Energy Manager July/August 2020 by Abbey Publishing

JULY/AUGUST 2020

Why we must not introduce a Zero Carbon Building Policy... ... but why we must push for an accelerated Zero Carbon Energy Policy.

www.energymanagermagazine.co.uk

INSIDE THIS ISSUE:

Could coal mines solve Britainâ&#x20AC;&#x2122;s energy crisis?

Step by step to energy efficiency

Impact of COVID-19 on the Energy Market

FRONT COVER STORY:

Why we must not introduce a Zero Carbon Building Policy... See page 36.

JULY/AUGUST 2020

PUBLISHER: Ralph Scrivens ralph@ energymanagermagazine.co.uk PRODUCTION: Sarah Daviner sarah@ energymanagermagazine.co.uk ACCOUNTS: accounts@ energymanagermagazine.co.uk PRINT: Mixam Print

ENERGY MANAGER MAGAZINE is published 10 times a year by Energy Manager. www.energymanagermagazine.co.uk 42 Wymington Park, Rushden, Northants, NN10 9JP Tel: 01933 316931 Email: mail@ energymanagermagazine.co.uk REGISTRATION: Qualifying readers receive Energy Manager free of charge. The annual subscription rate is £80 in the UK, £95 for mainland Europe and £115 for the rest of the world. Single copies £10. Some manufacturers and suppliers have made a contribution toward the cost of reproducing some photographs in Energy Manager.

PAPER USED TO PRODUCE THIS MAGAZINE IS SOURCED FROM SUSTAINABLE FORESTS. Please Note: No part of this publication may be reproduced by any means without prior permission from the publishers. The publishers do not accept any responsibility for, or necessarily agree with, any views expressed in articles, letters or supplied advertisements. All contents © Energy Manager Magazine 2020 ISSN 2057-5912 (Print) ISSN 2057-5920 (Online)

INSIDE: 4

News

Opinion

Monitoring & Metering

Recruitment

Heating

Heat Pumps

Renewable Energy

Energy Procurement

Lighting

Energy Management

Net Zero

Energy Supply

CHP

Water Management

Driving the Future ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

NEWS

VITAL ENERGI AWARDED CONTRACT TO DRIVE SMART TARIFF INNOVATION Vital Energi are leading a consortium of experts to drive innovation in the development and support of smart tariffs.

mart tariffs today are energy tariffs which vary depending on when energy is consumed – tomorrow’s smart tariffs may be even smarter. Smart tariffs are a critical part of the UK’s ability to achieve the 2050 net zero target. Typically, a smart tariff rewards consumers for using energy when it is abundant, thus enabling higher levels of intermittent renewable power generation that are key to achieving carbon neutrality. By encouraging reduced consumption during periods of peak demand, smart tariffs will also facilitate cost effective grid management. Consumers who can be flexible about when they use energy, through setting appliances or charging their vehicle, need innovative new tools to help them find the tariffs that work best for them. The consortium will develop a comparison prototype tool that gives consumers an easy way to find the most cost-effective tariff options to suit their needs; the prototype will also encourage and enable more informed adoption of low-carbon technologies like electric vehicles and heat pumps. Smarter comparison tools will help consumers see the benefit of smart meters; having a smart meter will mean they have a wider choice of tariffs and are able to get accurate price comparisons based on actual consumption The tool will be open source which means that every energy supplier, price comparison web site and low carbon technology provider can use the solution at no cost to help consumers make the best tariff and technology choices to suit their lifestyle and budget. Our work will be based on extensive research with consumers and energy sector stakeholders complemented by complex model development to deliver a customer-centric solution. The £400,000 Smart Tariff Smart Comparison project is funded through the Department for Business, Energy

and Industrial Strategy (BEIS) Energy Innovation Programme. By funding the development of this prototype and the related learnings, BEIS is giving industry a tool to encourage suppliers and low carbon technology providers to develop innovative new tariffs and solutions for the market. At the end of the project BEIS will publish reports and hold events to disseminate findings. Vital Energi will lead the consortium and other partners on the project include. • Hildebrand Technology (prototype delivery and smart meter data access) • davies+mckerr (consumer research) • Love Experience (user experience design) • The Carbon Trust and Dr Richard Carmichael of Imperial Consultants (subject and sector expertise) The project was conceived and funded by BEIS with the Vital Energi-led consortium delivering the winning bid. The project is expected to be completed by March 2021. A project web site will be launched within the next few weeks.

About Vital Energi Vital Energi provide energy generation, energy distribution and energy supply and consumption management to help both the public and private sector decarbonise their estates and developments.

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

We provide multi-technology solutions for your campus, city and new and existing developments that achieve your carbon reduction and energy cost targets for both now and in the future. Combining both renewable / low carbon generation solutions with optimised consumption measures allows new and existing homes and buildings to contribute towards carbon reduction targets. With over 30 years’ experience in the Heat Network market, we uniquely have access to 100 million metered data points coupled with the continued investment in products and services which allows us to develop and deliver secure and feasible energy solutions. www.vitalenergi.co.uk

About the Department for Business, Energy & Industrial Strategy (BEIS) BEIS is a ministerial department supported by 41 agencies and public bodies. It is responsible for developing the UK’s Industrial Strategy and supporting business, science, research and innovation, energy and clean growth and tackling climate change. The funding for this project forms part of the BEIS £505 million Energy Innovation Programme, which is dedicated to harnessing and rolling out cutting edge technology to fight climate change. More information can be found at: www.gov.uk/ guidance/energy-innovation#beisenergy-innovation-programme

NEWS

How energy companies can implement temperature screening to ensure staff safety post-lockdown

s lockdown restrictions are being gradually eased across the country, industries of all types must now consider additional health and safety measures, to ensure a safe re-opening. Energy companies in particular, are faced with the problem of re-opening the workplace as before, without risking a second wave of infections amongst staff. This is where fever screening can play an important role. By instantly identifying those with abnormal temperatures, energy companies can prevent those who may be infectious with COVID-19 from entering the workplace and in turn, potentially spreading the virus to others. Here, Lasse Tonnesen, Managing Director at Test Meter Group, explains exactly how thermal imaging temperature screening works to identify those with abnormal temperatures, and how energy firms can implement this technology to ensure their safe re-opening.

How does thermal imaging temperature screening work?

solutions, such as FOTRIC 226B, use AI face detection to automatically check an individual’s temperature These imagers also incorporate a body temperature calibration algorithm, which works to prevent false negatives. This algorithm works by automatically collecting face temperatures in different scenarios for self-learning. It then adjusts the body temperature alarm threshold in real time by adapting to ambient temperature changes. This prevents false alarms from people who report abnormal body temperature due to morning or night-time temperature differences, for example.

What happens if someone has an abnormal temperature? If an imager detects an abnormal temperature, it emits an automatic alert, which allows for a rapid on-site identification and prevention of the person from entering the premises. The imager will also automatically capture the photo of the detected person, which can be used for further statistics and analysis.

How can this help care

homes to re-open safely? It goes without saying that companies must implement a range of additional measures to ensure safety when easing lockdown restrictions. By implementing thermal imaging temperature screening solutions as part of these additional measures, energy firms will be able to identify any potential members of staff approaching the premise who may unknowingly have symptoms of COVID-19. It’s important that businesses then have a strict procedure in place to allow these staff to be removed from site in a safe manner and without coming into contact with any other person. Companies can then use the images captured by the imager to keep a record of those persons who have reported abnormal temperatures to ensure they do not return to the workplace within seven days, as well as to identify any trends or patterns emerging in the data. www.test-meter.co.uk

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ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

NEWS

ELECTRIC NATION VEHICLE TO GRID TRIAL SHOWS THAT THE EV STREET OF THE FUTURE MAY BE HERE SOONER THAN WE THINK

pplications to join the Electric Nation Vehicle to Grid (V2G) trial suggest that clustering of electric vehicles (EVs) may already be more common than many people expect. The project aims to demonstrate how V2G technology can provide a solution to potential electricity grid capacity issues as the numbers of EVs increase. Over 20% of applicants to the Electric Nation Vehicle to Grid trial already have two or more EVs at their property, and 48% are either likely or very likely to acquire a second EV in the future, or they have already ordered a second EV. Although the Electric Nation Vehicle to Grid trial is currently only recruiting households with one EV, these figures show that numbers of EVs per household are rising alongside increasing nationwide EV adoption rates. Charging an electric vehicle at home is equivalent to an extra house in terms of electricity demand. With many households liking their electric car so much that they either already have a second EV or are considering getting one in the near future, this ‘clustering’ will place further load on the local electricity network. However by using V2G technology, EVs can put energy back into the grid at peak times, so reducing the need for extra electricity generation or network reinforcement. A number of surveys have suggested that people are giving more consideration to EVs as we come out of lockdown, and green number plates are set to be rolled out from autumn to help encourage drivers to make the switch to electric vehicles, under plans to drive a green economic recovery. This is all good news for local air quality, but the extra demand on local

electricity networks needs to be managed. Electric Nation - a project of Western Power Distribution (WPD), in partnership with CrowdCharge - is recruiting 100 Nissan EV owners in the WPD licence areas of the Midlands, South West and South Wales to take part in the trial of Vehicle to Grid smart charging technology. Currently, only Nissan EVs are able to be used for V2G charging due to their CHAdeMO technology. One week after the Electric Nation V2G project was launched, 200 EV drivers had applied to join the project, and the following data had emerged: • 95% of applicants have a Nissan LEAF, 5% have a Nissan e-NV200 • 20% of applicants currently have two EVs at their property • 1% of applicants have more than two EVs at their property • 3% of applicants with one EV have ordered a second EV • 18% of applicants with one EV are very likely to acquire a second EV in the future • 27% of applicants with one EV are likely to acquire a second EV in the future • 41% of applicants with two EVs also had a Nissan LEAF as their second EV. As well as many households having more than one EV, applicants are already taking action in the area of energy, with 45% having solar PV installed at their property, and 14% having a domestic stationary battery storage device. The Electric Nation Vehicle to Grid trial is offering the free installation of V2G smart chargers worth £5,500 to Nissan electric vehicle (EV) drivers who live in the three WPD regions. CrowdCharge is recruiting

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

100 people for the trial to help Distribution Network Operators (DNOs) and others to understand how V2G charging could work with their electricity networks. Electric Nation is different to other V2G projects because it is using up to five different energy suppliers instead of just one. This means that the trial is a more realistic simulation of a future world in which many streets will have a number of EVs using V2G chargers operated by different energy suppliers. In the Electric Nation trial each supplier will use their chargers to test their various energy services utilising CrowdCharge’s demand management charger platform, which provides optimised charging sessions. The V2G trial follows the first Electric Nation project from 2018/19 which at the time was the world’s largest EV smart charging trial, providing real life insight into people’s habits when charging their vehicle. The trial provided data from more than two million hours of car charging, revealing the user habits on timings of charge, where and for how long, as well as the impact of different tariffs. By plugging in at specified times and putting energy back into the grid, active participants of the Electric Nation Vehicle to Grid project are expected to earn a minimum reward up to the monetary value of £120, available over the one-year trial period from March 2021 to March 2022. Recruitment is taking place from June 2020. Trial applicants: • Must be resident in the Western Power Distribution (WPD) licence area (Midlands, South West and South Wales) • Must have a Nissan EV with a battery capacity of at least 30kWh or more • Need to have the vehicle until the end of the trial (March 2022) • Need to have off-road parking • Will use the CrowdCharge mobile app to manage charging • May need to switch to a new energy tariff if required by their assigned project energy supplier • May need to have a new smart meter put in/updated as part of the project participation. Although the application process for the Electric Nation Vehicle to Grid project is now open, the timescale for charger installations is subject to confirmation based on government advice in relation to COVID-19. For more information and to apply to join the project visit www.electricnation.org.uk

NEWS

MORRISON DATA SERVICES SECURES FOUR-YEAR METER READING SERVICES CONTRACT WITH E.ON

orrison Data Services, a leading data services provider to energy and water utility retailers in the UK and Ireland, has been appointed to deliver nationwide meter reading services on behalf of E.ON. The four-year agreement will begin on 1 September 2020 and also includes an extension to Morrison Data Services’ existing ‘out of area’ meter reading contract with E.ON. As part of the mobilisation, a number of people will join Morrison Data Services to increase the scale of its meter reading team. Morrison Data Services Managing Director Simon Best commented: “We have continued to invest heavily in meter reading activity as we believe that we can help energy retailers achieve cost and efficiency improvements in a rapidly changing marketplace. This contract award extends the relationship that we have with E.ON which dates back over 10 years and adds further momentum to our ongoing growth plans. We look forward to

welcoming our new colleagues to MDS.” Matt Hardcastle, Morrison Data Services Director of Data Collection, added: “As the UK’s leading energy meter reading provider we have significantly invested over the last 12 months in our technology and processes to ensure we deliver a high class service to all our customers. This award from E.ON is testament to our hard work and

demonstrates that our approach to future delivery is well regarded in the industry.” For further information please visit www.morrisonds.com

The Future of Energy - By John Armstrong

he ‘Future of Energy’ takes the reader through a possible future for energy generation, transportation and utilisation, seeking to make some bold calls on what energy will look like in 2030 and beyond. The book brings together discussion on energy and thoughts on the range of topics which form the fulcrum of the challenges ahead of us. Written in an accessible way to spark ideas, discussion and debate the ‘Future of Energy’ engages the reader in the future challenges and opportunities of this hugely exciting and important field. The ’Future of Energy’ is available on Amazon as a paperback or as a Kindle ebook.

Background Energy is a huge topic, touching every part of society. Without it we couldn’t cook, heat our homes, make steel, travel or pretty much do anything. Since humans first made fire to warm themselves and cook, energy has been a cornerstone of progression and since the times of Watt and Brunel it is hydrocarbons in the form of coal, oil and gas which have

driven us forward; forming the cornerstones of a revolution which has changed every aspect of our daily lives. In 2020 we stand at a crossroads. On the one hand to continue our existing path reliant on hydrocarbons and the resultant impact on the planet. On the other hand, there is an alternative route in which we find another way, utilising hydrocarbons differently – and in lower volumes - and finding energy from ‘alternative’ sources including many that already exist and are rapidly moving from niche to main stream. There exists a huge range of information on the ‘energy transition’ with competing technologies and theories vying for supremacy. It’s easy to fall into the trap of believing there is an easy answer or ‘silver bullet’ to the huge challenges we face. It is substantially more complicated with an inevitable patchwork of future technologies, rather than a single simple solution. There is no perfect answer to the challenges we face but most will in some way shape the way we use energy through the next decade and beyond.

About the author John Armstrong is an engineer whose career has spanned the extremes of the energy industry – giving him a front-row seat on the energy roller-coaster. He began his career constructing oil refineries before moving to work across fossil and renewable electricity generation. More recently John has been leading the growth of decentralised energy and district heating.

Reviews “The author takes you on a journey through a range of environmental scenarios (home heating, air travel, industrial consumption) where energy is the problem but also, potentially, brings a range of solutions. Enough detail to keep the purists happy but also simply written so the amateur won’t get lost.” Andrew, May 2020. “A very good guide to the challenges the energy industry faces today. I will be recommending it to all my team to get up to speed with the industry – incredibly accessible in how the ideas are laid out.” Seb, Conference Producer, May 2020 “This should be mandatory reading for future undergraduates and graduates as part of our induction process.” Darren, Senior Energy Manager, May 2020. “The author manages to present a complex topic in an engaging and authoritative way.” Andrew, May 2020

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

OPINION

PROTECTING YOUR BUSINESS IN A VOLATILE ENERGY MARKET

he COVID-19 outbreak has had a significant impact on every aspect of global business and the energy sector is no exception. An unprecedented slump in demand has seen prices plummet; coal has been the hardest hit, with worldwide demand tumbling by almost 8% in the first quarter of 2020 compared with the same period last year. So how can organisations guard against market volatility while unprecedented uncertainty persists in energy market?

A GOOD STRATEGY IS VITAL A demand shock on this scale may be followed by a consequential change shock impacting supply going forward, with energy producers reducing production or shutting down altogether. If, or when, this happens, it is difficult to predict prices and increased volatility and uncertainty of the market direction often occurs as a result. Businesses may consider whether, in the wake of significant price fluctuations, it is more beneficial to fix energy costs long-term or to buy in the short-term market, also known as spot buying. There is no ‘one size fits all’ answer. Every business is unique, with its own individual tolerance to price fluctuation and supply risk. Formulating a long-term dynamic energy strategy will enable organisations to become more resilient to market changes. Important elements of such a strategy involve factoring in price trends and developing a hedging plan. Price fluctuation – albeit on a smaller scale than during the pandemic – is nothing new to the energy sector. Over the years, we have seen energy markets exposed to extreme market conditions and price changes, and we expect this to happen in the near future. Levels of demand for energy are greatly influenced by external factors such as the weather, climate change, competition and changing regulations. Therefore, the possibility of extreme price swings within the energy market will continue to exist long after the current crisis is over. Experience shows that the best way to combat price fluctuation and to safeguard supply is to have an efficient, robust risk management strategy in place.

