Tag Archives: Renewable Heat Incentive

The greenest budget ever


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Listening to the “emergency” budget today was fairly tedious. We were waiting for mention of some forward thinking on carbon reduction, energy, renewables, perhaps the greenest budget ever. We heard nothing. The Renewable Heat Incentive funding is set to close to new applications in April of 2016, and we, like most people in the industry, would like to know the governments thinking moving forward.

Amongst the welfare cuts, increase in the minimum wage, freezing fuel duty at the pump, the Chancellor has produced a package of measures worth £1.3bn to support the North Sea Oil based companies and help to expand production. He has removed the Climate Change Levy exemption on renewable energy produced electricity and confirmed the ending of subsidies for on shore wind. He channeling all vehicle excise duty into the building of new roads, perhaps this will help reduce miles travelled.

This does seem to be at odds with the Climate Change Comittee report that was published at the end of June 2015. This clearly states that whilst the delivery of bioenergy seems to be delivering to target, with the halt in funding the industry needs to “urgently” know what comes next. The Renewable Heat Incentive has not delivered the amount of heat pump installations as expected. The committee recommended in their 2014 report that the awareness of the RHI needs to be improved (at 21%) and this needs to be complimented with additional training as support for installers.

On the face of things there has been an unprecidented 8% fall in carbon emissions in the last year. They can largely be counted for by the following:

  • A very mild winter (and perhaps more mild winters on the way)
  • Closure of coal power production
  • A change in accounting measures
  • A reduction in the public sector estate, with many local councils selling off their building stock (and therefore not heating them.
  • Some good progress in renewable electricity generation

The main issue from the report is that for the targets to be met in the future you can only close so many power stations. There is significant CO2 being produced from heating. Low carbon heat makes up between 1.6 and 2.1% of the heating total in 2014 with an ambition to get to 12% by 2020. Buildings make up 16% of all CO2 emissions. If you add in the falling away of the retrofit of insulation or the lack of input into the development of standards for new homes or new social homes, then this area becomes a budget that may not be reached.

The Telegraph suggested that the Chancellor would review the Levy Control Framework this morning, as this was spiralling out of control. There was no mention of this in his speech. This money, raised through taxes on energy bills to pay for renewable energy (all electricity) strategies, e.g. FiTs

Looking forward we do know that there are 10 months of support for new renewable heating projects. Financially it makes better sense to install a biomass boiler if your needs are greater e.g. 40kW domestically or more than 100kW non domestically. If you would like advice on what to install, what it costs, what incentive you may achieve then get in touch with us through the “contact us” form or phone 01225 580 401


Biomass boiler efficiency


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Biomass boiler efficiency in general has come under some criticism in a recent Guardian article .

Key points from the Guardian article are that a DECC study of installed biomass systems found that the average efficiency of the boilers was 66.5%, that the surveyed systems can only reach 76% efficiency, and that this is lower than the needed 85% efficiency to contribute to carbon targets. Yet the original research also states  “In other words, the estimated central performance standards of 81.5% to 72% (and 76.75% on average) would only be slightly exceeded if the boiler were gas, oil or coal fired.”

Whilst the article was clearly pushing heat pumps, a rival renewable technology, there seems to be confusion in the text.

To qualify for the Renewable Heat Incentive biomass boilers have to conform to a European Standard EN303-5. In addition to this the boilers have to be tested to emit limited emissions.

The 85% efficiency relates to the EN303-5 standard and the class of boiler that can be used for an RHI Scheme. This is calculated in lab conditions from the burning of a specific fuel. This is not the overall efficiency of the heating system.

Over the last 2 years there are a number of variables that may have influenced the study.

Issue 1 – Heat Meters

Heat meters are used to measure effective heat that is used by the RHI biomass system. What is recorded on the heat meter is what is paid to the owner of the system. In the majority of cases the heat meters are placed on the entrance to the heated spaces. Thus they only measure what is being used, and not what is being wasted. In addition there have been some issues with the installation and accuracy of the meters, where the accuracy can vary by up to 30%. There are currently free courses to help remedy this.

