The UK’s electricity market is distorted in favour of supply rather than cheaper demand management and reduction measures. New research has found that British consumers and businesses could save around £2.5 billion by 2025, and avoid the need for eight new power stations by 2030, if power stations were made to compete against electricity saving.
Demand-side response, which involves shifting appliance demand to different times of the day, has already grown four-fold in the past two years. It has the potential to scale up even further and could cover most of the electricity capacity deficit that will be created by the prime minister’s pledge to phase out unabated coal.
A new ‘negawatts’ strategy, proposed by think tank Green Alliance, would create financial incentives for electricity saving at less than half the cost of building new power stations. It would enable businesses to compete to deliver savings on the most cost effective basis.
The report, Getting more from less: realising the potential of negawatts in the UK electricity market, shows how the UK’s electricity market is distorted in favour of supply side measures at the expense of cheaper demand side measures. Businesses and consumers spend too much on electricity supply because they are not investing in efficiency.
Electricity demand reduction measures are available at £30 per MWh saved, and can compete with new power stations, which cost a minimum of £76 per MWh. Substantial cost and carbon savings have been achieved using these policies in Texas, California and New England.
The report proposes two changes to the electricity market:
1) Create a negawatts feed-in tariff, paid on the basis of avoided energy consumption, with recipients competing in an auction to deliver electricity saving, eg installing LED lighting in homes or more efficient electrical motors in manufacturing businesses. This could reduce electricity demand by 6.4 GW by 2030, equivalent to the capacity of eight 800 MW combined cycle gas turbine power stations. The ensuing investment in electricity demand reduction alone could yield net savings to British consumers of £2.4 billion by 2025.
2) Open the UK’s capacity market to competition from demand-side response and energy demand reduction on an equal basis with electricity generation. This could bring forward 6 GW of additional load shifting and reduction by 2023, covering most of the coal capacity deficit created by the prime minister’s February pledge to phase out unabated coal.
Amy Mount, lead author of the report, said: “Negawatts are a no-brainer for consumers. Not only are they the cheapest way to reduce carbon emissions. They also reduce the pressure on the electricity system by reducing peaks in demand. These policies would save the UK huge amounts of money, by avoiding the construction of unnecessary power stations. If government wants to reset energy policy for the benefit of consumers this is where they should start.”
Sonny Masero, chairman of award-winning energy management business Demand Logic, said: “If the UK were to adopt an efficiency strategy like the one proposed by Green Alliance it would not only save businesses and consumers £2 billion a year, but also create top line revenue growth opportunities for businesses like Demand Logic to contribute even more to the UK economy. And the overall value created would be greater still, because efficiency services are exportable and in significant demand in international markets. Clean energy economics is overtaking environmental regulations and this strategy would be a timely initiative aligned with the government’s economic policies for growth. With government support, efficiency services could be an important growth sector, increasing the return for UK plc from investment already made by InnovateUK in efficiency innovation.”
Yoav Zingher, CEO and Co-Founder of KiWi Power, said: “Demand side balancing mechanisms are the greener and most cost effective grid balancing solutions. As outlined in Green Alliance’s report, the current market is structured in such a way that limits the ability of demand side solutions to compete with the higher polluting and expensive supply side alternatives. KiWi Power fully supports new policies advocating creating at least, a level playing field for demand side response to compete with supply and generation in meeting the needs of the UK power grid.
“Examples of how demand side response is keeping the lights on in the US are proof that DSR is not only a credible reserve function but should be prioritised as a core grid alternative to supply/generation. Aggregators such as KiWi Power have the scalable technology to increase our reach and operations exponentially, but limiting factors such as short term one year contracts in the capacity market act as disincentives for large commercial energy users to take up this credible alternative. We believe an urgent change to the Electricity Market Reform is needed to secure the future of the UK power grid.”
Is Wood Burning Sustainable For Your Home?
Wood is a classic heat source, whether we think about people gathered around a campfire or wood stoves in old cabins, but is it a sustainable source of heat in modern society? The answer is an ambivalent one. In certain settings, wood heat is an ideal solution, but for the majority of homes, it isn’t especially suitable. So what’s the tipping point?
Wood heat is ideal for small homes on large properties, for individuals who can gather their own wood, and who have modern wood burning ovens. A green approach to wood heat is one of biofuel on the smallest of scales.
Is Biofuel Green?
One of the reasons that wood heat is a source of so much divide in the eco-friendly community is that it’s a renewable resource and renewable has become synonymous with green. What wood heat isn’t, though, is clean or healthy. It lets off a significant amount of carbon and particulates, and trees certainly don’t grow as quickly as it’s consumed for heat.
Of course, wood is a much less harmful source of heat than coal, but for scientists interested in developing green energy sources, it makes more sense to focus on solar and wind power. Why, then, would they invest in improved wood burning technology?
