A Chink of Light for the Solar Heating Industry?

What the new £600 Grant Really Means for Solar Heating in the UK

Are you a glass half-full
type of person?

The Department of Energy and Climate Change (DECC) announced today that grants given to households installing solar heating and other renewable heating technologies have been doubled in value.

The grant for solar heating under the Renewable Heat Premium Payment (RHPP) is increased from £300 to £600.  Householders will have to spend a bit of the extra money on a Green Deal assessment, at a cost of around £100.

The move follows lobbying from renewable heating trade associations and a twitter campaign initiated by the solarblogger. 

The #TweetforHeat campaign had the aim of attracting the attention of the Climate Change Minister, Greg Barker, to a blog article on this website – 'You Just Couldn’t Make This Up'.  The article points out the damage that successive delays to the domestic Renewable Heat Incentive (RHI) has been doing to the renewable heating industry and proposes an increase to the grants as an immediate measure to help the industry get back on the front foot.

While the grant increase will undoubtedly boost installation rates for solar heating and is fantastic news for the solar industry, the most important aspect of this might not be the grant itself but rather what it signifies.

A Shot in the Arm

You see a feature of the argument to increase the grant was that DECC had revealed in its own consultation on the domestic RHI its intention to pay the RHI net of grants already made.   

If DECC truly was serious about launching the domestic RHI next spring, then the extra money to increase the grant would cost government nothing extra. 

After promoting solar heating systems to householders based on the promise of a future RHI, many solar installers had lost faith that this scheme would ever see the light of day.

The increase in the grant and Green Deal tie in sends a strong signal to the industry that DECC really is serious about getting the domestic RHI going next spring.  Because solar heating systems installed today will be able to apply to join the RHI once it launches, solar installers should be able to get back to promoting solar heating to householders with a renewed confidence.

For its part, government needs to ensure that it gets the promised summer announcement of the scheme details right.  The announcement needs to be comprehensive, including not only the tariff levels, but also the qualification criteria and the method for deeming the energy upon which the tariff will be paid. 

Once this information is out, (and assuming a reasonable tariff rate for solar) DECC will have put everything in place for the solar heating industry to really show what it can do.

Winners and Losers, but Mostly Winners

Changes to the MCS Photovoltaic Energy Calculation

The solarblogger has been working on a briefing document about how the new MCS PV Guide has changed the landscape for solar photovoltaic installation companies in the UK.

I've reproduced the results of the analysis below, speaks for itself really.  For more details on how it was arrived at, read the briefing here.

Here's a thought.

If the EU Trade War with China adds 50% to the cost of PV modules (BBC News reports the average is 47%), and if the modules are around 40% of the total installed cost of a domestic system, then the cost increase to domestic customers will be about 20%.

The increase in the MCS energy estimate maintains the return on investment for customers....well, so long as they live in Kent.

Is the Solar Keymark Fit for Purpose?

The Solar Keymark is held up as the "gold standard" for solar thermal accreditation, but is it still up to snuff?

So what happens when it rains?
Image courtesy: Viridian Solar

 They say that Nature abhors a vacuum. National test laboratories on the other hand love the stuff, and they've been falling over each other to fill the vacuum left by the current embodiment of the Solar Keymark with highly profitable testing requirements and a hotchpotch of local standards.

Ireland, France and now the UK have introduced additional requirements for solar thermal installations, and guess what? They're all ever so slightly different.

Solar thermal panel manufacturers are tearing their hair out. How has this come to pass?

The Keymark is intended to ensure the performance and durability of solar thermal collectors. A random sample of solar panels from the factory is selected and subjected to a battery of tests at one of a small number of accredited test laboratories.  In addition, the quality systems in use at the factory are regularly audited.

The tests are designed to answer the question "are the solar panels you're making this week any good", and the audit answers the question "is what you're going to be making next week anything like what we just tested?"

The tests are based on the European standard EN 12-975 parts 1 and 2. Part 1 determines the thermal performance of the panel, while part 2 assesses the durability of the solar panel. A series of tests attempt to break the panel, for example:

·         Leaving it to bake in the sun, then pumping cold water through it

·         Leaving it to bake in the sun, then throwing cold water over it

·         Dropping a ball-bearing onto the glass

·         Spraying the panel with water and seeing if any goes inside it

·         Trying to break the glass by pushing and pulling on it

It really is a very good test of the solar panel.

Unfortunately, it only considers the solar panel in isolation.

In most real life situations, a solar panel is attached to the roof of a building. People can be fussy about their roofs.  Most seem to prefer that the water stays outside when it rains and that the roof doesn’t end up in the garden after a windy night.  Building Regulations cover these two points, to which they add the requirement that if your neighbour’s house is on fire, your roof shouldn't go up in smoke at the first lick of a flame.

