Paper for DECC
7.11.11
Is whole city CHP/DH green?
By John Kapp, 22, Saxon Rd, Hove BN3 4LE, 01273 417997, johnkapp@btinternet.com,
former consulting engineer economist on electricity supply.
1 Summary of conclusions
a) s. Whole city Combined Heat and Power/District Heating (CHP/DH) is green,
because it more than doubles the efficiency of electricity-only power stations, to utilise 95%
of the fossil fuel energy burned. If all power stations were converted to that technology, the
space and water heating demand of 2 out of 3 the buildings in UK, (those in towns, classed
as ‘urban’) could be supplied with presently wasted hot water. This would displace the fossil
fuel (mostly gas) presently burnt to heat them, saving 720 TWh pa of energy, (A TWh is a bn
kWhs) and 175 million tons pa (mtpa) of carbon dioxide emissions.
This is a greater saving than all the all the other planned renewables projects put together,
and 170% of the target. It is 10 times the ‘by 2017’ target of 70-75 TWh pa (Huhne speech
on 20.10.11) A Sankey diagram is attached (see last page) . The upper half is the present
position (2010) and shows the fossil fuel energy that supplied our electricity and heat at an
efficiency of 64%. The lower half is for 2020, and assumes that whole city CHP/DH has been
retrofitted, showing the efficiency rising to 94%.
b) Heat is not classified as a ‘renewable’ resource, as it results from burning fossil fuel.
Because of this, the Department of Energy, and Climate Change (DECC) have no plans to
implement whole city CHP/DH, or even evaluate its potential. This is a mistake, because the
technology is not ‘pie in the sky’ but century old, with many examples of whole cities on the
continent (eg Flensburg) that have been heated in this way for at least half a century. This is
why Munich can realistically declare its intention to become a zero carbon city in future.
c) The newly licensed gas fired power stations at Port Talbot, Derbyshire and Thames
Estuary, etc, aggregating to about 4.2 GW, are 55% efficient, and will replace old coal fired
plant of about 30% efficiency retiring by 2017. If the new stations were planned to be
CHP/DH they would be 95% efficient, and save 26 TWh pa and 5 mtpa carbon dioxide
emissions. However, they are sited in the wrong place for CHP/DH, being 15-30 miles from
large conurbations, making it unduly expensive to transmit their waste heat during their
lifetime to at least 2050. The pipes would be like motorway tunnels costing extra £100s
million capital cost per station.
d) To generate our electricity, UK burns 1,020 TWh pa, (check) of fossil fuel (mostly coal)
to generate 410 TWh pa (check) This results in 610 TWh pa (check) of low grade heat being
thrown away to the sea and cooling towers. The average efficiency of generation is 41%, so
59% of the energy in the fossil fuel burned is thrown away. By ‘efficiency’ I mean: ‘energy in
kWh sold as electricity/energy in kWh in the fuel purchased.’ This electricity production
results in emissions of about 300 mtpa of carbon dioxide (at 300 gm/kWh chemical energy in
the fuel, assumed to be coal, (source from p335 of David McKay’s book ‘Sustainable Energy
without the hot air’)
e) Adapting all our power stations to whole
city CHP/DH technology can be done by
modifying the turbines by removing the last few
rows of blades, which would raise the temperature
of the distribution water from 30 to 95 degrees C.
The pipes would be laid in the ground to distribute
the waste heat to all urban buildings. This would
displace the same amount of fossil fuel presently
burned to heat them. The photo is of district
heating pipes being laid in Stokholm.
f) The current UK renewables target is to
reduce carbon dioxide emissions by creating 20%
of our electricity from ‘renewable’ resources by
2020. A recent DECC press release said that the
amount of energy in this 20% target is 108 TWh
pa, (check) This would imply that the UK’s total
electricity generation is 540 TWh pa (check)
However, the Sankey diagram figures are taken
from David McKay’s book, which implies 410 TWh
pa for the total generation, of which the 20%
target is 80 TWh pa. This 20% is a modest target,
and Chris Huhne wants to raise it to 30%, if other European leaders agree. This would
increase the target from either 120 or 162 TWh pa.
