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Renewable Energy for Businesses

While estimates about when our stock of fossil fuels will run out differ, one thing we can be sure of is that they are a finite resource.

Indeed the latest report from the Global Sustainability Institute at Anglia Ruskin University finds that the UK has:

  • 5.2 years of oil remaining
  • 4.5 years of coal remaining, and
  • 3 years of gas remaining

Whether it’s sooner or later, renewable energy needs to fill at least some of the gap that fossil fuels leave.

In this guide, we look at renewable energy and its implications and opportunities for your business.

Whilst large scale renewable generators are being developed there also exists an increasing move to small-scale generation as business owners and households wake up to the advantage of self sufficiency. You can find out more about how to get renewable energy for your business here.

Renewable energy sources

According to REN21 – the Renewable Energy Policy Network – about

  • 16% of global energy consumption comes from renewables with
  • 10% coming from biomass,
  • 3% from hydroelectricity and a further
  • 3% from better known renewables such as wind, solar, geothermal and biofuels.

Taking each source in turn:

Wind energy

Not only is wind the most common source of renewable energy in the UK, it’s also one of the most financially viable. This is because the energy is generated the ‘free’ source that is the power of wind.

Increasing number wind farms are appearing around the country supplying the National Grid, while increasing numbers of small-scale users are choosing to generate their own electricity supply using wind turbines. Wind power is not without controversy however with many protesting about their impact on the landscape. As a result wind power is being increasingly moved to the more expensive but less offensive offshore version.

Installing wind turbines requires planning permission, in addition if more than three turbines are being installed an Environmental Impact Assessment will be required.

Once those obstacles have been overcome however wind is an effective way of generating power. Turbines work well across most of the UK and can operate at wind speeds of just 4 metres per second. That said, the more successful projects are in areas with average wind speeds of at least 7m/s.

For small-scale generators, wind power is one of the more financially viable self-generation options and its viability is improving as technology advances.

The payback period for large, freestanding turbines is estimated to be between 4-8 years. However, turbine sites are often resisted, and when there’s no wind or wind levels are below optimal, they generate no electricity, so users still need a National Grid back up.

Our supplier partner Ecotricity specialises in wind energy as part of their commitment to green energy and a sustainable environment.

Biomass energy

Biomass energy is simply the burning or fermenting of organic material such as wood, straw and other crops.

This makes up some 85% of this country’s renewable energy, although local smoke control regulations limits its adoption in some areas.

Generally speaking, a biomass system will provide payback within 5-12 years, though this can be significantly shorter if free waste wood is available, negating the need for initial tree growth. Like wind energy, biomass is not without its controversies with claims being made that healthy trees and not waste wood are being used to generate fuel and that the importation of wood pellets and the like defeats the sustainable objective of renewable energy.

Biomass energy systems can be used in combination with a combined heat and power plant to deliver both electricity and heat.

However while burning biomass releases fewer emissions than fossil fuels, any system must still comply with legislation such as the Clean Air Act.

Our supplier partner Haven Power specialises in biomass energy generation through the burning of wood pellets as part of their commitment to green energy and a sustainable environment.

Anaerobic digestion

Biomass can also be converted into energy via anaerobic digestion.

This is the process where organic material is broken down by bacteria being starved of  oxygen in order to create gas rich in methane that is then burned to generate heat and electricity.

An additional benefit of  anaerobic digestion is that the solid waste called digestate can be used as compost.

However an environmental permit is needed for anaerobic digestion of waste and storing biomass fuels can require a great deal of space while finding an adequate supply can also be problematic.

The payback for anaerobic digestion plants is generally 5-10 years.

Our supplier partner Ecotricity specialises in anaerobic digestion as part of their commitment to green energy and a sustainable environment.

Solar energy

Photovoltaic (PV) panels convert sunlight into electricity and are available in formats including cladding, roof tiles and custom glazing. These can increasingly be seen installed on unshaded, pitched roofs.

In addition Solar hot water systems take energy from the sun and transfer it by means of heat exchangers, capable of heating water up to 65°C. Solar water heating collectors are usually mounted on roofs in the same way as PV panels.

You can get derive electricity and heat from solar energy but it’s unlikely to supply all the juice a business needs.

Solar panels don’t need much maintenance and don’t need planning permission and can be particularly economical for businesses that use lots of hot water, like canteens.

However, Solar is an intermittent technology – sunshine isn’t constant in the UK – and it can be expensive to install.

Our supplier partner Ecotricity specialises in solar energy as part of their commitment to green energy and a sustainable environment.

Geothermal energy and ground source heat pumps (GSHPs)

Geothermal power and ground source heat pumps use heat that is naturally contained in the ground.

Geothermal can be exploited in areas where the heat from the earth’s interior rises to the surface as hot springs or steam. Boreholes in the ground then harvest this. Once harvested this can provide heating or hot water and drive geothermal power plants.

GSHPs use pipes to transfer heat from the ground to buildings. Water and anti-freeze is passed through pipes to absorb subterranean heat, which is then taken to the heat pump.

