GRANT ENGINEERING IRELAND ULC
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GRANT ENGINEERING IRELAND ULC CRINKLE, BIRR, R42 D788, CO. Offaly, IRELAND Telephone: (057) 9120089 Fax: (057) 9121060 Email: info@grantengineering.ie Website: www.grantengineering.ie Draft NECP 2021-2030 Consultation, Strategic Energy Policy Division, Department of Communications, Climate Action & Environment, 29-31 Adelaide Road, Dublin 2, 21st 2 February 2019 Re: Draft Consultation - NATIONAL ENERGY & CLIMATE PLAN 2021-2030 Grant is Irelands largest indigenous manufacturer of home heating appliances, it is headquartered in Birr (Population 5600), County Offaly where it employs 360 people and a further 82 people in its International subsidiaries. We are members of OFTEC and the HPAI. Grant manufactures and supplies in to the Irish market renewable heating appliances i.e. Air Source Heatpumps , Solar Thermal Panels and Wood Pellet Boilers. Grant also supplies liquid fuel boilers (for both Kerosene and gas oil). Grant has 54% of the UK liquid fuel residential boiler market (Source EUA 2016) There are no independent statistics for the Irish market but, having been in business for over 40 years, and based on our historic sales figures, we believe that our appliances heat up to 400,000 of the 680,000 plus houses that use liquid fuel in Ireland. As Kerosene and Aviation fuel are distilled in the same process there has, to our knowledge, been no impact studies on any changes to existing kerosene supply such as bio-blending/ reduction of supply, increased carbon tax, storage and blending issues, distillation issues and price impact etc. Also, no studies on the impact to industrial users for this distillate used in non-heating/transport purposes. Rural Ireland is highly dependent on liquid fuel for home heating, according to the CSO a national average of 40% and up to 76% in County Monaghan. This is because it is the most affordable method of heating a home in rural Ireland that delivers the required comfort. Given that liquid fuel dependence is only 11% in Dublin, any increase in home heating costs in Rural Ireland will be perceived by the electorate as discriminatory, unfair and another disadvantage and cost burden of living in Rural Ireland. If carbon tax is used as an instrument to move households to less carbon intensive heating it should be done over a long period of time in Registered Office: Crinkle, Birr, R42 D788, Co. Offaly, Ireland Registered Number: 143329 DIRECTORS STEPHEN GRANT, MAURA GRANT, NIALL FAY
GRANT ENGINEERING IRELAND ULC CRINKLE, BIRR, R42 D788, CO. Offaly, IRELAND Telephone: (057) 9120089 Fax: (057) 9121060 Email: info@grantengineering.ie Website: www.grantengineering.ie very small increments. It is vital to manage the transition to a lower carbon future by putting fairness at the core, otherwise government policy risks alienating the electorate in Rural Ireland. For example, being based in the Midlands we have seen private commercial turf cutting end and energy production using peat end this has and will result in large job losses in this area. Resulting in economic decline and further Rural depopulation in this area, but to date we have seen little in policy, planning and strategy to alleviate this. Bearing in mind also that the recent TASC report states that 24% of the Irish population is at risk of falling into poverty, in Rural Ireland fuel poverty is a major contributor to poverty. As a company that also sells Air Source Heatpumps and believe they are a good technology and have an important part to play in decarbonising residential heat, we would have several observations to make. Air Source Heat pumps are an appropriate heat source for New Build houses, driven by part L of the building regulations and the required level of air tightness in the new building, as a result of changes to DEAP software methodology Air Source Heatpumps are becoming more popular in new residential homes. They are very expensive (for example our liquid fuel boiler at retail will cost on average €1500 while on average a heat pump will retail at €4000. If you install an Air Source Heatpump then normally, either underfloor heating or radiators that are suitable for Air Source Heatpumps must be used, this becomes a very expensive heating system to install compared to your traditional steel panelled radiators that are used with a liquid fuel boiler. So, in a new build with a high level of insulation