In theory a solar installer must be able to demonstrated to building control that the solar panel they have installed does not impair the weather tightness of the roof, is proof against the wind loads it may face, and is installed the correct distance from the boundary for the fire rating of the panel.

How does the Keymark help the installer with this?  

It doesn't.

Enter MCS012 (UK), CSTBat (France) and Irish Agrement (Ireland), none recognising the other.  (Read my article about MCS012 here)

The Keymark is no longer meeting the needs of the industry for a single, Europe-wide test to ensure free movement of goods and services.  It rapidly needs to mandate the following additional tests:

1. A wind uplift test with a defined substructure to which the panel is attached. The substructure should be representative of a worst-case timber width, as the strength of fixings to timber is affected by the ratio of timber width to the screw diameter.  The tests should also take into account that timber is a natural material, which is normally done by repeating the test and taking a worst case.  The current test limit of 1,000 Pa mandated by Keymark is completely inadequate for windy islands like the UK, especially once safety factors are applied.  Manufacturers should test their panels to failure and declare the limit.

2. A water penetration test for roof integrated systems, taking into account each family of roof coverings (tile, slate) with which the panel works.

3. A single fire test, which works across Europe.  Currently there are four different tests in the "harmonised" European fire standard, and different national governments require different tests.

CEN is currently developing a new version of EN12-975 with the aim of including optional tests for weather tightness and fire performance.  This cannot come soon enough for european solar manufacturers.

(Incidentally, everything written above applies to the EN61215 durability tests for solar PV modules. MCS 12 covers both solar thermal and solar PV, whereas the CSTBat only applies to solar thermal.  For once the UK has beaten France by getting its barriers to trade in first, perhaps not something to celebrate.)

This article first appeared in Solar Business Focus UK, Vol 7-2013, sister publication to solarpowerportal.co.uk

You Just Couldn’t Make This Up

Government Interventions in the Market for Domestic Scale Renewable Heat, and how to make it all better

Less incredible?

Imagine you work in government and you've been asked to really slow down the development and growth of a new industry. How would you go about it?

How about just outlawing it? You could pass a law that makes it illegal.  Bit too obvious for your tastes?  Perhaps not clever enough?  Yes, you're right.  It could get messy, people might protest, take you to court, that kind of thing.  

OK then, how about about this?  Why not announce a scheme that is going to actually pay a subsidy to people who buy the products this industry produces, but that its going to start in 12 months' time.  Anyone thinking of buying will wait for this scheme to start,  so no one will buy anything this year. 

Then, just before you were going to launch it - delay it for another year. 

Then do the same again. And again. Genius!   

Hmm, what if people spot that the delays will damage the industry, and moan about that?

Easy - just announce that anyone buying the products from now on will be able to get the payments once the scheme launches, (subject to qualifying criteria), so there's no reason to wait.  Then keep those qualifying criteria secret because you "haven't decided what they should be".

The great thing about this plan is that you can even claim that you're helping the industry as sales fall and businesses go to the wall. 

Why stop there?  Why not start a wildly generous subsidy scheme for similar products that people could buy instead.  MWA HA HA

Does this sound crazy? Unbelievable?  Like you couldn't make it up?

Stranger than Fiction

Unfortunately, this is exactly what the Department of Energy and Climate Change (DECC) has done to the UK's market for domestic-scale renewable heat. 

Filsol, Solartwin, Genersys, Sundwell...

As the roll-call of UK renewable heating companies that have got into difficulty continues to grow, the domestic Renewable Heat Incentive (RHI), originally announced in 2010 and due to start in April 2011 has been delayed again and again, most recently being put back from summer 2013 to spring 2014. 

Installation companies have largely given up on promoting the "forthcoming" RHI as they are embarrassed to have to field calls from customers who bought low-carbon heating systems on the back of previous government announcements. One well-known Bristol based solar installer quipped to the solarblogger recently that you could put "RHI starting next year" on your website and you never have to update it. 

Renewable heating companies used to moan about how DECC, the government body charged with encouraging the transition to a low-carbon economy, increasing energy independence and protecting the environment, was too focused on decarbonising electricity, and was neglecting the task of decarbonising energy used for heating.  

Maybe they'll be more careful what they wish for in future.  

Unlike some of his more cynical colleagues, the solarblogger doesn't see conspiracy here, just a well-meaning, but ultimately extremely damaging intervention in the market.

Government urgently needs to make a strong statement to the market and consumers that it truly is behind renewable heat, and that the industry is not just the butt of some cruel joke with a particularly long and drawn out punch line...