WHAT IS A PRICE RISK MANAGEMENT? Protecting your organisation against energy price volatility is important to avoid risks to your business. Simply settling for the daily market prices might not necessarily be the most cost-effective option, particularly if your business is a large-scale consumer of natural gas, electricity, or fuels. Having a comprehensive price risk management strategy in place can mitigate such volatility and enable users to manage budgets more effectively. It will also help to protect margins, minimise price swings and enable you to stay competitive. The first step is to understand how your business is affected by unexpected price fluctuation; and whether rising or falling prices have the biggest impact. This requires a thorough analysis of both external and internal factors, to determine your organisation’s objectives and unique tolerance to price fluctuation. While external factors such as the industry in which you operate, the competition and the weather may be beyond your control, it is important to understand how these known risks affect the market and to evaluate your business’s tolerance to market volatility. Various internal factors must also be considered, such as protecting margins, securing budgets and other financial requirements. In addition to helping you manage projected budgets and costs, this analysis will enable evaluation of suppliers and utility infrastructure, capacity and storage while monitoring price and aiding the credit process. This comprehensive risk assessment, used alongside in-depth market insight and daily monitoring, will establish short and long-term goals that will ensure your business has the right information to buy better and buy smarter energy. Energy price hedging is another integral element of your risk management strategy. Energy hedging solutions will benefit from market intelligence and your organisation’s data. Using hedging tools such as fixed-forward pricing, caps, and collars, depending on your business’s needs will help you take advantage of the rise and fall of energy prices. Including sell back or unfixing forward

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

prices in your strategy will also enable you to benefit from a falling market price trend, as well as the possibility to take spot in delivery for part or the whole portfolio. Sell back has been particularly well-received in recent years, as the renewable share of the energy production market increases. There is no definitive time to hedge energy; it can be done monthly, quarterly or when the time feels right to help your organisation meet its targets and protect profit margins. Always consult an energy expert before making any significant changes to your contract to avoid potential penalties or being forced to unwind hedges.

AN EYE ON THE MARKET Crucial to making informed decisions is keeping a close eye on the energy market. Tracking energy prices, market trends, carbon positions and regulatory changes will give you the most up to date market intelligence and pinpoint the risks and opportunities in the market at any given time – essential if you are to make informed decisions on energy procurement. Monitoring the markets effectively will not only help you to understand prices and identify opportune moments, it will enable you to avoid fixing at a moment when prices are at a peak. It is also important to keep abreast of any changes to regulation that may impact your business or sector, whether it is relating to energy consumption, such as ESOS or Contracts for Difference (CfD), or energy supply – for example, IMO 2020. Monitoring the markets and legislation can be a time-consuming and somewhat overwhelming process if you are unsure what to look out for and what fluctuations could benefit or impact your business. The rapidly changing nature of energy markets can make tracking energy prices problematic, particularly if organisations lack the in-house expertise to monitor prices on a global scale.

FUTURE-PROOF YOUR ENERGY PROCUREMENT The ongoing global COVID-19 pandemic has led to significant changes in demand for many businesses around their energy consumption, as well as price and cost uncertainty. While events such as this are

OPINION thankfully few and far between, it is still important to always have an eye on the market to mitigate risks and maximise opportunities as you never know what might be around the corner. It is good practice to review your energy portfolio regularly and consider the contract tenure. Markets can rise and fall but being ahead of the game can reduce potential risks and open up opportunities to make savings in the longterm. Explore whether your current contract gives you the option to extend, capture and lock in historically low prices or request a longer hedging horizon should the market dynamics change. Make sure you understand your payment and credit terms on your contracts, through appropriate due diligence. Communicating regularly with your suppliers will help minimise the impact of financial or commercial risk to your business. The success of an energy price risk management strategy is how you manage it. Once in place it needs to be monitored and regularly reviewed, either by an internal team or outsourced to a third party. What might be a risk today, might not be tomorrow. Rolf-Helge Sørensen is Head of Risk and Trading, EMEA, at World Kinect Energy Services. Managing a team of 10 portfolio managers and analysts based in Norway, RolfHelge is responsible for price risk management and trading activity within power, gas and EUA in the EMEA region.

COULD COAL MINES SOLVE BRITAIN’S ENERGY CRISIS?

Could a village in the North East of England be the trailblazer for geothermal energy? A 1,500-home garden village situated in County Durham is the first of its kind to be powered by geothermal heat from mine water. Guaranteeing no price fluctuations and the potential of a zero carbon footprint, Garry Forfar, regional manager at COPA-DATA UK, examines the Seaham Garden Village project and explains how industrial automation software could be critical to supporting the success of similar projects.

eaham Garden Village will consist of 750 affordable homes and the same number of private homes, plus medical and innovation centres, shops and a school. It will be the first working example of a network powered by geothermal heat from the nearby abandoned Dawdon mine. As part of a water treatment scheme overseen by the UK Government’s non-departmental Coal Authority, the Seaham pilot project is based on the idea of geothermally heating water from the UK’s extensive network of flooded abandoned coal mines. Mine heat can remain unaffected by external factors and, according to the Financial Times, advocates say there is enough geothermal energy in the UK’s abandoned coal mines to heat 180 million homes. Furthermore, CO2 emission savings generated by this concept are estimated at 55 per cent. There is a lot riding on the Seaham Garden Village project to prove successful – with a view that it could one day be rolled-out across the UK’s extensive abandoned coal mines.

INSPIRING TRUST As with all renewable energy sources, maintaining a stable energy supply from geothermal sources can be problematic. The supply of power from Dawdon mine to Seaham Garden Village will be transferred through a unique pipe network using a heat exchanger. In order to remain efficient, this geothermal heat network must remain stable all-year round. This is where industrial software platform can prove critical. One such platform is zenon, developed by COPA-DATA. The intuitive software allows operators on energy grids to track data, deliver reports and optimise the performance of energy generation equipment – all towards the goal of delivering savings. For a project like Seaham, zenon would be used to control and connect key devices in the network, such as linking programmable logic controllers (PLCs) and intelligent end devices (IEDs) with sensors. The software would process the data needed to ensure that the village’s homes are powered reliably and effectively. For instance, if zenon identifies a decreased demand for power during certain times of the day, operators can use this insight to reduce the amount

of power generated, store the energy or, if the grid allows, sell the energy onto another supplier. So far, so powerful. But, what if – aside from being able to analyse trends in real-time – operators could also benefit from knowing this information in advance? Gathering data over time makes it possible to identify forward trends that will make energy generation more efficient. Industrial automation software is already used in this way within smart grids or micro-grids.

WIDER POTENTIAL If the Seaham Garden Village proves successful, then other district heating schemes may be built on nearby coalfields and industrial software platforms will prove critical in rolling these systems out across the UK. A good example was achieved for EVN Hanoi, the board within Vietnam’s national electricity operator. Petrolec, the local power distributor, recommended that EVN Hanoi implement a new control system based on zenon automation software for more than 30 of its 110 kilovolt (kV) substations. zenon gave EVN Hanoi the overview of the system that it needed and, furthermore, allowed the organisation to control Hanoi’s entire network locally from a single, centralised point. With an estimated 25,000 square kilometres of disused coal mines and tunnels in the UK, the success of the Seaham Garden Village project poses huge potential. Industrial software platforms will be crucial in making these renewable energy concepts a reality. https://www.copadata.com/en/

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

OPINION

THREE LESSONS FROM THE BANK HOLIDAY WEEKEND THAT ALL EUROPEAN UTILITIES AND DER OWNERS/ OPERATORS NEED TO KNOW Thomas Jennings, Head of Optimisation, Kiwi Power

he late May bank holiday in Great Britain gave a real sense of the future of power generation. With significantly reduced demand thanks to the COVID-19 lockdown, at lunchtime on 25th May, over half of the electricity mix was being met by wind and solar. Over that weekend, we saw the energy mix of 2025 – today. However, while more renewable energy is a welcome trend, it also creates system volatility. The need to smooth this volatility presents a huge opportunity for distributed energy resource (DER) asset owners, who can help balance the grid. The Bank Holiday weekend was a case study on just how valuable this can be. Still, not all DER asset owners were able to make the same market gains. With the ever-progressing shift to a more renewable, flexible future – and the role for DERs increasing – how can DER asset owners maximise revenue and return on investment? It boils down to three simple tricks: be open to short-term thinking; know your asset; make a move on new opportunities.

THINK SHORT-TERM We often view an asset with its payback period in mind. That’s not wrong; if we can turn an eight-year payback into a six-year payback through clever thinking and market use, we’ve done well. But sometimes a short-term change can unlock even bigger gains. We saw an opportunity to maximise returns for our clients in the new Optional Downward Flexibility Management (ODFM) market. Introduced in May 2020 through the Balancing Mechanism to tackle the unusually low lockdown demand, ODFM is unlikely to be a product that is needed every day. However, the ability to react to the volatility created by coronavirus meant DERs had access

to a short-term revenue generating option, which others missed out on. These assets will make revenue by turning down – a rare treat for DERs.

KNOW YOUR ASSET While it might sound simple, knowing your asset, it’s capabilities and applications is key for getting the best from it. A ramp time of 30 seconds, 90 seconds, or five minutes means access to different ancillary services; knowing where you fit in that mix presents different revenue generating streams. But there’s more to it than that. We’ve typically viewed DERs through the lens of frequency response or to reduce demand peaks, yet the last bank holiday has shown they can also be used for supply turndown or demand turnup services. Understanding what flexibility your assets and business operations possesses allows you to make the most of some of that short-term thinking mentioned above. With so many potential revenue streams, this can become quite complicated, so getting a DER manager involved can take the stress away.

MAKE A MOVE ON NEW OPPORTUNITIES While DERs were broadly the winner from the bank holiday weekend, one asset type really stole the show – storage. Battery storage will become increasingly important for system flexibility. Those businesses that already have these

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

assets really saw the value over the bank holiday weekend – if prices remained at that level, they could have seen a return on investment of just two to three years. Storage assets have taken over the frequency response market in Great Britain and provided essential frequency services over the weekend, while also offering greater flexibility through charging and discharging as needed. Right now, the potential returns from storage look lucrative thanks to new revenue streams; nonetheless, they will also continue to do so as demand for flexibility increases. In Great Britain, any less than 10GW of storage by 2025 could leave the grid imbalanced, as more and more renewables pile onto the system. The long weekend at the end of May brought into sharp focus why we need DERs, but also how different models can generate different returns. Across Europe, the energy landscape is changing and, as Project TERRE (a new Europewide balancing project which will enable cross border trading) widens access to the market, asset owners need to jump on the opportunities in front of them. There are many complexities around market access, grid flexibility and revenue stacking – but DER managers, can manage away these challenges for asset owners. The benefits of this extend past a better rate of return for the owner, as you can help facilitate the shift to a cleaner grid, playing your part in the wider energy transition. www.kiwipowered.com

OPINION

HOW TO MANAGE THE TRANSITION BACK INTO OFFICE WORKING

s we head into the summer months, the UK’s lockdown measures are slowly being relaxed. This in turn is a source of excitement, trepidation or indifference, depending on who you ask. Indeed, a recent survey of more than 2,000 UK adults commissioned by KnowYourMoney.co.uk revealed that exactly half (50%) were anxious about social distancing measures being curtailed. And in a business context, the evidence certainly suggests that employees are not exactly clamouring for a return to office working. But a return to the office is – in one form or another – inevitable for most companies. With this transition back into commercial premises comes numerous challenges; in fact, it is likely that some business leaders will find this process more complicated than when they had to move to complete remote working back in March.

SO, WHAT ARE THE KEY QUESTIONS THAT MUST BE ADDRESSED? MAKING THE WORKPLACE SAFE The absolute priority must be ensuring employees’ safety. No business should ask its staff to return to the office until necessary steps have been taken to make the risk of anyone catching or spreading COVID-19 as low as possible. In many instances, this will require a physical restructuring of the workplace – desks, chairs and storage units might need to be removed, while the layout of the space may also need to be revised. There is pressure on the Government to cut its two-metre social distancing rules in half, until this happens employers must be able to ensure staff are kept more apart than would usually be the case. Businesses should also consider investing in other equipment to protect employees. For example, they might need to install screens between desks, hand sanitiser pumps and clear demarcation on floors to help people keep their distance from one another. Cleaning practices will need to be ramped up significantly in many cases. Regular deep cleans will be essential for minimising risk, while staff

Nic Redfern, Finance Director, KnowyourMoney.co.uk themselves will also have to follow strict policies around handwashing and what to do if they cough or sneeze. Such protocol will, of course, need to be determined in advance and clearly communicated to all employees before they return to the office. What practical changes are required will depend entirely on each business’ setup; how big a space they have, what furniture and equipment they require in it, and how many staff will be working in the office at any one time.

DETERMINING ‘ON-SITE’ NUMBERS It would be ill-advised for businesses to transition from remote to office working in one go. Rather, employees should be invited back in smaller groups, starting with just one or two days a week in the office and gradually building it over time. How many employees should be in the workplace at a time will, again, depend on the size and layout of the space. But the challenge will be understanding which members of staff to have in at the same time. Smaller teams within the business – marketing, finance or sales, for example – ought to be kept together to maximise the value of them being back in the office. After all, the return to the office is primarily a way of increasing the ease of collaboration and allowing certain tasks to be completed more effectively than when all employees are working remotely. As the transition back into the office begins in the weeks and months ahead, businesses must be wary not to rush back to ‘normality’. Doing so will almost certainly compromise the safety of employees – start with smaller, more conservative numbers of people in the office and then slowly increase things from there.

MANAGING EMPLOYEES’ CONCERNS Those are some of the main practical and strategic questions to address. One of the most important, though, is how to manage employees’ concerns.

As stated above, KnowYourMoney.co.uk’s research has shown that people are concerned about the easing of lockdown measures. After months of largely avoiding public spaces – and certainly indoor spaces – the return to crowded buses, trains, streets and offices is understandably daunting. Businesses must recognise and respect these concerns. Remote working, while not without challenges, has been a welcome change for many employees, and the thought of no longer being able to do so could affect their job satisfaction. What’s more, there will inevitably be health anxieties among many people as long as the virus is still at large across the country. Speaking openly with employees before starting the transition back into the office would be wise. So too would be allowing working from home on an on-going basis, at least for some of the week. Indeed, we are often told that the “new normal” will see remote working become the de facto model for many organisations – the key will be to find the right balance between when a team member can work from home and when they are needed in the office. Changing office hours is another worthwhile consideration; shifting the working day forward or backwards by an hour or two will better enable staff to avoid rush hour, which could put their mind more at ease, particularly if they are using public transport for their commute. Ultimately, just as the onset of the lockdown in March did, the decision to move back into bricks and mortar premises will present numerous challenges. Businesses must be mindful of these challenges and address them diligently. People’s safety is the paramount concern. Thereafter come questions around ensuring productivity is optimised and employees’ mental wellbeing is protected. Importantly, all of these issues feed into each other – businesses that can best manage safety, productive and staff concerns will be best placed to smoothly transition into the new normal. www.knowyourmoney.co.uk

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

MONITORING & METERING

RINNAI INTRODUCES REMOTE MONITORING FOR HOT WATER DELIVERY CONTINUOUS FLOW SYSTEMS Rinnai remote monitoring system gives sites total control of hot water delivery – and cuts operational site costs.

innai, the UK leader in continuous flow hot water delivery systems, is introducing, with immediate effect an advanced remote monitoring system which allows instant access and intelligent service and maintenance. This enhanced monitoring system enables the advanced proprietary technology of the Rinnai continuous flow water heaters to be transposed to an onsite BMS system or I.P via Cloud services. This enables site managers, energy managers, end users and FM professionals to set alarm functions, trend data, event handling, temperature set points, temperature control for Legionella regimes and many other monitoring capabilities. Alarms can be set; functionality can be checked – any malfunction can be repaired by a first-time fix due to enhanced remote visibility which in turn will severely reduce on site down-time. This new system supports unit and systems to run maximum efficiency for the lifetime of the appliances due to advanced data analytics of temperature and combustion set points. If there is a constant supply of gas and water Rinnai hot water heating units are guaranteed to supply temperature accurate hot water in unlimited quantities for all hygiene regimes in all types of sites. The new monitoring system will integrate Rinnai proprietary communications onto open protocol BMS, and this is also compatible with touch screen technology to provide localised feedback from

the water heating units via intuitive user experience. The system can link up to 6 Rinnai commercial-sized continuous flow water heaters with a smart serial hub which in turn transposes Rinnai data objects via gateway technology to be viewed on open protocol BMS. The advanced system has present day and future proofing in mind as the serial hub and gateway can be transposed as data objects on to a range of communication protocols including – BACnet/ IP, BACnet MS/TP, and Modbus RTU. Due to the many proprietary data objects communicable from the water heating systems, preventative and even predicative maintenance regimes can be established. This system has been taken up in multiple sites by a global foodservice chain, utilising the new Rinnai N series 1300i continuous flow water heaters. The global chain is also focusing this monitoring system on predictive maintenance. Also available from Rinnai: 24/7 technical support; 24/7 product and

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spares availability; digital technology aids such as the ‘Help Me Choose’ facility on the www.rinnaiuk.com website. Rinnai manufactures over 2million water heaters every year and as such is at the forefront of creating real advantages for users. Rinnai’s complete range of hot water heating units are available for next day delivery on orders placed before the previous mid-day. Contact the company direct by calling 01928 531 870 or via email engineer@ rinnaiuk.com or sales@rinnaiuk.com or alternatively use the smart online contact points “Help Me Choose” or “Ask Us a Question”, all held on the website homepage at www.rinnaiuk.com.