and airtightness, a medium temperature heating appliance such as an air source heat pump will heat the house comfortably. Retrofit however is a very different matter. Any home above a C1 has a possibility to be suitable for a heat pump as they can be brought up to a BER A rated house, which we believe, is the type of standard a home needs to be to allow a medium temperature appliance such as a heat pump provide heating comfort without excessive electricity bills. This will though require substantial investment by the householder. The issue that the householder faces is the cost versus benefit. To put this into perspective according to Sutherland, January 2019 data, for an average 3 bedroom house in Ireland the current cost of heating your home with a Condensing LPG boiler and radiators is €2574, an Air Source Heatpump and radiators is €1852, a Condensing liquid fuel boiler and radiators is €1606 per year, Air Source heat pump and underfloor is €1458. So, for a householder to invest a huge amount of money into switching from an existing condensing liquid fuel boiler to an Air Source Registered Office: Crinkle, Birr, R42 D788, Co. Offaly, Ireland Registered Number: 143329 DIRECTORS STEPHEN GRANT, MAURA GRANT, NIALL FAY
GRANT ENGINEERING IRELAND ULC CRINKLE, BIRR, R42 D788, CO. Offaly, IRELAND Telephone: (057) 9120089 Fax: (057) 9121060 Email: info@grantengineering.ie Website: www.grantengineering.ie Heatpump with the additional cost of underfloor heating to save approximately €150 on their heating bills, makes it a very difficult choice. Also considering as the airtightness or BER rating increases so to does the heat load so the cost of heating the property drops proportionately, like for like. Bearing in mind that 90% of our homes are below a C1, to upgrade from a D rated house to an A1 rated house will cost in excess of €50,000, depending on the scale of measures that are required. Not to mind the disruption of having wet tradesman ie plumbers, plasterers and painters in the house during retrofit. Given that both a liquid fuel oil boiler and an Air Source Heatpump has a life span of approximately 10 – 15 years, this amortisation for the householder needs to be considered. The other issue is that given the small population of Air Source Heatpumps in rural areas currently and given the distances service engineers will have to travel in the event of a breakdown, the householder will not get the same service. This is a result of two issues, over the last 30 years of liquid fuel heating in rural Ireland a large network of service engineers has developed - in excess of 1500, in comparison there are no more than 300 Air Source Heatpump service engineers (mainly based in urban areas (i.e where the majority of housebuilding is currently happening). Has there been a study on the economic impact to excise revenue, job losses in fuel depots, service engineers, fuel delivery drivers, and closure of fuel stores and delivery depots? There is also a substantial increase in costs to servicing an Air Source Heatpump and there are several critical parts, that if they fail, will result in the uneconomic repair of the Air Source Heatpump. The reason for the higher service costs is down to the qualifications required to service Air Source Heatpumps such as Fgas qualified and electrical qualifications. Where a liquid fuel boiler service engineer does not require this level of qualifications. Also, baring a leaking shell, the most expensive replacement part of a boiler, is the burner, which can be replaced for less than €300. The other issue is boiler breakdown, this normally occurs during winter, it becomes a distressed purchase, as no one wants to be without heat during this time. So, the idea of having to wait for multiple measures such as cavity wall insulation, triple glazing, heat loss calculations, is not going to happen. In a retrofit, moving from a condensing liquid fuel boiler (high temperature 75 degrees) to an Air Source Heatpump (medium temperature 55 degrees) is complicated, expensive, disruptive, and really is only applicable to those that can Registered Office: Crinkle, Birr, R42 D788, Co. Offaly, Ireland Registered Number: 143329 DIRECTORS STEPHEN GRANT, MAURA GRANT, NIALL FAY
