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LEICESTERSHIRE COUNTY COUNCILLEICESTERSHIRE HEAT NETWORKS STUDYLOT 2 – HEAT MAPPING AND MASTERPLANNING
PE10591/FinalFEBRAURY 2017
Page 88
Table 3.32: NPV Sensitivity Analysis for Loughborough B Network at 40-year project lifecycle and a 10% discount rate with 20% HNIP Grant& RHI
LEICESTERSHIRE COUNTY COUNCILLEICESTERSHIRE HEAT NETWORKS STUDYLOT 2 – HEAT MAPPING AND MASTERPLANNING
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As shown in Table 3.24 to Table 3.26, there are three DHNs that show some potential financial
viability, gas boilers exclusively (option 3) and gas CHP with gas boilers (option 4 and 6). When
comparing the options, option 4 is the most financially viable with positive NPVs in all
scenarios at the 3.5% and 5% discount rates (although not at all at the 10% rate). In the best
of the modelled cases, option 4 has an IRR of 9.3% over 40 years and has a breakeven period
of 13 years if a 20% HNIP grant is obtained.
Options 3 and option 6 are borderline financially viable with IRRs of 5.3% and 5.4%
respectively in their modelled best cases (note, option 3 is not eligible for an HNIP grant as it
meets neither the renewable energy nor CHP criteria). When modelled without a grant over
a 25 year project life both options do not achieve positive NPVs even when modelled at a
3.5% discount rate. As both of these options are borderline they are quite sensitive to
increases in CAPEX, OPEX and in the case of option 6 decreases in the electricity sales price.
In the case of the Loughborough B DHN only gas CHP with gas boilers should be considered
moving forward.
3.8 Business as Usual
A business as usual (BAU) case has been considered for the Loughborough A and B networks.
The BAU cases involve the financial analysis of the anchor loads on the network under a set
of standard conditions should a DHN not be implemented. The exact mix of existing heat
supply plant, the age of existing plant and the prices currently paid for heat are not known for
most of the identified anchor loads. Therefore, it has been necessary to simulate the existing
BAU cases by modelling the use of modern gas boilers with the heat demands used in the
DHN analysis. For the Loughborough A network a gas purchase price of 2.2p/kWh has been
applied to the University’s heat load to reflect the price it currently pays. The gas purchase
price for all the other heat loads is assumed to be 2.55p/kWh, which is the average price paid
by a medium industrial business in Mar 2016. For the Loughborough B network the gas
purchase price has all been modelled at 2.55p/kWh which is considered representative of the
price that would be paid commercially for this heat at the scale of the heat loads present in
this network. The existing gas boilers were assumed to have 5 years of useful life left from a
15year lifetime with replacement costs applied at the appropriate times. Table 3.33 and Table
3.34 show the BAU analyses.
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The BAU analyses have shown that modern gas boilers in the individual buildings can provide
the heat required by the anchor loads modelled on the Loughborough A and B networks. The
purpose of considering the BAU case is to compare the costs of doing nothing (except like-
for-like replacement when required) with the costs of implementing the DHN. The BAU
scenario is also used to calculate the carbon savings from each technology.
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3.9 Future Opportunities
This stage of the feasibility study has focussed on the anchor loads identified as being core to
kick starting the DHN, however once a DHN is established there are a number of opportunities
for future growth, in particular the development areas to the north and south of the Newhurst
EfW plant located at Charnwood Quarry. Current proposals indicate construction of up to
3,200 dwellings, 16ha for employment purposes, a community hub, two primary schools and
an extension to the science park. The Loughborough A network would utilise around 75% of
the EfW plant’s heat capacity, so there would be some spare capacity to cater for this
potential expansion. If this proves insufficient, there may be an opportunity to utilise waste
heat from Boal UK’s aluminium casting plant. Alternatively, a new energy centre could be
implemented. Any DHN that is developed will need to be “futureproofed” to be compatible
this potential growth, i.e. the pipework specifications are compatible with this and there is
space at the energy centres to add more equipment. If the Loughborough A network does not
go forward, a separate DHN based solely on the EfW plant could be developed at a future
date to service these areas. There are also a number of smaller residential developments
closer to the centre of the town, which may be suitable for connection to either the
Loughborough A or B networks at a later date.
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4 COALVILLE
4.1 The Opportunity
Coalville is a town in the North West Leicestershire District of Leicestershire with a population
of approximately 5,000 people. It lies on the A511 trunk road between Leicester and Burton
upon Trent, close to junction 22 of the M1 motorway.
4.2 Potential Heat Loads from Existing Buildings
Figure 4.1 (below) shows the spatial distribution of heat demand density in and around the
Coalville area, based on the National Heat Map model.
Figure 4.1: Spatial Heat Density in Coalville
The map shows clusters of spatial heat demand density around the High Street in the centre
of the town, as well as in the industrial estates located directly to the north of the centre and
to the north-west of town. There also appears to be an area of high demand density at the
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Bardon Hill industrial area, out to the south-east of the town. This correlates less clearly with
the results of the overlay analysis (see Figure 4.2 below) due to the absence of large
residential buildings and buildings that can be classed as anchor loads within these industrial
areas. As discussed in previous sections, areas defined through the overlay analysis are those
that fulfil each of the three criteria outlined in Section 2.1.3 of the methodology section (i.e.
areas that are within the 10% of land area with the highest heat demand density, that are
within 200m of residential buildings with an annual heat demand of more than 100,000kWh
per year, and that are within 200m of potential anchor loads), and again, industrial buildings
are not included in the anchor load definition at this early stage, but may be considered for
further investigation once an area of focus has been defined.