g) By comparison, the Rampion project spread over 270 square km of sea 15km off the
Sussex coast, will build 100 wind turbines, each the size of the London Eye, at a capital cost
of £2 bn. They will generate 700 MW peak, and 2.1 TWh pa. They will thus contribute 2% to
the renewables target, and displace 0.4 mtpa of carbon dioxide presently emitted by gasgenerated electricity, which will be saved.
h) Shoreham power station (opposite Rampion) is 420MW, gas fired, and last year
generated 2.6 TWh pa of electricity. It wasted about the same amount of heat (at 50%
efficiency) namely 2.6 TWh pa of hot water. It discharged this into the sea at 7 tons a
second, raised in temperature by up to 12 degrees C at full output. The photo below shows
the outfall. It was taken at low tide, (0.6m) when the temperature of the effluent was 22
degrees C, and the open sea was 12 degrees C.
This 2.6 bn kWh pa is enough energy to heat every home (120,000) in Brighton and Hove
with CHP/DH hot water at 22 MWh pa/home. I have proposed a CHP/DH scheme to save this
heat, contribute 3% to the target, and save 0.5 mtpa carbon dioxide. This is more energy
and carbon than Rampion. This scheme is estimated to cost £2.6 bn, and create 20,000 jobs
pa for 5 years, half of which (10,000) would be for local people. We have a team of experts
working on this project, and details are given in other papers available from me.
i) The conversion to CHP/DH would sacrifice about 20% (80 TWh pa) of the electrical
output by removing a few rows of turbine blades. We saw above (1d) that the heat presently
thrown away to the sea and cooling towers in UK is 610 TWh pa (check). This modification
would raise the temperature to 95 degrees C, which is the optimum for distribution. This
would have reduced * the electricity generated to 410-80=330 TWh pa, but the heat output
would have been increased by the same amount (80 TWh pa) This would have augmented
the total heat to 610+80=690-50 stack losses=640 TWh pa of heat available for distribution.
This would be enough energy to meet the space and water heating needs of every urban
building in UK, assumed to be about 2/3 of the buildings in UK. *This reduction of 80 TWh pa
in electrical output will not matter when there is that much capacity of wind, and solar
electricity generation available on the system, as 70-75 TWh pa is planned for 2017. (speech
20.10.11)
i) This CHP/DH project would make about a 4% return on the capital investment
(£350 bn) in distribution pipes etc, so would probably not be economically viable at present
fuel prices (crude oil $120/barrel, domestic gas 4p/kWh, domestic electricity 14 p/kWh)
However, fossil fuel prices are set to rise in real terms, as world oil and gas production
peaked in 2008, and world demand now exceeds world supply by 7%. The recent (Sept
2011) rise of about 20% in prices pushed the average home lighting and heating bill up to
£1,345, which put millions into fuel poverty. Much oil and gas comes from the Middle East,
which has been destabilised by the Arab Spring, so prices could suddenly treble, as they did
in 1973, 1979, and 2008.
2 Recommendations
a) Remove the barriers and evaluate the potential of whole city whole city CHP/DH
schemes at every power station, by doing the following, (as has already done in continental
countries, such as Germany and Denmark)
b) Change the paradigm of perceiving waste heat from power stations as having zero
value to be thrown away because it is low grade (temperature of about 30 degrees C), to
perceiving it as a valuable way of saving carbon emissions by utilising it for space and water
heating by whole city CHP/DH, thereby meeting our renewables target.
c)Re-classify CHP/DH heat as a renewable resource, because it saves carbon dioxide
emissions by replacing fossil fuels (gas, oil and coal) which are presently burned for space
and water heating in buildings.
d) Make CHP/DH heat eligible for grants and government subsidy through the
Renewable Heat Incentive, (RHI) and Renewables Obligation Certificates (ROCs) This would
enable the potential of these schemes to be properly evaluated by grants for pre-feasibility
studies, and feasibility studies.
e) Make the Local Authorities responsible for providing district heating distribution
pipes in their roads to keep the radiators hot in their urban buildings, as they are (and always
have been) in continental towns and cities. (and were in UK until nationalisation of electricity
in 1947.
f) Give Local Authorities the legal power to mandate the owners of buildings who are
near enough to the heat grid to contract with the monopoly supplier of hot water in
perpetuity. (as they are in continental towns and cities).
f) Resite the newly licensed gas fired power stations on brown field sites in Newport,
Cardiff, Derby, London, etc. The gas supply pipe will not cost any more, and might cost less
there.
