[RHI: FUEL AND CAPACITY ANALYSIS]
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1 [RHI: FUEL AND CAPACITY ANALYSIS] [Frank Aaskov REA] [217]
2 RHI: Biomass fuel and capacity analysis Fourth edition (June 217) Contents Introduction... 2 Data... 2 Fuel type: Overall... 3 Fuel type: Below 2kW... 4 Fuel type: 2kW-999kW... 5 Fuel type: Non-woody biomass fuels... 6 Distribution of Capacity: Below 2kW... 7 Distribution of Capacity: 2kW-999kW... 7 Conclusion... 9 Table of figures Figure 1: Installations and capacity in Non-domestic RHI... 3 Figure 2: Installations and capacity in non-domestic RHI: -199kW... 4 Figure 3: Fuel use in non-domestic RHI, -199kW, Figure 4: Installations and capacity in non-domestic RHI: 2-999kW... 5 Figure 5: Fuel use in non-domestic RHI, +2kW, Figure 6: using non-woody biomass fuels... 6 Figure 7: Capacity distribution of installations: -199kW... 7 Figure 8: Capacity distribution of installations: 2-999kW... 8 Figure 9: Capacity distribution of installations... 8 Introduction Data The following analysis looks at the capacity, number of installations, and fuel type of the biomass installations in the non-domestic RHI. The data, which was received through a Freedom of Information (FOI) request to Ofgem, includes records for the new installations since the first (February 215), second (October 215), and third analysis (July 216), and thereby shows the recent changes and overall market movement in the biomass heat sector. Following feedback from members and the WHA Board, we requested data from Ofgem on fuel use and capacity size, which currently is not publicly available. The analysis only RHI: Fuel and capacity analysis woodheatassociation.org.uk Page 2 of 9 June 217
3 uses the FOI data and does not include other data sources. The information from Ofgem covers the period from November 211 to the end of 17 May 217 and contains data on 15,182 non-domestic biomass installations and their postcodes, installation capacities and fuel types. This analysis does not contain any data on domestic RHI installations. In total, the 15,182 non-domestic RHI solid biomass installations have a total installed capacity of 3.1GW, with the sub-2kw installations totalling a capacity of 1.49GW, the 2-999kW installations totalling a capacity of 1.34GW, and the large biomass installations of 1MW+ totalling a capacity of 263MW. In this analysis, we have split the installation capacity equally between the fuels, e.g. a 2kW installation using energy crops and wood chip fuels will be split into a 1kW energy crop and a 1kW wood chip. This assumes that each fuel is being used equally, which most likely does not reflect real world use, but without more in-depth data, it is the most appropriate approach. The analysis of the number of installations using different fuels has counted the number of installations using each fuel, which means the 2kW installation using energy crop and wood chip has been counted as 1 installation using energy crops and 1 installation using wood chip. Although this installation is being counted twice, the analysis better reflects the installations using a number of different fuels, instead of ignoring any additional fuel types being used. Furthermore, the data only reflects what participants have stated to Ofgem, and not what fuels they may actually use in practice. There is, therefore, an inherent uncertainty in the data set. Nevertheless, it is still possible to draw some conclusions from the data as shown below. Fuel type: Overall The following bar chart illustrates the number of installations and the total capacity (MW) using various fuel types. Figure 1: Installations and capacity in Non-domestic RHI Agricultural residues Energy Crops Recycled wood Other Wood chip Wood logs Wood pellets using fuel Capacity of installations RHI: Fuel and capacity analysis woodheatassociation.org.uk Page 3 of 9 June 217
4 As demonstrated in figure 1, 9% of installations use wood based fuel types, either in log, chip or pellet form. Similarly, 86% of the total capacity installed use wood based fuel types. It is thereby clear that wood fuels still dominate the non-domestic RHI biomass installations. Fuel type: Below 2kW The use of wood fuels in the small biomass market is illustrated in figure 2 below, showing both the number of installations and the total capacity for wood chips, wood logs and wood pellets. Wood pellets dominate this market, with the highest number of installation and total capacity, but it is worth noting that there are over 2,35 fewer wood chip installations, but only 89MW less capacity. This again points to the general larger capacity of a wood chip installation. Figure 2: Installations and capacity in non-domestic RHI: -199kW Wood chip Wood logs Wood pellets. Capacity of installations per fuel type (MW) If just comparing wood chip and wood pellets in the -2kW bracket (see figure 3), wood pellet boilers are more popular than chip in the -125kW, after which wood chip boilers become slightly more popular. RHI: Fuel and capacity analysis woodheatassociation.org.uk Page 4 of 9 June 217