PEL 103

Power & Energy Logger

Bridge the energy gap between today and tomorrow. Increase energy efficiency and reduce your costs. Our future energy needs are changing and businesses need to improve their energy efficiency. You can reduce required power generation, save money and increase productivity. Gain a competitive advantage now with the PEL 103.

The key to a reduced carbon footprint & improved energy efficiency. Measure and monitor power usage. Identify inefficiencies and out of hours use. Discover power factor, phase balance and harmonic issues.

CHAUVIN ARNOUX UK Ltd 125 YEARS IN BUSINESS 30 YEARS IN THE UK 1 Flagship Square | Shaw Cross Business Park | Dewsbury WF12 7TH | T: 01924 460494 | E: info@chauvin-arnoux.co.uk

MONITORING & METERING

STEP BY STEP TO ENERGY EFFICIENCY Is your business struggling to cope with the financial impact of COVID-19? Do you need a fast, effective and painless way of making cost savings? Then you may just have found it! It’s very likely, says Julian Grant of Chauvin Arnoux, that you could make substantial savings on your energy bills with very little effort and investment.

f, like the majority of businesses, you need to cut costs as part of your response to the COVID-19 crisis, many of your options are likely to involve making tough decisions. But here’s one that doesn’t need to be difficult – taking steps to improve your energy efficiency. Maybe you think this sounds a little like rearranging the deckchairs on the Titanic, but if so, it may be time to think again. Many – probably the majority – of businesses in the UK are surprisingly wasteful in their use of energy, so there are big savings to be made. Follow the steps described in this article and you’ll be well on your way to banking those savings.

STEP 1: GET A PEL This step, it has to be admitted, involves spending money as you’ll need to hire or buy a portable energy logger (PEL) like the Chauvin Arnoux PEL103. With it you’ll be able to accurately monitor your power consumption and much more, including the level of harmonics in your systems, voltage imbalance and power factor. Furthermore, you’ll be able to record the results over time giving you comprehensive and reliable data about what’s contributing to the energy bills in your business. If this is your first foray into energy monitoring, you’ll probably be tempted to hire a PEL. That’s no bad thing to get a first feel for what it has to offer but bear in mind that energy saving is an ongoing affair, so once you’ve established a few baselines you’ll want to monitor your energy usage regularly to check whether things have changed. It won’t be long, therefore, before having your own PEL becomes more cost effective than paying multiple hire fees, and it’s also likely to be a lot more convenient as the instrument will be to hand whenever you need it.

STEP 2: START MONITORING Having acquired your PEL, decide where to install it – usually this will be in a distribution cabinet – and set it up to monitor the circuits that interest you. Typically, these might be lighting, HVAC and possibly computer systems. Remember that some three-phase PELs, including the PEL103, can be used to monitor three single-phase circuits simultaneously which saves a

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MONITORING & METERING lot of time. Set your PEL to make recordings over a period; a day is good, but a full week is better, as interesting things often happen at weekends! Later, you may find it useful to record information over even longer periods, which is another good reason for buying your own PEL.

STEP 3: WHAT HAPPENS OUT OF HOURS? When you’ve got the data from your PEL, the first thing to look for is out of hours usage. How much energy is your business continuing to use after the workers have gone home in the evening and over the weekend? You may be in for a shock – British Gas recently surveyed 6,000 SMEs and discovered that 46% of their electrical energy usage occurred outside normal business hours. Some of this usage is necessary, of course, but a lot isn’t and, armed with reliable information from your PEL, you’ll be able to address this issue – the solution is often no more costly or complicated than installing a few time switches.

STEP 4: IS THE LIGHT RIGHT? Next take a look at the energy you’re using for lighting. Typically, this accounts for around 40% of the energy used in a building so it will repay careful examination. If it looks as if you’re spending too much on lighting – and you’ve eliminated unnecessary out-ofhours usage – it may be time to take a look at your luminaires. Hopefully they’re already low-energy types, but even so you’ll probably be able to make substantial extra savings by switching to the latest LED types. Depending on the type of luminaire, this may involve no more than changing the bulbs, an exercise that will quickly pay for itself.

STEP 5: IS POWER FACTOR A FACTOR? Your PEL will give you information about the power factor of your loads. Most electrical loads consume two “types” of power – active power and reactive power. The active power does useful things – light the lights, turn the motor and so on – while reactive power does nothing useful. But the catch is

that you pay the same for active and reactive power! But where does power factor come in? It simply tells you how much reactive power your loads are consuming. If the power factor is 1.0, they consume no reactive power, but if it’s any lower – 0.9 or 0.8, say – then you’re paying for useless reactive power. The good news is that it’s possible to ‘correct’ poor power factor, bringing it nearer to 1.0 and reducing the amount of reactive power you pay for. This correction usually takes the form of capacitors fitted near the main distribution board and you may already have them. But, over time, capacitors can lose their capacitance and, of course, the loads on your system may change. As a result, your power factor may be much worse than you think, and reactive power may be costing you a lot of money. Your PEL will tell you!

STEP 6: HARM FROM HARMONICS? Computers, LED lighting, variable speed drives and many other types of load found in modern installations generate harmonics, which are currents at multiples of the supply frequency. The PEL will tell you about the size and order (frequency) of these harmonics. With this information, you’ll know whether harmonics are likely to be a problem and, if so, the information will help you to decide what action to take. Unlike the other factors we’ve looked at, harmonics won’t add much directly to your energy bill, but they can cause many other types of costly problems, like overheated neutral conductors, malfunctioning

and premature failure of IT equipment, and excessive vibration of motors - so they’re well worth investigating.

STEP 7: A BIT OFF BALANCE? If you have a three-phase supply, the final step in the preliminary analysis of your PEL data might well be to check whether the voltage is the same for all three phases, and whether it stays that way throughout the whole day and whole week. If it doesn’t, your PEL will be able to help you identify whether the problem is with your energy supplier or whether it is being caused by equipment in your installation, such as poorly distributed large single phase loads and, in these cases, which equipment is causing it. This is particularly important if your business uses three-phase motors, as even modest supply imbalance can cause these to heat up excessively.

STEP 8: PHONE A FRIEND! In this very short article, it’s only been possible to give a few suggestions about how to cut your energy bills by detecting and correcting energy wastage. These suggestions should be enough to get you started, but you’ll find a lot more detailed information on the Chauvin Arnoux UK media channel (www.cauk.tv). And, of course, you can always phone (or email) a friend – the Chauvin Arnoux technical team is at your disposal, and will be happy to help with all of your energy monitoring and energy efficiency enquiries. www.chauvin-arnoux.co.uk

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

MONITORING & METERING

THE DATA YOU NEED TO EFFECTIVELY REPORT ON YOUR ENERGY SAVING TARGETS The correlation between data and energy saving targets

eporting on your energy saving targets is a vital part of any effort to increase energy efficiency in your business. The process involves collecting and analyzing large amounts of data to uncover actionable steps to decrease energy consumption. But how do you cut through the noise to see the trends in your data? Bridging the gap between data and understanding is a difficult task. Without a centralized dashboard detailing your commercial building’s energy consumption and associated costs, meeting energy saving targets, reducing energy usage and improving overall energy efficiency becomes complicated and difficult to navigate. So, how do you leverage data to uncover insights and create accurate reports? To tell your energy story, you need to collect the right data and organize it effectively. The key lies in utilizing the right metrics to focus on the data that provides reporting value. By focusing and reporting on these metrics, you can make data-based decisions that help you meet energy saving targets.

1. MONITORING - COLLECTING THE RIGHT DATA Good reporting relies on collecting real-time, reliable, and accurate data. Measurement of energy performance across a building is the backbone of any meaningful energy reduction strategy. Smart metering and monitoring tools, for example, are essential for both measurement and efficient energy management. In a single office building, an effective metering and monitoring system can often generate an immediate energy saving of 10%, and up to 30% once building operations are enhanced over time. Continuous automatic metering systems use dynamic energy dashboards to display building operation and energy consumption data. Tables, graphs and images are used to illustrate energy information in ways that facilitate informed decision-making. For example, an energy dashboard may display that a building’s aeration system is consuming more energy than it should. Once informed of this fact, the operator can reduce energy consumption incrementally to reach energy saving targets without negatively impacting performance. A Building Automation System (BAS)

monitors the performance of equipment at a high-level and concerns the building as a whole. A BAS can automate controls for things like elevators, metering, air-handling units, heat pumps, lighting systems and more. A newer BAS can maximise the energy efficiency of all the things it controls, as well as monitor fire and flood safety. While a BAS does not generally offer advanced analytics, it can be leveraged in combination with Energy Management Software (EMS) to extract key data for reporting. When it comes to collecting data over time, using 15-minute intervals strikes the right balance. As an energy manager, you want to reduce noise in the data to produce a clear picture of how your building and equipment within the building are operating. If you were to review data at 10, 5 or even 1-minute intervals, you would notice more scattering of the data, making it difficult to understand what is actually happening in the equipment. With 15-minute intervals, energy usage patterns can become clearer and more easily interpreted, making reporting on energy saving targets more effective.

2. ORGANIZING THE DATA - NOT ALL DATA POINTS ARE CREATED EQUAL When it comes to interpreting energy data, it’s important to understand and account for different types of data. Comparing total or average energy use in one sector against another will lead to skewed data. For example, manufacturing plants often have long operating hours and heavy machinery which requires a lot of energy to cool. So, comparing it against a distribution centre based on total or average energy used will provide an uneven representation of total energy usage. It’s imperative that data is normalized in order to interpret it correctly and for reporting on energy saving targets. Take degree days for instance. Degree days are a measure of the severity and duration of cold weather. It’s a vital metric because extreme outdoor air temperature will require more energy to stabilize setpoint temperature in the building. Therefore, to avoid misleading statistics, you should also normalize against active hours and normalized occupancy. Once the data is normalized, you can look at it to determine the priority area of focus. What other metrics should you look at in relation to your key performance indicators? Check out our eBook to find out! https://bit.ly/3cyul1T

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For example: an energy manager of a manufacturing plant notices that packaging has the highest energy consumption of all activities across the plant. That would highlight to the energy manager that improving the energy efficiency of packaging operations is a priority.

3. REPORTING – GET THE BIGGER PICTURE Most organizations have data loggers and systems across their commercial buildings to capture energy usage, performance and consumption data but, instead of filtering the information and refining the most actionable parts, it is all compiled into a single large and very complex report. Instead of a single large and complex report, those organisations could normalize their data and establish priority areas of focus to understand data trends, leverage the right metrics and make data-driven decisions. For example, with this approach, an energy manager can compare packaging across all the business’ plants and clearly see which are more efficient than others. The manager can then review the efficient plants to determine best practices to improve energy consumption consistently across the enterprise in line with energy saving targets. Efficient reporting is about compiling the clearest possible picture of your energy usage and costs to people at different levels of your business and relies heavily on the ways in which you collect and interpret energy data. If you have multiple sites, comparing energy consumption increases in complexity as your organization may be balancing a variety of business operations. Normalizing energy data facilitates effective comparison to help you to clearly understand your energy consumption patterns and performance across separate business units. When you’re able to obtain a high-level overview of energy consumption, using the right metrics turns that raw data into insight, giving you the ability to make data-driven decisions for your business and to take real and consistent steps towards your energy saving targets. Once you’ve understood the big picture view of your energy story, which specific metrics should you focus on to guide your actions? Find out by reading our eBook: Understanding Energy Management KPIs - Vanity vs. Authoritative Metrics. https://bit.ly/3cyul1T www.esightenergy.com

RECRUITMENT

REBEL ENERGY LAUNCHES THEIR RECRUITMENT Rebel Energy are going to revolutionise the Energy Supply market and you can become part of the Rebellion!

limate17 are pleased to announce our recruitment partnership with Rebel Energy – a new-to-market energy supplier launching their business in Q4 2020. Rebel Energy’s mission is to supply renewable energy to all. For a long time now, we have heard energy suppliers making commitments towards a fairer, more sustainable energy market. However, we have yet to see a product offering where price, quality of customer service and guarantee of origin mean everyone in the UK can access renewable energy. Rebel Energy intend to change this. They pledge to act differently, transform lives and change society through supplying affordable clean energy to all. To ensure they live by their aims and objectives, they are a registered B-Corp, and have these guiding principles within the foundation of their organisation. Dan Bates, CEO and founder of Rebel Energy, is seeking to hire people who want to disrupt the norm. Dan has recently launched ‘Rebel Conversations’, and in his recent blog post talks of this being a ‘Kairos moment’ – a once-in-ageneration time to rebel against the way things are currently being done, do things differently, and change the way we do business forever. Climate17 believe this describes the attitude we look for when hiring for Rebel Energy. Rebel Energy is an energy company with a difference. They are looking to create a rebellion against

the status quo, with a mission to support those who need it most, to help restore the planet and be ethical in everything they do. Penelope Hope, Chief Commercial Officer at Rebel Energy, says “we are excited at the prospect of attracting new talent to our business. We want to reassure people that innovation, a pair of fresh eyes and different ways of doing things are not only welcomed but will also be acted on.” It is clear that action plays a key role in the way Rebel plans to establish themselves. They “want to prove that big business can be good business and help transform lives and change society.” Dan Bates describes this attitude as “walking the talk”: “many businesses are very good at doing the ‘talking’, but not so good about the ‘walking’ bit – and it’s important to us that we can demonstrate how we live our values in everything we do.” One of the key aspects of working at Rebel is the way they see the employer-employee relationship, which is no longer based on power, but on collaboration, cooperation, and partnership. Rebel Energy truly want to reflect their values of “compassion, connection, curiosity, creativity, courage” in the way they build their core team from the start. Penelope goes on to say “we are looking for collaborators, innovators and people who may have experienced some kind of disadvantage in their lives. Often recruitment is biased toward education and experience. We are interested in quality, of course; however, what’s even more interesting

for us is people who may have had to struggle in their upbringing, personal or professional life.” For those who are thinking of moving jobs and are looking for an opportunity with a company where social and environmental commitment drives business, Rebel is the place to go. In Penelope’s words: “To anybody who has ever worked within an organisation and felt frustrated, who could see quicker, better ways of doing things but didn’t feel they had the power to make a change – we are the company for you. We want to welcome those who are freethinking, who do not follow the status quo but have their own ideas about how society, the environment and business can be changed for good.” This is a unique opportunity to join a unique company from its start. It is not only about bringing change into your life, but also driving it for the future generations. Rebel Energy’s first recruits will be leaders in their own right within the business. They will be mentors, nurturing and supporting those coming after them. They will be “culture carriers,” responsible for leading and guiding other people in the Rebel culture. Initial vacancies include Pricing Analyst and a Partnerships Sales Manager. However, Climate17 will be recruiting for a number of other vacancies for Rebel Energy over the coming months across Sales, Operations and Technology. Please do get in touch with Climate17 should you be interested in joining Rebel Energy. www.climate17.com

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

HEATING

REDUCING THE ENVIRONMENTAL IMPACT FROM HEATING BOILERS & NOT COST THE EARTH

ith everyone now coming out of lock down the Climate Emergency Declaration made by Parliament in 2019 has still to be addressed, all sectors are looking for ways to reduce their environmental impact and could also provide financial benefits. Within hospitality, industry, public sector, and at home, keeping the heating on in the colder months is essential. A warm, cosy room is expected by guests, the public and staff as they work, check-in to stay for the night or just at home. A cold building like a hotel, Bed & Breakfast or home could see the fabrics of the building suffer or quickly see its TripAdvisor ratings go down. Across all sectors with wet central heating and hot water requirements they all face the challenges of how to reduce carbon emissions. According to the Carbon Trust, just the hospitality and leisure sector accounts for over a third of the UK’s energy consumption. Heating, is so important to a guest’s overall experience, but it contributes to the company’s carbon emissions. Heating systems also account for up to 60% of hotel energy bills. So, how do you keep the heating on and reduce carbon emissions while still making a profit??? A new low carbon solution recently launched to commercial and domestic heat markets, The Hydro Genie System, works with existing and new, gas, LPG and oil heating boilers to lower carbon emissions & reduce fuel consumption by up to 35%1 on commercial heating. On domestic Heat boilers by up to 45%2 depending on the system installed. Retro-fitted to the flow and return pipe work of existing wet heating, the Hydro Genie System provides lower 1 Tests carried out by Strathclyde EcoInnovation Unit on a large secondary school using a 150mm Platinum Hydro Genie System & recorded a reduction of 39%* in Gas used. 2 The Scottish Government funded SETN, in conjunction with the University of Strathclyde carried out a tests on a 3 bed house recording a reduction in gas used of 49.8%* using a 28mm platinum system.