3 How can the barriers be removed?
The above barriers can be removed by a paradigm shift in government thinking, to model the
paradigm of continental countries, (say Denmark and Germany) There, electricity and hot
water (for space and water heating) have always been seen as the dual products of power
stations, by means of a technology known as Combined Heat and Power (CHP)
This is because municipalities have always had the responsibility for the provision of both
these products (electricity and heat) distributed in cables and pipes under their streets. This
is why many continental countries have already got well developed CHP/DH schemes to keep
the radiators hot in their towns. I visited these installations 30 years ago in new towns in
Holland and old towns such as Flensburg in Germany, and Gothenburg in Sweden.
In UK, nationalisation of electricity in 1947 established electricity as a single product, and the
heat was perceived as waste of zero value, to be thrown away. This is why there is no
institution in the UK responsible for the provision of a district heating network under the
streets, so no heat grids exist. The remedy is to give that responsibility back to the Local
Authorities, as they had before nationalisation.
The Localism Bill already gives greater powers to Local Authorities. These should be extended
to give them this extra responsibility. This removes the barrier and makes the Local
Authorities the ‘parent’ of the heat, which is presently an ‘orphan’ child.
Get the stock market and banks to find the funding for the capital costs, which is mostly for
the pipes in the ground to distribute the hot water. This includes bus mains to transmit the
hot water over the long distance (c50km) between the power stations and the nearest towns,
which may add £100 million to the cost of those schemes. Whatever they are, those capital
costs will be recovered from the future sales of heat.
4 How many buildings would this 640 TWh pa heat?
About 80% of the buildings in UK, namely those which are classified as ‘urban.’ This means
that they are in densely occupied towns and cities, where there are many homes per street,
so having a high heat load density for each km of pipe. Assume that there are 62 million
people living in the UK, at an average number of 2.2 people per home. This means that there
28 million homes. Assume that 2 in 3 of these (18 million) are classed as ‘urban’. If the
annual heat demand for the average home is 22 MWh pa, the heat load for all urban homes
would be 18m homes X22 MWh pa/home =400 TWh pa of heat as hot water.
Assume that to heat every urban work space would require half as much as the homes, (200
pa). The total heat load of every urban building (home and work space) would therefore be
400+200=600 TWh pa. There is 640 TWh pa potentially available. If this were used to heat
those buildings, the fossil fuel (assumed to be gas) would be saved, and the carbon dioxide
emissions would be 120 mtpa (at 190gm CO2/kWh, which would be displaced and saved. If
some of it had been provided by coal, the saving in carbon dioxide emissions would have
been more, at 300 gm/kWh, or heating oil, at 250 gm/kWh.
5 Job creation potential of whole city CHP/DH
This paragraph answers the question: ‘how much would it cost to modify all the power
stations in UK to raise the temperature of their heat to 95 degrees C, and lay the district
heating pipes in the urban streets so that it could be distributed?’
I have estimated that the whole city CHP/DH scheme for Shoreham power station, and the
laying of 2,000km of pipe in the densely populated parts of Brighton and Hove where half
(130,000) of the population (260,000) live or work. See map below, showing the bus mains. I
believe that it would cost £2.6 capital cost, made up of £2 bn for 2,000 km of pipe at
£1,000/m, plus £0.6 bn for other capital costs. It would take up to 5 years to implement.
Taking a cost per job of £25,000 pa (double the minimum wage) this £2.6 bn capital
expenditure would create £2.6bn/£25,000=100,000 job years.
Spreading the construction over 5 years, this would create 100,000/5=20,000 jobs per year.
About half (10,000) of these jobs would be for local people, and many of them would be
semi-skilled, or unskilled, digging up the roads. This scheme costs £2.6bn to heat 260,000
people in Brighton and Hove, so the capital cost is £2.6bn/260,00capita =£10,000 per capita.