Although they use a renewable heat source, the heat exchange mechanism is powered by gas or electricity, so GSHPs can only be classed as renewable if they get that energy from a renewable source too.

GSHP is a well understood technology and can provide both heating and cooling however, installation requires major civil work, meaning it is only really viable to install at the build stage.

The initial installation can also be expensive with payback periods usually more than 15 years – and will often need appropriate permissions from the Environment Agency to get started.

Hydroelectric power

Hydroelectric comes from water flowing through a turbine and powering a generator.

This is achieved by a water wheel or turbine using the natural flow of the water, or stored water in a reservoir being passed through an underwater turbine.

Nuclear power

Conventional fission power is sometimes referred to as sustainable but this is controversial because of concerns about radioactive waste disposal and the risks of accidents.

And neither is it renewable, because deposits of nuclear fuel uranium are finite.

Fast breeder reactors, fuelled by uranium extracted from seawater, have a stronger case for being considered renewable. They could supply energy at least as long as the sun’s expected remaining lifespan of five billion years according to physicist Bernard Cohen.

There is an alternative; nuclear fusion, this is the reaction that exists in stars. It doesn’t create the radioactive waste of fission, but sadly though this could be the long-term answer, with current technology nuclear fusion isn’t a commercially viable option.

Future sources of renewable energy

Wave generation

The idea of harvesting large amounts of power from ocean waves is gaining momentum.

The Carbon Trust estimates the extent of the economically viable offshore resource in the UK at 55 TWh per year, that’s about 14% of current national demand.

Enhanced geothermal

This is a type of technology that doesn’t rely on geothermal hotspots, but generates heat by pumping water into porous rock, a process known as hydraulic stimulation.

The largest project in the world is a 25-megawatt plant being developed in the Cooper Basin, Australia, which has the potential to generate 5,000–10,000MW.

Experimental solar power

This is a theoretical design for the collection of solar power in space, for use on Earth.

Artificial photosynthesis

This uses nanotechnology – that is the manipulation of matter on a molecular or atomic scale – to store solar electromagnetic energy in chemical bonds by splitting water to produce hydrogen and then using CO2 to make methanol.

The benefits of renewable energy for your business

As well as helping reduce their contribution to climate change, the benefits for businesses include: 

  • Exemption from paying duty under the Climate Change Levy (CCL) – this duty is a tax on the energy used by businesses. 
  • A reduction in allowances required under the CRC Energy Efficiency Scheme – businesses generating renewable energy might be able to offset this against the number of allowances they are required to buy.
  • A more secure energy supply – fossil fuels won’t last forever and supply is increasingly dependent on imports. In contrast, renewable sources occur naturally, in all regions, and won’t run out. 
  • Stable energy costs – renewable energy sources are not subject to the same price rises as fossil fuels because of this security. 
  • Improving environmental credentials and strengthening your brand – dealing with businesses with proven environmental credentials is important to an ever-growing subset of customers and other stakeholders.
  • Future proofing – using renewable energy will become more widespread. Indeed, legislation is already setting targets for its use in some new developments. Switching sooner rather than later will give you a head start in renewable energy expertise.
  • Subsidy – a large range of subsidies are already available for businesses, these include the Feed in Tariff (FIT), the Renewables Heat Incentive (RHI), the Renewables Obligation (RO) and the soon to be launched Contracts for Differences (CfDs). Eligible businesses can therefore benefit greatly from these deals.

To find our more about the grants and schemes available to businesses visit our guides to Feed in Tariff (FIT), the Renewable Heat Incentive (RHI), the Renewables Obligation (RO) and the soon to be launched Contracts for Differences (CfDs).

Renewable and green energy tariffs

If generating your own renewable energy isn’t an option, and it won’t be for most business, but you still want your business to go green, you could consider a green energy tariff.

Some energy suppliers get all their energy from renewable sources, so opting for them means none of the energy you use comes from fossil fuels, Ecotricity are amongst the suppliers who offer this.

Be aware though, by signing up for a 100% green tariff, you won’t get 100% green energy delivered to your premise (it all gets mixed together at source) but it does mean that the utility company guarantees to undertake best endeavours to generate or buy enough green and renewable energy to cover all those customers that sign up to their green tariff.

However, it’s important to realise that green tariffs often cost more and the net environmental carbon benefit isn’t entirely clear.

If paying more for green energy isn’t an option, then you can identify a supplier’s green credentials by studying its fuel mix.

All energy suppliers are required by DECC to source some of their electricity from renewable sources and publish the percentage (known as their fuel mix) on their websites.

By looking at the fuel mix data you can identify a supplier who measures up to your standards on renewable energy, where a full green deal isn’t suitable for your business needs.

You might not end up with either the cheapest or the greenest plan on the market, but it does mean that you can find a compromise that suits both your business expenses and ethics.

Visit our dedicated supplier pages to understand your energy suppliers’ fuel mix.

To find out more about renewable and green energy and how your business can benefit call us on 0800 051 5770, we’d love to hear from you.