& tobacco

7%

All other sectors

11%

Backing industrial productivityThe combined heat and power opportunity

2014 2020

£9.58m

£10.12m

£9.96m

£13.05mWithoutrelief

Withrelief

Backing industrial productivity –The combined heat and power opportunityFor many industrial energy users, Combined Heat and Power (CHP) represents the biggest single opportunity to increase their energy productivity, controlling energy costs by cutting primary fuel use by up to 30%.

CHP integrates the production of usable heat and electricity, in one single, highly efficient process. This contrasts with conventional ways of generating electricity where vast amounts of heat is simply wasted.

According to the Climate Change Committee, industrial energy costs rose by more than 120% in the last 10 years. However, CHP users saw their costs rise by less than half that. This protection from cost increases is one of the reasons that many of the UK’s key industries use CHP, including large portions of the food and drink, chemicals, refining and paper sectors.

Industry analysis shows that CHP supports more than 100,000 industrial jobs by providing those sites with highly efficient energy. If CHP met its industrial potential, 260,000 additional jobs could be supported.

In addition to supporting industrial productivity, CHP reduces UK gas imports by 2% and saves 15 million tonnes of carbon every year, the equivalent of taking 1 in 5 cars off the road. With the right investment signals, a significant increase in CHP capacity would help British industry increase its competitiveness, as well as improve security of energy supply and reduce emissions.

Both gas and renewable CHP can support industrial competitiveness while playing a key part in the UK’s transition to a cost effective, efficient, low carbon energy system; one where the user can take control of their energy future.

To help achieve this industrial energy productivity potential, three key steps are needed:

• Protect and strengthen the investment case for industrial energy productivity solutions, including gas CHP, through the Government’s business energy tax review.

• Enable the Capacity Market to value the participation of efficient industrial energy users.

• Increase policy investment certainty for CHP across all tax and energy policy, especially the Contracts for Difference scheme and the Renewable Heat Incentive.

Rising business energycosts for energyintensive user…

Combined heat and power reduces primary fuel use by up to

30%

Case Study | Boots

Boots, part of the Retail Pharmacy International Division of Walgreens Boots Alliance, has used Combined Heat and Power (CHP) to reduce energy costs, carbon emissions and support its business activities in Nottingham for 100 years. Its latest 14.1 MWe CHP plant supplies steam, hot water, electricity and compressed air for manufacturing, warehousing, logistics and retail business support on its 300-acre site in Beeston.

Not only does the CHP plant deliver energy self sufficiency, security of energy supply, reduced energy and therefore reduced product costs, it also powers the entire site where approximately 8,000 people are employed.

Case Study | Lifescan Scotland

Lifescan Scotland manufactures healthcare products such as glucose test strips for the global diabetes market. The site in Inverness employs over 1,000 people and is regarded as a centre of excellence for diabetes.

CHP was installed as part of a companywide energy efficiency drive to reduce carbon emissions and cut energy bills. The CHP has reduced electricity consumption by more than half (53%) which has reduced carbon emissions by 21%, making a saving of 625 tonnes of CO2 a year and lowered the site’s energy bill by 27%; a cost saving of approximately £99,000 per annum.

Case Study | Tata Chemicals Europe

Tata Chemicals' CHP supplies energy for the manufacture of soda ash, a key ingredient for glass, and sodium bicarbonate for use in pharmaceuticals and food applications. The CHP provides for all of Tata Chemicals’ heat requirements, energy for adjacent businesses and enough power for 200,000 homes.

Tata Chemicals sees CHP as vital in keeping a lid on the rising cost of energy for industry. With energy costs escalating, their highly efficient CHP (80%+ efficiency) helps ensure secure supply of energy to Tata Chemicals and helps minimises the impact of rising energy costs.

Winnington CHP supports 250 jobs directly, and an estimated 2,000 indirectly.

CHP in action

Economic benefit of CHP to UK industry, showing some key existing and potential new sites

industrial jobs with 111,000 already supported.

CHP has the potential to support up to

368,000

89% of CHP capacity supplies British industrywith heat and power.

CHP meets over 6% of the UK’s electricity needs.

2900 MW Potential Industrial CHP

5261 MW Existing Industrial CHP

383Existing

sites

Oil refineries

Food, beverage& tobacco

37%

8%

PotentialCHP

7%

7%

27%

Paper,publishing& printing

Other industrial

Chemicals

Regional Industrial CHP Potential

Key

Manufacturers benefiting from CHP(case studies overleaf)

• Tata Chemicals, North West EnglandTata Chemicals uses CHP to manufacture chemicals such as soda ash and sodium bicarbonate; key ingredients for glass and detergents.

• Boots, East MidlandsBoots is a leading healthcare and beauty retailer. Boots uses CHP to manufacture pharmaceuticals including skincare products and medicine.

• Lifescan Scotland, Scottish HighlandsLifescan Scotland uses CHP to manufacture healthcare products such as glucose test strips for the global diabetes market.