carbon emissions. Using proven, patented technology, to dramatically improve the heat transfer to the circulating heating water, this reduces the amount of carbon emitted and the fuel your boiler uses. To do this, the hydro Genie System uses its unique fluid dynamics to induce Henry’s Law, to the circulating water to remove the elements, which slow down the exchange of heat. The heat that is not being absorbed into the circulating water, is just going up and out the flue. The Hydro Genie System also stops rust and sludge from forming, it kills existing rust so that radiators provide up to 20% more heat, Radiators which aren’t giving out much heat will start to work again. The Hydro Genie System also has onboard dirt separation, to remove any magnetic and none magnetic dirt this can be emptied manually or automatically. Once the Hydro Genie System has removed the elements from the heating water as it passes through each of the Hydro Genie Units the fluid is slightly compressed providing a temperature lift of up-to 2-3 degrees, with out burning any fuel. The Hydro Genie System incorporates its thermal controls which regulate the now enhanced heat coming out of the Hydro Genie Units, overall this leads to lower carbon emissions, warmer rooms and much lower heating bills. All whilst customers, enjoy their buildings achieving their set temperature quicker, happy in the knowledge that they are warmer, saving money and doing there part for the planet. Not only can the Hydro Genie Systems provide lower emissions and running costs but the commercial systems can be fully installed with no up front cost with the financial savings paying for the servitised lease. All Domestic Hydro Genie Systems and our Commercial Hydro Genie Systems will have there final assembly and dispatch done by our heroes at Scotlands Bravest Manufacturing Company. Domestic Hydro Genie Systems are fully installed at 5% VAT www.hydro-genie.co.uk

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

Retro fitting a Hydro Genie System, to existing boilers running on GAS, LPG, or OIL, can provide major reductions in carbon emissions and running costs. The Hydro Genie System’s use a proven, retro-fit, patented technology, to dramatically improve the heat transfer from the boiler to the circulating heating water. It does this by removing the dissolved oxygen from the water, which normally forms as bubbles on the boilers heat exchanger, slowing down the heat transfer. It’s also the cause of rust & sludge build-up in radiators. The Hydro Genie System kills, and removes existing rust and sludge, so that radiators provide up to 20% more heat. The System’s also come with a smart temperature control unit, that controls the now enhanced heat, and together dramatically lowers the fuel consumption of the boiler, reducing emissions and running costs. The Scottish Government funded, Scottish Environmental Technologies Network, in conjunction with the University of Strathclyde, carried out a test on a 3 bed house using a 28mm platinum hydro genie system, and recorded a reduction in gas used of 49.8%. To find out more, Email Jim@hydro-genie.co.uk or call 01786 850375 | www.hydro-genie.co.uk

HEATING

HEATING BUILDINGS AND ACHIEVING NET ZERO

he recent publication of the Committee on Climate Change’s report into the UK’s net zero progress demonstrates a pressing need for project specifiers and developers to consider low-carbon heating systems. The CCC’s report into what still needs to be done for the UK to reach net zero carbon emissions by 2050 – a pledge signed into law last year – highlights how gas boilers remain a key obstacle for reducing emissions. With this in mind, Steve Richmond, Head of Marketing and Technical for REHAU Building Solutions, is advising key construction stakeholders to further accelerate the decarbonisation process. “The passage of the UK’s net zero commitment into law transformed the landscape in many industries, including construction,” says Steve. “Lower carbon emissions are now vital concerns for any project, and governs key specification decisions. Additional legislation such as the Future Home Standard 2025 are a step towards this goal, but as the CCC’s report shows, there is more work to be done – especially with the current uncertainty about the future renewable heat policy landscape.”

With the report urgently advocating the uptake of more eco-friendly heating technology, Steve is advising specifiers and developers to look into low-carbon solutions. “If we are to stay on track with our goal of decarbonising the economy, the construction sector must take action now, in line with the CCC report’s recommendations. It is therefore crucial that developers and specifiers evaluate the merits of more sustainable heating technologies. By doing so, they can futureproof both residential and commercial developments for years to come.” Examples of more sustainable technologies include heat pumps, which produce heating and hot water from the sources such as water, air, or the ground. Hydrogen is often highlighted as a viable renewable heating technology, but with workable solutions potentially years away, specifiers should turn to proven options to lower carbon emissions, such as heat pumps. Fourth generation district heating systems linked to low-carbon sources can also help markedly reduce carbon emissions. Because water flows through the system at a lower, 40-60oC flow temperature, it is ideally suited

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to waste heat or centralised water, air or ground source heat pumps, resulting in much lower emissions when compared to gas-powered third generation district heating options. Steve concludes: “Developers need to consider both district heating and heat pumps if they are to decarbonise at the pace outlined in the CCC’s report and produce buildings fit for the future. The release of the Construction Leadership Council’s post-pandemic ‘Roadmap to Recovery’ earlier this month, which placed net zero at the heart of any industry recovery and reinvention plan, further prioritises this course of action. “Whether used on an individual, house-by-house basis, or as the central source for a district heating system heating a number of buildings, heat pumps and district heating represent viable options for reducing emissions in line with net zero targets as the construction sector recovers from COVID-19 disruption.” For further information on REHAU’s pre-insulated pipework systems, and their use in heat pump and district heating networks, visit: www.rehau.uk/districtheating

HEATING

UNDERFLOOR HEATING INDUSTRY— A BILLION-DOLLAR BUSINESS

nce seen as a luxury investment – underfloor heating – has gone mainstream and UFH is now perceived as one of the fastest growing areas in the heating landscape, partly due to soaring energy bills and environmental concerns. With the industry witnessing an unprecedented focus on comfort and efficiency, manufacturers have upped their investments in underfloor heating systems to keep up with requirements of both new-build and refurbishment projects. While the principles of UFH are almost same as they were during the Romans circa 500 B.C., the development in technology pertaining to UFH pipes and in low temperature renewable sources has been grabbing headlines across Europe. UFH, as such, is being designed within the fabric of the building. The trend towards “greener” building systems in advanced economies such as the U.K. and the U.S. has witnessed underfloor heating popularity soar in numerous sectors, including residential, commercial and industrial. Mega-trends favouring the expansion of underfloor heating are the use of better thermal insulation within buildings and the transition towards condensing boilers. Underfloor heating has become the next big thing as a highly efficient form of space heating which stems heat via hydronic and electric heating elements embedded beneath the surface of the floor.

SCREED AND NO-SCREED SYSTEM Demand for good quality screed, especially in-screed system has surged in the UFH ecosystem as these systems are said to ramp up installation and conduct the heat evenly across the surface of the floor. Installation of a top-quality screed helps to retain the heat for longer hours, thereby improving the energy efficiency and reducing the energy required at the source of the UFH system. Dry fit system, or no screed system that allows UFH to keep up with the heating system and end user’s comfort, has been gaining momentum. Radiant heating systems have become a major revenue generating stream as they are believed to be a quiet, clean, efficient, cost-effective, and dependable way to heat buildings. When it comes to promoting energy efficiency across the value chain, underfloor heating has become second to none, thanks to comfort and energy efficiency that it offers to the consumer. As these systems have high heating capacity even with low flow temperatures,

UFH systems are easily being combined with heat pumps, gas condensing boilers, and thermal solar power systems. A notable uptick in the high net worth individuals in the U.S. and the U.K. may well play a huge role in the adoption of underfloor heating. Countries such as Germany, the U.K., France, the U.S. have been leading the way in terms of installation of UFH systems.

HYDRONICS SYSTEM BOOSTS SUSTAINABILITY The year 2020 and the following years are slated to be replete with investments in hydronic UFH systems. Hydronic underfloor heating systems have become popular as a sustainable and energy efficient heating solution. The system is an attractive revenue stream and allegedly works better under several floor surfaces such as stone, marble, carpet, timber and slate. With no dust and cost-effective attributes and ideal for large open areas, hydronics UFH industry outlook is up for a robust projection. Manufacturers of underfloor heating have been using sophisticated designs and in-screed to boost the quality of UFH systems. Hydronic radiant heat has become the most sought-after and cost-effective heating system for heating dominated areas. Besides, advanced hydronic systems have been allowing for zoned heating that tends to control temperature in various parts of the buildings. Amidst critics claiming that hydronics cost more than electric UFH systems, it is worth noting that cost of installing a hydronic UFH system depends upon floor covering, the type of installation, location, and size of the home.

TRENDY ELECTRIC UFH SYSTEM In retrospect, electric UFH systems were perceived as an expensive and inefficient; however, they have come through the ranks, and have evolved as an efficient and quick responding system. Electric UFH systems have become an ideal choice for single zone renovation and wet rooms. Underfloor electric heating has become a top-notch solution as it does not compromise on any design features and does not emit VOCs. Some of the upsides such as easy installation, adding value to properties, and reducing dust and allergens have augured well for stakeholders vying to expand their portfolios As there is no distribution manifold, electric UFH has become apt for single room refits. Moreover, they provide a low temperature as compared to standard baseboards or radiators, thereby reducing the heating costs.

UNDERFLOOR HEATING BECOMES “SMART” Smart thermostat is also being adopted to offer a cost-effective, optimal, and energy-efficient electric underfloor heating systems. To put things in perspective, smart underfloor heating WiFi thermostat has been making headlines in the U.K and the U.S. and is gradually gaining pace in China, Japan, and Australia. An app controlled WiFi UFH thermostat boosting energy-efficiency of a floor heating system may be the business strategy to woo new consumers. There are unwavering efforts being undertaken by companies to combine underfloor heating with smart intuitive control of heating. Expanding penetration of UFH in the global scale has a lot to do with easier installation in retrofit landscape in electric systems. This will help to rev up installation and reduce disruption. As such, low profile UFH systems that boost flexibility and reduce the impact on floor height have become massively popular.

DIY KITS GAIN PROMINENCE WITH RISING RENOVATION DIY sector for underfloor heating has been gaining momentum in residential sector as high percentage of UFH is being used in new build housing. Further, custom build housing remains a lucrative sector for UFH manufacturers. With renovation witnessing an upward trend in North America, Europe, and APAC, demand for DIY underfloor heating systems has surged drastically in recent years. Consumers are opting for a low-profile UFH system that will help reduce any disruption to fittings and fixtures. Besides, rising trend for DIY UFH has compelled manufacturers to introduce lightweight systems. In areas where space is at a premium, UFH has become an apt choice. Business outlook for UFH industry remains intact as there is a sense of optimism and recovery in the housing market is likely to be witnessed after world turns corner from COVID-19 pandemic. With thermal comfort, environmentally friendly, and energy saving attributes, underfloor heating technologies have become a go-to-solution for stakeholders eyeing to expand their portfolios. UFH has become one of the fastest growing business in the Europe and North America as these systems are being retrofitted; spreading heat consistently; and manage energy usage without compromising on comfort. Billions beckon underfloor heating makers as they have scaled up efforts to mass produce the systems. www.gminsights.com

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

HEAT PUMPS

HEAT PUMP MARKET POISED FOR RAPID GROWTH Heat pumps will deliver impressive energy savings for a growing range of commercial buildings once the industry returns to normal working, according to Lochinvar’s Sales Director, Liam Elmore.

n the months before the COVID-19 crisis, the market for heat pumps had been growing rapidly. Regarded by the government as a pivotal technology in the push to reduce the carbon impact of heating, it remains poised on the edge of a major market breakthrough, which will no doubt gather pace when the industry gets up and running again. The UK has been steadily decarbonising its electricity supply and this has further improved the technology’s already impressive environmental credentials. Low carbon generation accounted for more than 51% of the electricity supplied in the UK in 2019, according to the Department for Business, Energy and Industrial Strategy (BEIS). This represented a 2% increase compared with the year before and the National Grid confirmed it was the cleanest year on record for electricity production. As a result, the carbon factor of grid electricity has fallen by more than half from 495 grams in 2014 to just 200g of CO2 for each kWh of electricity generated today. BEIS now predicts it will be just 66 grams by 2035 as more and more renewable sources come on stream. This makes heat pumps an extremely attractive option because they use electricity as their primary energy source and then multiply that primary input by a factor of three or four.

LION’S SHARE To date, the lion’s share of UK demand has been in the new build, domestic sector with many new developments now using heat pumps as their main source of heating and hot water. Take up has been much slower in commercial buildings where demand patterns are often very different from residential. In the case of hot water, for example, many commercial buildings experience short peak demand periods when very high volumes of hot water are required – leisure centres and hotels being particular examples. Lochinvar has been supplying heat pumps to the commercial sector for more than 12 years, but progress had been relatively modest. Therefore, towards the end of 2018 the company decided to invest in this market to realise its potential, galvanise demand and drive sales. The first step was to extend the company’s range of products suitable to serve the commercial building market. This included

the addition of new high temperature (HT) and higher output models to its Amicus range. Lochinvar now offers models up to 110kW, which are suitable for a range of LTHW and DHW applications. The company also introduced an Amicus low temperature (LT) range, which includes models with outputs of up to 464kW. Amicus LT heat pumps are designed for low temperature heating systems or for use in hybrid installations. They can be integrated with Amicus HT or Boost heat pumps, or with high efficiency water heaters and boilers. Amicus Boost is the most recent addition. This is a water source range with outputs of up to 500kW. They have an acceptance temperature range of 10º to 35ºC and work well with heat recovery systems. At the same time, the company restructured its product management and technical teams with the addition of new, dedicated heat pump roles. Customer support now includes preinstallation visits for every heat pump order received in addition to telephone and email support. The pre-installation visits are provided free of charge and are designed to ensure that installations run as smoothly as possible. The company also embarked on a programme of employee development to increase heat pump expertise across several departments, supported by ongoing training. For customers and the wider market, Lochinvar developed a CIBSE approved CPD seminar on the subject of heat pumps, which has been rolled out to many building services engineers throughout the UK. This has proved beneficial to a wide section of the industry. All of this investment led to Lochinvar having an excellent year for heat pump sales in 2019. At the same time, the company has provided equipment for a range of projects, which will help towards achieving high energy

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

efficiencies and substantially lower carbon emissions for its customers.

HYBRID SOLUTION The company believes that its range of heat pump types and their ability to integrate has helped many clients procure a system which closely matches their expectations. The availability of a wide range of hybrid solutions has been particularly beneficial for retrofit projects. In addition, the fact that the company can now provide a wide range of heat pump and hybrid packages has been a major factor in creating the volume of additional orders, specifications and enquiries. Although this strategy was part of a strong company business plan to drive sales, it also had a wider aim of extending the reach of renewable heating and hot water solutions into more commercial buildings that had previously not been able to access this kind of technology. As well as stand-alone heat pump sales, there is also increased demand for ‘hybrid’ systems where heat pumps are combined with high efficiency ‘conventional’ technologies like gas-fired boilers and water heaters to improve operating performance in projects where a fully renewable system was not an option either for financial or technical reasons. As a result, there are now more commercial buildings where heating and hot water services are provided by heat pumps, many of which have been provided at reasonable capital cost for clients. There will also be many more in the future once we move back into more normal market conditions – so contributing to the ongoing decarbonisation of heat across the UK. www.lochinvar.ltd.uk

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RENEWABLE ENERGY

HYDROGEN COULD FUEL GREEN ECONOMIC RECOVERY Mark Griffin, Hydrogen Market Development Manager for Clean Fuels, BOC

arge-scale hydrogen storage can support renewables while bringing benefits to public sector organisations, transport companies and electricity suppliers.

HYDROGEN AND THE FUTURE OF GREEN ENERGY

react quickly to vary their electricity demand on request, they can get paid for their flexibility by grid operators. This is called demand-side response.

ENERGY STORAGE – EXPLORING THE OPTIONS

Public sector organisations need to take a lead role in the government’s plan for a green economic recovery, and investment in hydrogen transport and storage is a good place to start. Converting transport fleets to hydrogen power is not only practical and achievable, but, when combined with investment in large-scale hydrogen storage facilities, could set the foundations for further decarbonisation projects. By investing in large scale storage facilities, public sector organisations can both bring down the cost of fuel at the pump (making hydrogen powered EVs more affordable to a wider audience) and support the growth of the renewable energy sector. According to the National Grid Future Energy Scenario, the UK needs to increase its capacity for renewable generation to about 100GW to reach its target of net zero by 2050. That’s about double the capacity that was in place at the end of 2019. But the more we rely on renewable sources of energy, the harder it is for electricity suppliers to balance supply and demand. This is where large scale hydrogen storage facilities come in. By storing surplus energy, they can help to balance the grid – a win-win situation for all parties. Electricity suppliers get the flexibility they need, city councils and local authorities receive financial rewards for grid balancing, and the price of clean hydrogen fuel for transport comes down for everyone.

There are a number of ways to store surplus electricity, and each has its own unique advantages. Pumped storage hydroelectricity (PSH) uses surplus electricity to pump water from a reservoir to a higher elevation. This is one of the most efficient ways of storing energy – but relies on very large-scale geographical solutions. Most of the sites where PSH could be effective are in use and creating new sites would have a significant impact on the environment. Large scale battery storage facilities offer another way to store electricity. The recently completed Pelham Battery Storage Project in Hertfordshire can store up to 50MW and release it to add capacity to the grid when needed. Its big advantage is flexibility and speed of reaction. But battery storage facilities tend to have a relatively short discharge time – making them less suitable for prolonged shortages of power. A third option, however, is hydrogen. Using electrolysis, hydrogen can act as a very cost-effective energy store, which has similar performance to PSH without requiring suitable geographical features. The flexibility of the proton exchange membrane (PEM) technology used within the electrolyser enables the electrolysis process to be switched on and off very quickly to help balance the grid. Its long discharge time – particularly when stored at scale – makes it a natural choice to complement battery and hydro as a means of balancing the grid.

