July 2018

Easy energy efficiency measure with great results

It often turns out that the simple measures work best. In this case we installed insulation jackets on the district heating system in Charlestown, Finglas, Dublin in 2016. We have v good heat sub metering in this area and as a result we were able to show that the payback from this change a year later was just 4 months. In addition, we applied an SEAI grant of 30% to this reducing the payback to less than 3 months. The expected savings were three times higher than was expected using the normal empirical guide. Insulation remains one of the cheapest & most effective energy saving measures you can take for both commercial & home applications. Email me if you want further details and I will send you a copy of the report.

The new Irish Renewable heat scheme 

Ireland has a target of 16% of gross final energy consumption to come from renewable sources in 2020, with sub-targets for the electricity (40%), transport (10%) and heat (12%) sectors. In 2016, Ireland reached a level of 6.8% (verus12% target) in the heat sector. To help move these energy renewable targets along some renewable heat schemes have been introduced by SEAI which include:

1. An on-going operational support (paid for a period up to 15 years) based on useable heat output in renewable heating systems in new installations or installations that currently use a fossil fuel heating system and convert to using the following technologies: Biomass heating systems, Anaerobic digestion heating systems

2. A grant (of up to 30%) to support investment in renewable heating systems that use the following technologies: Air source heat pumps, Ground source heat pumps and Water source heat pumps

3. Other technologies and methods of support continue to be under consideration (including biomethane grid injection) for subsequent phases of the scheme.

Unfortunately, as you dig into the numbers, the incentives don’t look so good in payback terms. For example, for the bio-mass heating system the support consists of the following prescribed tariffs – 5.66 cents per kilowatt hour of energy produced from biomass heating systems and 2.95 cents per kilowatt hour of energy produced from anaerobic digestion heating systems up to certain tier levels.

For biomass, this would work out to about €37,000 per annum of heat subsidy depending on how cheaply you can source the biomass material. But the catch is that a biomass boiler with an automated feed system would set you back at least €150k (& up) making any payback lengthy. It might be possible to install a cheap manually fed boiler and feed it with say a fork lift if you have the labor and a good source of bio mass to hand.

The RHI for commercial heat pumps don’t seem to have got off the ground yet. But will certainly worth looking at when they do. Heat pumps are particularly good in some situations such as leisure centers & hotels. There is also a €3,500 grant for home owners. However, again the criteria to get it are onerous with lots of BER assessment & insulation requirements (the former will eat up a lot of the grant even if you can meet the tough insulation requirements).

World energy outlook 

Energy prices have been holding to the high side across the board with a lot of geo-political stuff going on in World oil markets right now with Iran, emergency OPEC meetings, Trump calling Saudi King Salman to increase output, Venezuela collapse and the latest – the election of a leftist Mexican president who intends to meddle in that country’s oil industry (how did that work out in Venezuela with the World’s largest oil reserves and yet the nationalized oil company still manages to lose money).

Aside from oil forward UK gas prices are holding stubbornly high with Oct 18 rising back above 58 p/th. As a result fixed gas & electricity contracts for those who want to fix their contracts for the year going forward look v expensive.

Irish Wholesale electricity prices 

Irish SMP electricity prices for June where 6.15c/kwh. You can see from the graph below how this compares with the last two year’s – ie considerably higher.  The high gas prices and lower wind levels this year are the drivers behind these prices.

The one piece of good news (sent out as a special alert) is the proposed reduction in the PSO level from Oct this year. Stay tuned as we are still expecting price volatility to pick up as we head towards the planned I-SEM introduction in Oct.