Remeha has announced its support for the Association for Decentralised Energy’s (ADE) call to enable Combined Heat and Power (CHP) to compete more fairly in the capacity market auction.
According to the ADE’s ‘Lightening the Load’ report, the Government’s scheme is “failing businesses” because its structure sidelines CHP. By generating power and heat simultaneously, CHP can offer a more energy efficient commercial heating process, especially for buildings that require high and continuous year-round heating loads.
Without equal support for the technology in the capacity market, the ADE has warned that organisations in the UK could be missing out on savings of £750m a year.
Paul Wilson, National Sales Manager – CHP at Remeha, comments: “Whilst traditional gas plants definitely have a role to play in the capacity market, CHP should be given equal support via the scheme. When considered in conjunction with condensing boilers to meet additional heat demand, CHP can reduce energy bills by around 20% compared to conventional power generation. What’s more, the ADE has also highlighted that widespread adoption of CHP could cut the same amount of carbon emissions as removing one out of every 14 cars from British roads.
“So, if the capacity market is to encourage the provision of low-carbon, reliable supplies of electricity as much as possible, it must be structured in a way that gives CHP a level playing field in the auctions. This would give businesses, especially those who operate buildings with long running hours, an incentive to invest in CHP.
“Using CHP, these businesses can produce electricity at gas prices, which is approximately eight pence cheaper per kWh compared to buying it directly from the grid. CHP electricity doesn’t suffer losses resulting from moving power over large distances, resulting in a more efficient process. Buildings that require high and continuous year-round heating loads can achieve the most energy efficient operation because of their long running hours.
“By giving CHP a level playing field in the capacity market auction, it would encourage organisations that could gain a great deal from CHP to invest in the technology and consumers would benefit from a better balanced electricity network and more affordable electricity prices.
“Many cities across Scandinavia already utilise highly-efficient energy sources such as CHP plants to power their heat networks. The UK is lagging in comparison. We would urge the Government to strongly consider increased support for local CHP systems via the capacity market mechanism to help secure the country’s long-term supply of electricity, whilst delivering clean and affordable energy for all.”