Issue 2 – Fuel

When the RHI first came into being the boilers could be tested on a very efficient fuel, but in reality the boilers were using a similar fuel that was much less efficient.

For instance you can buy wood briquettes that can have a low moisture content e.g. 8%. These will burn very efficiently, in excess of 90% in the right conditions. However if you use logs that are not properly seasoned then the moisture content will be much higher e.g. 30%, and the efficiency of the burning process may be as low as 65%.

This issue has been addressed in part by a tightening of the specifications. However there are boilers installed that are burning poor quality fuel as it is cheaper than specified fuel. This is more prevalent with landowners or farmers. Today all newly installed boilers should only be burning specified fuel and the boilers should be able to burn with an efficiency of above 85%. Owners of the installation have to keep records of the fuel they have purchased.

Wood Pellets all have to be ENplus. Regular samples of pellets are taken and they are measured for moisture, dust (fines), hardness, and burn quality. There have been some issues with dust in particular. The pellets can degrade in transit and when loaded into a hopper. There are examples where the dust content can rise above 10 or 15%. Clearly this makes the efficiency of fuel to heat produced less efficient. Again these issues are often dealt with by an experienced installer, or many of the good distributors will offer replacement pellets if they have been wrongly handled. There are very few issues with bagged ENplus pellets.

The majority of the boilers in the study seemed to be using woodchip at 199kW. In the case studies provided the fuel used was often wood chips with a moisture value of 30 or 31 percent. Wood Chips are significantly cheaper than wood pellets, but burn less efficiencty, and therefore will have a poorer efficiency. For instance if the burn efficiency of 31% moist pellets is 80% then the heat transfer to water will be below 80%. This will largely explain the number of responses that seemed to be 70% + and fairly well installed.

Issue 3 – sizing of boilers

With Solar PV everyone who purchased wanted as much as possible. This produces more electricity, which is a good thing! For biomass the owner of a system gets paid the highest tariff up to 199kW. So if you are buying a biomass system for investment purposes then it seems that choosing 199kW will earn you more money.

The difficulty with this is that this causes 2 problems. a) The boiler is not run at its most efficient output. This is true, for instance, for many combination condensing boilers that have been sized for hot water production and not heating need. The boiler never reaches its optimum output and is less efficient as a consequence. b) The heat is not really needed. Here the owner is more interested in the tariff rather than the efficient distribution of the heat. The heat is then lost.

Issue 4 – UK weather and system management

UK weather presents a number of issues. Firstly we do have mild winters and cold winters. This can relate to the sizing issue. When you size a boiler you examine possible temperatures that you want the boiler to be able to cope with. For many this may be -3 degrees. In reality we may experience the majority of the winter with temperatures of between 6-12 degrees.

The other issue with UK weather is that it is intermittent. We generally do not need the heating on all day every day. Therefore you have to consider carefully when the heating needs to be turned on. If the following month is then warm you will wast the heat that is already in your system. For instance if you have buffer tanks and have spent time heating them up, only not to use the heat, then this heat could be lost and not used.

Issue 6 – General heating system efficiency

What is not clear from the Guardian article is how the efficiency is measured. The original article is far clearer and looks at the whole system efficiency rather than implying that the efficiency is all down to the boiler.

Before the heat gets to the heat meter there may be pipework (lagged), district heating pipe work, buffer tanks, and the transfer of the heat from the burn chamber within the boiler to hot water.

Examining the transfer from heat to water, there is a UK database that is slowly expanding that shows that heat to water efficiency (typically 80-86%) from biomass boilers rather than the burnt efficiency of the burning process that is often above 90%.

Due to the nature of the study being more about 199kW boilers for predominantly large retail systems with possibly wood chip boilers, it does not cover smaller systems that do not have district heating, or many pellet boilers.

If you are in doubt over what your system efficiency is or even means, then please get in touch with us.


Domestic Renewable Heat Incentive – update


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The domestic Renewable Heat Incentive is currently waiting for its final details from the government. These are expected during the summer of this year with the scheme going live early in 2014.