GRANT ENGINEERING IRELAND ULC CRINKLE, BIRR, R42 D788, CO. Offaly, IRELAND Telephone: (057) 9120089 Fax: (057) 9121060 Email: info@grantengineering.ie Website: www.grantengineering.ie afford it and are upgrading their house such as expanding family, do not want to move location etc. In conclusion Air Source Heatpumps are not a panacea to moving to low carbon residential heating in rural Ireland (Retrofit) The German Experience with Liquid fuel Heating The above graph is interesting it shows the number of households in Germany heated by oil (orange line) from 1996 to 2015 it went from 5.9 million houses to 5.5 million houses, less than a 7% drop, a large number connecting on to mains natural gas grid. The interesting part of this was the level of oil consumption dropped 58% while the consumption per meter squared dropped 45%. This was done with a combination of government financial supported measures, done incrementally over time. Non-Condensing liquid fuel oil boilers were replaced with High efficiency Condensing liquid fuel boilers this equated to an approximated 20% drop in fuel consumption and hence Carbon emissions. This process began over a period of 10 years from the late 90’s early 2000’s. Registered Office: Crinkle, Birr, R42 D788, Co. Offaly, Ireland Registered Number: 143329 DIRECTORS STEPHEN GRANT, MAURA GRANT, NIALL FAY
GRANT ENGINEERING IRELAND ULC CRINKLE, BIRR, R42 D788, CO. Offaly, IRELAND Telephone: (057) 9120089 Fax: (057) 9121060 Email: info@grantengineering.ie Website: www.grantengineering.ie This was improved with the combined financial assistance for adding heating system controls (a further fuel reduction of approximately 5%). It then combined supports to install a wood stove (sealing chimneys increasing air tightness, a chimney results in up to 40% heat loss in a room) and or solar panels (thermal). 20% of home heating requirements is Direct Hot Water (DHW) so solar panels will effectively provide DHW for up to six months of the year thus reducing fuel consumption by a minimum of 8%. One consideration regarding Solar thermal panels, in most of Europe Solar panels are the preferred option as opposed to tube. Solar panels have a life span of 30 years plus and require minimum maintenance. Tubes on the other hand, while an easier install, have a shorter life span due to the fact that they operate in a vacuum and over time this vacuum depletes and rubber seals breakdown, so there is a higher maintenance cost/shorter life. The other point, is that any financial support for Solar Thermal should not be on the square meter of the house, as it is currently to avail of current support, it becomes very expensive resulting in the payback for the householder being too long. The most affordable system is a two panel on roof system which fitted, will cost the householder approximately. €3500 to €4000. Given that the annual cost of Direct Hot water is approximately €200 this is a 20-year payback. If a subsidy of 50% was paid, then this is a 10 year pay back. Given that the panels have a longevity of 30 year plus it becomes attractive. Through out the above timeline, insulation and increasing airtightness measures where heavily promoted in Germany and subsidised. This also has the effect of reducing the required heat load of the house and a reduction in fuel consumption. All the above was done here in Ireland, but the level of financial support, scale of uptake, level of bureaucracy, all acted as a barrier. To the point, where there are no independent statistics available, but industry would say circa 50% of the current liquid fuelled homes (circa 350,000 homes) are still using non condensing liquid fuel boilers and that the average house is only a BER rating of E/D. Nowhere near the results achieved in Germany. Before moving on to developing another strategy, consideration should be given to the German Model and reapplying it to achieve similar results to what has been achieved in Germany. Registered Office: Crinkle, Birr, R42 D788, Co. Offaly, Ireland Registered Number: 143329 DIRECTORS STEPHEN GRANT, MAURA GRANT, NIALL FAY