5 Figure 3: Fuel use in non-domestic RHI, -199kW, Wood pellets Wood Chip Fuel type: 2kW-999kW The use of wood fuels in the medium biomass market is illustrated in figure 4 below, showing both the number of installations and the total capacity for wood chips, wood logs and wood pellets. Figure 4: Installations and capacity in non-domestic RHI: 2-999kW Wood chip Wood logs Wood pellets Capacity of installations per fuel type (MW) Wood chip dominates the 2kW-1MW market, both in terms of numbers of installations and capacity. However, when looking at the distribution, wood pellet boilers are slightly more popular in the 2-299kW bracket, with chip being more popular in every other range between 2kW-1MW. RHI: Fuel and capacity analysis woodheatassociation.org.uk Page 5 of 9 June 217
6 Figure 5: Fuel use in non-domestic RHI, +2kW, Wood pellets Wood Chip Fuel type: Non-woody biomass fuels Figure 6 below shows the distribution of non-woody biomass fuels, split over boiler capacity. The use of waste/recycled wood is by far the most popular, but also energy crops and agricultural waste are used in many boilers. Figure 6: using non-woody biomass fuels Agricultural residues Energy crops Waste/recycle wood Food waste RHI: Fuel and capacity analysis woodheatassociation.org.uk Page 6 of 9 June 217
7 Distribution of Capacity: Below 2kW Figure 7 shows that a large part of the installations below 2kW is just below the tariff band, demonstrating the impact of the previously higher small biomass tariff band (prior to serial degressions). Figure 7: Capacity distribution of installations: -199kW Total capacity of installations However, there is still a large group of installations around the 1kW size, showing that the small biomass market is not just 199kW boilers, but also boilers of smaller sizes. Indeed 7.6% of installations are smaller than 19kW. Distribution of Capacity: 2kW-999kW The above market tendency wasn t as pronounced in the medium biomass market (see figure 8), with 22.2% of installations being kW size boilers, but the market is very polarised. 47% of installations in the 2kW-1MW bracket are either 2-25kW or 95kW- 1MW. This is largely assumed to be due to the tariff structure, where the current tariff for 999kW boilers is 4.79p/kWh 1, and the support is 2.8p/kWh for 1MW boilers. Similarly, the support for 2kW boilers is 4.79p/kWh, compared to 2.71p/kWh for 199kW boilers. This would incentivise the market to either over- or undersize their boilers to fit into the more beneficial medium biomass tariff bracket. 1 Tier 1 is 4.79p/kWh, tier 2 is 2.8p/kWh per 1 July 217 for medium biomass boilers (2-999kW biomass boilers). RHI: Fuel and capacity analysis woodheatassociation.org.uk Page 7 of 9 June 217
8 Figure 8: Capacity distribution of installations: 2-999kW Total capacity of installations The new interest in the 2-299kW size systems has appeared after the tariff degressions, as evident in figure 9, which also shows an increased interest in the 9-999kW systems. Figure 9: Capacity distribution of installations Feb-15 Jun-16 May Considering the outcome of the RHI consultation, which lowers the overall support for sub- 1MW systems, it would be expected that the market would rush to install the systems that have most to lose in terms of support levels. This is largely what we now have seen. RHI: Fuel and capacity analysis woodheatassociation.org.uk Page 8 of 9 June 217
9 Conclusion From the data a few conclusions can be drawn on biomass installations in the nondomestic and domestic RHI: The majority of installations use some kind of wood fuel, with 43% of systems stated to use pellets, 31% chip and 16% logs. The data also reveals that pellets are still used in generally smaller installations than chip, and systems using logs are on average smaller than those using pellets. The distribution of boiler size is still heavily affected by the RHI tariff bands. Please contact Frank Aaskov for further details. The raw data is available upon request. BEIS also publishes monthly deployment data and aggregated capacity for the nondomestic and domestic scheme, in addition to forecasting expenditure for the degression mechanism. Frank Aaskov, REA 27 th June 217 RHI: Fuel and capacity analysis woodheatassociation.org.uk Page 9 of 9 June 217
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