A mix of low-carbon heating technologies is the cheapest way to decarbonise the UK’s 1.5 million rural off-grid homes, according to a new analysis carried out by the Liquefied Petroleum Gas (LPG) industry’s trade association.
The analysis, carried out by Ecuity Consulting for Liquid Gas, assesses the costs of converting a post-war off-grid home to low carbon heating.
The government wants such homes, which typically tend to be heated using oil or bottled gas fuelled heaters, to switch over to lower carbon sources of heating before the rest of the existing housing stock.
The analysis, shown exclusively to Utility Week, says that only a mixed or fully electrified approach would meet the UK’s target.
A mixed technology approach involves offering off-grid consumers the choice of a range of low carbon options including BioLPG and heat pumps among other solutions.
Replacing existing heating systems with a mix of technologies or electric heat pumps could reduce emission reductions from such homes by 90 per cent and 95 per cent respectively by 2050, the report shows.
Of these two options, the mixed technology approach would be the most cost effective, it indicates.
It shows that the up-front cost of switching to BioLPG would be £1,500 per home, making it the second cheapest of the low carbon heating options assessed in the report
This figure compares to £6,570 for a heat pump, without taking into account retrofit costs, £8,120 for a biomass boiler and £1,400 for direct electric panels.
But the cost of energy by source to the consumer for bioLPG is £90/MWh half the £180/MWh for direct electric panels, according to the analysis.
In order to maximise the effectiveness of heat pumps the installation of retrofitting measures would be needed, such as insulation, double glazing and temperature controls, in order to ensure a consistently warm temperature.
Using a mixed approach, including liquid bio gas, would cost consumers less in aggregate than full electrification because it means that technologies can be installed where it is most cost-effective to do so.
In addition, 100 per cent electrification would create the need for distribution network upgrades and the construction of additional renewable power generation to meet peak heat demands.
A hybrid technology approach could substantially lower the network and system costs associated with heat decarbonisation and ease pressure on the fledgling heat pump supply chain, according to the analysis.
Across the economy, opting for a mix of technologies could save consumers up to £7 billion once all of these factors have been taken into account, according to the analysis.
George Webb, chief executive of Liquid Gas UK said: “For homes off the gas grid, a mixed technology approach is a pragmatic and credible route to meeting these targets by delivering a 90 per cent reduction in emissions, while saving over £7 billion in costs to homeowners. Due to costs and preserving homeowners right to choose, government should not prescribe a one-size fits all approach to decarbonising off-grid homes.
“A mixed technology approach has three clear advantages over a solely electrified route. Firstly, there is the higher up-front cost of full electrification to both the homeowner and industry, not to mention the cost of upgrading the grid and network costs in order to allow the grid to cope with the extra demands. Secondly, a mixed approach alleviates pressure on supply chains with challenges including scalability and training of heat pump installers, all of which will take time.”