Scaling the Shoreham scheme up to implement whole city CHP/DH schemes nationally for 2/3
of the UK urban population (35 million people) these schemes would cost £350 bn. This
expenditure would create many jobs, including unskilled labour digging up the roads, which
would help the country out of recession. Taking a cost per job of £25,000 pa (double the
minimum wage) this capital expenditure would create £350bn/£25,000 pa=14 million job
years. Spread over 28 years, this would create 500,000 jobs per year. Half of them (250,000
jobs) would be unskilled or semi-skilled, for local people.
6 Would implementation of whole city CHP/DH be economically viable?
Assume that the Shoreham scheme had been built for £2.6 bn, Assume that 2.6 bn kWh of
heat is being supplied to urban buildings in the city of Brighton and Hove. The gas that is
presently heating them would be saved, saving 0.5 mtpa carbon dioxide emissions.
The present domestic gas price is 4p/kWh, so assume that this 4p/kWh would be the tariff
price of the district heating hot water. Assume that customers would pay the same amount
for district heat as they did before for gas, so would see no difference in their bills. The
annual revenue from the sales of heat would be 2.6 bn kWh paX4p/kWh= £100 mpa. This
would make a 4% pa return on the £2.6bn invested.
Therefore the rate of return (R) in %pa, is approximately equal to the price of gas (P) in
p/kWh. The price of gas is expected to rise in real terms, as world oil and gas production
peaked in 2008, and demand is said to now exceed supply by 7%. When the price of gas
rises to 5p/kWh (25% more than the present 4p/kWh) the project would make a 5% pa
return on the £2.6 bn investment. I do not know what rate of return is required, but
supposing that financiers would require a 6% return on capital, the scheme will be
economically viable when the gas price is 6 p/kWh, which is a 50% rise.
7 Conclusion – We should start evaluating these projects now
After the price rises in domestic fuel last Sept, the average annual bill for home lighting and
heating is now £1,345. This has pushed millions of homes into heat poverty, and many will
struggle to keep warm this winter. Neither UK nor EU controls the gas price, because it is
linked to the oil price, and that is controlled mainly by Middle Eastern countries. If the unrest
continues in Middle Eastern countries, or spreads to Saudi Arabia, the price could treble, as it
did in 2008, (going back to where it was after a few weeks) and goin up and staying up in
1979, and 1973, when it plunged the world into recession.
One of the problems of whole city CHP/DH projects is that there is a long lead time between
the decision to start, and the commissioning. This is at least 5, and could be as much as 10
years, because of the need to dig up the streets. Under the precautionary principle we should
start planning whole city CHP/DH now, because the earliest that any scheme could be
operating on line is 2017. By then the gas price could well be 50% higher (6p/kWh) or even
double, (8p/kWh) when these schemes would make an 8% return on the capital invested and
certainly be viable.
Imagine that we fast forward to 2017, and the average bill to light and heat a house has
doubled to £2,890, and more than half the population is in fuel poverty. If the population
realise that the power stations are still throwing away enough heat for every urban building in
the country, there could be riots in the streets. DECC should avoid this by evaluating whole
city CHP/DH schemes now, and removing the barriers to their implementation.
We in Brighton and Hove are seeking a grant of about £40,000 to commission a pre-feasibility
study on whole city CHP/DH at Shoreham power station, as a pilot project. We already have
the support of the MP for Hove (Mike Weatherley) and the green leader of the council (Bill
Randall) We have asked for all party support from the other MPs (Caroline Lucas, and Simon
Kirby) and the councillors who are leaders of the Conservatives (Geoffrey Theobald) and
Labour (Gill Mitchell)
We have had a meeting (26.10.11) with the DECC officer responsible for district heating
(Patrick Allcorn) the minutes of which are available. We are seeking a meeting with the
Sustainability officers of the council (Thurstan Crockett and Fracesca Iliffe)
We would appreciate support from DECC ministers in getting a grant for a pre-feasibility
study to confirm or amend the above conclusions. We are working on a list of potential
tenderers, who should include consultants from the continent. We are drafting the terms of
reference for the study, which will assume that the legal barriers have been removed.
The
study
would
calculate
the capital costs to the Brighton and Hove City Council of providing a heat grid, and
determine the ratio between the cost of gas (P) and the rate of return (R) (thereby checking
whether R=P as I presume). This will enable government and financiers to determine if and
when they will implement this scheme.