HOW ENERGY STORAGE CAN BALANCE SUPPLY AND DEMAND

STORAGE AND AFFORDABLE FUEL FOR TRANSPORT

When electricity demand is high, energy companies must either bring more power online or encourage users to reduce demand. When supply is plentiful and demand is low, suppliers must either lower production or find ways to store the surplus power. The driving force behind this is the requirement to keep alternating current at a continuous frequency of 50hz. A shift in the balance of supply and demand will affect the frequency – so electricity producers, suppliers and traders must constantly work together with large consumers to ensure the grid remains stable. If large energy users are able to

A shift towards large-scale hydrogen storage will also provide a supply of affordable clean fuel for transport. By investing in large-scale hydrogen projects, public sector organisations can benefit from financial incentives offered for grid balancing and put the infrastructure in place needed to decarbonise transport hubs. These refuelling stations could also be made available to the public – a potential game changer in terms of the cost of hydrogen at the pump. Finally, large-scale hydrogen storage facilities will help support the grid as renewables become a larger part of the

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energy mix – bringing benefits to everyone involved. The UK grid benefits from increased flexibility, while hydrogen storage facility owners benefit from financial incentives offered for grid balancing activities. Transport companies then benefit from reduced prices in hydrogen fuel. And of course, everybody benefits from lower transport emissions and reduced carbon emissions as renewable energy becomes more viable.

HOW PUBLIC SECTOR ORGANISATIONS CAN GET INVOLVED While the initial investment required for hydrogen storage is high, it becomes feasible for when businesses and public sector organisations begin converting transport hubs to hydrogen power. When applied to fleets of 50-100 vehicles or more, the economics of hydrogen refuelling change dramatically. Driving up demand for large volumes of hydrogen opens the door to different investment models, including the option to have the hydrogen supplier fund the capital cost of the refuelling station. This removes one of the biggest barriers to organisations developing hydrogen infrastructure and frees up capital to invest in vehicles. One of the best examples of this is the Kittybrewster refuelling station in Aberdeen. BOC, a Linde company, worked with Aberdeen City Council to develop and install a tailored, state-of-the-art hydrogen refuelling station at Kittybrewster. The facility produces green hydrogen from electrolysis on site. Hydrogen is stored as a compressed gas until it is needed and then pumped into vehicles, much like refuelling a petrol or diesel vehicle. The station opened in 2015 and was originally designed to refuel single-deck buses. In 2018 it was scaled up to offer public refuelling of cars and vans, with further upgrades to accommodate double decker buses. With an expanding fleet of hydrogen buses and other vehicles, Aberdeen City is starting to reap the rewards of hydrogen as a transport fuel. And, with the potential to provide energy storage and grid balancing services in the future, there are opportunities to develop the role of hydrogen even further. www.boconline.co.uk/HydrogenSolutions

RENEWABLE ENERGY

WHAT ON EARTH IS HYDROGEN?

• Abundant element could be vital in response to climate emergency but support for public’s “hydrogen literacy” must keep pace, says EI President. • New EI Guide to Hydrogen provides information on the potential benefits, challenges and user experience in the home, for transport and in industry.

new resource designed to support everyday understanding about hydrogen has been published today, to address concerns that lack of awareness could be a barrier to its deployment in the low carbon energy system. Energy Essentials: A Guide to Hydrogen is an evidence-based, peer-reviewed resource specifically aimed at those who are not expert in the field. It sets out what hydrogen is, how it is made, transported and used, what the experience would be like in the home, for transport and in industry, and what the future of hydrogen might be. EI President Steve Holliday FREng FEI said: “Our response to the climate emergency must put all low carbon solutions in the frame. Hydrogen has potential as a versatile enabler of decarbonisation across the economy and our way of life. “Like the unfamiliar application of any technology, hydrogen will need to prove itself in terms of cost, safety and low carbon production, but it’s hard to imagine a net zero future without hydrogen in some form or other. “That will mean change, and require a greater level of support to improve the hydrogen literacy of energy users themselves. This new guide has been produced by the Energy Institute as a contribution to that endeavour.” It is estimated by the Committee on Climate Change (CCC) that more than half (53%) of the emission reductions needed to reach net zero in the UK will come from behavioural or societal change in combination with low carbon technologies. But studies have raised concerns that the public’s level of awareness about hydrogen and its potential role is lagging behind other low carbon technologies and could pose a barrier to its deployment. Research by Madano for the CCC in 2018 found just over half (51%) of survey respondents have never heard of hydrogen fuel boilers, the lowest awareness of all alternative low carbon heat technologies. Research for the H21 project by Leeds Beckett University found 68% of customers are indifferent or undecided about conversion to hydrogen, largely because they don’t know enough about it, are unconvinced that it’s the right solution, or are simply not engaged with the topic. The new guide is freely available at www.energy-inst.org/hydrogen both as an interactive web page and a print-friendly pdf.

WANT TO REDUCE YOUR CARBON FOOTPRINT?

ith large landholdings, vast available roof space, significant energy demand and specific carbon reduction targets, universities and public sector organisations are well placed to develop renewables as a means of making energy savings and potentially generating an additional source of revenue. Locogen are equipped with specialist knowledge of renewable sources including solar PV, wind energy, hydropower and renewable heat, all of which can reduce reliance on electricity from the grid and safeguard against rising electricity prices. The investment in renewable technologies is a robust one for universities and public sector organisations, especially when the majority of the power is consumed on site or in the case of solar PV, uses freely available space and requires little to no maintenance. There are also opportunities to enter into power purchase agreements with developers who can finance the build and sell the electricity back at a reduced price. This is a low risk way to generate carbon savings and reduce running costs. Locogen have considerable experience working with Local Authorities, NHS Trusts, universities and police authorities on renewable energy projects. This work has ranged from individual technology-specific projects to multi-technology strategy documents and framework agreements for the whole Authority area. The breadth of our experience with universities and public sector organisations means we understand how best to help our clients through the internal decision making stage and provide support during the public procurement process. If you are an energy manager with carbon reduction targets for your university or public sector organisation - contact us. Phone us on 0131 555 4745, email us at info@locogen.com or find us online at www.locogen.com.

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

ENERGY PROCUREMENT

IMPACT OF COVID-19 ON THE ENERGY MARKET The impact of COVID-19 has created unprecedented economic and social consequences globally. COVID-19 has significantly affected all aspects of life, including the energy sector. Though we are nearing the end of some economic and social restrictions, the consequences may have indelibly impacted the behaviour of the energy market. Fortunately, there are tentative signs of an economic revival as businesses begin to resume operations, which means many could now capitalise on the developments on the energy market. 26

Fig 1 Energy prices have plunged to record lows. [Source: Northern Gas and Power]

ommercial activity has been curtailed for many businesses and firms since the UKâ&#x20AC;&#x2122;s lockdown, with the Organisation for Economic Cooperation and Development forecasting an alarming 11.5% slump in UK GDP, greater than the falls in France, Italy, Spain, Germany and the US, the Paris-based thinktank said. The new reality compels businesses to better manage costs and energy behaviour to secure their futures or risk financial damage as we begin the post COVID-19 recovery. The time afforded to businesses as a result of lockdown has been a great opportunity to regulate and scrutinise commercial operations to identify and remedy inefficiencies. This report looks at how the energy market has been affected, and what businesses are still able to do to capitalise and manage energy and energy expenses efficiently.

IS IT APPROPRIATE TO BUY ENERGY NOW? COVID-19 has caused companies in the UK to urgently review their operations in order to maintain financial stability

ENERGY MANAGER MAGAZINE â&#x20AC;˘ JULY/AUGUST 2020

through months of inaction. The Furlough scheme, business grants, VAT deferrals and interruption loans have gone some way to protect businesses, but a more obvious and straightforward solution has been neglected: the cost of energy. Often overlooked, energy costs constitute the single most critical supply element for the smooth output and operation of any business, especially in services such as the industrial sector. Energy costs for the manufacturing industry often represent the second or third highest expenditure, after labour costs or materials. Manufacturers have saved money through the lower demand for materials, and governmentsanctioned financial assistance has relieved some payrolls, but what is being done about energy costs? The global energy market is currently sitting at a 70-year low. Some perceptive energy managers have managed to capitalise on this by locking in longterm fixed energy contracts at a heavily reduced premium, allowing them to budget and forecast responsibly over the long-term with discounted energy rates. Live data from wholesale energy markets indicate that the grid is

ENERGY PROCUREMENT struggling to manage a massive oversupply of electricity and is also facing difficulties in depositing the excess supply, leading to UK electricity markets plunging into the negative 66 times. The data would indicate that securing a new, long-term energy deal in this market could give businesses a financial advantage over idle competitors as we begin an economic recovery.

WHY SHOULD I BUY ENERGY NOW? IS IT THE RIGHT TIME TO BUY ENERGY? Global economic uncertainty has led to a collapse in the demand for energy. With the lower demand, energy prices have fallen considerably. Data from wholesale energy markets, trading in Megawatt Hours, indicate the true imprint of COVID-19 on energy markets. Energy markets peaked at £68.27 per MWh in 2019 but have now dropped to as little as £42.67 per MWh in April 2020 – a colossal decrease of 35.5% in price. The recent imprint COVID-19 has left on the UK energy markets can be seen in the radical decline in Fig. 1.

WHY IS THIS HAPPENING TO THE ENERGY MARKET? As suppliers struggle to sell viable quantities of energy in the current climate, we can expect the low energy price trend to continue well into mid-to-late 2020. As well as the lack of demand, the steep drop in prices in the energy forum is down to the immense inventories of gas supplied to the global market with larger UK businesses reaping the rewards. Record hauls of gas are flooding the UK market from Qatar, Russia and the US. Analysts predict gas contracts are expected to fall by up to 30% in 2020 as the UK expects to receive an energy surplus at record levels. Russia, Europe’s largest gas supplier, sustains its colossal flow of gas to Europe in order to establish market dominance and obtain a stronger economic foothold in the gas extraction industry. In March 2020, Gazprom (Europe’s largest gas supplier) celebrated the highest-

on-record share of the gas market, at a commanding 36.7%. Gazprom is keen to maintain its control of the market and has pledged to fight off challenges from the US and Saudi Arabia by continuing its generous flow of energy into Europe.

WILL THE MARKET RECOVER? The market is beginning its recovery. Recent government easing of economic restrictions will see a demand for energy rise, leading to the inevitable increase of energy prices towards previous levels. Similar to the 2008 recession, greater economic activity and adaptations in financial policy will help to stabilise global markets. Some financial reports even indicate that UK GDP could return to positive growth of 4.5% by 2021.

SUMMARY: •

•

Commercial activity declined sharply from COVID-19 onset, reducing demand for energy Lack of energy demand and excess energy supply resulted in market crash; energy markets currently at 70-year low Consequently, energy prices now heavily reduced; reviewing energy contracts now may lead to future savings Economic recovery expected by 2021 – prices on wholesale markets may stabilise within 6 months Energy consumption patterns must be analysed to eliminate inefficiencies

I’VE READ THE DATA, NOW WHAT SHOULD I DO? To capitalise on the condition of the energy market, businesses should review their energy management systems now. Reviewing energy behaviour and consumption patterns could lead to longterm savings on energy bills. Investments in energy software are becoming everuseful as a global drive towards clean, green energy emerges post COVID-19. ALPHA. Lite provides energy management software-as-a-service (SaaS), which is fully cloud-based and accessible remotely. Where energy management systems would previously take months of data collection, and cost tens of thousands in hardware and regular maintenance, ALPHA. Lite instantly provides 14 months’ worth of historic consumption data within two minutes of sign-up. The revolutionary software records consumption patterns and gives alerts when inefficiencies are highlighted, prompting businesses to quickly and easily implement preventative measures. ALPHA. Lite offers energy assessment remotely, without the need for intrusive site visits or expensive hardware. Currently, no other platform can do this. This technology is exclusive to ALPHA. Lite and unavailable elsewhere in the energy industry. ALPHA. Lite’s goal is to make businesses more efficient, to stop energy wastage and work towards net zero carbon. https:// clearvuesystems.com/alpha-lite/

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

ENERGY PROCUREMENT

PROCURING ENERGY TO MEET SUSTAINABILITY OBJECTIVES Andrew Toher, Head of Customer Insights, Enel X UK, looks at the options available to energy managers as the country emerges from lockdown. have claimed a greater share of electricity generation, increasing roughly 3% globally.

ccording to International Energy Agency data, COVID-19 has caused a “staggering” decline in overall energy demand. Many organisations have been left struggling to make sense of abnormal demand patterns throughout the crisis. Where facilities have been forced to stand idle, demand has plummeted. For some operations, such as distribution centres, demand has actually increased in line with activities. With the uncertainties surrounding lockdown exit strategies, organisations have little idea when demand will return to normal, or for some, what normal looks like once lockdown is over. The transition back to work will be a gradual process for many, with social distancing continuing to impact operations for some time. Organisations will be under enormous pressure to control their costs, with energy spend in particular coming under the spotlight. Depressed energy prices present attractive opportunities to lock in energy savings. This has made committing to long-term renewable energy purchasing more difficult when viewed in the context of current conventional power market pricing.

THE NET-ZERO OPPORTUNITY The UK government recently signalled that it would ‘probably’ not publish the Energy White Paper until the Autumn, and the delay in part was because ‘we need an institutional refresh’ to meet net zero goals. Alongside the growing evidence linking air pollution with the health impact of coronavirus, organisations may come under pressure to accelerate their decarbonisation initiatives. Some governments are already demanding steep emissions cuts from certain sectors in return for bailout packages. On top of this, many local authorities have declared climate emergencies and are looking to accelerate their regional net-zero initiatives. While the coronavirus continues to spread and challenge our way of life, a bright spot emerged recently when the International Energy Agency (IEA) published data for the first quarter of 2020. It showed a 5% decrease in global CO2 emissions compared with the same quarter in 2019, a figure which could increase to 8% for the entire year. As a result of depressed electricity demand, renewables

CUSTOMERS LOOK TO MANAGE RISK AND STAY ON TRACK TO MEET DECARBONISATION TARGETS Unfortunately, there is no one-sizefits-all strategy as major energy users look to navigate their way through the COVID-19 crisis. The best course of action depends on the sector and each customer’s specific situation. Many customers cannot easily delay short-term purchase decisions and while the best approach for each business will depend on their specific circumstances, there are some best practice recommendations that should apply to most organisations. Buyers are often tasked with decarbonising their energy systems while looking to minimise costs. Attractive prices for short-term energy deals make long-term renewable power purchase agreement (PPA) commitments look relatively expensive today. However, there is nothing to suggest that today’s exceptional short-term price trends will change the long-term outlook for energy prices. A PPA that looked like a good deal a year ago may still be a good deal today. Buyers shouldn’t assume that procurement forecasting models using today’s energy prices will be valid over the medium to long term. When re-evaluating projected economic benefits of a long-term renewable energy contract, it is important to review those outcomes over different scenarios, which may range from 12-20 years. Delays in the global supply chain may impact the timeline of renewable projects, which are often dependent on shipping schedules and manual labour. While delays are uncertain, companies may have to adjust to the possibility of new project timelines and plan to cover any gaps in supply contracts by extending or renewing existing contracts to avoid holdover rates. Companies that face project delays may need to find short-term solutions

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

to meet sustainability goals in the interim by purchasing Energy Attribute Certificates such as Guarantees of Origin. Many large developers have robust procurement teams with access to a portfolio of assets and can help bridge the delay with Energy Attribute Certificates. Demand for corporate renewable energy is driven by a variety of factors. Corporations are striving to be good corporate citizens and community partners through more sustainable business practices. As an increasing number of employees, investors and consumers are all asking organizations to engage in more sustainable activities, this is resulting in companies embracing climate action. Because the process of renewable energy procurement can take years from commitment to commercial operation, it’s more important than ever to keep the momentum going – even if an organisation has put the pause on transacting. Procurement is just one part of an increasingly holistic and complex energy strategy, which typically includes long-term sustainability goals, monetising flexibility and demand-side response, evolving efficiency measures and deploying EV infrastructure to enable e-mobility. With a raft of competing priorities, it is extremely challenging to achieve the right balance.

THE NEW ENERGY TRANSITION We should expect continued turbulence across the energy sector for some time. Combining a detailed understanding of the dynamics of today’s energy landscape with a vision for the long-term horizon will enable organisations to build agility and resilience into their procurement strategies while maintaining a commitment to decarbonisation. Having access to procurement professionals with extensive expertise in assessing energy contracts will help manage risk and enable some customers to take advantage of the attractive prices in retail markets to meet their energy needs. www.enelx.com

LIGHTING

HEALTHCARE LIGHTING: INTERVIEW WITH DIETER LANG, R&D EXPERT HUMAN CENTRIC LIGHTING What characteristics must good lighting fulfil in the healthcare sector (e.g. hospitals)? • The light is based on the natural course of daylight. • Bright and higher bluish content in the spectrum, similar to daylight. • Dynamic light with reduced brightness and reduced blue content in the evening. • Comfortable lighting for patients and hospital staff. • No glare, even when light is bright. • This requires larger areas for lighting, light ceilings, or bright indirectly illuminated areas at the wall.

