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Archive for the ‘private wire’ Category

pllWith the election looming, it’s time to nail your colours to the mast. Ain’t no purdah round here, so here’s my contribution…

If I were Secretary of State for Energy and Climate Change, my mission would be to put us firmly on the path to zero carbon heat and electricity. Only by doing this will we meet our legally binding promise to decarbonise the UK economy and mitigate the worst effects of climate change.

As you’ll see, I also wouldn’t get too hung up on where my remit officially stopped.

To get back on the path, we’ll need to radically improve energy efficiency, develop our ability to shift electricity demand, enable renewables to meet the bulk of our electricity requirements, and rapidly develop our district heating market.

First: ramp up energy efficiency

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As summarised in earlier posts, license light is pretty much the only tool in OFGEM’s toolbox to allow small scale generation schemes to get value for the electricity they generate. It’s nothing to do with subsidies or guaranteed prices or feed in tariffs. Instead license light is trying to redress the fact that our electricity market just isn’t a level playing field. The big companies can afford to play, while small time (usually low carbon) generators are squeezed out.

I noted in the earlier post that the GLA were working on a pilot to trial license light. They had hoped to get the license light toolkit and sample contracts published by end of March 2012. This hasn’t happened.

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On-site generation only works if you get good value for the energy you produce. For example, the viability of CHP (and the resulting cost of heat) depends on the price you get for the electricity you generate.

So what are your options? You could export to the grid under an offtake contract with a licensed electricity supplier. But as a small generator your electricity is almost worthless to them so they won’t pay much for it: maybe 2 or 3p. So unless you’re able to negotiate a particularly sweet contract, this is usually a non-starter.

The obvious route should be to sell energy directly to people on the site where the energy is generated. That’s supposed to be the point of distributed energy, right? (more…)

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Isabelle McKenzie has put up a very useful post on the Fontenergy blog describing the practicalities of third party access for private wire networks. She starts with background info on the Balance and Settlement Code before going on to outline the two main strategies for allowing third party access.

Will private wire always be an option for small schemes? Maybe not, but until DECC and OFGEM can come up with an alternative, these schemes will need to tread carefully to make sure they’re adhering to best practice and not being anti-competitive. Have a look.

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For consultants, energy reports for planning are fantastic: a bit of SAP, a few benchmarks, some spreadsheet magic, and hey presto you’re sending an invoice. But the contents of the energy report can have huge implications, in some cases committing the scheme to commercially or legally impossible strategies, causing delays and increasing costs later in the programme. Here are a couple of examples:

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As Phil Clark pointed out in a comment on my last post, there’s a very good piece in Building on the disappearance of ESCOs. This is a subject near to my heart as I’m part of  Fontenergy, an independent ESCO.

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Most people who work in the built environment agree that ESCO stands for Energy Services Company. But that seems to be the only thing about ESCOs that everyone agrees on – the term can mean vastly different things to different people.

So what is an ESCO?

The short answer is: there’s no one answer. Here’s a rough list of the services that an ESCO might offer. Keep in mind that a company might provide all, some, or only one of these services and still call themselves an ESCO:

ESCO-responsibilities

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In a blog post earlier this month, Mark Brinkley wrote that the zero carbon agenda is dependent on private wire networks, which he contends are anti-competitive. While I have a lot of respect for Mark, in this case his arguments aren’t valid. Here’s why.

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From the zero carbon consultation, you can see that CLG has accepted that we need to resolve the onsite / offsite question. They have also moved away from the requirement for private wire networks or “direct connections” between generators and homes since it caused all sorts of problems.

So positive moves from CLG, but there is still a huge amount of confusion over what onsite and offsite actually mean. This is a crucial issue since only onsite energy will count towards carbon compliance, while offsite energy is only likely to count as an allowable solution.

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In case you don’t fancy wading through it, this is a brief summary of the zero carbon consultation doc. While nothing will be finalised until next summer (after they’ve ruminated over the responses), the document does give some insight into the way CLG is leaning on some issues.

At the core of the document is the government’s preferred framework for reaching zero carbon. In order of priority:

  1. A minimum standard of energy efficiency will be required.
  2. A minimum carbon reduction should be achieved through a combination of energy efficiency, onsite low and zero carbon (LZC) technologies, and directly connected heat. This is referred to as achieving carbon compliance.
  3. Any remaining emissions should be dealt with using allowable solutions, including offsite energy.

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