Solar and wind technology are good large-scale energy solutions, but when it comes to small-space heating, wood has its own advantages. First, wood heat is in keeping with the DIY spirit of homesteaders and tiny house enthusiasts. These individuals are more likely to be driven to gather their own wood and live in small spaces that can be effectively heated as such.
Wood heat is also very effective on an individual scale because it requires very little infrastructure. Modern wood stoves made of steel rather than cast iron are built to EPA specifications, and the only additional necessary tools include a quality axe, somewhere to store the wood, and an appropriate covering to keep it dry. And all the wood can come from your own land.
Wood heat is also ideal for people living off the grid or in cold areas prone to frequent power outages, as it’s constantly reliable. Even if the power goes out, you know that you’ll be able to turn up the heat. That’s important if you live somewhere like Maine where the winters can get exceedingly cold. People have even successfully heated a 40’x34’ home with a single stove.
Benefits Of Biomass
The ultimate question regarding wood heat is whether any energy source that’s dangerous on the large scale is acceptable on a smaller one. For now, the best answer is that with a growing population and limited progress towards “pure” green energy, wood should remain a viable option, specifically because it’s used on a limited scale. Biomass heat is even included in the UK’s Renewable Heat Initiative and minor modifications can make it even more sustainable.
Wood stoves, when embraced in conjunction with pellet stoves, geothermal heating, and masonry heaters, all more efficient forms of sustainable heat, should be part of a modern energy strategy. Ultimately, we’re headed in the direction of diversified energy – all of it cleaner – and wood has a place in the big picture, serving small homes and off-the-grid structures, while solar, wind, and other large-scale initiatives fuel our cities.
7 Benefits You Should Consider Giving Your Energy Employees
As an energy startup, you’re always looking to offer the most competitive packages to entice top-tier talent. This can be tough, especially when trying to put something together that’s both affordable but also has perks that employees are after.
After all, this is an incredibly competitive field and one that’s constantly doing what it can to stay ahead. However, that’s why I’m bringing you a few helpful benefits that could be what bolsters you ahead of your competition. Check them out below:
One benefit commonly overlooked by companies is offering your employees financial advising services, which could help them tremendously in planning for their long-term goals with your firm. This includes anything from budgeting and savings plans to recommendations for credit repair services and investments. Try to take a look at if your energy company could bring on an extra person or two specifically for this role, as it will pay off tremendously regarding retention and employee happiness.
While often included in a lot of health benefits packages, offering your employees life insurance could be an excellent addition to your current perks. Although seldom used, life insurance is a small sign that shows you care about the life of their family beyond just office hours. Additionally, at such a low cost, this is a pretty simple aspect to add to your packages. Try contacting some brokers or insurance agents to see if you can find a policy that’s right for your firm.
Dedicated Time To Enjoy Their Hobbies
Although something seen more often in startups in Silicon Valley, having dedicated office time for employees to enjoy their passions is something that has shown great results. Whether it be learning the piano or taking on building a video game, having your team spend some time on the things they truly enjoy can translate to increased productivity. Why? Because giving them the ability to better themselves, they’ll in turn bring that to their work as well.
The Ability To Work Remotely
It’s no secret that a lot of employers despise the idea of letting their employees work remotely. However, it’s actually proven to hold some amazing benefits. According to Global Workplace Analytics, 95% of employers that allow their employees to telework reported an increased rate of retention, saving on both turnover and sick days. Depending on the needs of each individual role, this can be a strategy to implement either whenever your team wants or on assigned days. Either way, this is one perk almost everyone will love.
Even though it’s mandated for companies with over 50 employees, offering health insurance regardless is arguably a benefit well received across the board. In fact, as noted in research compiled by KFF, 28.6% of employers with less than 50 people still offered health care. Why is that the case? Because it shows you care about their well-being, and know that a healthy employee is one that doesn’t have to worry about astronomical medical bills.
Unlimited Time Off
This is a perk that almost no employer offers but should be regarded as something to consider. According to The Washington Post, only 1-2% of companies offer unlimited vacation, which it’s easy to see why. A true “unlimited vacation” program could be a firm’s worse nightmare, with employees skipping out every other week to enjoy themselves. However, with the right model in place that rewards hard work with days off, your employees will absolutely adore this policy.
A Full Pantry
Finally, having a pantry full of food can be one perk that’s not only relatively inexpensive but also adds to the value of the workplace. As noted by USA Today, when surveying employees who had snacks versus those who didn’t, 67% of those who did reported they were “very happy” with their work life. You’d be surprised at how much of a difference this could make, especially when considering the price point. Consider adding a kitchen to your office if you haven’t already, and always keep the snacks and drinks everyone wants fully stocked. Doing so will increase morale tremendously.
Compiling a great package for your energy company is going to take some time in looking at what you can afford versus what’s the most you can offer. While it might mean cutting back in other areas, having a workforce that feels like you genuinely want to take care of them can take you far. And with so many different benefits to include in your energy company’s package, which one is your favorite? Comment with your answers below!