New tariffs could rejuvenate solar thermal market
New Renewable Heat Incentive (RHI) tariffs could be just the shot in the arm the solar-thermal market needs, says David Pepper of Lochinvar.
Currently just 2% of the UK’s usable heat is generated by renewables, and the Department of Energy & Climate Change (DECC) has set itself a hugely ambitious target to increase that proportion to 12% by 2020. That is quite a distance to travel in just six years.
However, a lot is being pinned on the Renewable Heat Incentive (RHI), especially as the domestic version of the scheme is just about to start. However, the commercial version, which has been in place for more than two years, still has a long way to go to stimulate the market in the way the Government hoped.
There was a 7% rise in renewable heat during 2012, but the market is still some way short of where the Government hoped it would be by now. When announcing new more generous commercial tariffs in January 2014, DECC admitted much still needed to be done to improve uptake of the RHI if the country was to meet its carbon reduction targets.
‘We have seen strong uptake in certain renewable heat technologies. However we have not, so far, seen the levels of uptake that were anticipated,’ a DECC statement said.
‘Whilst applications of biomass installations smaller than 1 MW (thermal) have exceeded our expectations, uptake for the other technologies offered support has been lower than was originally anticipated. Based on current applications we estimate the total heat generated in 2013/14 will be about 1.2 TWh. This is just over a third of what was originally expected.’
In fact, biomass dominates. It accounts for over 90% of RHI installations, but to get anywhere close to the target, we will need the incentive scheme to work for a basket of technologies — including heat pumps and solar thermal.
When the new tariffs were announced, most attention was focused on the fact that air-to-water heat pumps were to be included for the first time. However, the potential impact of solar thermal systems could be equally, if not more, significant.
The new tariff, applicable to solar-thermal installations installed from October 2013 onwards, is 9.2 p/kWh for systems below 200 kW (thermal). The tariffs will be reviewed again later this year because DECC wants to keep a close eye on the impact on ‘underperforming technologies’.
However, 9.2 p/kWh is generous enough to rejuvenate the market for a technology that can make a significant difference to a building’s running costs.
Solar thermal looks even more attractive if you also consider the fact that insulation standards are improving. This reduces demand for space heating and makes hot water responsible for a greater proportion of overall costs.
Payments are guaranteed for 20 years so can make a considerable difference over the lifecycle of a solar-thermal array, particularly as energy prices are likely to keep rising.
Solar thermal was sidelined because of the way the solar photovoltaic (PV) market was superheated by over-generous Feed-in Tariffs () that then caused the market to collapse when they were cut. There is only so much roof space available, and too much of it was taken up by PV that would not have been economically viable without the very high FiTs. Solar thermal suffered again when the general solar market went into decline, despite having a very strong financial case compared with other renewables.
If the market is stimulated and we see installation numbers picking up, no doubt attention will return to the management of these systems. The use of thermal stores will improve the performance and return from solar-thermal systems by ensuring the system can meet high demand levels, even when the Sun is not shining.
We do have to be mindful of the possible risk of legionella build up, however. The temperature at which the water from a solar system is held in the pre-heat storage vessel can often be right in the middle of the ‘danger zone’ of 40 to 45°C where legionella bugs can proliferate. Engineering attempts to minimise this risk often lead to overly complex and expensive solutions that rely on regular interventions from an end user or maintenance team during the system’s operating lifetime.
Some renewable pre-heat cylinders need a regular pasteurisation process to prevent the risk of Legionnaires’ Disease, but this is an energy-intensive and expensive process. So, ironically, in trying to reduce the energy burden of a building by deploying renewables, a building operator can end up having to use more energy to purify the water system.
Thermal stores can eliminate the legionella risk because the design of such products is often based upon the pre-heated water being generated in a low-water-content coil rather than a large storage cylinder. This concept is a simple, highly practical approach that can also save money throughout the operating life of the system by reducing the need for disruptive maintenance.
This year could see a bounce in the solar-thermal market and, as it is one of the more reliable and time-proven solutions, that can only be a good thing for the industry and end users — not to mention those ambitious Government targets.
David Pepper is managing director of Lochinvar.