Further details can be gained from here

Among the key points are that the government is reconsidering the tariffs. This includes a possibility of increased tariffs for some technologies.

Currently the domestic tariff for biomass is projected to be between 5.2 and 8.7p per kWh over 7 years. For a 20kW installation this could mean £16000 over 7 years.

This does not compare as well as the non domestic Renewable Heat Incentive where the same installation could get a similar tariff over 20 years ie in excess of £40,000. However you would probably pay for your installation and financing as per the government report depending on the boiler and facilities that you want from your boiler.

Whilst we are waiting for the government to announce what they want to do we are finding that customers are changing or tailoring their installations to suit the delay.

In discussion with customers have found that a key difference between commercial and domestic is the issue of a pellet store. On smaller installations it is easier to poor pellets more frequently into a boiler that has an internal hopper or a smallish hopper that sits next door to it. If you want to build a hopper or buy a larger hopper the hoppers can be reasonably priced. For instance an 8 tonne external hopper can be about £2000. You then have to consider how to feed the pellets from the store to the auger. This can be a further £950 for a flexible auger of 3 or 4 meters. Alternatively you can use a vacuum system, where prices can start at £2000.

The payback of a boiler without a large hopper is much greater, but you have to poor in pellets on a more regular basis. It is possible to do this in the short term with a view to putting in a larger hopper as and when the RHI is confirmed.

The other trend we have seen is that wood boilers are being more carefully considered. For instance logs can be purchased in the South West from Longleat

Log Type Price
Hardwood Logs from £130.00 per tonne Delivered
from £116.00 per tonne Collected
Softwood Logs from £101.00 per tonne Delivered
from £87.00 per tonne Collected

These prices are considerably less than wood pellets and affect the payback of an installation project.

Mass produced fuels have gone up in price over the winter with oil reaching 65p a liter as the cheapest alternative to gas.

Our WBS boiler can accept a wood pellet burner. You can start with a log boiler and upgrade to a pellet boiler at a later date.

Both the above ideas are a move to keep costs down as te main driver for everyone is cost.

At Ecobuild this year we exhibited our Pyroburn product that gives an alternative to a straight log burner.

Log gasifying boilerIt is available as an 18, 25 and 40 kW boiler. It is attractively priced and can be an alternative to the WBS active range.

The other development is the “Duo”, now a live product, we visited the factory 12 months ago to see the product in the final stages of development.

duel chamber burning boiler

 

You can see a Dual chamber boiler video by following the link.

So we are finding that fuel prices are increasing – and this makes biomass more attractive, and logs or alternative fuels even more so. Well priced boilers and installations are met with approval, however we would all like to see a final version of the Domestic Renewable Heat Incentive confirmed soon!


Log Burning Boilers or Wood Pellet Boilers?


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If you are considering “biomass” as a heating system the most obvious choices are between log burning boilers and wood pellet boilers.

For some the clear advantages of log boilers are:

  1. Cost of installation
  2. Cost of fuel
  3. Sustainable use of wood

For others the clear advantages of pellets are:

  1. Automation of heating
  2. Higher efficiency
  3. Pellets are a waste product
  4. Space saving

Cost of Boiler

Log boilers such as the WBS active are MCS accredited and burn wood up to 90% efficiency. The boilers start at at a little over £1000 (20kW WBS) and this is a lot cheaper than the Pelleburn wood pellet boiler that starts at £3500.

Cost of Extra Water Heating

Wood pellet boilers modulate. This means that they can adjust to produce the  amount of hot water that you need to store for heating. Log boilers need to heat water when they are burning otherwise there is nowhere for the heat to go. This is often in the range of 30-50l per kW.

For instance a 20kW log boiler will need to heat 600-1000l of hot water.

You could choose an accumulation tank or a thermal store to do this.

An accumulation tank or “buffer store” can used to store the heat. They are well insulated and once heated can distribute the heat without the need for the boiler to be “on”. A 1000l buffer store is nearly 1 meter diameter by 2 meters tall. This does mean that you need to find space for this. The buffer store will be an extra £1000+ and there are extra plumbing costs in installation.

