Written evidence submitted by Orchard Partners London Ltd (HEE0005)

William R H Orchard MA (Oxon) MBA CEng FIMechE MCIBSE MIET FEI manages Orchard Partners London Ltd, a firm that worked for IC-consult, FES/AEA, London Economics, Tebodin, ERM, and Power Planning Associates and EBRD on due diligence and national energy policies for more than six countries.

CHP and its joint products heat and electricity, presents a challenge for economists.  Some allocate any benefit to the heat consumers, others to electricity consumers, others an arbitrary method for allocation between the sectors.

1)      Dukes and the EU Cogeneration Directive choose an arbitrary allocation.

2)      WASP, Markal Times, LCP DECC model, EUETS, and EMR choose to allocate any benefit to electricity consumers by reducing electricity sector emissions. Heat consumers see no reduction in emissions as the method assumes their heat comes from a boiler.

3)      DEFRA and the BRE building regulations, assume electricity is the prime product for competition evaluating the rent required from the waste product heat to make the electricity competitive with other sources.  Williams “Orchard method” developed for Lithuania his first EU national energy policy project uses a modification of the BRE method to avoid a negative results when modelling heat sector emissions.

An analysis of the different methods and the effects they have on signals given for the cost and CO2 overhead for heat fed into heat networks and hence the return on investment in networks is analysed in our paper to an International Association of Energy Economists, IAEE conference in Dusseldorf in 2013. “ A review of methodologies electricity and heat production from Combined Heat and Power, CHP, and their signals to heat and electricity sectors. Cross subsidy of electricity sector by heat sector” An analysis of this paper by John Macadam of Ilex subsequently Povry provides an “economists” approach to CHP see http://www.orchardpartners.co.uk.

As the last chairperson of the District Heating Association and first chairperson of the Combined Heat and Power Association, advising the Select Committee on Energy and hosting the initiation of the Association for Independent Electricity Producers with his team William recognises the tensions heat networks generate for incumbent gas and electricity suppliers.  

To reach 2050 targets heat networks integrated with gas and electricity networks can provide benefit for all players.  Recent work by Orchards to minimise the size of pipes and deal with legionella for stored domestic hot water means it should be technically possible to use current HDPE 32 mm gas pipe connections to dwellings to carry the new heat networks return water. We suggest the gas industry offers consumers who prefer gas hobs to electric induction cooking, bottled gas using locations currently occupied by gas meters.

Industrial waste heat potential for upgrading with heat pumps to feed heat networks.

Industrial waste heat and the option to upgrade it with heat pumps and feed heat networks has huge potential compared to heat in the environment in winter.

On February 5th 2015 when it was 1.75C from an analysis of Gridwatch we estimate that 1200 GWh of heat were rejected by UK power stations.  This equates to estimates for gas supply to our domestic sector for the same day. 

Professor Robert Lowe and Professor David Mackay explain that how thermal power generation using steam turbines which reject heat to the environment at around 30C behave in the same way as a water source electric heat pump “WSHP”. In both cases “electricity is foregone” to upgrade the heat.

The amount of electricity required to upgrade the heat is illustrated in this “Carnot” chart that reflects the second law of thermodynamics.  Its principles govern both processes.

One can see how much more valuable 30C heat is than heat at 0C. Twice the amount of electricity is needed upgrade the 0C heat to 60C. The temperature for domestic hot water to kill legionella bacteria quickly.

There is an anomaly in EU policy.  The electricity to drive electric heat pumps can be fossil or renewable.  Where the fuel for the electricity is fossil, greater CO2 emissions arise from water source electric heat pumps than CHP as they qualify for renewable status so “good”. Heat from CHP whose electricity is driving the heat pump qualifies for fossil status so “bad”.

EU directives, EUETS, and UK methods place heat from CHP at a disadvantage where they assume it decarbonises the electricity sector compared to heat from water source electric heat pumps the same technology that they assume decarbonise the heat sector.

There is an interesting sum to calculate the optimal amount of CHP one should install to reduce the CO2 overhead of “EUETS” EMR and Dukes electricity to improve the case for electric heat pumps.

Comparison of incentives for heat from CHP and heat from water source electric heat pumps.

It is fascinating to compare current incentives per unit of electricity if heat from CHP is valued at 19.1 pence per kWh in line with ground source heat pumps.

28.65 P/kWh can be compared to current export electricity at 4.77 P/kWh an estimate from a CHP operator.  CHP of less than 2kW attracts a 4.85p FIT for  50% of output exported on top of  a generation subsidy for all electricity generated of 13 .45 P/kWh.

It is not clear why the government encourages micro CHP where it has a low electrical efficiency and sees little diversity of either electrical or heat demand compared to larger scale CHP feeding heat networks and cannot practically contribute to national installed capacity or security of supply.  Its operation is dictated by the heat load in the dwelling.