Existing industrialsites with CHP

Installers and manufacturers of CHP

Industrial sites withpotential for CHP

Largely unmet

Mostly unmet

Somewhat unmet

Somewhat met

Mostlymet

Largelymet

EASTMIDLANDS

WEST MIDLANDS

SOUTH WEST ENGLAND

WALES

NORTHWESTENGLAND

NORTHEASTENGLAND

SCOTLAND

NORTHERNIRELAND

SOUTH EAST ENGLAND

LONDON

Celanese

British Sugar

Boulby Mine – Cleveland Potash

Port Clarence Works – Koppers

Fine Organics

Conoco Phillips Teesside Operations

INEOS

Fellside CHP

Weetabix

British Sugar British Sugar

Crisp Maltings

British Sugar

Babraham Research Campus

Thames WaterGlaxosmithkline

Sainsbury's

Air Products

Bran Sands – NWL

Iggesund Paperboard

TataChemicals

GrowHow UK

Jaguar Cars

AstraZeneca

Fribo Foods

Thames Water

De La Rue International

Thames Water

Dow Corning

Inbev UK

Thames Water

John Heathcoat & Company

Thames Water

Southern Water

Southern Water

John Thompson& Sons

Springfield Fuels

Kellogg’s

Green Frog Fuel

BASFNufarm UK

Romiley Board

Inbev UK

Sonoco – StainlandBoard Mills

Balcas

Wilton International Site (Sembcorp)

Norbord

James Cropper

Glaxosmithkline

Caledonian Paper

Stanlow Manufacturing Complex

BHP Billiton Petroleum

UPM Shotton

Glaxosmithkline

Southern Water

Tangmere Nursery

ExxonMobilRefinery

Balcas

Erith Oil WorksNational Grid Grain

Georgia Pacific – Bridgend Paper Mill

Kingspan Insulation

Smurfit Kappa SSK

Thames Water

Glaxosmithkline

Johnson Matthey

Johnson Matthey

Tate and Lyle

Thames Water

Thames Water

Genzyme

Boots

INEOS

Samlesbury Aerodrome

Vinnolit Hillhouse

Syngenta Millenium Inorganic ChemicalsVPI Immingham

Humber Energy

INEOS Grangemouth Refinery

DSM

Ryobi

Tonnagh Pig Unit

Murco

SH

ETL

AN

D IS

LAND

S - SCOTLAND

Sullom VoePower Station

Clarke Energy

ENER–G

Cofely

Siemens

Centrax

Businesses at the Wilton International Site, which is supplied by Sembcorp’s 160MW CHP plant, employ over 3,000 people, 150 of which are employed by Sembcorp directly.

1600 staff are employed at ExxonMobil’s Fawley Refinery and Petrochemicals site. During times of major activity, this figure can be considerably higher.

Nearly 2000 staff are employed at AstraZeneca’s Macclesfield site which manufactures and distributes medicines for over 130 global markets.

2000

1600

3000

1600INEOS employ around 1600 staff to operate its chlorine and sulphuric acid production facilities in Runcorn.

Finning UK

First Energy

Cogenco

Aventis Pharma

GlaxoSmithKline

Muntons

IBC Vehicles

Smithkline Beecham

Syngenta

AWE

BMWHonda

Invista Textiles

Dairy Crest

Roxel

SI Group

Coors Brewers

Toyota

SLI Glass and Glazteknology

Redfearn Glass, Rexam Glassand Rockware GlassProcter & Gamble

Warwick International

BAE Systems

Elyo UKIndustrial - Nestle

Voridian England

Caledonian CheeseGallaher

Glanbia Cheese

Short BrothersDalefarm

Moy Park

Land Rover

Sensient Flavorsand Volac International

Intertissue

Valero Energy

Elf Oil

SouthHookLNG

Ford Motors

Innovia Films

AstraZenecaRHM Group

Cogent Power-Orb Electrical Steels

Nynas

GE Plastics

BAE Systems

MGT Power

McCain Foods

Croda Chemicals

CampbellGrocery Products

Garden IsleFrozen Foods

Kodak

Lever FabergeVauxhall Motors

Lifescan Scotland

GrowHow UK

The Association for Decentralised Energy

6th Floor10 Dean Farrar StreetLondonSW1H 0DX

Tel: +44 (0)20 3031 8740

@theADEuk

info@theade.co.ukwww.theade.co.uk

Boots has been manufacturing cosmetics and healthcare products using combined heat and power since the 1920s.

The oat husks from Quakers’ porridge making process is used as fuel for their CHP unit.

In Fife, Diageo uses CHP to produce over 100 million litres of whisky a year.

CHP supplies heat and electricity to help produce 400 million boxes of Kellogg’s cereal each year.

CHP helps the UK’s largest oil refinery supply 20% of the UK’s cars with fuel.

Each year, British Sugar produces over onemillion tonnes of sugar and grows 140 million tomatoes using combined heat and power.

* From publicly available information.

All data references are available at chpmap.theade.co.uk

The Association for Decentralised Energy is the leading advocate of an integrated approach to delivering energy locally, designed around the needs of the user.

Key CHP users in the UK Anheuser-Busch InBev, AstraZeneca, BASF, BHP Billiton, Boots, British Sugar, Carlsberg, Cleveland Potash, Diageo, Dow Corning, DSM Nutritional Products, Essar Group, ExxonMobil, Fortum Corporation, Georgia Pacific GB, Glaxosmithkline, Humber Energy, Iggesund Paperboard, INEOS Group, Jaguar Land Rover, James Cropper, Johnson Matthey, Millenium Inorganic Chemicals, Phillips 66, Sygenta, Tangmere Airfield Nurseries, Tata Chemicals, Tate and Lyle, Thames Water Utilities, Total, UPM Paper, Weetabix.

Key manufacturers and installers of CHP in the UK

CHP impacts many of the products the UK uses every day*. Did you know:

BasePower, Bosch Industrial, Centrax Industries, Clarke Energy, Cofely, Cogenco, Edina, E.ON UK, ENER-G Combined Power, Eurosite Power, Finning UK, First Energy, MTU, MVV, Opra Turbines, P3P, RWE npower, Sav Systems, Sembcorp Utilities, Siemens, Turbomach, Vital Energi Utilities.