How to Fix This

A good start would be to increase the Renewable Heat Premium Payment (RHPP).  This is a stop-gap grant scheme, that was to run from  April 2011 for one year. It's now about to start its third year, running to spring 2014. 

The recent consultation on the domestic RHI proposed that anyone applying for the RHI who was already in receipt of an RHPP would get the RHI payments less what they'd already been paid.   

Perfect!  If government really is serious about introducing the domestic RHI they could announce a doubling of the RHPP right now and at no net cost.

A solar heating installation would qualify for £600 grant, air source heat pump £1,700, a biomass boiler £1,900 and a ground source heat pump £2,500.

The next thing that is needed is that the announcement of RHI tariffs in summer 2013 must be complete and unambiguous.  It must not only confirm tariff levels, but also qualification requirements, and the deeming methodology.  With this is in place, consumers will be able to install with absolute confidence.

The industry would at last have something to cheer, and we could launch the domestic RHI next spring with a vibrant, growing renewable heating sector. 

You may also be interested in the following posts:

The Domestic RHI for Solar
Let's Get Down to Brass Tacks

Lessons from the Sustainable Building Regulations in Scotland

What can the Scottish teach the rest of us about Sustainable Building?

Everyone knows that the UK is not building enough new homes.

The reason, evident to all, is that the banks are only approving mortgages for those who will deposit the eternal soul of their first born child into a sub-prime structured casino-investment accumulator on the 2.30 at Newmarket.  ("A dead-cert mate, can't lose").  Oh, and the small matter of a 20% deposit too. 

In a near-perfect example of having your cake and eating it, government exhorts banks to lend more (to get the economy moving), while at the same time regulating that they should increase their reserves (ready for the next banking crash).

It may be obvious to everyone that developers won't build houses if people can't get a mortgage with which to buy them, but the UK government has been insisting that the real problem is "red tape".  

As house builders unveil spectacular improvements in profitability, government continues to work to reduce the cost of regulation, arguing that this will increase the supply of new homes.  In fact the main effect is of course to make more profitable the houses which would have been built anyway.

It is only recently that initiatives have been announced to try to unfreeze the mortgage market, with programmes such as Newbuy starting to have a real effect on demand for new homes.

So, since this Greenest Government Ever came in, we’ve seen it systematically water down regulations intended to ensure that new homes are built to high environmental standards:

• a dilution of the definition of what constitutes a ‘Zero Carbon Home’,
• cancelling a planned increase in the environmental standards for new social housing
• delays to new Building Regulations that would have tightened up on energy efficiency
• a Housing Standards Review to “simplify the mass of rules imposed on house builders.” 

This last initiative, under the banner of "the bonfire of the red tape", is (among other things) examining a practice where local authorities require developers in their region to achieve energy performance standards in new buildings that exceed the current Building Regulations.  For example some local authorities require a certain level of the Code for Sustainable Homes (CSH) or a percentage of the energy used in the buildings to be provided from renewable energy technologies.

Developers dislike these local requirements, because means they have to customize house designs for each area in which they operate.  There is a lack of consistency between Local Authorities, each of which have dreamt up their own requirements – 10% renewable energy, 10% CO₂ emissions reduction, CSH level 4 and so on.

It’s worth at this point reflecting on the fact that the Building Regulations are not some sort of gold standard of quality.  They represent a minimum requirement, a baseline, an adequate product.  There’s nothing wrong with local authorities choosing to require higher levels of sustainable construction and energy efficiency in their area.

This government has repeatedly spoken about the importance local people deciding how they want to run things in their area.  Can a compromise be found which allows local decision making while at the same time simplifying things for developers?

Well, as it happens, you don’t have to look very far for the answer.  North of the border, the Scottish government seems to have pulled it off.

Scotland's Miles Better

The Scottish Building Regulations 2011 introduced a new section – Section 7, Sustainability. 

New homes in Scotland are categorised from Bronze Sustainability to Platinum Sustainability, moving from current building regulations at Bronze and adding tougher and tougher requirements for energy use and a host of other measures such as water consumption, sound proofing, and the provision of space for a home office, recycling bins and wheelchair or baby buggy.  The table above shows how the standards develop for the energy requirements.

The energy requirements display an encouragingly sensible focus on lowering the demand for heat (which must be generated locally) in preference to generating low carbon electricity (which can be done anywhere).  

This system “encourages consistency between planning authorities that use supplementary guidance to promote higher measures of sustainable construction in their area.”  By creating a set of clear national benchmarks, local areas can choose what they want, but from a limited menu, greatly simplifying things for developers.  By linking the standards to the Building Regulations, they are given primacy.

Westminster shouldn’t be too proud to adopt this ready-made solution to the problem of how to give choice to local areas without the proliferation of similar, but slightly different standards.