There is a strong case for the EU to develop a more level playing field for CHP and electric heat pumps feeding heat networks.  When CHPQA was reviewed we proposed an additional incentive to maximise the use of the available waste heat.  Currently the incentive structure cuts off at around 60% overall efficiency with no incentive to use its 80% potential in the way that other RHI tariffs are structured. The problem with CHP is the incentive is on the prime product electricity not the waste product heat.

We have suggested the EU introduce a new “Heat Network Directive” to specifically address this anomaly and rationalise the different methods of analysing CHP and to flag up the superiority of CHP over electric heat pumps for electricity from any form or thermal power plant.  This is simply due to the higher temperature of the heat rejected in power generation compared to heat in the environment.

Optimisation of Heat network design for low CO2 heat supply the benefit of storage.

William co-authored chapters BSRIA guides on CHP and variable flow heat networks to be found on Orchard’s web site he also served on UK and EU standards committees for underground pre-insulated piping.  He is the inventor of the sandbox test in those standards. 

His latest invention is the Exergenius method of heating and storing domestic hot water which addresses issues with Legionella and scaling of heat exchangers, minimises heat losses from connections and giving consumers and operators a choice.  They can meet their domestic hot water loads either from low CO2 heat networks or and renewable or fossil electricity if lower cost. The system with its security of supply also means that where there is excess electricity from as an example PV there is the option to shut down local heat networks in summer or to maintain and extend them.

A current objective is to optimise delivery of low CO2 heat to retrofit dwellings currently heated by gas in a way that we use the gas pipes currently feeding dwellings to carry return water for new heat networks.  We think that we may be able to replace boilers with a domestic hot water heat store.

Comparison of Heat loss and pipe size for DHW Store” and DHW instantaneous “IHU”

Orchard’s prefer “stores” to instantaneous “combi boiler” IHU solution as pipes and the impact on installed capacity at power plant are smaller.

Store, 3-4 kW load 10-15 mm pipe, IHU, 35-60kW load 22-28 mm pipe.

Heat loss ratio 28 pipe to 15mm pipe 1.86.

Store recharge 24 hours.  IHU peak 6 hours?

If an intelligent store in a dwelling recharges over twenty four hours to meet consumers demand for installed capacity, the relative size of central plant can be compared to meeting a peak diversified IHU demand over 6 hours.  A potential ratio of 4 to 1 indicates capacity benefits from local storage in dwellings.  Wall mounted solutions at high level being optimal due to value of floor space.

24 hour continuous heating or 16 hour intermittent heating?

Is 24 hour heating likely to be more economic overall and attractive to consumers than 16 hour heating?

This thinking links to the amount of heat rejected at night from power generation, the low marginal cost of heat from CHP, the advantage of using buildings as a thermal store, and the fact that, unlike electricity, losses heat network losses are only a function of the temperature of the pipes, not the load they carry.

On the coldest days heating 24 hours instead of 16 hours signals that many current radiators may be oversized by a factor of 1.5 to meet their original intermittent design parameters. 

Continuous heating will allow return water temperatures from such existing radiators to be lower increasing the potential to use current gas pipes for the new heat network return water.

The radiator characteristic above shows that for 50% load our return temperature is 32C raising the question of whether insulation on return piping buried in the ground is economic.

Raising flow temperature for heat supply to 82C-72C radiators to reduce heat loss in new heat networks and use current gas pipes for return water.

Our Roupell Park EST and EU grant aided project to demonstrate condensing CHP serving 423 flats in Lambeth is designed for 95C flow and 45C return using the design principles learnt from Danish engineers and their model system heating the city of Odense. The best system William has seen in his travels as it has no heat exchange between the district heating condensers and the radiators.

Odense and many EU countries design with top and bottom opposite end connected radiators. This reduces radiator area.  The top is always hot, if on. It avoids the problem where consumers with bottom opposite end connected radiators thinking their TRVs are not working because the radiator is cool!

Designing for 95C 45C gives a much neater installation with small 10mm pipes and simple fixings and covers to pipes if required.  Pipes at 95C are not as hot as electric lamps, kettles hair curlers dryers and other items defined as working surfaces.

Understanding radiator characteristics relation is key to optimal heat network design and operation. A counterintuitive result is that increasing flow temperatures to achieve greater carrying capacity and a larger delta T actually reduces heat losses due to the smaller pipes.

How much you can raise flow temperature for the same heat loss by dropping a pipes size with a larger difference between flow and return is illustrated below using copper pipes.

A further factor for consideration is how TRV control delivers lower return temperatures and more condensing operation and pumping cost savings compared to outside compensation control.

