UK policies fail to support CHP industry says industry chief

Energy efficient combined heat and power producers are being driven out by a failure by government to back its targets with supportive policies. This is the view expressed by David Green, Director of the UK Combined Heat and Power Association (CHPA), in a statement ahead of the association’s annual conference in London Tuesday.

“The industry (is) close to collapse and on the eve of a fourth year of waiting for a vital plan to achieve its full potential,” said Green. He said the government’s promise in 1997 to double the amount of Combined Heat and Power (CHP) in Britain to 10 000 MW by 2010 was not being matched by policies.

CHP, also known as cogeneration, technology harnesses heat produced as a by-product of electricity generation instead of wasting it, saving money and cutting pollution. It is ideally suited to industrial applications where there is a need for heat or for district heating schemes.

Green said the lack of supportive policies had led to all the major companies active in the UK CHP sector withdrawing from market development and that 1400 jobs had already been lost.

On September 20, major utility Innogy joined the growing list of such companies when it said it was halting the expansion of its CHP business, blaming the impact of new wholesale electricity rules (NETA) introduced in March.

“The UK is on the brink of losing the three billion pound of investment the industry intended to pump into sustainable energy development, placing in jeopardy over five million tonnes of additional carbon emission savings that CHP would bring over the next decade” said Green.

Back in 1997 the government said a drive to encourage CHP was part of the government’s wider attempt to cut 1990 carbon emission levels by 20 per cent by 2010. In other parts of Europe, most notable The Netherlands, CHP is thriving on the back of more supportive regimes.

Green said the government should make CHP plant exempt from the climate change levy, mitigate the negative impact of NETA, and make sure the introduction of the Renewables Obligation did not price CHP out of the market.

A typical CHP plant has an overall efficiency of up to 80 or even 90 per cent compared with only 50 per cent for modern gas turbines. The current mix of CHP installations achieves a reduction of over 30 per cent in CO2 emissions in comparison with generation from coal-fired power stations, and over 10 per cent in comparison with gas fired combined cycle gas turbines. The newest installations achieve a reduction of over 50 per cent compared with generation from coal-fired power stations.

The aim of the CHPA is to promote the wider use of high efficiency Combined Heat and Power (CHP) and Community Heating. The Association, along with its Members who comprise the key organizations at work in the UK CHP sector, work with national and local and devolved government to tackle the current obstacles facing the industry and to educate and lobby government and businesses about the advantages of CHP.

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