News: Analysis
Taking the middle ground
As public indignation at rising energy prices and the need to decentralise
generation move ever further up the agenda, Tony Stiff, CEO of Flowgroup,
argues that microCHP could be the silver bullet we’re all looking for
n some ways it’s a terrifying
time to be in business. One
minute you’re happily driving
an expensive black cab or
running an over-priced hotel, the next people
are paying to sleep on other people’s sofas
(airbnb) and hailing a lift from anyone they like
(Uber). Disruptive business models can and
do appear overnight.
For a long time, it seemed like rapid
change in the energy industry was unlikely.
Central generation run by a handful of large
companies made some sense. Bills were
relatively affordable, demand was manageable,
investment was available, the environment
could be ignored and customers were
relatively compliant.
I
Call to action
Of course, almost all of that has changed.
Now, the energy industry is awash with
well-publicised problems, and everyone
demanding that something be done.
Disruptive business models very often
turn an industry completely on its head. This
is what may now happen with the energy
industry. The thinking goes that if customers
are feeling disengaged from the energy
industry, that can be rectified by involving
them directly in it. If bills are rising and the
environment is suffering, let’s reduce bills
and emissions by generating electricity more
efficiently.
Decentralising generation involves
moving away from central power stations
to generation by businesses, groups and
individuals on a local level. Even if there were
no economic, environmental or structural
benefits in doing this it would, philosophically,
be the right thing to do. The energy industry
needs to engage customers much more if it’s
to successfully deliver the huge change that’s
required to transition to a renewable and low
carbon future. Involving people directly in
generation does just that.
8 | www.renewableenergyinstaller.co.uk
Hidden agenda:
microCHP deserves
a much higher
profile in a sector
dominated by solar
and wind, suggests
Flowgroup CEO
Tony Stiff
Efficiency drive
But, of course, there are significant economic,
environmental and structural benefits in
microgeneration. Big power stations are
relatively inefficient and lose huge amounts of
energy during generation and transmission to
homes. So generating electricity in the home
makes sense.
That said, one of the inherent issues
with some forms of microgeneration is that
it can’t reliably take pressure off the Grid, or
that it does it at the wrong time. Solar often
produces most electricity when people need it
least. Wind is famously intermittent. However,
there are technologies in development which
will allow renewable power to be stored,
meaning it can be used at more appropriate
times.
Supply and demand
Solar and wind are the big names in
microgeneration. But microCHP technology
is a strong addition to the mix. MicroCHP
technology, often in the form of a domestic
boiler, generates heat for a household’s central
heating system and also electricity for the
home. Crucially, it generates most electricity
when demand is highest – on cold, dark
evenings when the boiler is at full throttle and
central generation is under most strain. While
it uses gas rather than being a renewable
technology, the carbon intensity of microCHP
is less than half that of the marginal peaking
plant it displaces. Considering that gas will
continue to play a key role in generation for
at least the next 20 years, technologies that
use gas more efficiently to generate lower
carbon electricity, and that reduce bills and
re-engage customers with the idea of energy
are an important element in the energy mix.
Installing 500,000 microCHP boilers with an
annual output of 2000 kWh of electricity is
equivalent to a large central gas fired power
station.
While mass market adoption at that level
might seem fanciful, with 1.7m boiler sales
annually in the UK and a rapidly reducing
cost for microCHP products based on recent
technological advances, it might be possible
to suggest that the decentralisation of energy
generation has just entered a new and
incredibly exciting phase.