Are there any special legal requirements in this area that must be met? In Germany, there is a DIN standard, DIN 5035-3 - Lighting of health care premises. This has to be fulfilled in addition to the requirements mentioned in DIN EN 12464-1.

What are the benefits for health and well-being of patients? Why is the right light beneficial? Patients often suffer from a loss of circadian synchronization. They lose sense of time and sense for day and night. Especially in intensive care units, which are often without significant quantities of daylight. HCL can support to maintain their day-night rhythm. A stable circadian rhythm supports good sleep and recovery. Good sleep is the main contributor to recovery (of course accompanied by good care). Bright light during the day supports good sleep at night.

Can good lighting also contribute to recovery and general health? If so, how exactly?

What is the ideal use of light in healthcare?

The main effects have already been described above. A stable circadian rhythm and a good sleep are important for everybody. And the strongest effects are visible in cases when health is not in the best shape. A healthy person may cope with bad light for a while. But a person in the state of disease or recovery can even benefit much more.

To what extent can the concept of Human Centric Lighting also be applied and implemented in health care?

To what extent does good lighting also affect doctors and hospital staff? For the hospital staff the lighting for patients is simultaneously the lighting of their workplaces. They can benefit from the same positive effects as activation and synchronization during the day. Additionally, it is necessary that the lighting concept does not only take into account the patient’s rooms, but also the spaces where the hospital staff is doing other work than direct care activities with patients. Especially rooms which are often without natural daylight like x-ray- or MRI-rooms must not be forgotten. A critical topic is the right light at night for hospital staff. On one hand they should be active and alert in case of emergencies, on the other hand they should not be desynchronized in their day-night-rhythm by too bright and cold-white light. There are still no simple solutions for night-shift work. But the general recommendation is to avoid cold-white light at night. Even for night-shift-work in hospitals.

Integrate HCL in the lighting concept for room lighting.

To 100 percent. But some additional functions for emergency lighting, intervention lighting and similar healthcare-specific requirements need to be added. Nevertheless, for the main room lighting in patient rooms as well as in working areas, HCL is the best concept.

What special products are used in the healthcare sector? There are special luminaires for patient rooms. Some are integrated in the supply-equipment for gases and electricity. Sometimes “standard” luminaires are used for the standard room lighting. Often, there is not much space on the ceiling – especially in intensive care units. Recently more and more requirements are coming for luminaires which can be easily cleaned or disinfected. This requires a high IP-protection level. More information about HCL: https://www.ledvance.com/ professional/products/product-stories/ human-centric-lighting/index.jsp Healthcare lighting – example Tirol Kliniken: https://www.ledvance. com/professional/lighting-solutions/ lighting-projects/led-lighting-

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

ENERGY MANAGEMENT

CLIMATE CHANGE AGREEMENTS – WHY YOUR BUSINESS SHOULD TAKE ACTION NOW TO FEEL THE BENEFIT Claire Markham, Director of Sustainable and Renewable Energy at Inspired Energy

t a time when businesses are seeking to reduce their OPEX costs wherever possible, the proposed reopening and extension of the Climate Change Agreement (CCA) scheme will be welcomed by many. But those that wish to secure an agreement – and benefit from the significant savings they bring – must act fast. The CCA scheme, which enables eligible businesses to receive a discount of up to 92% on the electricity element of the Climate Change Levy (CCL) and 83% on the gas element, is currently set to end on 31st March 2023. However, it’s been so successful that the Government is now proposing to extend the scheme to March 2025, and they have already reopened the CCA to new applicants. It’s estimated that this extension will save businesses around £300m each year. As the Government strives to rebalance gas and electricity CCL rates, the rate on gas will continue to rise over the next few years, which will increase energy bills for most businesses. This will make holding a CCA even more valuable. While the extension and reopening of the CCA depends on the outcome of the Government consultation, eligible businesses must act quickly to ensure that they secure this discount if it is approved. The application window for new applicants closes on 30th September 2020, and some trade associations require submissions up to 4 weeks before this date, which means there’s limited time for businesses to submit their applications.

NEXT STEPS FOR NEW APPLICANTS Businesses that think they might be eligible for a CCA should investigate whether their processes do indeed fall under the scheme’s criteria. A full list of eligible processes can be found in Appendix A of the CCA Operations Manual.

If their processes are eligible, then new applicants need to start gathering the information they need to apply for a CCA now, to ensure they can submit their application before the 30th September deadline. This includes information around: • the specific facility/facilities carrying out eligible processes • any environmental permits they hold (including existing or previous CCA or EU ETS permits) • the manufacturing process they use • the amount and type of energy they use • other activities directly associated with their eligible process that will have an effect on CO2 emissions The CCA application process can therefore be complex and timeconsuming for businesses, and with the coronavirus pandemic causing ongoing disruption for many organisations, it may not seem like the ideal time for businesses to take on extra admin. But the financial benefits of gaining a CCA can make such a substantial impact on an organisations’ energy bills that it’s vital for eligible businesses to apply.

towards under a CCA, but they all involve either carbon or energy reduction. This means that any measures businesses put in place with the aim of achieving their targets should also help to boost their sustainability credentials. Those that are required to participate in the Streamlined Energy and Carbon Reporting (SECR) scheme should also be able to include any carbon or energy reduction measures they take to achieve their CCA target in their SECR reports. Existing participants must be careful not to be complacent, as the proposal also includes plans to reset the baseline from 2008 to 2018, and increase the buy-out rate from £14/tCO2e to £18/tCO2e. This will mean that companies that have previously relied on early overperformance and buyouts will need to focus on taking action instead.

AGREEMENTS REQUIRE ACTION

Of course, for the many organisations that are facing reduced workforces and increased workloads due to COVID-19, preparing and submitting a CCA application within the next few months may seem unachievable – but that’s where the support of external experts can make a real difference. By working with an energy consultant, businesses can benefit from the expertise of those who deal with energy compliance on a daily basis, which should streamline the CCA process and take the burden off their in-house team. Whether they choose to go it alone or seek external support, however, it’s crucial that businesses don’t delay in order to secure the substantial savings available for those with a CCA. inspiredenergy.co.uk/landing/cca

Securing approval to participate in the CCA scheme is just the first step in the process. If the Government’s proposal is approved, then the next target period will run between January 2021 and December 2022. This means that all applicants – new and existing – will need to be prepared to take action to achieve their agreed targets within this time period against a 2018 baseline, in order to secure their discount on the CCL between July 2023 and March 2025. Savvy businesses will be putting plans in place now to ensure they make steady progress towards their target within the target period. There are a range of different targets businesses can work

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

SEEKING SUPPORT IN CHALLENGING TIMES

ENERGY MANAGEMENT

PILOT GROUP ENERGY MANAGEMENT SYSTEM TO SAVE ONE MILLION TONNES OF CO2 IN 2020 • The new Pilot EnergyMgr 2.0, launched in October has already seen a strong start to sales • Pilot Group expect to save businesses more than one million tonnes of CO2 in 2020 and guarantee at least 25% saving on fuel bills • New features added to the system means Pilot Group can meter energy usage

ilot Group’s EnergyMgr 2.0, launched in October, is expected to save more than one million tonnes CO2 being produced in 2020. Pilot Group has also made several new features available and numerous upgrades to the system to ensure that the energy management system delivers savings in both costs and energy usage using the latest technology. The new intuitive interface will make it easier for customers to navigate menus with a new dashboard that displays utilities and equipment in real-time. The addition of a multi-site feature means that customers can view performance, energy usage and make changes to each site from any

internet enabled devices, providing customers ultimate control and visibility. In addition, with a new intelligent reporting tool, the EnergyMgr 2.0 will automatically convert kWh burned to CO2 tonnes, which allows customers to keep on top of CO2 used month on month, year on year. By measuring how much energy is used, businesses can begin to see how changing some processes and ways of working can significantly reduce the overall carbon footprint. To achieve this, Pilot Group will work with customers to help create a bespoke energy saving strategy ensuring that optimum energy efﬁciency is realised. The Energy Management System is on course to revolutionise the monitoring, control and management of heating, air conditioning systems and compressors as Pilot Group expected it to. In addition to improved control and management of heating, the upgraded EnergyMgr 2.0 system can now control an existing lighting system, or new system which can be supplied by Hilclare, resulting in an all in one, cost effective management system. The EMS integrates a central control unit with an intelligent software and highly accurate digital sensors to optimise the performance of industrial heating systems. Chris Pearson, Managing Director at Pilot Group commented: “At Pilot

Group we believe in using technology to make the places we live and work smart, safe and sustainable. “Since 1991 we have saved more than 9 million tonnes of CO2 entering the earth’s atmosphere, something we are extremely proud of, and, following two months of strong sales and by utilizing the visualisation feature, we expect the Energy Management System to save more than one million tonnes of CO2 being produced in 2020. “Not only this but the EnergyMgr 2.0 utilises the latest technology to provide customers with average savings of 40% on their heating bills and coupled with our LED lighting solutions this can rise to 60%.” Since acquiring Vickers Electronics, an energy management specialist with over 28 years’ experience of providing energy savings in industrial and commercial businesses, Pilot Group has invested heavily in product development. All systems come with a complimentary 12-month warranty and service agreement, which includes an onsite annual health check. The warranty and service can be extended at any time to ensure that the energy management system contributes to energy savings with maximum efficiency. The agreement includes full parts and labour warranty, annual service, engineer callouts and software updates. www.thepilotgroup.co.uk

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

NET ZERO

WHY IT PAYS TO LOOK BACK WHEN LOOKING TO THE FUTURE OF THE ENERGY SECTOR npower Business Solutions’ head of flexibility services, Ben Spry, explains why taking a look back can help to plan the road to net zero.

020 is proving to be a landmark year for energy. While it’s a time we will remember for many reasons – with Covid-19 resulting in shifting demand, an unprecedented coal-free spell and record low energy prices – it is also an opportunity to reflect and refocus. With the sector now focused on 2050 and the possible scenarios that could help the UK achieve its decarbonisation goals, we thought it would be interesting to revisit the predictions we made for 2020, back in 2011. Almost a decade ago, we worked with the Grantham Institute on Climate Change and the Environment at the London School of Economics to model four potential energy scenarios out to 2020. Now we are in 2020, we have looked back at the predictions we made then to assess if there were any lessons learned that could help shape the future of the sector. In a new report – The Future Report 2020 – we gathered the views of industry experts, including author of the original report, Professor Sam Fankhauser, Arjan Geveke from BEIS and Robert Buckley from Cornwall Insight to debate the technologies, investment and policy needed to reach net zero, and the role business will play. In the short to medium term, the experts agreed that while the immediate attention will be on the post-Covid-19 recovery – a time when ‘cash will be king’ – the focus should also be on

using the green economy to stimulate this recovery, arguing that it is an opportunity for the government to use net zero by 2050 to accelerate the sustainability projects that will cement a more resilient economic future. Longer term – net zero by 2050 is the target all the contributors were focussed on. While they agreed that it was an ambitious target, all believed that it was possible if major strategic decisions around the investment in technologies, incentives for renewables and changes to the structure of the system are taken in the next five years. CCS, hydrogen, battery storage and electric vehicles were all cited as technologies that would make the biggest impact on the UK’s decarbonisation goals. Revisiting the 2011 report has been fascinating and taught us three very valuable lessons:

1. W E CAN NEVER PREDICT EVERYTHING We didn’t know that the resilience we started building in 2011, following the financial crash of 2008/9, would serve us so well in 2020. And, while many of the questions we raised a decade ago have now been answered, new challenges have emerged. There are some things that we know we don’t know yet – like the best way to effectively decarbonise heat, how the UK’s participation in the EU’s Emissions Trading Scheme (ETS) will work, and how societal changes caused by the coronavirus pandemic will shape energy consumption in the longer term. That’s why building greater resilience and being flexible enough to adapt are now more important than ever.

2. W E NEED TO STAY FOCUSED ON NET ZERO With uncertainty the most consistent feature of our social, political and economic landscape over the past decade, it’s more important than ever to stay focussed on key goals. And in the energy sector, the primary

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goal now is facilitating net zero. As we said earlier, many argue that a post-Covid recovery plan that has net zero at its heart will give us the best chance of securing long-term economic and environmental stability, whatever else the future throws at us. What’s clear is that energy – and how it’s procured and managed by businesses – will be central to achieving this.

3. B USINESSES HAVE A VITAL ROLE TO PLAY For this vision of a better energy future to become a reality, large industrial and corporate businesses will be required to play a key role. We recognised the importance of their role back in 2011, as well as our own responsibility to support them – and both remain crucial today. But what actions should businesses be taking? One of the messages from the Future Report 2011 that still rings true today advises: ‘The key is to understand and manage energy well’. For businesses in 2020, this will mean going further than energy efficiency and demand side response. It will mean setting ambitious internal decarbonisation goals and taking corporate social responsibility seriously. Energy strategy must become an integrated part of broader business strategies – influencing business culture and transforming operations right across the supply chain. Whatever the long term future brings, the next 12-24 months will be particularly crucial, as organisations focus on getting ‘back to business’ post-COVID-19. It is becoming clear that a green recovery plan – that puts net zero right at the heart of the UK’s future economic resiliency – and policy clarity are urgently needed. As we await the Energy White Paper later this year, this is an opportunity to accelerate the projects that will cement a stronger and more sustainable future both for businesses and wider society. To download a copy of The Future Report 2020: The Road to Net Zero visit www.energy-hq. co.uk/futurereport2020

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ACHIEVING NET ZERO: WE NEED A NEW NORMAL

e are without a doubt experiencing a period of unprecedented disruption. There’s not one person, organisation or sector that hasn’t been affected; and it is only right that the focus now should be on crisis management and immediate relief. We know that a healthy planet means healthy people, which supports a healthy economy; so we must keep up the fight to protect it. The pandemic presents us with the opportunity to think about the world of tomorrow. Calls for a renewed focus on tackling climate change have been increasing in recent weeks. As we look forward to the future, the challenge of net zero will still be there, but our means for financing and delivering the tools to fight it will be fundamentally changed.

ACCELERATING CHANGE There is no right or wrong answer for achieving net zero. The challenges are different for every sector. Full decarbonisation by 2050 even for heavy polluting industries such as manufacturing and transport, while ambitious, is possible. Since legislating for net zero, the Government has pledged more than £2 billion in funding to support decarbonisation across UK sectors. Much of this will go towards the development of electric vehicle and carbon capture technologies, investment in hydrogen and green finance strategy. While most organisations are prioritising the pandemic, it can be difficult to think about then refocusing sustainability and net zero plans. It is true though that many energy leaders might find that they have, or are on track to achieve their energy and sustainability targets this year without needing to do much. This has come as the consequences of the pandemic have forced many organisations to reduce their workforce or close their doors, leading to a natural reduction in energy consumption. But the gains from this are short term. There is also a pay-off between the benefit of this reduction against the likely hit to revenue. The pandemic will no doubt affect the available capital for decarbonisation initiatives, and budgets and spend will be scrutinised more than ever; where this is the case will these projects get the attention they deserve? There will, we hope, eventually come a time when we’re able to return to ‘normal’ and when that day arrives climate targets and net zero 2050 will still be there. But instead of picking up where we left off, organisations will have to adapt

Looking ahead to a future post the COVID-19 pandemic, TEAM Energy’s, Head of Customer Success, Tom Anderton, considers how organisations will need to navigate and adapt to a new normal to meet climate targets. their strategies to meet their goals with strained budgets and fewer resources. So now is a great time to take advantage of our reduced operations, to take stock of where we are, what we have achieved and prepare for life after the pandemic to meet our energy and sustainability goals. Lessons from the past have taught us that recessions can provide the opportunity to accelerate change. Now is not the time to take our foot off the pedal, but rather we should be looking for new ways of driving clean growth.

THE COST OF SUSTAINABILITY In the conversations I have, there are two common hurdles that typically prevent energy leaders from investing in and fulfilling their sustainability ambitions: time and money. Yes, the cost of solar and wind power has come down, and renewables are now cheaper than fossil fuels. But decarbonising is expensive, and the reality for many organisations that don’t have capital reserves, is to get project funding, they need to be able to prove a return on the investment upfront. This can be a challenge when many energy efficiency measures have longer-term return rates. The second biggest challenge is not having the resources. This is more prevalent now as many organisations are operating with a reduced workforce. While we are waiting for the economy to recover, staffing levels may be impacted for some time, forcing energy and sustainability leaders to meet targets on their own. With the Environmental Audit Committee warning of ‘constrained’ Government finances post the pandemic, there’s talk and potential for a number of financial recourse options to help bridge the funding gap. This could mean an increase in carbon taxes to create revenue for green funding or ending fossil fuel subsidies; both measures that would hit high emissions industries particularly hard. There is also the option to leverage private finance investments (PFI). It is estimated that the UK’s transition to net zero will require PFI to the tune of £393 billion by 2031. There are challenges to this though, stakeholders will no doubt want guarantees against their investments,

and expect energy efficiency projects to happen at scale to make them bankable. With these eventualities in mind, organisations looking to the post pandemic recovery will need to consider how they are going to navigate and adapt to meet their energy and climate plans.

