2_Kim Slowe_RHI Presentation - Regensw
The Renewable Heat Initiative A Developer’s Perspective 16 March 2010 Kim Slowe
ZeroC
Ecofirst
A low carbon house builder (based in Dorchester)
A renewable technology supply and installation company (based in Yeovil)
Ecofirst Consult
A sustainable consultancy set up for house builders and developers (based in Dorchester)
Poundbury based house builder 150 starts planned for 2010 Options on 1500 homes Funded for 250 homes a year All homes to be built to Code 4 or higher We don’t talk about sustainable development we do it! Significant design code experience
Supplies and installs throughout the UK: Solar Photovoltaics Solar thermal systems Wood pellet boilers Rainwater harvesting Heat recovery ventilation Wind turbines Natural Insulation
ZeroC Projects
ZeroC Projects
District biomass heating serving 2 offices and 24 homes Now been running largely trouble free for over 6 months Should qualify for he RHI
Money will go the management company Has had grant Payback mechanism?
77 Homes Athlete’s Village for 2012 Olympics Code 4 and 1 home Code 6
District biomass heating (59 homes) Wood pellet stoves with back boilers (18 homes) Rainwater harvesting HG ready
Additional cost £7K per house
o 3 plant rooms o Flats above plant rooms o Delivery over 2.5 years o Managed by an ESCO o RHI qualifying? o Gas back up?
o Fits into a single garage o Contains: o Wood pellet boiler o Back up gas boiler o Heat store o Hopper o Flue exits through the apartment o Includes 3 garages and a flat above o Effectively self funding!
o Wood pellet stoves with back boilers o Gas back up o HG Ready
o Will not qualify for RHI as it stands
o 28 houses, 10 apartments, 4 office suites and 2 shops o Mixture of Code 5 and Code 6 o Renewables include: o District biomass heating o Photovoltaics o Wind turbine o Rainwater harvesting o Hydro generation o Part CLG funded as a demonstration project o Started on site November 2009 o Will the CLG grant impact on the RHI?
o Existing outline consent for 700 houses and apartments over 20 years o JV with the Prince of Wales Charities and Hope Homes o District biomass heating o 1 Plant room for each sub phase of 20 30 homes o Flats above plant rooms o Possible energy from waste plant for electricity only o Managed by an ESCO o Will be RHI qualifying o Planning application in June 2010
o 270 houses and apartments in first phase o District biomass heating o 9 plant rooms o Flats above plant rooms o HG Ready o Solar Thermal o PV o Delivery over 5 years o Managed by an ESCO o Will be RHI qualifying o Planning application in June 2010
o Existing outline consent for 700 houses and apartments over 20 years o JV with the Prince of Wales Charities and Hope Homes o District biomass heating o 1 Plant room for each sub phase of 20 30 homes o Flats above plant rooms o Possible energy from waste plant for electricity only o Managed by an ESCO o Will be RHI qualifying o Planning application in June 2010
o
Capital cost of installing technology o o
o o
Is the cost recoverable within a sensible timescale? Is the installation cost bank fundable?
Maintenance of technology after the build Overcoming customer resistance and prejudice o o o
Not to be underestimated Many customers still reluctant to abandon gas Established perceptions often a stronger sentiment than common sense
Centralised scheme wide plants:
High capital cost All or nothing Only one plant room
Mini district plants
Can be delivered with the phases Lower capital costs Will be working at full efficiency on a phase basis Can take up more development space Greater maintenance load
Solar thermal water heating on individual dwellings
How does the developer recover the installation cost at time of installation Contract with the home purchaser not very attractive Developer fits for – but not with This has code implications Spilt the RHI to a capital payment for the developer and a reduced income to the purchaser?
Air and ground source heat pumps on individual dwellings
How does the developer recover the installation cost Contract with the home purchaser not very attractive Developer fits for – but not with This has code implications Almost impossible for a ground source heat pump and difficult for air source Spilt the RHI to a capital payment for the developer and a reduced income to the purchaser?
District Systems (Biomass/CHP) Developer can easily act as the ESCO and obtain the benefit of the RHI Developer still has to carry the capital installation cost
Developer might be able to bank fund the installation against the RHI Purchasers still want fossil fuelled ‘individual home’ back up systems in houses Individual Systems (Biomass/CHP/Heat Pumps/Solar Thermal) Almost impossible for the developer to act as the ESCO due to freehold/ownership issues Developer unlikely to obtain additional funding for the technologies Difficult to persuade owners to give up part of the RHI? Properties may demand a premium depending on socio economics
Will developers be able to obtain bank/government funding for capital costs secured against the RHI for district systems How will developers be able to benefit from the RHI income where they have installed technologies on individual homes How long will it be before the homes benefiting from the RHI command a meaningful premium? Will developers have the flexibility to install fossil fuelled back ups without losing the RHI Will the message on the very real benefits of the RHI get through to purchasers
‘(The RHI’s) design and tariff levels will be reviewed from time to time for new projects, so as to adapt to changes in technology costs and other circumstances’
‘Where a project has received or receives a central government grant , we may require that such grant monies are paid back …..’
‘HM Treasury/HM Revenue will clarify the treatment of RHI payments for income tax purposes in due course’
‘HM Treasury/HM Revenue will clarify the treatment of RHI payments for income tax purposes in due course’
‘We are proposing that projects where an installation was completed before 15 July 2009 will not be entitled to RHI support’
Developer’s need, above anything else, certainty Rapidly changing rules do not work in development as schemes have very long lead times The rules need to be consistent from the time of land purchase right through to last sale. This can be many years!
