Renewable Energy – Cost Justification

For many years the ethical argument has been the strongest reason for deciding to invest in small to medium scale Renewable Energy and Micro-Generation Solutions, however the Feed-in-Tariff (FiT) and the emerging Renewable Heat Incentive (RHI) financial justification is becoming more of a reason and this will drive to more installations.

To investment in any renewable energy or micro-generation system you need to be in it for the long term. Payback periods are not short but the long term benefits are worth having both financially and ethically.

In the past 5 years Electricity costs have risen by 70% & Gas prices by more than 100%. Indications are that these energy costs will continue to rise at these rates for the foreseeable future as global demand for fossil fuel increases & governments look for ways to encourage people to be energy efficient & to switch to alternative energy technologies.

Running cost comparison:

Based on current heating oil and bulk wood pellet costs and calorific values of the fuels.

Heating oil @ 63p per litre                 yield of 10 Kwh/litre               6.3p per Kwh

Wood Pellet @ £200 per tonne          yield of 4800 kwh/tonne         4.2p per Kwh

Running cost reduction of 33%

Costs of running Ground Source Heat Pump (GSHP):

Although a GSHP systems uses electricity (the most expensive fossil fuel), the most efficient systems operate at a conversion rate of 4:1 (this means for every 1 Kwh of heating energy out). Considering that mains gas is about half the price of electricity, putting in a GSHP system will mean that heating & hot water costs should be less than those of a gas system.
It is also worth noting that gas prices have increased at a greater rate (over 100%) than electricity prices (70%) over the 5 years 2002 to 2007.

Generating your own electricity, Solar PV & Wind Turbines:

Unless you have a remote building AET recommend grid connect systems.
As well as supplementing the electricity that your property is demanding any surplus is put back into the grid and through the Feed-in-Tarriff (FiT) you will receive an incentive payment from every unit of electricity you generate.

Initial investment is relatively high & long payback periods must be accounted for with this technology, however with no moving components the system comes with long guarantees, up to 25 years (some systems from the 1960′s are still running today). There is a certian smug satisfaction to be had when watching your meter rotate backwards!!