RECOVERY AND BEYOND As we look forward to recovery, we have the opportunity to use the insights gained during this time to shape our new normal to prioritise energy and sustainability, and support clean and resilient growth. The world has changed significantly since the start of the crisis. Businesses have had to adapt quickly to new ways of working, with many now running much of their operations remotely. As a consequence, their utilities consumption has fallen and their operational emissions are significantly reduced. The cumulative effect of this has also for many organisations, delivered considerable financial savings. Where this has been successful, do we need to go back to operating in the same ways as before? As organisations will be looking for low cost and resource options to support their transition to net zero, this could be the no investment solution they are looking for. This isn’t to say this solution is right for every sector, some industries rely on people and travel. There is still the opportunity though to consider new ways of working that can support efficient operations. Behaviour change programmes are particularly effective at helping embed a culture of sustainability, training and guiding staff, customers and stakeholders to adopt habits that can have a significant impact on overall emissions.

OUR NEW NORMAL In a post pandemic world, the challenges to achieving climate change targets will still be the same, but the landscape against which we need to meet them will have considerably changed. If organisations are open to accepting and adapting to a new normal, the answers to net zero transition are more achievable than they have ever been before. www.teamenergy.com

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

NET ZERO

UK ENERGY INFRASTRUCTURE – ARE WE ON THE NET ZERO PATHWAY? Chris Paul, Partner – Energy & Sustainability group, Trowers & Hamlins LL

arlier this year, the National Infrastructure Commission (NIC) published a report analysing the ability of the current National Infrastructure Assessment to meet the Government’s legally binding 2050 Net Zero target. It makes for interesting reading, particularly in the context of the current push towards a green recovery post COVID-19. The NIC was set up in 2015 to provide independent and impartial advice to the Government on the UK’s long-term infrastructure needs. The National Infrastructure Assessment, which is published every five years, provides useful guidance on the longterm strategy for the UK’s infrastructure. In its first Assessment (published in July 2018), the NIC set out the strategy for moving to a low cost, low carbon electricity and heating system. This recommended pilot projects to test low carbon heating options (including hydrogen and heat pumps) and improving building fabric so they require less energy to heat. It also flagged the need for a radical reduction in the use of natural gas for heating. Of course, nothing stays still for long. In June 2019, the Government amended the Climate Change Act to set a legally binding target to reduce all greenhouse gas emissions to net zero by 2050 (compared to the previous target of at least 80% reduction from 1990 levels). Given this change, the NIC took the opportunity to review their 2018 recommendations against the Net Zero 2050 target. Their report,

which was published in May 2020, concludes that many of the previous recommendations are still consistent with the Net Zero 2050 target. It is clear, however, that some recommendations have become more urgent or need to go further that originally envisaged.

DECARBONISING POWER In its 2018 Assessment, the NIC made recommendations for the UK to move towards a highly renewable electricity system. A low carbon electricity system mainly powered by renewable energy generation was considered to provide a low cost option, comparable to the cost of building further nuclear power plants after Hinckley Point C. The NIC recommended at least 50% renewable electricity generation by 2030, and noted that the continued use of fossil fuels with carbon capture and storage was unlikely to form part of a cost competitive energy mix. The NIC also highlighted the need for a more flexible electricity system to deal with the increased use of renewable electricity (as renewable electricity generation can be variable depending on seasonal factors). This included the need for investment in technologies that provide both supply-side flexibility (eg electricity storage and interconnection solutions) and demand flexibility (eg demand side response measures). The 2020 NIC report confirms that renewable energy remains the cheapest way to decarbonise electricity. The previous recommendation for at least 50% renewable energy generation by 2030 still works with the Net Zero 2050 target, but the need for focus on the delivery of renewable energy has become even more urgent. While the NIC acknowledges the progress that has been made in decarbonising the power sector in the last decade,

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they highlight the need to continue that trend. They also note that future infrastructure costs could be reduced if hydrogen turbines can play a part in providing flexible generating capacity. The NIC also examined the use of bioenergy with carbon capture and storage as a source of energy. While this will not match the cost reductions or flexibility of hydrogen, the report suggests that this could be deployed as baseload generation (to generate a constant output) which could be used to displace other technologies such as nuclear.

IMPROVING ENERGY EFFICIENCY OF BUILDINGS The NIC’s 2018 Assessment recommended a focus on buildings that require less energy to heat. Aside from having obvious benefits (in terms of cost and comfort), this is linked to the choice of heat technology – things like heat pumps work best in buildings with higher insulations standards. To achieve the required levels of change, the NIC recommended that the Government should set a target for the installation of energy efficiency measures of 21,000 measures per week by 2020, with that rate being maintained until the Government has decided on the future direction of heat infrastructure (ie electrification or hydrogen). The 2020 NIC report recognises that the Government has yet to decide on the future direction for heat, but recommends that energy efficiency measures should be installed in the short term to reduce emissions and reduce energy demand. With the current focus on the forthcoming changes to Part L of the Building Regulations and the Future Homes Standard, it is important that we don’t lose sight of the retrofit challenge.

NET ZERO LOW CARBON HEATING The NIC’s 2018 Assessment flagged two potential options for low carbon heating – either electrification (with heat pumps increasing the efficiency of electric heating) or using hydrogen from a zero carbon source as a replacement fuel in boilers and appliances. Given the scale of the transition that is required, the NIC recommended trials of low carbon heating systems including heat pumps and hydrogen. The 2020 NIC report recognises that the more aggressive Net Zero 2050 target will require more heating systems to be replaced/ upgraded – even in buildings that are difficult to decarbonise. As this will take longer and be more difficult, the NIC recommend that the process should start earlier. The report again highlights the importance of trials on heat pumps and hydrogen heating to prove these technologies. Whichever route is adopted, it is clear that there will be real challenges to build the market and provide the necessary skills and capacity to enable the required scale of transition.

POTENTIAL FOR A NET ZERO RECOVERY? Less than two months on from the NIC’s updated report, we are already seeing the impact of COVID-19 on the UK economy. With the lockdown came the slowdown – with significantly reduced the energy demand (according to the National Grid demand is down 20%) resulting in an interesting change to our energy mix. According to reports, our remaining coal-fired power plants have not been in operation since April, and renewable energy has provided a greater share of the load than fossil fuels. Of course, this may not be a permanent change – but it provides a useful window on what a low carbon future might look like. It is clear that more investment is needed if the UK is to break free from fossil fuels. The future is a grid with more renewable energy alongside energy storage to provide the necessary resilience to cope with fluctuating generation and seasonal differences. The NIC’s report places a significant focus on the Government’s policies

around energy efficiency and low carbon heating. There has been some progress in this regard, including extension of the Renewable Heat Incentive to March 2022 and consultation on the future support for low carbon heat. Current proposals include a ‘Clean Heat Grant’ (for small scale renewable heat installations in residential properties or small non-domestic buildings) and a ‘Green Gas Support Scheme’ (to incentivise the injection of biomethane into the gas grid to reduce dependence on natural gas for heating). It is clear that the transition to low carbon presents significant challenges and opportunities. Given the scale of the work required across all sectors, it is unsurprising that many are seeing the retrofit market as way to kick-start the economy. The Prime Minister has called for a recovery that is “fairer, greener and more resilient”. To meet that challenge, the market needs more consistent policy direction for retrofit, with targeted incentives, training and investment. www.trowers.com

building & facilities management

The Public Sector FM Magazine BFM is the total facilities management publication

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

NET ZERO

WHY WE MUST NOT INTRODUCE A ZERO CARBON BUILDING POLICY... BUT WHY WE MUST PUSH FOR AN ACCELERATED ZERO CARBON ENERGY POLICY. Pooran Desai OBE, CEO OnePlanet.com. Pooran has thirty years experience in sustainable development. He has been a developer as well as a consultant leading sustainability strategies for over $30 billion of zero carbon real estate around the world.

t’s déjà vu all over again. A Zero Carbon Buildings Policy is wellintentioned but misguided. We can’t afford to make the same mistakes we made last time around. We mustn’t push to introduce a Zero Carbon Buildings or a Zero Carbon Homes Policy – either nationally or locally. We need one policy for energy efficient buildings and a separate policy for zero carbon energy. This is a point of pain for me. The last Zero Carbon Homes Policy was ill-conceived and unworkable. I saw it develop and was horrified. It was not rooted either in reality or good sense. I was not sorry to see it axed by the government in 2015 – though I was sorry to see the UK’s commitment to a zero carbon future undermined. A building or a real estate development is not the right scale at which to push for zero carbon. Sometimes it can be right – for example in a low-density development where the roofs can be covered in PV, but often it simply is not – for example in a highdensity urban setting. If a developer

wants to construct a zero carbon building or net zero carbon building, then fine. This is why I am supportive of guidance to developers on how they might do this – for example in guidance produced by the London Energy Transformation Initiative (kudos to Clara Bagenal George for driving this and rallying support). But this is completely different from introducing a policy to force a developer to do so. Let me give you some more reasons. First, the idea of including socalled ‘plug loads’ as part of a building’s emissions is unhelpful at best, silly at worst. The emissions from energy consumed by a building can be divided into ‘regulated emissions’ from heating, lighting, cooling and the like, and from appliances or ‘plug loads’ arising from computers, televisions, cookers, etc. Why should the building (or the developer of the building) be responsible for all carbon emissions from appliances and activities which residents, tenants or workers in the building might release, even if we knew what these would be? Take my laptop. When I plug this into a socket in a building, why should the housebuilder or developer have had to deal with the emissions from charging it? Why not the laptop manufacturer? I take my laptop from a new net zero carbon building to an old building and it goes from clean to dirty. If I plug an electric car into my building, is it now counted as part of my building emissions? It doesn’t really make sense. Should we have a Zero Carbon Laptops Policy, Zero Carbon Televisions Policy, Zero Carbon Cookers Policy and a Zero Carbon Electric Cars Policy? Probably not, but we should have a Zero Carbon Energy Policy so that all our energy use, whether in a new building or an old one, inside or outside a building, is heading to zero carbon. Let’s get leading players across all industries rallying behind an accelerated national Zero Carbon Energy Policy so that each part of the system can then take its fair share of

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the costs and reap its fair benefits as we transform to a zero carbon future. Second, building on the point above (excuse the pun), a Zero Carbon Buildings Policy is an unfair tax on new buildings and new homes. Many, if not most, of us don’t like developers, often with good reason. But to slap a blanket carbon tax on them and ask them to pay for our emissions is not right. Indeed developers will say it is an unfair tax and play it off against affordable homes – which is exactly what they did last time – creating a dangerous and unhelpful narrative: ‘Do you care more about affordable homes or the environment?’. Third, the concept of ‘allowable solutions for net zero carbon’ which often accompanies discussions of a Zero Carbon Buildings Policy is unsound. It is the idea that the developer offsets emissions either by investing in reducing emissions in the surrounding area (e.g. by insulating homes), committing to buy green energy to cover all the buildings emissions for a set time or investing in additional renewables offsite to create a ‘net zero balance’. There are too many problems to go into detail here. But this assumes the energy modelling is correct and we know energy modelling is problematic as soon as we take human behaviour into account and with rapidly changing consumer appliances - what appliances and devices will we be using in five years let alone fifteen years and will they consume more energy or less energy than today? Then there is the problem of defining when is a renewable energy source additional. Additionality is not trivial to define. Take a wind farm: is it additional when it simply an idea, when it has planning permission but before it is fully financed, or can it still be classed as additional if it is fully financed and under construction but not operational yet? Fourth, when developers are forced to install on-site renewables, the outcomes are often not good. Developers are not energy generation

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or supply companies – nor should they be. When we require developers to install decentralised renewable and low carbon energy systems we often push technology into places it is just not happy to go. Last time around we saw solar, CHP and district heating systems installed to meet planning conditions, but sometimes not even switched on. Let’s not even go into the operational and maintenance challenges. Fifth, decentralised energy will have its place, but big renewables are still the most important way to get carbon savings cost-effectively. Losses in transmission exist but they are relatively small (around 8%) compared to the sheer efficiencies and economies of scale with large renewables (e.g. a wind turbine with twice the diameter in a location twice as windy will generate 1,600% more energy). Big renewables currently account for the vast majority of UK renewable generation. Decentralised renewables remain a small (but useful) part of the mix. For example, small solar PV installations (less than 4 kW) account for 2% of renewable generation or less than 0.7% of all electricity generation in the UK1. Especially as we enter what will be a 1 Small scale PV accounts for 20% of solar generation, which in 2018 was 11.7% of renewable electricity generation, which was turn 33% of UK electricity generation, giving the net figure of 0.7% of all electricity.

major economic crisis, we must recognise that the big, cost-effective carbon savings are coming from big renewables such as offshore wind. We must support decentralised energy and communityowned energy, for example though incentives such as grants, but we must not push technology or developers too far beyond their comfort zone and simply waste money and make new buildings and homes less affordable in the process. The same will go for battery storage. Don’t force decentralised battery storage. Incentivise developers to put them in but recognise that the bigger future in the near and medium term is in battery storage at city and region scale as is being done in many places around the world. So, what should we do? I want developers to focus on building beautiful homes and other buildings. These buildings must be designed to be good for people and support thriving communities where, for example, people can reduce their dependence on cars. Developers must be required to focus on a fabric first approach with a requirement to do the simple things like build to very high U-values for walls and windows to make building efficient and be required to build them with a high level of air-tightness. I want to encourage and require them to reduce the embodied carbon of materials. I want

old buildings to be retrofitted to make them more efficient and to generate jobs. Completely separately, I want a decent national (and if needed city and region) zero carbon energy strategy promoting rapid deployment of large scale and decentralised renewables in a way that the renewable energy industry can delivery coherently. This will enable the energy industry to collaborate with willing developers in a way that works for both. For me, all buildings must be energy efficient and run on renewables whether they are generated on-site or off-site. We must aim for a future where all buildings are zero carbon but this is different from a Zero Carbon Buildings Policy. All our vehicles and appliances must be zero carbon too. So, let’s not introduce a Zero Carbon Buildings Policy. Let us not tax new buildings and new homes or try to turn developers into energy companies. It didn’t work last time and it won’t work this time. Instead let’s promote decent, energy efficient buildings and join with other industries and lobby for a coherent Zero Carbon Energy Policy. We simply cannot afford to repeat the mistakes made last time round. We neither have the time nor the money. OnePlanet.com Originally published on LinkedIn.

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

ENERGY SUPPLY

REACTING AND REFORECASTING: HOW SUPPLIERS HAVE RESPONDED TO COVID-19

he rapid spread of Covid-19 has led to an unprecedented degree of change to the ways we live and work. As countries have introduced measures to prevent the spread of COVID-19, the major impact has seen all of us adopt changes to our day-to-day lives. Government guidance has seen businesses faced with unique and pressing challenges, and the closure of non-essential businesses and the shift to remote working has fundamentally changed energy consumption. While we are beginning to take the first steps out of lockdown and back towards a semblance of everyday normality, energy consumption may take longer to return to its previous patterns or may be changed for good.

HOW COVID-19 HAS AFFECTED ENERGY DEMAND Energy consumption patterns have changed significantly over the course of the UK’s lockdown - so much so that the system operator, National Grid, has raised concerns around system stability. As the country has gone into lockdown to combat COVID-19, businesses closures - and the widespread shift to working from home - has caused energy demand to change dramatically in a short period of time. Weekday consumption now looks more similar to a typical Saturday or Sunday; energy consumption overall is down by around 20%. Whilst this rapid change has brought some positive results in the form of reduced carbon intensity, it has also raised some interesting challenges.

FORECASTING ENERGY CONSUMPTION When taking on a customer for energy supply, all suppliers undertake a forecast to determine how much energy that customer will consume. This figure is based on a combination

of historic energy consumption as well as a customer’s best estimate of what they may consume on site. When it comes to determining the price of the energy a customer needs, forecasting is central. For customers with a fixed contract, the power required is priced at the time the contract is offered. For flexible customers, the price is dependent on when the customer decides to enter the market to buy (or sell) and the power is priced retrospectively. It’s important that energy suppliers routinely forecast as accurately as possible, so that energy demand data provided to the system operator matches expected supply, ensuring system stability. While forecasted energy consumption is written into a supply contract, it can be changed by either party if it becomes apparent that actual consumption will vary from the contracted volume. This requires either party to reforecast, giving a more accurate picture of the expected energy consumption. It’s important - and a matter of regulatory concern - that customers genuinely represent their energy consumption in these forecasts, as knowingly under- or over-purchasing energy on the wholesale market in bad

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

faith can constitute speculative trading. When entering a contract for flexible energy supply, energy is purchased on behalf of the customer by the supplier based on predicted demand. This demand is forecasted in good faith, and customers are expected to represent their demand accurately; if that demand does not materialise, the cost burden does not lie with the supplier.

THE DIFFERENCE BETWEEN VOLUME VARIANCE AND REFORECASTING Suppliers frequently build volume variance or volume tolerance mechanisms into contracts to protect the supplier against variances in consumption outside of the volume that has been contractually agreed. Volume variance clauses are a cost recovery mechanism for suppliers to protect against forecast deviation, and also provide a degree of protection for customers using energy outside of their arranged consumption. However, they do not provide protection against large variances in consumption and will not protect customers against increased costs due to reforecasting. However, it essential to undertake reforecasting for the reasons illustrated above.

