Over £38 million of Salix funding used to install CHP across the UK public sector

Over £38 million of Salix interest-free loans have been used for the installation of combined heat and power (CHP) to provide high efficiency heat and power generation to UK public sector buildings, bringing estimated annual savings of over £10 million on energy bills. Last year saw a record number of these Salix funded CHP projects completing, with a total of £14 million of funding utilised throughout the public sector.

CHP can generate heat and power across one or more buildings and can reduce energy use by up to 30%[1]. Funding for CHP has been particularly well received for projects in hospital and higher education estates, as their year round electrical and heating base load allows for CHP running hours which can maximise the return on investment.

Poole Hospital NHS Foundation Trust identified the opportunity to make significant financial and carbon savings by  replacing two smaller, aging CHP units with a 850 kWe CHP located in a new energy centre. Using £1.2 million of Salix funding, the project completed in March 2017 and it is estimated to save over £262,000 per year on energy bills as well as over 1,100 tonnes of CO2e2.

Steven Fall, Estates Officer at Poole Hospital NHS Foundation Trust, said: “Working with Salix has been a smooth and efficient process. This funding has significantly contributed towards our overall Trust carbon reduction target and sustainability plan.”

In 2014, the University of Liverpool completed the largest CHP project supported by Salix funding. Using an interest free loan of £6.1 million, they installed two 2 MWe CHP engines into a disused Grade II listed boiler house. The engines generate 22 GWH of electricity each year, with a net reduction to energy bills of over £1.5 million.

Peter Birch, Engineering Services Manager at University of Liverpool, said; “Our CHP engines have delivered fantastic financial and carbon savings for the university. Without the support and funding from Salix Finance we would have been unable to implement such a large scale project.

In addition to the projects already completed, Salix has committed a further £7.7 million of funding to CHP projects in hospitals and universities which are now in the process of being implemented.

Further funding for CHP and other energy efficiency projects is available now, and details can be found at https://www.salixfinance.co.uk/loans. Salix can provide part or full funding for projects, with funding allocated based on value for money both in terms of financial payback on funding requested and estimated carbon savings.

Salix will be running workshops on CHP for the public sector later this year. These will be an opportunity to learn more about best practise for the design and operation of CHP systems, as well as how Salix funding can be utilised to help with the upfront costs of installation. If you work for a public sector organisation and are interested in attending, please contact emma.lawes@salixfinance.co.uk

1 ‘Lightening the Load – How CHP helps win the global race for a competitive, low carbon economy’, The ADE (https://www.theade.co.uk/resources/publications/lightening-the-load-how-chp-helps-win-the-global-race-for-a-competitive-low)

2 Calculated using emissions factors published by government in June 2016 for carbon footprinting purposes


Good things come in small packages

It is often said that the best things come in small packages, and nowhere is that more true than in the installation of combined heat and power (CHP). In fact, the most successful CHP installations in the UK have been kept purposefully small. Gary Stoddart, general manager at SenerTec, explains why.

As facilities managers will know, the heating and hot water systems in a commercial building is responsible for the lion’s share of both carbon emissions and energy use, and a large proportion of costs out of the business. However, with a recent report highlighting that average total carbon emissions are 3.8 times higher than those estimated at design stage, it’s clear that the ongoing battle to match up a building’s predicted and actual energy use has to be won if we are to reduce emissions in line with the government’s ambitious carbon targets.

The key for heating and hot water systems largely lies within sizing correctly for each and every application, and CHP is no exception.

CHP can help to achieve carbon reduction either as part of a standalone heating system, or as part of a heat network. It delivers savings in two ways – by producing electricity using natural gas rather than purchasing electricity from the grid, and through the generation of heat.

In comparison to electricity from the grid, CHP electricity doesn’t suffer transmission losses, and costs three or four times less. At the same time, where the ‘waste’ heat from the generation process is lost at gas power stations, the heat generated by CHP can be reused in the heating/hot water systems – normally most effective when CHP is designated as the lead heat source. Overall, it means CHP can be approximately 30 per cent more efficient than traditional electricity.

But in order to achieve the predicted savings, it is essential to first consider whether CHP is appropriate for the building in question, has been specified and installed correctly, and used as intended.

A major consideration for building and facilities managers is the need to rely on the heating/hot water system’s ability to continue to run efficiently, even when demand is low. Because oversized CHP units will not run if the heat demand is not present, and as a result the anticipated electricity will not be generated, this is a particularly important issue for CHP.

Unfortunately, incorrect specification of CHP is all too common. In many cases, the ‘10 per cent for luck’ rule is applied, meaning that many buildings have larger plant than required. The equipment is of course more expensive in the first place, but in addition will not operate efficiently, leading to higher operational costs.

The golden rule for CHP is to keep it as small as possible. Sizing the system so that the base load heating and hot water requirements can be met largely by the CHP unit alone will result in the continuous generation of low cost, low carbon electricity as a by-product of producing base load heating.

According to Building Regulations, CHP must be sized to provide ‘not less than 45 per cent of the annual total heating demand’, which includes space heating and domestic hot water. This is critical for CHP as oversizing for summertime loads can result in either non-operation of the CHP or the heat produced being ‘dumped’ in order to continue generating electricity.

To ensure the CHP runs continually throughout the summer months the hot water requirement should be the initial target for CHP sizing. Here, the risk is that 45 per cent of the total annual heating demand is mistaken for 45 per cent of the central heating load, which is not the case as the hot water loading is all year round and con be a significant part of the annual fuel usage.

Building managers also need to know that the system can react swiftly, accurately and efficiently to changes in heating demand. Cascades are rapidly emerging as an ideal way to deliver these performance benefits, as they can respond rapidly to changes in usage patterns, and extend the operating life and reliability of the equipment.

What’s more, a cascade of CHP units offers end users the option of shutting down parts of the system when there’s a fall in demand or maintenance required, meaning that the remaining units can continue to run at full capacity and maximum efficiency – unlike modulating CHP units.

The best way to ensure that CHP works as intended is for all parties to work together at the early stages of a project. It is also important for the CHP supplier to stay involved with the project after commissioning, to ensure that the system continues to perform and deliver savings. SenerTec offers a range of maintenance and monitoring solutions, meaning we can work with the building operator to ensure the system runs efficiently.

With increasing take-up of CHP technology across commercial building stock and its potential as a low carbon technology to help realise emission targets, it is vital that facilities managers are up-to-date with the latest guidance on how a system should be sized if they are to guard against ill-fitting solutions and costly malpractice.

For more information visit www.senertec.co.uk