NEWS


Decarbonising the UK’s heating system could cost £450 billion


Premier Inn goes solar


Whitbread, now the UK’s biggest hospitality compa- ny, is extending its nation- wide solar programme to a further 70 Premier Inn hotels, cementing the hotel chain’s position as a leader in sustainability and energy efficiency. It is believed that following


the latest installations, Premier Inn will have more sites with solar panels than any other hotel chain in the UK. All the installations are being designed and


managed by renewables developer, Anesco, with all works expected to be complete by the Autumn 2018. The project comes on the


back of a previous scheme, which saw Anesco installing solar panels on 88 Premier Inn hotels, between 2013- 2015. The latest programme will see this portfolio extended, with up to 70 more sites fitted with solar PV panels to generate energy.


In 2017 Anesco built the 45- acre Clayhill solar farm and energy storage facility near Flitwick in Bedfordshire. This is made up of over 30,000 solar panels - enough to power 2,500 homes. The solar farm was the first


in the UK to be built and operated without Government subsidy, follow- ing a fall in the cost of solar panels by two thirds since 2010. To date the industry has successfully installed 12GW of solar capacity across the country. Battery technology also has


an important role to play in making renewable energy a viable part of the UK’s energy network by ensuring energy can be captured and stored for use when needed. The Clayhill development features five battery storage units.


These help maximise the usable output from renew- able power sources such as solar, which generates differ- ent amounts of energy depending on the weather.


The cumulative additional cost of decarbonising the


UK’s heating system by 2050 could be as high as £450 billion, research for the government’s infrastructure advisory body has concluded in a new report. E4tech with lead partners Element Energy conducted a


study for the National Infrastructure Commission to examine the costs associated with different pathways to decarbonising heat in the UK. These pathways included electrification (heat pumps,


direct electric heating), decarbonisation of gas (hydrogen networks, biomethane) and hybrid gas-electric approach- es, supported by the deployment of energy efficiency, heat networks and biomass combustion. The cost analysis considered all levels of the energy system, from the building level consumer costs, through the distribution and transmission network, to the genera- tion and raw resource costs. This study is said to provide a clear and transparent


comparison of the likely costs of decarbonising UK heat using different pathways, whilst highlighting the impact of uncertainties and practical barriers to implementation. The work demonstrates that while the cost of heating is


likely to rise in the UK, the costs are manageable and heating is expected to represent a smaller share of GDP in 2050 than today. However, the study indicates that any decarbonisation


pathway will require a much-increased level of ambition relative to current policy. While there are low regrets options in the short term, the various pathways for heat decarbonisation in the UK diverge clearly from the mid-2020s and important decisions on the future of the UK’s energy and heat infrastructure will need to be taken in advance of that date. The findings suggest that while significant uncertainties


remain regarding the cost of the different pathways, and that there is no clear winner at this stage, decarbonisation of the gas grid with hydrogen has the potential to be the lowest cost option, and should be taken seriously as an alternative to deep electrification. And the study estimates that retrofitting the gas pipe network for hydrogen is likely to cost about £100bn less than electrifying the heating system by mass deployment of heat pumps, which would also require much better energy efficiency to work effectively. The report also finds that cost savings and carbon emissions reductions of up to 10 MtCO2 could be achieved by the wider roll out of heat networks, which could supply as much as a quarter of the UK’s heat demand.


12 A


tlantis Resources announced a proposed placing to raise up to £20m through an accelerated bookbuilding process. The AIM-traded company also announced that it


had agreed further definitive documentation in relation to the acquisition of SIMEC Uskmouth Power. Following the acquisition, 220MW of capacity at the power station was proposed to be converted to use a waste-derived energy pellet. Proceeds of the placing were to be used to contribute towards the working capital requirements of the enlarged group, to pay down some debt, to fund the costs of the FEED study for the conversion of the power station to run on the waste-derived energy pellet, for tidal project and technology development, and to fund some of the costs of the board's proposals. Net present value of the power station was estimated to be £123m using the current


estimate of the conversion cost of £185m, and a leveraged discount rate of 13%. A fixed-price power purchase agreement was also signed with Fuel SPV, a joint venture


company incorporated by SIMEC Fuels - a GFG Alliance company - and N+P Group - a Dutch recycling group - pursuant to which the power station proposed to supply up to 15MW of electricity to the SUP fuel processing facility proposed to be constructed on a site adjacent to the power station.Under the fixed price PPA, output would be sold at a fixed price of £130 per MWh, escalated annually based on CPI. A fixed-price 20-year fuel supply agreement was also signed with Fuel SPV, under which all


of the power station's fuel demands after conversion would be supplied by Fuel SPV. Fuel SPV would supply energy pellets to SUP based on SUP's demand for fuel, which was estimated to be 875,000 tonnes per annum. SUP would pay £4 per tonne for the energy pellets, subject to adjustment in certain circumstances, and such price indexed in accordance with CPI. AECOM, the technical consultant, estimated the cost of conversion at approximately £185m,


subject to a -10%/+30% estimate accuracy range and including contingency. It is projected that the power station will complete commissioning and enter into commercial operations in late 2020.


MAY‐JUNE 2018 UK POWER NEWS


Atlantis Resource plans for conversion to waste­derived energy pellet fuel


SIMEC Uskmouth Power is central to


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