Renewable Heat Incentive: C4E’s Consultation Response

This is our response to the Department of Energy and Climate Change (DECC) consultation on the anticipated Domestic Renewable Heat Incentive and Phase 2 of the non-domestic RHI. All our points involve possible implications of the consultation on biomass heating systems and in particular focus on the self supply of energy crops (e.g. willow and miscanthus) or from undermanaged woodlands.

Domestic scheme

1. Self supply of woodfuel

The consultation suggests that fuel will need to be purchased from an “approved supplier” list from 2014. Such a condition would prevent people with their own woodlands or those who wish to grow a small plantation of energy crops from self supplying their own woodfuel. This would affect many of our clients who are seeking to maximise the financial benefits of the RHI by using their own resources. If one purchases woodchip, pellets or logs from a regional depot and the price of diesel goes up then so will the price of the woodfuel. By contrast if one grows their own in their local fields or extracts wood from previously undermanaged woodlands then they will be insulated from these fuel increases because the transport requirements will be negligible. The RHI should be encouraging people to grow and use their own woodfuel at all scales not just over 45 kW.

We have done an appraisal of the impact of locality of supply and increased transport fuel costs in our report: Why we need energy crops in the SW.

2. Project size

There is a no man’s land between the domestic and the non-domestic scheme. To qualify for the non- domestic scheme a property must be paying business rates or have several council tax bills to demonstrate a district heating scheme is in place. In order to qualify for the domestic scheme the boiler system needs to be 45 kW or less. Some properties will inevitably fall between two stools. For instance, a single large farmhouse or large estate property is likely to be paying council tax but have a heat load much higher than 45 kW. We have recently specified a 130 kW boiler for a 120 room private mansion in Cornwall. Under the proposed measures this installation would not be covered by either the domestic or non-domestic schemes. Such an eventuality has to be avoided.

 Non Domestic scheme

3. Emissions targets

The emissions targets of 30 grams per Gigajoule (g/GJ) for particulates and 150 g/GJ for nitrogen oxides (NOx) might prove disastrous for the energy crops industry.  It should be possible to achieve these targets with good quality woodchip in more efficient boilers.  By contrast, miscanthus is particularly dusty and produces a high level of particulates (around 100 g/GJ) so is more likely to miss this target in some boilers.  It might be possible to achieve these stringent requirements by using ceramic filters in the flue. It is suggested that ceramic filters can significantly reduce PM10 (particles measuring 10 micrometers or less). However, this would add around 10-15% to the installed costs of the boiler. This will reduce the economics of self supply and put farmers off investing.

Both SRC and miscanthus have higher nitrogen contents than typical woodchip and they might fail to meet the grade on this front as well.  This is more likely to be the case when energy crops are used as biofilters or as barriers to prevent nitrate leaching. Energy crops have an important part to play in an integrated agricultural system. Planting energy crops as buffer strips is likely to become more common place under new “greening measures” proposed as part of the revised Common Agricultural Policy (CAP). As such, they will provide huge benefits by preventing nitrates and spray residues getting into water courses and help the UK meet Water Framework Directive targets. However, if the farmer cannot use or sell the biomass produced because of the possibility of not meeting the emissions figures then there will be very little added value for the farm business. This will mean that farmers will be less likely to plant and the potential benefits to our waterways will not be achieved.

To the best of our knowledge there is currently no emissions control technology that is capable of cost effectively reducing NOx emissions from smaller biomass boilers.

Crops for Energy conducted a survey of installers of miscanthus compliant biomass boilers. We found that only one manufacturer had tested their boiler range when using miscanthus. In this case, two of the four boiler sizes in their range met the emissions target in laboratory conditions whilst another was borderline. We are aware that many end users are rushing to get installations installed under Phase 1 of the RHI in order to avoid any chance of missing out on accreditation due to the stringent emissions control measures. We feel that this is counter productive and will no doubt lead to some poorly planned and constructed projects.

Of the boiler installers we consulted none had differentiated SRC woodchip from typical woodchip from roundwood in their testing protocols. Energy crops are low input crops and when grown for use on the farm there are negligible emissions from transporting the crop. As a result the lifecycle emissions from growing and using energy crops are very low. Furthermore, in most cases the crop will be used in a rural situation, outside a smoke control zone and will cause minimal reductions in air quality. Miscanthus in particular has a low bulk density and unless densified into a pellet is unlikely to be used in an urban setting.

Crops for Energy therefore suggest that there should be a two tier system. Any boiler installed in an urban area should be demonstrated to be capable of achieving the emissions targets either through laboratory tests or through the addition of ceramic filters etc. However, in rural situations (e.g. on farms) the emissions target should be less stringent in order to encourage farmers to grow and use their own energy crops.

4. Energy efficiency measures and district heating schemes

We are concerned that groups of individuals will decide against the potential of a collective district heating scheme if they all have to meet the Green Deal ‘green tick’ energy efficiency recommendations. The consultation suggests that 100% of homes in a district heating network of less than 10 homes will need to fulfill this obligation. Although, we welcome the need for increased energy efficiency measures to maximise resources and reduce the amount of heating fuel required, we feel that this will put unnecessary burden on householders wishing to sign up for an ESCO arrangement in which they are provided heat for a price or co-financing a district heating scheme amongst their properties. It is very difficult to get groups of householders to even consider the possibility of a shared heating system. The RHI should be doing its utmost to facilitate this rather than making it more onerous.  The linking of small numbers of properties together in this way is much more likely to be a retrofit step to existing housing. By contrast, when 100+ houses are served by a network it is more likely to be a new development. We therefore suggest a relaxation of this rule (to around 70%) for small district heating schemes.

We would also like to mention that many of our clients will struggle to meet green tick measures on their properties as these are Grade 1 or 2 listed buildings or in conservation zones. These properties will not be able to install double or secondary glazing and are often very difficult to insulate. In many cases, such properties are very expensive to heat with fossil fuels. We feel that residents of these properties should be encouraged to install a biomass system and not hindered by additional bureaucratic measures.

Kevin Lindegaard

Director, Crops for Energy Ltd

21 November 2012