over 2.7 which is quite high for the UK. This is a rough estimate but doesn’t take into account marginal grid carbon emissions, i.e. the fact that when heat pumps are on is likely to be the highest carbon intensity part of the day (peak). This can significantly increase emissions for heat pumps if accounted for.

Overall though, the RHI is an important and well designed policy and with a few tweaks such as joining it up with energy efficiency and removing some other hurdles, the RHI will be a very important tool for decarbonising our heat supply.

Table 2.4 – Accreditations by previous fuel type, Great Britain, April 2014 to July 2014
Tariff Band		Fuel type displaced
		Oil	Biomass	LPG	Coal	Electricity	Gas	Other / NA1		Total
Air source heat pump	Number	709	5	112	27	228	356	338		1,775
	% of total	40%	0%	6%	2%	13%	20%	19%		100%
Ground source heat pump	Number	241	0	37	17	46	42	331		714
	% of total	34%	0%	5%	2%	6%	6%	46%		100%
Biomass systems	Number	707	20	96	72	140	63	84		1,182
	% of total	60%	2%	8%	6%	12%	5%	7%		100%
Solar thermal2	MW	324	3	60	23	71	649	160		1,290
	% of total	25%	0%	5%	2%	6%	50%	12%		100%
Total	MW	1,981	28	305	139	485	1,110	913		4,961
	% of total	40%	1%	6%	3%	10%	22%	18%		100%