GRANT ENGINEERING IRELAND ULC CRINKLE, BIRR, R42 D788, CO. Offaly, IRELAND Telephone: (057) 9120089 Fax: (057) 9121060 Email: info@grantengineering.ie Website: www.grantengineering.ie The Future If Ireland had achieved similar results to Germany, then a much larger number of homes would be in a position to consider a heat pump it would have also reduced carbon emissions substantially. Going forward Hybrid Heating solutions will play a critical role in low carbon residential heating. We have seen how Solar thermal can play an important role in Direct Hot Water. Heat Pumps combined with existing condensing liquid fuel boilers will allow householders to reduce carbon emissions dramatically due to reduced fuel consumption. By integrating these two appliances, the Heat pump will become the primary heat source however it will only provide heat when economically viable to do so which effectively means eight to nine months of the year (medium heat demand). The existing oil boiler will only cut in when the Air Source Heatpump cannot meet the householders demand for high temperature heat economically, that is when SCOP begins falling towards 1 (pure electrical heating). This obviously happens in very cold weather. But it means that the householder does not have to change the heating system (radiators) it can work at current levels of insulation allowing the house holder to improve this over time. In the event of a break down one of the two appliances will continue heating allowing the householder to look at their options without distress. This technology is currently available, we have various models already placed in the market. Bio-Blending of kerosene is also a future pathway that can be combined with above. All of our appliances are suitable for a bio-blend of up to 30%. Germany is moving towards a 10% blend. There are however very specific issues to Ireland with this, it is not our area of expertise. Europe uses gas oil so their blends can be aligned with general transport seamlessly. Ireland however uses Kerosene which is distilled with Aviation fuel. How much consideration was given to this when RES-H targets were set. There needs to be an impact study carried out to see how any changes to RES-H policy will impact aviation fuel and in particular around Bio blending. The use of Rapeseed in bio-blending may also have the benefit of reducing methane if substituted for Cattle rearing, if feasible and economically viable. Registered Office: Crinkle, Birr, R42 D788, Co. Offaly, Ireland Registered Number: 143329 DIRECTORS STEPHEN GRANT, MAURA GRANT, NIALL FAY
GRANT ENGINEERING IRELAND ULC CRINKLE, BIRR, R42 D788, CO. Offaly, IRELAND Telephone: (057) 9120089 Fax: (057) 9121060 Email: info@grantengineering.ie Website: www.grantengineering.ie Having considered the above, we find the proposal to arbitrarily move 170,000 home from liquid fuel to Air Source Heatpumps as aspirational but lacks practicality for all the reasons above. Given the unique situation of Rural homes and the potential bio-blending of kerosene/aviation fuel, I refer to a recent article in the Renewable Energy Magazine where Paul Deane of UCC quoted “ a 2% blending obligation of renewable gas from 2021 would give a similar contribution to converting 170,000 homes from oil to Air Source Air Source Heatpumps in terms of emission reduction and compliment the policy to make heat cleaner.” The proposed electrification of Transport and the proposed electrification of Heat will require billions of investments in the National Grid. Peak energy demand coincides with peak home heating demand. There is also the dilemma of the fuel source of this electrification, when we look at Moneypoint (Coal Burning) the idea of moving highly efficient liquid fuel boilers with efficiencies of 90% to a coal burning energy generating station with a fraction of this efficiency. To move current fossil fuel burning energy power stations to renewable energy will also cost billions. While wind has made a huge impact to our national renewable energy contribution it is unpredictable* (need for a mixed fuel energy model) and this will require billions of investments in battery storage if electricity is to be available when wind is not blowing. The cost of all the above will ultimately find its way back to tax payers (higher taxes) householders (higher energy, heating and transport bills) particularly a higher burden on rural householders due to lack of public transport etc and to Industry (higher energy and production costs and transport costs) resulting in higher costs and uncompetitiveness Therefore, the decarbonisation agenda should be gradual, fair, balanced with no one sector of society bearing the brunt. *http://www.dailymail.co.uk/sciencetech/article-5812811/Wind-turbines-standstill-wind- disappears-thew-UK.html Registered Office: Crinkle, Birr, R42 D788, Co. Offaly, Ireland Registered Number: 143329 DIRECTORS STEPHEN GRANT, MAURA GRANT, NIALL FAY
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