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Ground source heat pump rewards explained

Chris Davis, at Kensa Heat Pumps, explains the benefits of district ground source heat pump systems for the residential sector
IT'S DIFFICULT to talk about renewables without mentioning the Renewable Heat Incentive, especially as the changes anticipated to the scheme in 2014 will make it a real driver for the take up of heat pumps and other renewable heat technologies. The recently announced increase in tariffs for ground source heat pumps under the non-domestic RHI will without doubt help commercial users to make the switch to renewable heating and it's hoped that the domestic stream will follow suit when it's launched in the Spring.

Residential opportunities
However, while we wait for the policy detail of the domestic RHI to emerge, the existing nondomestic RHI stream is already beginning to show opportunities for larger scale residential projects and is an area that specifiers and installers would do well to familiarise themselves with as a viable and attractive solution to the residential market, particularly for new build and social housing.

Since its launch in 2011, the non-domestic RHI has shown only a modest deployment of ground source heat pumps, due in no small part to the original policy providing inadequate tariffs rates. Fortunately this has now been rectified and any ground source heat pump installations commissioned after January 2013 will be eligible for new, significantly more appealing RHI tariff rates.

District heating
Significantly for the residential sector, the non-domestic phase of the RHI also covers district heating systems, both for existing buildings and - unlike the planned domestic RHI - new build. This opens up significant opportunities for renewable heat to residential developers and social housing providers by considering a district heating approach.

District heating currently provides less than two per cent of the UK's heat demand, but is an area DECC is keen to see increase. Traditionally district heating schemes - typically consisting of a large central boiler plant and a network of insulated pipes delivering heat to multiple properties, for example a block of apartments - have not been especially popular. Not only is there significant energy loss associated with circulating warm water around the building, they also create complex billing issues. And if the plant fails it leads to a lot of unhappy customers.

All of these drawbacks however can be overcome with a new approach being pioneered by Kensa, utilising the new Shoebox heat pump and the District Vertical Array solution. The compact and quiet Kensa Shoebox heat pump is intended to be installed within each property - giving each occupier complete control over their own heating and hot water system and responsibility for their own bill. Multiple Shoebox heat pumps are then linked to a communal ground array, which enables the system to satisfy the definitions of district heating as laid down by DECC and Ofgem.

The beauty of this solution is that it is completely scalable from small houses to multi-storey apartment blocks; a district heating system may be as small as two dwellings - perhaps a pair of semi-detached houses - sharing a common borehole. This flexibility therefore allows developers to employ an innovative technical solution while retaining ownership of the system and benefit from the RHI, or for social housing providers and other owners of multiple dwellings such as holiday let providers to adopt a scalable district heating system approach across their off-gas grid housing stock.

Another significant benefit of this approach is that the solution does not require large quantities of heated water to be circulated throughout the building, therefore eliminating the problem of energy (and subsequent system efficiency) loss through distribution pipework, a common problem with traditional central plant style district heating systems. Using the Shoebox heat pump in this way also allows an element of free 'passive' cooling to be provided if required, something often attractive in new build.

Compelling case
The approach also brings other benefits in terms of installation cost saving. Sharing a ground array makes plenty of sense as drilling contractors can reduce their costs by focusing on a smaller number of deeper boreholes - as there is no longer a need to provide an individual borehole for each property. A diversity factor can also be applied to the borehole design, reducing the overall total capacity required (and therefore cost) from the ground array, as the design no longer needs to cope with the worst case heat load scenario on an individual property by property basis.

Compared with the likely alternative in off-gas grid areas of fitting individual air source heat pumps to each property - with no possibility of RHI benefit in new build and an unattractive rate of return under the domestic RHI for retrofits - the reduced cost of the district ground source solution, combined with the recently announced increased non-domestic RHI tariffs means the financial case is compelling. Index-linked payments extending for 20 years based upon the metered output from the ground source heat pumps are made to the owner of the installation or, in some circumstances, to the funder who retains ownership for the duration of the RHI scheme.

Better still, retrofit district heating schemes in off gas grid areas in the social housing sector can also attract additional funding via the Energy Company Obligation (ECO). Paid as an upfront grant, ECO contributions are already available whenever a district GSHP installation accompanies a solid wall insulation upgrade, or in certain geographical areas housing the most vulnerable residents, a district scheme can be offered as a standalone measure. And yet more good news has been received following the Government's recent high-profile review of ECO is that district heating schemes are likely to be available as a standalone measure to all retrofit schemes as early as the Spring this year.

And with RHI and ECO able to sit alongside one another, the financial case is clearly a compelling one, especially when compared with the alternative options. For social housing providers, a retrofit ground source heat pump district scheme able to attract ECO funding will present both a lower capital cost solution than fitting individual air source heat pumps and provide a significantly more attractive rate of return under the non-domestic stream of the RHI than the proposed domestic scheme. For new build housing developers, the district scheme approach provides a neat solution to attract lucrative RHI funding, mitigating the additional costs of fitting renewable heat over traditional solutions.

The renewable heat industry is heading for exciting times and heat pumps are clearly an excellent alternative to traditional heating and hot water systems, particularly for those homes not connected to the gas grid. So when looking at renewable solutions for multiple residential properties - either new build or retrofit - district ground source heat pump solutions could well provide the answer.

// The author is the commercial director of Kensa Engineering //
3 March 2014


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