A thermal store can incorporate a hot water tank and heating hot water in one tank. A “tank in tank”. Assuming you need hot water for baths and showers, then you will need a hot water tank. Some houses already have these, some do not. Others are old and need replacing. A thermal store is a good solution if there is a need for a new hot water tank.

Wood pellet boilers do also benefit from the use of accumulation however they can burn efficiently for shorter periods of time and so need less water to heat. On smaller systems it is possible to work without one, however your boiler may need to come on more often. Using an accumulation tank may prolong the life of your parts.

In summary – log boilers need more accumulation than pellet boilers, and this will increase costs of installation. This will vary depending on the installation.

Space Needs

Wood pellet boilers that are completely automated generally infers a large pellet store that can be filled. This can take up a lot of space e.g. 10m3. This has to be dry and purpose built. Whilst there are pellet stores that can be outside for most homes the choice is between a top loading boiler (ie no storage) e.g. an MCZ Musa , an indoor pellet hopper e.g. Pelleburn or a purpose built hopper. This means that the storage needed varies in size depending on the location and budget. For those tight on space a 1.5m by 1m space is generally more than enough.

For logs the space is larger for the smallest boilers. The boiler is larger, needs more space for a larger flue, and accumulation tank. This is typically 2.5m2

Cost of Fuel

Often the most immediately available fuel is more expensive on the internet. Pellets do range in price, but are frequently £200 per tonne or 4.5p per kWh. (Oil prices were 65p per liter (6.5p per kwh in March and are currently 53p per liter, 5.3p per kWh)

Logs vary more in price and this also varies considerably regionally. For those with a ready supply there is the cost of cutting logs ie your time, or alternatively you can get fuel delivered often at £90-100 per tonne 

This makes the cost of logs about half the price of pellets.

Efficiency and Sustainability

A WBS log boiler can be 90% efficient and a pelleburn pellet boiler can be 94% efficient. Some of the efficiency difference can be put down to pellets being dryer and only pulp, ie no bark.

If your logs are from your immediate surroundings then there is no transport or significant processing costs. In addition some pellets have been artificially dried. Whilst not significant, pellets are transported and there is a manufacturing cost that involves drying wood pulp.

If your logs are the result of forestry or woodland management and the wood is offcuts ie cannot be used for other things, then it is sustainable. This is also true for pellets e.g. if as part of making paper there is sawdust and pulp left over then this waste product can make pellets.

There is a strong argument for logs in terms of sustainability and transport. Unfortunately this does not work for many people due to the availability of local woodland management for our homes and logs are not economic to transport.

Renewable Heat Incentive

Currently the non domestic Renewable Heat Incentive pays the same incentive for log boilers as pellet boilers.

A 30kW log boiler May get RHI payments of  30 (Size of boiler) X 8.3 (higher tariff) X 1314 hours = £3271 per annum.

For an installation of logs or pellets costing between £7-10,000 this would payback in under 3 years before you take into consideration the lower cost of fuel.

A Possible Compromise

If you are finding it difficult to decide whether you want logs or pellets. For many the logs do appeal but there is the extra work involved and will you be happy doing this?

The WBS range of log boilers all come ready to fit a pellet burner ie you can convert your boiler over at a later stage. The pp and pelle ranges of burner are easy to fit and with some minor adjustments to your settings you can be burning pellets.

For more information do get in touch with us using the form on the right hand side or by phoning 01225 580 401


Renewable Heat Incentive – Farms


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Renewable Heat Incentive eligibility is not clear for farms and similar organisations. However we believe that it is possible for a farm to qualify for the non domestic Renewable Heat Incentive to heat their home and an acceptable farm building as part of a district heating system.

Ofgem provide a detailed guide Ofgem Website and helpline support 0845 200 2122 to clarify questions and the information here is a guide. Each scheme would have to be approved by Ofgem.

Difficulty 1 – Business rates

Farmers do not pay business rates and this is the way that Ofgem defines a “building”. Therefore applications will have to show that the building is indeed a building that is exempt from business rates and used for agricultural use e.g. farm office. This could be a letter from the local council.

