Renewable Heat Incentive: Expanding the Non-Domestic Scheme
Reference 12D/334
7 December 2012
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Introduction
1. BT is one of the UK’s top 10 electricity consumers, using over 2TWh every year. Despite
achieving an absolute reduction of 6.5% in consumption over the last three years, BT has
seen its electricity costs increase substantially over the last eight years and this is impacting
our business.
2. Heating accounts for a significant part of our electricity consumption at BT; we would like
to move to renewable heat schemes where economically viable in order to limit our total
carbon emissions.
3. Only two renewable heat systems are potentially under consideration at BT. This
consultation response will be limited in scope to these two technologies and seeks only to
address general principles associated with Renewable Heat Incentives (RHI) in so far as they
would support the reduction of BT’s carbon emissions and improve the sustainability of our
business.
Specific response to Renewable Heat Incentives:
Air to Air Heat Pumps (AAHP)
4. Do you agree that the RHI should not include energy efficiency requirements for process
heating? Reversible air-to-air heat pumps should be supported by the RHI. Based on recent
discussions with a major contractor, current economics limit retrofit application only to
buildings currently employing the most expensive sources of heating. With suitable RHI
support, we consider that BT could apply this technology to a wider range of buildings
currently using electrical heating.
5. Do you agree that any support for air to air heat pumps should be banded by size?
Applying banding for AAHP may be inappropriate until an evidence base is available to
confirm if support is insufficient or above requirements. The use of multiple units in a single
building would be driven by the heating load, or simply, the size of the building. If banding
is to be applied, it should not penalise the use of multiple units within one building.
Biogas
6. Increasing the production and use of renewable biogas requires joined-up consideration
by Government of the approach to delivering biogas to point of use. Government should
not just consider biogas production being co-located with heat or electricity generation as
this significantly limits the potential for both increasing biogas production and renewable
energy generation.
7. Under the RHI, Government should allow defined volumes of biomethane injected to the
gas grid to be accessible to users at a separate point of use. The tripartite contract
approach (where a company’s existing energy supplier purchases renewable energy from a
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third company, which supplies it direct to the first company) is well established in the
renewable electricity market and provides support for the building of new renewable
generation capacity. Formalising this contracting approach would provide significant
support for the increased production of biogas from anaerobic digester (AD) or other
technologies. For BT, it would provide a significant opportunity for the installation of heat
only or Combined Heat & power (CHP) systems using grid-delivered biogas, thus driving
decarbonisation and reduction in electricity demand from the grid.
8. Do you think that we should introduce a requirement for biogas CHP systems to be
CHPQA accredited in order to receive RHI payments? BT is a signatory to the ‘Down To
Zero’ procurement compact that was launched in May 2012 by The Department for
Business, Industry and Skills and the UK Corporate Leaders Group on Climate Change. BT is
strongly supportive of this linked up approach to low carbon energy generation. If we apply
the approach above, with geographic separation of biogas production and use, we would
support the application of Quality Assurance for Combined Heat & Power (CHPQA) criteria
to biogas CHP systems to ensure sustainable design and application.
9. Do you think we should introduce support under the RHI for biogas combustion
installation plants over 200kWth? Heat generation through biogas should be supported
above 200kWth. This will ensure that the efficiency benefit of installations can be fully
realised, being sized to suit the building they are serving rather than being sized to suit the
banding applied under the RHI.
Energy Efficiency and Heat use
10.
Do you agree that the RHI should not include energy efficiency requirements for
process heating? Energy efficiency proposals should follow definitions in the Energy
Performance Certification procedures, separating commercial accommodation areas from
commercial process areas. The RHI should therefore not include energy efficiency
requirements for heating process areas.
11. If you disagree, what process heat uses should be required to meet energy efficiency
standards, and what do you suggest they should be? The RHI should allow for combination
of heat uses, ie, heating of commercial space along with export of heat to district heating,
perhaps to domestic properties, reflecting the seasonal variations in commercial heat
demand.
12. BT has a very consistent demand for electricity but a very variable seasonal demand for
heating. Any export of excess renewable heat from BT buildings is most likely to link to
district-wide heating schemes operated by others, for the benefit of numerous end
consumers. BT would have no influence over the energy efficiency of the end users, but
could be an important contributor to the viability of the overall scheme as an anchor load.
The RHI should allow for support in this circumstance.
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12. In the absence of a district-wide heating scheme, exported heat is likely to be directed to
one or two end users. These users could be other individual businesses or for instance,
collectives of social housing. The definition of ‘small’ or ‘large’ networks and the
requirements for energy efficiency measures should contain flexibility to allow for these
scenarios. RHI could also provide support, without a pre-requisite for energy efficiency,
where this heat provision is supporting alleviation of fuel poverty.
We would be happy to discuss these issues further. Further enquiries can be directed to
David Pincott, Head of Political Research, Policy and Briefing, BT Group plc
Tel: 020 7356 6585/email: david.pincott@bt.com
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