Integrating CHP with boilers. Is your CHPs heat rejection circuit running at the same time as your boilers?

Circuits where the CHP acts as a return water heater in series with boilers present designers with hydraulic and control problems which can cause this problem.

The economic case for CHP depends on maximum utilisation of the heat it has to reject to run. This requires integration of the control of the CHP with other heat sources. Often this is not part of the “CHP package units supply and maintenance contract”

Orchard’s design the hydraulic circuits for both the CHP and the boilers and define the control parameters to be achieved.  Their most recent design is for condensing CHP for the Roupell Park Estate in Lambeth.  They reason CHP has to compete with Combi boilers if and when they condense when feeding radiators.

Orchards are happy to share their experience of the project with other engineers. At one time a packaged CHP supplier who contracted to install the CHP for Lambeth, withdrew and payed money back when they realised we included a clause in their contract to make certain the CHP always led the boilers, and that the CHPs jacket and oil heat rejection circuit should not run at the same time as the boilers ran when meeting site heat loads. 

When the original EST grant was obtained, the case for CHP was marginal. Later the spark spread reduced and returns on the CHP became dubious. One part of the public sector needed CO2 savings from the project to justify their programme. This meant pressure on another public sector body to spend whatever money was necessary to meet deadlines or pay back grant money already spent on new heat infrastructure.  This project was already over budget due to an unforeseen asbestos based vapour barrier, found under the fibre glass insulation on the existing riser pipes we planned to use. One specialist reasoned we could use the pipes as the barrier not an insulation material. Others advised the pipes could not be used.

The Roupell CHP has vacuum insulated silencers and heat exchangers supplied through Clean Heat Provision Ltd and manufactured by Enalco to evaluate the “vacuum and nanogel insulated pipe option”. The installation of the silencers and heat exchangers is vertical to avoid condensate blocking tubes in horizontal condensing heat exchange configurations and to minimise the footprint.

The installation allows for modulating diversion of exhaust gases from the engine to the flue or though the cocurrent and counter current heat exchangers installed in series to optimise engine heat recovery. The system can load follow either electrical or heat loads and is designed with a view to operating in island mode.  The idea was to demonstrate emergency heat and electricity supply to estates and other consumers connected to the two UKPN local transformers if their 11kV ring of higher voltage networks feeding the ring fail.

Budget constraints and a significant overspend on a cost plus contract resulted in Orchard’s stepping down as contract administrator.  The client placed the project work with other consultants. The controls between the CHP and the boilers were omitted due to lack of funds with the idea of completing the work at a later date when funds became available.

A business that recognised the unique features of this demonstration project at one stage showed an interest in potentially investing in completion of the project with Orchards.

The project demonstrates the Exergenius concept of heating and storing domestic hot water covered by a patent held by Clean Heat Provision Ltd which resolves Legionella issues attributed to other domestic hot water storage systems. 

This is achieved by using an electric element is series with the plate heat exchanger used to charge the store and its small pump.  William at one stage hoped the estate might share in any benefit from his invention.

Orchards 2050 vision for retrofitting our domestic sector to heat networks.

Our vision for the future for heat networks is illustrated below.

I am grateful to Simon Woodward for his initiative to provide a clear voice for the “heat network option”. I would not be writing this if my father Ronald Orchard had not asked me to look at his own business Lovely and Orchard. An attempted internal take over resulted in my purchase of Mr Lovely’s share of the business plus the Tredegar Road District heating project.  The other parties in the dispute set their own business.

Earnest Haseler was key figure in my education, as the founder of the District Heating Association he suggested I visited Denmark to find out how to design district heat. I was then fortunate that one engineer in our office Charles Robert Bodle who had designed huge variable flow chilled water systems in Australia not only understood the Danish designs but felt he could improve them.

The Bodle Orchard circuit for Tredegar Road project and its circuits and what Orchards learnt about the design of variable flow systems are described in two BSRIA guides see web site for details.

I also owe a debt to Les Alexander and John Wisdom of Danfoss who made the project and all our other ones successful by manufacturing a low KV factor TRV.  At that time there was no suitable valve on the market in the UK or Europe. They did it by modifying the body of their FJVR return temperature limiter to accept a TRV head. The fast liquid vapour or liquid remote sensors detect room temperature in the room avoiding flow temperature dependency of valve heads detecting temperature next to radiator. The control was better than the slower wax operated valves and remote wall mounted controls made it easier for control by consumers. The latest version of the valve Danfoss made is their RAUR installed at Roupell on a system which had heat to all flats without being commissioned.

The success of or original Tredegar Road see article by David Andrews at the time “Balance and control provide the answer”, resulted in significant work for Orchards retrofitting “Problem district heating estates”

Our vision for retrofitting the UK to new heat networks is illustrated below.

October 2015