Difficulty 2 – Complex heating systems

If a farm house and office are 2 buildings then they are almost certainly separated and will need some form of well insulated underground heating pipe. There is a small heat loss from this, and as such the payments need to be based on the delivered heat. In order to make this happen meters need to be placed inside the relevant buildings where the pipe has to travel between one building an another.

If there is a back up heating source, such as an oil boiler, then then the heat produced from this will also have to be measured, as will the heat produced from the renewable source e.g. log boiler.

Therefore is is possible for 3 or 4 class 2 heat meters to be needed as part of an installation. This will increase costs accordingly.

For instance a 20kW log boiler in a “complex” system may cost between £8-12k to supply and install.

If a farm used 1314 hours of heat during a year they could gain over £43,000 (1314*8.3*20)

If you consider a farm may be in an off gas area and be making significant gains by burning biomass rather than oil or LPG then this is an excellent investment.


Renewable Heat Incentive Tariff – Non Domestic Adjustment


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Here’s a quick rundown of the renewable heat incentive tariff adjustment for non domestic heating.

Small commercial biomass tariffs have been adjusted as of 1/4/12.

From the previous rate of 7.9p the new rate is 8.3p for the first 1314 hours.

For instance if you installed a district heating scheme for an agricultural building and a farm house needing a 20 kW log boiler then your payments could be:

20 * 8.3 * 1314 (hours used) = £2181 per annum for 20 years or £43625 in total

The log boiler would need to be MCS accredited, along with the installation.

A standard log boiler installation tends to be between £7 and 10k.

If the installation is “complex” then there would be extra metering costs that would have to be taken into consideration.


Renewable Heat Incentive Update


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The Renewable Heat Incentive programme has been updated. Firstly through a DECC ministerial statement on 11 June 2012.

The Renewable Heat Incentive Update Changes

This stated that current uptake of the non domestic RHI seems to be working ie there has has not been a deluge of applications. They have put in controls so that the monies do not suddenly run out like the FIT’s.

Greg Barker has also confirmed “longer term support” for households and said that the plans announced in March are on track.

The RHI has also been approved by the EU commission to be expanded to Northern Irleand. The scheme, which will be managed by the Northern Ireland Executive, will operate for maximum 20 years and will be worth an estimated £184 million (approximately €227 million), of which £25 million have already been allocated for the first five years. Its target is to reach a level of 10% of renewable heat by 2020. This implies an increase of 1.3 TWh over and above the 0.3 TWh of renewable heat currently produced in the territory.


Wood Pellet Boiler Installations – Some General Rules


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As part of our service we assess requirements and properties to help you choose the right system or boiler for your heating and lifestyle choices. This post is all about Wood Pellet Boiler Installations.

For this we asked Tom Jacques, an architect and RIBA Client Adviser based in the South West for some comments.

Tom responded with 3 articles the third of which is below.

Part 3 General rules about wood pellet heating

Rule 1 – Most estimates on websites are unreliable

As the complexity of the system selected increases, the parts and the labour go up in price significantly. However the maintenance levels go down and the efficiency of the system goes up.

Expensive parts do include the pellet boiler which ranges in price from £3000 to £17,000 but also:

The flue – this can cost between £750 and £2000

Accumulation or climate control – between £850 and £2000

Pellet Store – You can use the integrated hopper that will last you a few days at peak load. Otherwise there are several options. A steel hopper may cost between £2000-£3000, as may a flexible liner in steel frame.

Pump sets and other plumbing equipment are also needed, especially if you have several heating circuits.

The labour charge varies from a few days to a couple of weeks depending on the design of the heating system proposed. This may be in the range of £1500 to £6000 with plumbing supplies (e.g. copper pipe) being extra.

Rule 2 – Everyone is an expert

We accept that the market is relatively new. Whilst most MCS accredited installers are very good and knowledgeable we have found that people’s knowledge varies. This includes consultants, other technologies, advice centres, builders, architects etc

If you have a budget and know what you want, do invite several companies to quote. Any risks that there may be can be identified and ironed out.