ENERGY SUPPLY As such, volume tolerance mechanisms give high-volume energy consumers a degree of flexibility in their energy contracts and can help to protect consumers and suppliers from short-term market volatility. This also offers safeguards – both for suppliers and customers – against speculative trading on the wholesale market.

HOW SUPPLIERS HAVE RESPONDED TO COVID-19 Businesses are currently using much less energy, and for those businesses with flexible supply contracts there will be implications

around their contracted volumes. As such – and in line with most, if not all, energy suppliers across the country – Haven Power has been contacting the relevant customers across our portfolio and reforecasting their energy use. Subsequently, we currently require our customers on flexible supply contracts to adjust their contractual volumes and sell back any unused power or purchase additional power. Because of COVID19’s impact on the wholesale energy market, customers doing so will likely see an impact to their final energy costs.

HOW WE’RE HELPING THROUGHOUT COVID-19 At Haven Power, our commercial and energy trading teams routinely undertake reforecasting work for our customers, helping them to re-calculate their energy use and the cost implications. We understand that the last few months have presented a unique and challenging set of circumstances. If you’re a Haven Power customer and you’re worried that your energy consumption needs reforecasting as a result of the COVID-19 pandemic, please contact us. www.havenpower.com

LOCALISATION OF ENERGY IS STARTING TO TRANSFORM THE ENERGY SYSTEM By Jon Slowe, Director, Delta-EE. Don’t get caught out by thinking this is something for the future. It’s happening now. Local optimisation of supply and demand is on the rise, and will accelerate. In this article I set out the five reasons why.

f you agree with these, and you are in the active in the energy value chain, you need to take an active position on what this means for your business. There is a whole host of start-ups and companies from outside the traditional utility sector (as well as your traditional competitors) starting to target the opportunities arising from localisation of energy. Here are my five reasons why localisation of energy is on the rise.

1. T HE GROWTH IN DISTRIBUTED ASSETS – AND IT’S CERTAINLY NOT JUST ABOUT PV. CONNECTED OR CONNECTABLE ASSETS SUCH AS EVS, ELECTRIC HEATING APPLIANCES, BATTERIES, AND COMMERCIAL HVAC SYSTEMS ARE FOLLOWING A HOCKEY-STICK CURVE. Much of the attention, rightly, is on shiny new assets – such as connected EV chargepoints, connected batteries installed with PV, or hybrid heat pumps. But there is also 100s of GW of connected or connectable assets already installed in European buildings, with companies now starting to retrofit and tap into this huge resource. This type of resource simply hasn’t

been available to the energy system in the past, aside from crude direct load control or fixed time of use tariffs. I see more and more companies learning how to generate value from optimising these assets and using data to deliver value for customers.

2. CHANGES TO MARKET STRUCTURES & REGULATION ARE SEEING MORE VALUE OPPORTUNITIES FROM BALANCING OF DEMAND AND SUPPLY USING DISTRIBUTED ASSETS, OFTEN ON A LOCAL BASIS. These range from implicit incentives to self-consumed, locally generated energy, to DSOs using flexible demand to defer or avoid local network reinforcement, to incentives for collective self-consumption of renewables. This is just the beginning – market structures and regulation are still heavily weighted towards a centralised system. This is inevitable, as market structures and regulations will rightly always lag innovation. But I see these starting to move across many European markets.

3. THE INFRASTRUCTURE FOR DISTRIBUTED ENERGY IS INDUSTRIALIZING – CONNECTING ASSETS, MANAGING DATA FLOWS AND OPTIMISING OPERATION. Companies, often start-ups, have been innovating with building this infrastructure over the last twenty years. Some of these companies have now got several years of experience under their belt with a variety of distributed assets, experiences in multiple markets, and big backers. It is a complex area – with competing standards, protocols and architectures. But a lot of hard lessons have been learnt, and developments in connectivity, AI and machine learning are accelerating progress.

4. A WAVE OF BUSINESS MODEL INNOVATION IS BEING UNLEASHED – SOME (BUT UNFORTUNATELY NOT ALL) WITH COMPELLING CUSTOMER PROPOSITIONS. The amount of innovation in business models at the customer end of the energy value chain is astounding. Much of it is, unfortunately, still led by ‘technology push’. But an increasing proportion is built around customer needs, using local balancing of supply and demand to deliver a compelling customer proposition. What I’ve seen over the last years gives me plenty of confidence that enough of this business model innovation will succeed and stick, and start to grow from their niches and beachhead markets.

5. C USTOMER GROUPS ARE INCREASINGLY MOTIVATED TO PLAY AN ACTIVE ROLE IN THE ENERGY TRANSITION – BE THEY VILLAGES, TOWNS, NEW DEVELOPMENTS, UNIVERSITY CAMPUSES OR INDUSTRIAL ESTATES. Many people mistake ‘playing an active role’ with ‘engaging every day with energy’. Not even I can be bothered to engage every day with my hybrid heat pump, exciting though it is. But the underlying desire to play a role in creating a more sustainable energy system is there, as our customer research demonstrates. It’s the job of the energy sector to tap into this and deliver something that is highly complex in an engaging and simple way that delivers value to customer groups. To find out more about how energy communities can fund the energy transition, download Delta-EE’s new whitepaper at www.delta-ee.com.

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

CHP

AWARD WINNING CHP DISTRICT ENERGY SCHEME BRINGS LOW COST ENERGY TO GATESHEAD

wo combined heat and power (CHP) engines, supplied by Edina, are delivering low cost, low carbon to the award-winning Gateshead Energy Company. Distributed power generation solutions provider Edina was selected by Gateshead Council to supply and install two MWM 2MW gas-fired CHP engines to provide electricity and heat to domestic, municipal and commercial buildings in the town centre. Together, these engines can generate enough electricity to power 5,000 homes. Unlike conventional power stations, the Gateshead CHP scheme also recovers waste heat created during the electricity generation process and uses this to heat buildings via an underground network of pipes.

POWERING GATESHEAD’S FUTURE The innovative district energy scheme, which is owned and operated by Gateshead Energy Company, combines generation, distribution, energy storage and demand side management to reduce energy costs and carbon emissions. The council passes these financial savings on to homes and organisations in the area, with discounted rates on heat and power. Heat and electricity is distributed to businesses and residents across Gateshead via a three kilometer network of heat pipes and high-voltage ‘private wire’ electricity cables. The Gateshead project received the Visionary Award from the Association of Decentralised Energy (ADE), which recognises the project as a successful model that can be used to help boost redevelopment in other towns.

FUTURE-PROOF NETWORK At the launch of the scheme in 2017, it was used to heat and power a Gateshead art gallery and music venue as well as several public buildings and a small local housing scheme. Sufficient capacity has been built into the energy centre to future proof-the district energy project. This includes spare capacity to

meet additional heat and power demands from new commercial developments, such as those at Gateshead Quays and the Baltic Business Quarter, as well as major housing developments planned nearby. The CHP energy centre was initially projected to reduce carbon emissions by 5,000 tonnes per annum. This carbon saving will increase as the scheme expands.

MEETING FLEXIBLE GRID DEMAND In 2018, Gateshead Energy Company became the first small generator in the UK to be invited into the National Grid’s Balancing Mechanism, which helps ensure there is enough power in the UK supply system to meet short term spikes in demand. It pays a premium to organisations that can provide extra power to the grid rapidly at times of system stress. Because the Gateshead CHP engines can supply energy to the grid in less than one hour, the Balancing Mechanism helps provide additional income to the local authority. Gateshead Council leader Martin

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

Gannon said: “This is an important project which will give our area a real cutting edge. Our District Energy Centre is twice as efficient as a conventional power station and far greener, and we can pass on some of those cost efficiencies to local people and businesses in the form of cheaper heat and power. This alone will make a real difference to customers’ energy costs. “However, the commercial advantages offered by cheap heat and power will be obvious to incoming businesses and we believe this is likely to drive up demand for business space here in Gateshead, something that should help to generate much-needed new jobs. We are also helping to substantially reduce Gateshead’s carbon footprint.” For more information about reducing energy costs through gas-fuelled Combined Heat and Power (CHP) plants, please visit Edina at www.edina.eu

WATER MANAGEMENT

POLLUTION - THE GREATEST THREAT TO UK WATER SUPPLIES?

The biggest concern that the general public has regarding the UK’s water supply is pollution, followed by flooding and drought, a new survey has revealed - showing increased public awareness of the effects that climate change will have in this regard in the future.

arried out by engineering professional services consultancy WSP, the study also found that 34 per cent of people would pay ten per cent more on water bills for better tap water,, while a further 33 per cent said they would pay more than ten per cent to protect supplies against pollution. Interestingly, 34 per cent of survey respondents said they now feel motivated to use less water to help the environment, while 15 per cent would feel motivated by rewards for using less water. Turning the tap off when brushing teeth is the most popular way to save water, while others are now opting for capturing rainwater to use in the garden and household, as well as taking shorter showers. Earlier in the year, the National Audit Office said that England could be hit with droughts within 20 years unless action is taken to mitigate the risks posed by climate breakdown on water availability. By 2050, four billion litres of additional water supply would also be needed to counter the increasing risk of imbalances between growing demand and reliable supplies. Strategic growth director of water at WSP Mike Woolgar said: “As we continue these current warmer temperatures, there may be a shift in concern towards drought and potentially restrictions on use in some areas of the country “Water storage in the right places, whether to reduce flooding or ensure adequate water supplies during dry periods, could help the broader water sector to address these challenges. “Clever use of more dispersed storage, for example, could help to reduce the amount of water needed in the energy intensive process of moving supply from place to place, and thus addressing the UK’s net zero challenge.” Businesses in the UK concerned about their water stewardship can start taking action right now to reduce their reliance on mains water and help protect the environment, safeguarding this precious resource for future generations as the climate crisis deepens. Responsible stewardship means enhancing your understanding of the risks associated with water usage and consumption so you can introduce strategies to minimise the risks and make sure your operations are sustainable now and well into the future. Think of it as a way of continuing to make improvements where your water usage is concerned, while reducing the waterrelated impacts of the way you operate. It’s also your commitment to managing shared water resources sustainably by working with governments, local communities, other companies and nongovernment organisations. If you’d like to find out more, get in touch with H2o Building Services today to see how we can help you make real lasting changes where your water usage is concerned. www.h2obuildingservices.co.uk

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ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

DRIVING THE FUTURE

THE ROAD TO NET ZERO – LOWERING TRANSPORT’S EMISSIONS

K local authorities are declaring climate emergencies as a result - the target: to reach net zero emissions before 2050. Public understanding of net zero, though, is varied, with confusion between ‘actual zero’ and ‘net zero’ (often used publicly as synonyms), and the hidden impacts of ‘offsetting’ out of sight and out of mind. Here, Jacob Roberts, Infrastructure Strategy Specialist at Cenex, looks at the meaning of ‘net zero’ and the low emission solutions available to achieve it.

WHAT IS NET ZERO? Net zero = total carbon emissions – total carbon offsetting = 0gCO2. The UK Government describes net zero as meaning “that the UK’s total greenhouse gas emissions would be equal to or less than the emissions the UK removed from the environment”. While “zero emissions” implies that no fossil fuels will be burnt and no emissions released, net zero acknowledges that some carbon emissions are unavoidable, but instead can be offset by, for example, capturing and storing CO2 or by planting trees. So if you emit 100 tonnes of carbon a year and you offset 100 tonnes of carbon a year you’re at net zero. It’s like a bank balance - when your incomings are the same as your out-goings then your balance is zero, but that’s not saying you didn’t spend or earn anything. The whole idea of thinking of carbon as a budget or balance is fairly common and the UK Government has set “carbon budgets” since 2009 that impose legal limits on the amount of carbon that the UK can emit. We are currently in the UK’s third carbon budget, which prevents the UK from releasing any more than 2,540 million tonnes of carbon emissions between 2018 and 2022. To put that in perspective, you would have to drive a car over a lightyear to emit that much carbon! Even though the UK is on track to be well within the target set in the third carbon budget, we still have a long way to go to become net zero by 2050!

WHY IS NET ZERO IMPORTANT? We need to reduce our emissions and prevent catastrophic climate change. We’re breaking records every year for

the wettest or the hottest months and we’ve just had the UK’s sunniest month on record, during its sunniest Spring ever. This is not a coincidence and it is forming part of a worrying trend, but it’s not too late to turn things around by reducing and offsetting emissions and reaching net zero. The concept of net zero is important because, even though we need to reduce emissions, it’s not feasible to completely live without them, with certain industries unlikely to ever be completely zero emission. By setting targets based on net zero, we are encouraging research and development into carbon offsetting that will enable us to continue to use fossil fuels where there is no feasible alternative. That being said, we should not use net zero as an excuse to justify continued reliance of fossil fuels. Offsetting should ideally only be used to address areas where we have no other option.

HOW DOES TRANSPORT REACH NET ZERO? Many areas of society could feasibly become zero emission – anything powered by electricity can be made zero emission by using renewable energy – but transport as a sector is more tricky. For light vehicles, it’s fairly clear cut: for small vans and cars there’s a good proportion of owners who could transition to an electric alternative without any inconvenience. Electric vehicles produce zero tailpipe emissions and release less CO2 than petrol or diesel, even when they are charged with electricity generated using fossil fuels, which is reducing all the time as the UK keeps breaking records for the amount of renewable energy on the grid. Alternatively hydrogen fuel cell electric vehicles also produce zero tailpipe emissions and can be truly zeroemission with hydrogen generated using renewable energy, and biomethane from sustainably sourced crops can also reduce emissions as any emissions released are absorbed in the growing of the crops. In terms of public transport, trains have long been the lowest carbon mode of travel, taking advantage of efficient and potentially zero carbon renewable energy, and the move to very light rail is an important part of achieving net zero emissions. However, long-distance and international transportation – particularly aviation and shipping – will probably always be somewhat dependent on fossil fuels and therefore continue to release carbon emissions so

ENERGY MANAGER MAGAZINE • JULY/AUGUST 2020

those are the areas we will really need to think about carbon offsetting.

HOW DOES TRANSPORT SUPPORT THE WIDER TRANSITION TO NET ZERO? A lot of research and development is being undertaken to explore how zero-emission vehicles, particularly electric vehicles, can be used to support the wider transition to net zero. Smart charging technology can allow an electric vehicle to charge when renewable energy generation is at its highest or prevent charging when there is high-demand on the grid, to save money and reduce emissions. Vehicle-to-Grid (V2G) takes this a step further and allows an electric vehicle to use electricity from their vehicle battery back to power their homes, or to support the grid. This means renewable electricity can be used to charge an EV battery with V2G when its cheap and then discharge it back when grid electricity is expensive and carbon intense. It can also allow an electric vehicle to support the grid during periods of high demand, effectively doing a job that is currently often done by diesel generators, but with lower or potentially zero emissions. Having that ability to take energy at one time and use it at another time can help households to save money on their electricity bills, but it is also really important for reducing carbon emissions.

WHAT CAN I DO TO LOWER MY TRANSPORT EMISSIONS? The most important thing is travelling less. If you do need to travel, use the most low carbon transport method possible - ideally walk or cycle, then look to use public transport or car share, or, if you have to, drive yourself. If you have to drive, ideally use a low or zero emission vehicle but, whatever you are driving, drive it as efficiently as possible: take the most efficient route while avoiding congestion, try not to accelerate or brake more sharply than you need to. It’s important to remember that the biggest impacts are not achieved when a few people make huge changes to their lives, but when we all make small changes. As an independent not-for-profit, Cenex works with your business or organisation to find a viable and sustainable solution that achieves the greatest carbon reduction within a reasonable budget and timeframe. Together, we can lower your emissions through innovation in transport and energy infrastructure. www.cenex.co.uk

PSSA

Public Sector Sustainability Association

BECOME A CORPORATE MEMBER The Public Sector Sustainability Association (PSSA) provides a professional association and network for all those working in the Public Sector who have a common interest in sustainability. The aim of the association is to bring together a wide group of people working across all areas of the Public Sector – to help educate, train, support and connect as we work towards a more sustainable future.

Corporate membership of the Public Sector Sustainability Association is available to any private sector organisation wishing to reach committed and influencial sustainability professionals in Government, Local Authorities, NHS, Education and Housing Associations. MEMBERSHIP BENEFITS • • • • • • • •

Comprehensive listing in Suppliers Directory Unlimited opportunity to supply press releases, articles & news to feature on PSSA website One release for inclusion in monthly Newsletter. Logo on PSSA homepage Introductory email sent to our members as the latest Corporate Member to join the PSSA Logo - ‘Member of the PSSA’ to use on your own websites/materials 25% off Website/Newsletter banner advertising 25% off Newsletter sponsorship

WHAT DOES IT COST The introductory rate for annual membership is £495+VAT.

Interested in becoming a Corporate Member of the PSSA? Get in touch today - call us on 01933 316931 or email us at corporate@pssa.info

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Energy Manager July/August 2020

Articles inside

Net Zero

CHP

Heat Pumps

News

Energy Procurement

Opinion

Energy Management

Renewable Energy

Recruitment

Heating