Select Committee on Trade and Industry Written Evidence


Memorandum by The Micropower Council

  The Micropower Council is pleased to respond to the Committee's inquiry into the Government's Energy Review and, in particular, its investigation of the capacity of microgeneration to meet a substantial proportion of UK electricity demand in the medium and long-term.

  Our response to the Government's Energy Review which provides further, more detailed, information on the contribution micropower can make in meeting four of Government's Energy White paper objectives, including meeting future demand for electricity is attached.

  Domestic scale micropower technologies have a major role to play:

    —  Reducing Emissions: ~1MtC of annual carbon savings can be obtained by any of:

    —  1m biomass-fired heating systems or heat pumps (one in every 26 homes);

    —  6m gas-fired microCHP (one in every four homes);

    —  7m (~1kW) micro-wind, (~1kW) PV or solar hot water (one in every three to four homes);

    —  Supply Security: 1GW new CCGT baseload power station's electricity would be displaced by any of:

    —  1m biomass-fired heating systems or heat pumps (one in every 26 homes);

    —  3m gas-fired microCHP (one in every eight to nine homes);

    —  7m (~1kW) micro-wind, (~1kW) PV or solar hot water (one in every three to four homes);

    —  Home Heating: Fuel consumption, and therefore cost, is either eliminated or permanently lowered, particularly when micropower technologies are combined with energy efficiency measures;

    —  Competitiveness: The use of micropower technologies:

    —  reduces both economic and energy waste leading to greater economic competitiveness; and

    —  enhances competition in the energy sector as the only real alternative to network-based, gas and electricity supply.

  Micropower Technologies capture "hearts and minds", resulting in behavioural change that reconnects consumers with their use of energy and results in positive behaviour change:

    "The most striking finding is the difference in `energy intelligence' between mainstream households with no micro-generation and those who have acquired the technologies passively . . . Having come from a similar starting point, these new DIY energy generators exhibit in general a wholly new grasp of energy issues and control over their energy use".[106]

  Micropower technologies replace low efficiency centrally produced electricity with high efficiency clean power produced where it is needed without incurring excessive transportation losses; micro-heat technologies displace the use of gas and other fossil fuels for heat production in the home and local community.

  The number of installations required to deliver the equivalent of a CCGT is well below the mid to long term market potential for most of these technologies and no allowance has been made in the numbers quoted above for technological developments that could lead to major performance enhancements in the future (in particular the potential for fuel cells CHP technologies).

  In addition, the total potential contribution from decentralised generation which includes microgeneration in larger applications and community schemes is considerably greater.

  A mass market capability cannot be delivered overnight; the rate at which micropower technologies are installed and the eventual market size will be dependent on many factors including Government market transformation policies, the removal of barriers to the development of small scale heat and power technologies, and future movements in fuel prices.

  Some indication of the potential market is given by a number of recently published studies:

    —  the SBGI's updated projections for micro-chp (micro-CHP Updated projections SBGI)[107]—indicates that this technology can take 30% share of the boiler replacement market by 2015 and that 5.6 million homes could have microCHP installed by 2020;

    —  the EST study (Potential for microgeneration Study and analysis[108]) has been quoted as saying that 30-40% of the UK's electricity demand could be met by microgeneration devices by 2050; and

    —  in a more ambitious and environmentally focussed scenario, the report on the 40% House (40% house project report (Environmental Change Institute of Oxford University March 2005[109])) suggests that there could be more than 50m low and zero carbon technologies providing heat and hot water in the domestic market, under the "40% House" scenario, by 2050. [110]

  Taken together these studies demonstrate that the market potential for micropower is very substantial. Looking forward there are a number of factors that will facilitate its development in the mid to long term.

    —  The micropower industry is new and very diverse. Over the next five to 45 years there is the potential for considerable innovation and for future micropower technologies to deliver even higher efficiencies and fuel savings than can be delivered by current technologies.

    —  The industry is a long way from mass market production/installation and significant economies of scale are available that should move them beyond niche market application to real alternatives to conventional technologies accessible to everyone.

    —  The market itself is subject to major changes over this period. By 2050:

    —  almost all gas and electricity infrastructure will be replaced and should[111] be better able to accommodate decentralised power production;

    —  all existing power stations will be closed (and even some yet to be built will have closed by then);

    —  there is the potential for major technological innovation in related areas that further facilitate the efficient deployment of microgeneration:

        —  Smart metering should be the norm aiding customer choice and, amongst other things, allowing consumption to better aligned with production;

        —  improved power flow management;

        —  improved small scale storage capabilities could emerge (eg dc/battery application within homes); and

    —  fuel availability and price movements will change the relative economics of different technologies over time.

    —  The diversity of the industry means that different technologies can be used in different situations and the industry should be able to respond very flexibly to any changes in the heat and power market.

  The nature of the market with bulk sales of small scale technologies also allows for smooth market build up as new capability is added incrementally over time.

106   Sustainable Consumption Roundtable seeing the light: the impact of microgeneration on the way we use energy. October 2005. Available at: Back

107 Back

108 Back

109 Back

110   Table 7.2. Back

111   How quickly this happens will depend on how quickly an appropriate regulatory framework and correct investment incentives for monopoly infrastructure providers are put in place. Back

previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2006
Prepared 21 December 2006