Rule 3 – Do the sums

We often suggest biomass as we think it has great potential as an alternative to oil and Lpg, particularly where heat loads are higher. Occasionally other solutions, including ground source heat pumps, air source heat pumps, solar thermal, and electrical generation and output devices may be preferable, or used in combination, and should also be considered.

All renewable technologies have the benefit of being able to have MCS accreditation. As such when your house is assessed, they should tell you how much heat you can get from their system, how much it will cost to install and run. It is then a fairly simple process of firstly doing the sums and then secondly having a feel about which technology you like best and works in your situation.

Key considerations for “doing the sums” are to:

  • Understand your own heating needs. What heat did you use last year? For instance if you used 2000 litres of oil you burnt about 20,000 kWhs of energy. At 60p a litre this is £1200. This costs 6p per kWh
  • Get a price for the equipment and installation along with the output or performance, probably in kWs.
  • Understand how the equipment works at its best and its worst so that you can get an idea of operating costs. ie. how many tonnes of pellets do I need to burn? Pellets often release 4800 kWhs per tonne. In the above example this would be approximately 4.2 Tonnes of pellets. This gives a fuel bill of about £800 and a saving of £400. This costs 4p per kWh

For Heat pumps understand the co-efficient of performance (COP). For instance a heat pump will perform differently based on:

The type e.g. Air Source heat pump or Ground source heat pump,

The job it is being asked to do e.g heating water to 60 degrees C

The temperature of the air or ground where the heat exchange is taking place, and maintaining optimum performance.

Each kWh of “free energy” needs electricity to power the heat pump. If the COP is 2:1 then you get 2 units of heat for 1 unit of electricity.

A recent study of heat pumps in 2010 – “Getting-warmer-a-field-trial-of-heat-pumps” by the Energy Savings Trust suggested that the COP or Coefficient of Performance for heat pumps varied between 1.2 and 3.6 with a mid range of 2.2 for ASHP and 2.3-2.5 for GSHP. If electricity is 15p a kWh (then you would be paying between 12.5p and 4.2p per kWh with the majority of outcomes being between 6 and 6.8p per kWh ie a total bill of about £1200. Clearly if you had a PV installation with spare capacity or a “special” rate then you can reduce this cost.

Similarly, if the electricity is obtained through the mains, system losses will be taken into account in any calculation of carbon consumption and overall efficiency.

With the Renewable Heat Incentive, the rates for non domestic RHI have been published and this gives you an idea of the possible rates for domestic RHI in the future. Biomass is 7.9p a kWh, Solar 8.5p, and GSHP 4.5p. For 20,000 kWh’s of heat biomass wood pellets would gain nearly £1600 per annum for 20 years.

Rule 4 – The price of fuel will go up in price

Unfortunately we are in a volatile period for prices. Electricity, gas and oil are likely to keep going up in price. No one really knows by how much. There is greater demand for a diminishing world supply, resulting in a shortfall in the amount of energy to go around. In general oil and gas go up in price when you need it most.

Wood pellets are being made all over the country and there are more pellet suppliers than there are electricity providers (or gas and oil producers). This means it is a more competitive market which is likely to remain price sensitive for some time to come. Clearly there is a potential limit for how many wood pellets can be produced. The main constraint is the supply of raw material either sawdust or recycled wood. Many providers have fixed their prices to give confidence in the industry and it is very unlikely that you will get a monopoly in the same way as other forms of fuel. Still, it is likely to make more sense to order when demand is lowest.

For a good idea of relatively up to date price comparisons do click here

Rule 5 – Simple is best

With all the above points there is a tendency to get confused or wedded to a particular solution which may prove inappropriate, or to get consumed by too much detail at an early stage. Do take advantage of your home as it is. If you are combining alterations with an extension, consider how best use can be made of each element, and what can be best located where. Do ensure that you minimise heat loss as this is usually the most cost effective intervention which can be made. For systems installed do consider carefully how you will use and maintain the buildings and systems installed, for example the trade off between filling a hopper once or twice a week against once or twice a year (and the increase in costs that will result). Do use existing chimneys where possible as this will decrease your costs.

