New report questions the benefits of rural renewables

Published:  19 March, 2013

A new report has questioned the suitability of renewable heating for rural homes.

The independent research was commissioned by OFTEC and compared biomass, heat pumps and solar thermal technologies in off-gas main households that currently use oil. The report exposed some of the downsides of renewables in off-gas areas, including high installation costs and the possibility that the renewable technologies will not produce the expected carbon and fuel cost savings when compared with oil heating.

Commenting on the research, OFTEC's director general Jeremy Hawksley said: "OFTEC supports the UK government's aspiration to improve home energy efficiency and reduce carbon emissions. However, the research we commissioned shows the technologies that are likely to be made incentive through the forthcoming domestic Renewable Heat Incentive (RHI) will not deliver the promised carbon savings in a real life situation, and could end up increasing fuel bills rather than saving householders money."

The report compared what would happen if an existing oil boiler was replaced by a biomass boiler, heat pumps or a modern oil condensing boiler.

It found the physical size of a biomass boiler installation was a big disadvantage. Planning permission was a likely requirement and the overall installation cost was very high at around £16,000 plus VAT, compared to just £3,000 for a new oil condensing boiler. It noted that the carbon credentials of biomass have been questioned by environmental groups, including Friends of the Earth, who also identified pollution concerns from particulates caused by burning woody biomass. The Health and Safety Executive has also warned about the risk of carbon monoxide poisoning from wood pellet stores.

The installation costs for air or ground source heat pumps were also found to be high, at around £10,000 and £17,000 respectively. The heat pumps were not a straight swap for the oil boiler due to the lower temperatures they produce. This meant that larger radiators or underfloor heating also needed to be installed - at significant additional cost. Space requirements and noise were also identified as concerns.

The report highlighted that unless heat pumps operate at their highest efficiency rating, running costs will rise dramatically due to higher electricity consumption, making their high installation costs hard to justify. Using ‘real world' data, the report calculated that a ground source heat pump could reduce fuel bills by £113 per year. By contrast, an air source heat pump would be £311 more expensive to run each year than an oil condensing boiler.

The report concluded that, for existing oil heating customers, the cost of switching to renewables was hard to justify. Upgrading the existing oil heating system by installing a condensing boiler and improving heating controls is a much cheaper option and could cut fuel bills by around 20%.

Customers in England and Wales who replace their existing boiler with a high efficiency oil fired condensing one are eligible for £310 cashback under the Green Deal, and up to £40 million of government funding has been set aside to help householders improve the energy efficiency of their homes by upgrading insulation, windows and heating systems.