The hybrid route to flexibility

Colin Calder believes it’s more efficient to use domestic boilers as peaking plant than a power station. He explained to EiBI how a prototype project in Wales could be a blueprint for the future

Flexibility will be the key to opening up the UK energy market and allowing consumers to take control. And Colin Calder’s vision doesn’t stop there. The CEO of PassivSystems believes that putting in place a much smarter energy system with hybrid heating systems could save the UK economy £15bn a year. “The net outcome is that we would halve consumers’ bills,” he told EiBI. “And that’s at today’s prices with the added bonus that we will have decarbonised.”

This vision for the future is not one that has been thrown together but the careful culmination of the work the Calder has achieved since he set up the company ten years ago. It has grown to be a leading provider of smart energy platforms to help consumers manage assets such as solar PV and district heating more efficiently. “We are now the UK’s leading roof-top solar asset management company,” he stated.

This layer of technology between the energy system came about after Calder examined the smart meter rollout in Italy. “The country was well ahead of everyone. But one of the most important things about smart meters is to discourage people from using energy when it is most in demand, typically winter evenings between 5 and 8pm. But the Italian government was opposed to time-of-use pricing due to the fear of civil unrest. But it got me thinking that we need demand flexibility.”

One of the company’s first products was a smart thermostat. “What it does is learn about the thermodynamic model of your home,” he stated. “How is it going to behave in the next 48 hours? Then we create a demand profile, work out the flexibility value and see how much we can timeshift the demand without comfort being impaired.”

The next stage of the journey towards Calder’s flexible vision of the future has been the Freedom project. PassivSystems has installed more than half of the planned 75 hybrid heating systems in private and social housing properties in Bridgend, south Wales as part of a £5.2m innovation project designed to prove the economic benefits of providing a flexible choice between fuels for heating.
The Freedom project measured the consumer, network and energy system implications of hybrid heating system deployments, where domestic heating systems had the option of operating using a standard gas boiler, an air source heat pump (ASHP), or both.

Freedom also demonstrated how hybrid heat systems can significantly lower running costs for consumers – both on and off the gas grid – while improving comfort levels.

The project further showed how hybrid heating can help to decarbonise domestic heating with no increase in peak load, if operating within the context of a demand ‘flexibility’ solution that is designed specifically for householders. “Using smart controls has give a 23 per cent reduction alone in energy consumption,” added Calder. “We now need to do this at scale.”

“What the Freedom project demonstrated was that if all flexibility came from hybrids then we will deliver £15bn of savings a year,” added Calder. “Those are made up through greater efficiency and less reinforcement of the network and 25 per cent less nuclear and wind. All through smart controls and turning the boiler into the peaking plant. A hybrid hearting system requires far fewer interventions in the home than a heat pump. Just put a unit on the outside of the building, connect to the existing wet system, change any radiators, and when the heat pump can’t cope you go back to the boiler. The utilisation of the boiler goes down to around 20 per cent.”

If the hybrid revolution can come about there needs to be a mass roll out. However, the Committee on Climate Change has endorsed a target of 10m hybrid systems in homes by 2035. “That’s 630,000 a year,” said Calder. “Let’s say we go for a more cautious 300,000 a year. That’s only 20 per cent of boiler replacements – hardly ambitious but manufacturers will cost optimise and we have products designed and manufactured for the UK market at a competitive price.”
The installation costs are not an issue, believes Calder. “As the added cost of an air source heat pump installation is around £2,000 and an ASHP should last 15 years then that is about an extra £150 a year. So the question we have to ask ourselves is if hybrids are installed across 27m homes what is the value per household and would it be sufficient to fund the £150 year difference. The answer is, of course, yes.”

But he government has to make reforms to the market, believes Calder. “If the team in BEIS that is empowered to deal with heat decarbonisation could recognise that they need to make reforms to the capacity market to recognise that the 90 per cent of UK homes that have gas and electricity could act as peaking plant when the grid is under stress. We can then breach the price difference to go from high to low carbon and have an outcome that is good for everyone.

”We can move from a high subsidy level, which is where we are today with the Renewable Heat Incentive, to zero levels as the volumes are ramped up.”
Calder believes that there is a danger the Government could get behind solar, batteries and nuclear. “We now need to put money behind hybrids. We can see from the data where it takes us. The Freedom project has given us some real foundations.”

Colin Calder is CEO of PassivSystems Ltd