If biomass forms part of your solution, some of the choices you will make will be substantial and make a difference to the costs and effectiveness of the system. Other choices will be a bit like choosing a car. Once you have narrowed down the options by essential criteria, the remaining options will largely do the same job, but preferences can lead to significant price differences even within a model.

Installation costs are normally quite similar between companies for the same job, (it is worth getting alternative quotations to verify this), but the more complex the system, the higher the installation costs.

Tom Jacques

Tom Jacques is an architect and RIBA Client Adviser based in the South West.

Alongside interpreting,defining and meeting clients spatial and aesthetic requirements, Tom prioritises environmental design alongside an understanding of building physics, the use of appropriate technology, and the performance of buildings and their systems in use.

He embraces different approaches in different circumstances, and works where possible with specialists in their fields. Many of his projects involve work with listed buildings and in sensitive settings, and where planning and listed buildings consent is required.

He is not a specialist in any particular product or technology, nor a building services engineer, but is able to offer advice and assistance on projects where required.

If you wish to contact Tom, please contact us and we will pass your comments on to him.


Renewable Heat Incentive announced for non domestic buildings


Posted by Woody

RHI UPDATE – 25 NOVEMBER 2011

The Renewable Heat Incentive (RHI) for non-domestic generators will open for applications on Monday 28 November 2011.

The start of the scheme follows a short delay while DECC resolved the scheme’s compatibility with EU state aid rules and re-submitted the draft regulations to Parliament. Organisations will be able to apply to Ofgem for support under the scheme from Monday 28 November and will receive payments on a quarterly basis for heat generated over 20 years.

Applications can be made by the owner through Ofgem

For installations less than 200 kW the payment for biomass (wood pellets, wood chip, logs, miscanthus etc) will be 7.9p per kWh of metered heat below 1314 hours and 2p per kWh of metered heat above 1314 hours.

For instance for a 50 kW boiler using 1314 hours over 1 year would gain a little over £5000 per annum for 20 years.

For information on how you may be able to benefit from these payments please contact us.


Ofgem Guidance for Non-Domestic Renewable Heat Incentive


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Ofgem issued their guidance for how the Non-Domestic Renewable Heat Incentive is to be administered last Friday, and here’s all the information that you need to know.

For biomass the key guidelines are:

MCS certification requirements apply for installations less than or equal to 45kWth.

Must be specifically designed and installed to use solid biomass as its only primary fuel source.

A log via invoice of all fuel purchased must be kept. For wood harvested on a property a log must be kept. For installations below 45 kW the fuel “must not be contaminated” above 45 kW there is a 10% allowance.

They expect at lest one fuel hopper to be new.

Comment

Applications are made on a case by case basis. Ofgem are very keen not to support applications where fossil fuel can be burnt in place of biomass. In the applications it will need to be clear how the fuel source and equipment used will be dedicated to biomass especially under 45 kW.

Clearly wood pellet boilers have an advantage as:

  • The boilers can be dedicated to wood pellets
  • Wood pellets are made and to a standard so conformity can be shown.

Eligible Applications

Applications can be made by any non domestic property owner e.g. local council, school, bed and breakfast, hotel, office, etc.

The heating must be via hot water or steam and metered.

In addition the support is also for district heating systems. This is where more than one property is heated via the same boiler.

This is a grey area and there is an advice line to phone. However the following below is our understanding:

Will count for non domestic RHI
  • 2 domestic properties with one boiler
  • A hairdressing salon
  • A hotel
  • A bed and breakfast
  • Mixed use premises – e.g. offices and flats
  • A block of flats
Will not count
  • Landlord properties with individual boilers
  • Home office and domestic property

Evidence required will often come down to council tax banding or business rates. This is not exclusive, however the “mixed use” definition above is going to be difficult to interpret in cases where there are not clear definitions. e.g. Farm house and office – is it mixed use?

For further information please see the Ofgem Website or phone their enquiry line 0845 200 2122