ZeroC
Ecofirst
A low carbon house builder (based in Dorchester)
A renewable technology supply and installation company (based in Yeovil)
Ecofirst Consult
A sustainable consultancy set up for house builders and developers (based in Dorchester)
Poundbury based house builder 150 starts planned for 2010 Options on 1500 homes Funded for 250 homes a year All homes to be built to Code 4 or higher We don’t talk about sustainable development we do it! Significant design code experience
Supplies and installs throughout the UK: Solar Photovoltaics Solar thermal systems Wood pellet boilers Rainwater harvesting Heat recovery ventilation Wind turbines Natural Insulation
ZeroC Projects
ZeroC Projects
District biomass heating serving 2 offices and 24 homes Now been running largely trouble free for over 6 months Should qualify for he RHI
Money will go the management company Has had grant Payback mechanism?
77 Homes Athlete’s Village for 2012 Olympics Code 4 and 1 home Code 6
District biomass heating (59 homes) Wood pellet stoves with back boilers (18 homes) Rainwater harvesting HG ready
Additional cost £7K per house
o 3 plant rooms o Flats above plant rooms o Delivery over 2.5 years o Managed by an ESCO o RHI qualifying? o Gas back up?
o Fits into a single garage o Contains: o Wood pellet boiler o Back up gas boiler o Heat store o Hopper o Flue exits through the apartment o Includes 3 garages and a flat above o Effectively self funding!
o Wood pellet stoves with back boilers o Gas back up o HG Ready
o Will not qualify for RHI as it stands
o 28 houses, 10 apartments, 4 office suites and 2 shops o Mixture of Code 5 and Code 6 o Renewables include: o District biomass heating o Photovoltaics o Wind turbine o Rainwater harvesting o Hydro generation o Part CLG funded as a demonstration project o Started on site November 2009 o Will the CLG grant impact on the RHI?
o Existing outline consent for 700 houses and apartments over 20 years o JV with the Prince of Wales Charities and Hope Homes o District biomass heating o 1 Plant room for each sub phase of 20 30 homes o Flats above plant rooms o Possible energy from waste plant for electricity only o Managed by an ESCO o Will be RHI qualifying o Planning application in June 2010
o 270 houses and apartments in first phase o District biomass heating o 9 plant rooms o Flats above plant rooms o HG Ready o Solar Thermal o PV o Delivery over 5 years o Managed by an ESCO o Will be RHI qualifying o Planning application in June 2010
o Existing outline consent for 700 houses and apartments over 20 years o JV with the Prince of Wales Charities and Hope Homes o District biomass heating o 1 Plant room for each sub phase of 20 30 homes o Flats above plant rooms o Possible energy from waste plant for electricity only o Managed by an ESCO o Will be RHI qualifying o Planning application in June 2010
o
Capital cost of installing technology o o
o o
Is the cost recoverable within a sensible timescale? Is the installation cost bank fundable?
Maintenance of technology after the build Overcoming customer resistance and prejudice o o o
Not to be underestimated Many customers still reluctant to abandon gas Established perceptions often a stronger sentiment than common sense
Centralised scheme wide plants:
High capital cost All or nothing Only one plant room
Mini district plants
Can be delivered with the phases Lower capital costs Will be working at full efficiency on a phase basis Can take up more development space Greater maintenance load
Solar thermal water heating on individual dwellings
How does the developer recover the installation cost at time of installation Contract with the home purchaser not very attractive Developer fits for – but not with This has code implications Spilt the RHI to a capital payment for the developer and a reduced income to the purchaser?
Air and ground source heat pumps on individual dwellings
How does the developer recover the installation cost Contract with the home purchaser not very attractive Developer fits for – but not with This has code implications Almost impossible for a ground source heat pump and difficult for air source Spilt the RHI to a capital payment for the developer and a reduced income to the purchaser?
District Systems (Biomass/CHP) Developer can easily act as the ESCO and obtain the benefit of the RHI Developer still has to carry the capital installation cost
Developer might be able to bank fund the installation against the RHI Purchasers still want fossil fuelled ‘individual home’ back up systems in houses Individual Systems (Biomass/CHP/Heat Pumps/Solar Thermal) Almost impossible for the developer to act as the ESCO due to freehold/ownership issues Developer unlikely to obtain additional funding for the technologies Difficult to persuade owners to give up part of the RHI? Properties may demand a premium depending on socio economics
Will developers be able to obtain bank/government funding for capital costs secured against the RHI for district systems How will developers be able to benefit from the RHI income where they have installed technologies on individual homes How long will it be before the homes benefiting from the RHI command a meaningful premium? Will developers have the flexibility to install fossil fuelled back ups without losing the RHI Will the message on the very real benefits of the RHI get through to purchasers
‘(The RHI’s) design and tariff levels will be reviewed from time to time for new projects, so as to adapt to changes in technology costs and other circumstances’
‘Where a project has received or receives a central government grant , we may require that such grant monies are paid back …..’
‘HM Treasury/HM Revenue will clarify the treatment of RHI payments for income tax purposes in due course’
‘HM Treasury/HM Revenue will clarify the treatment of RHI payments for income tax purposes in due course’
‘We are proposing that projects where an installation was completed before 15 July 2009 will not be entitled to RHI support’
Developer’s need, above anything else, certainty Rapidly changing rules do not work in development as schemes have very long lead times The rules need to be consistent from the time of land purchase right through to last sale. This can be many years!