Figure 4.2: Area Identified as Meeting all three Conditions of Overlay Analysis in Coalville
As with Loughborough, the initial list of anchor loads was reviewed with the client and
supplemented with data collected through the survey. The final list of proposed anchor loads
is shown in the table below and the energy demands (i.e. for heat, power and, where
appropriate, cooling) for each of these are included in Appendix A3.
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It should also be noted that at the time of writing there are plans to relocate the Hermitage
Leisure Centre to a town centre location within the next 5 years. This development would
provide a high and consistent demand for heat (data provided by North West Leicestershire
District Council states that the demand for heat from the existing leisure centre building was
460,800 kWh in 2014), hence its connection to a heat network should be viewed as a
significant opportunity.
4.3 Potential Heat Loads from New Development
Figure 4.3 shows the location of possible development sites within and around Coalville. The
large development site to the south-east of the town, known as the ‘South East Coalville
Sustainable Urban Extension’, appears to be the most significant of these in both location and
size with plans for almost 3,500 dwellings along with a primary school and local centre
(including a public house, day nursery, medical centre and 2000m2 space for A1, A2, A3 and
A5 uses). There is also an adjacent site to the south of this site that is designated for
‘employment’ purposes (this looks likely to include both B5 and B8 uses). Estimated energy
demands for these sites are included in Appendix A3. These are based on a trajectory for
construction that has been provided by North West Leicestershire District Council and has
been set from 2015 to support the potential to link the Local Plan. Note that whilst a total of
3,500 dwellings are anticipated for the South East areas of high heat demand in Coalville site,
only the 2,178 homes that are included in the current trajectory (i.e. up until 2031) are
included in the calculations. Dwellings due for construction at a later date may also be suitable
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for connection to a heat network and this should be considered once more information is
available regarding their timeline for delivery.
Figure 4.3: Proposed Development Sites in and Around Coalville
4.4 Heat Load Profile
The Coalville profile accounts for all anchor loads noted in Table 4.1. A sample of the modelled
demands for the educational, commercial and total profile are shown in Figure 4.4. As can be
seen the total combined profile shown in purple is mostly impacted by the commercial profile
(orange) while the educational profile (purple) has less of an effect. This is because the
commercial profile accounts for 61% of the annual heat demand and the commercial profile
only 39%. The total annual demand for the Coalville network without losses is 125,756MWh.
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Figure 4.4: Heat Demand Profile for Coalville Network
As can be seen the profile modelled is quite “peaky” with the peak load modelled at
approximately 3.5 times higher than the average load. The demand profile would therefore
require high boiler capacities which would be underutilised for substantial time periods over
the course of the year. The modelled profile can be smoothed using a moving average to
account for the storage capacity of the network itself (water retained in the pipework) and
additional storage tanks which have been included within the model. The Coalville network
has a storage buffering capacity of approximately 20 hours. The impact of this on the final
demand profile is shown in Figure 4.5. As can be seen the modelled storage capacity of the
Coalville network has a substantial impact on the demand profile, reducing the peak load to
approximately twice the average load.
Figure 4.5: Heat Storage Buffering Effect on Coalville Network
0
200
400
600
800
1000
1200
1400
0 12 24 36 48 60 72
Hea
tD
eman
dkW
Hour
Commercial Profile Education Profile Total Profile
0
200
400
600
800
1000
1200
1400
0 24 48 72 96
Hea
tD
eman
dkW
Hours
Actual 6h Offset 12h Offset 20h Offset
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4.5 Potentially Viable Energy Supply Options and Energy Centres
The Coalville networks have a number of technologies that are suitable for consideration. A
summary of the technologies being considered are shown in Table 4.2.
Table 4.2: Technologies Under Consideration for Coalville Heat Networks
Network Option Baseload Peak
Coalville Network Biomass Boilers
Biomass CHP
Gas Boilers
Gas CHP
Minewater Heat Pumps
Gas Boilers
The target baseload capacity was 75% of the heat demand, with the peak load plant aiming
to provide the remaining heat. Based on the capacity of the individual boilers and CHP units
the baseload modules couldn’t always meet exactly 75% but multiple modules were used to
reach a capacity that was as close as possible to this size. The number of units in each of the
scenarios varies due to capacity of the individual modules being modelled. In some cases,
based on quoted plant costs, it was preferable to use a larger number of lower capacity
modules to come closer to the 75% baseload rather than a lower number of higher capacity
modules. Details of the Coalville energy centre technology options are shown in Table 4.3
below.
LEICESTERSHIRE COUNTY COUNCILLEICESTERSHIRE HEAT NETWORKS STUDYLOT 2 – HEAT MAPPING AND MASTERPLANNING
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Table 4.3: Coalville Heat Generation Technology Options
Coalville Heat Generation Options
1 2 3 4 5 6
Bas
e
Heat Generation Technology Biomass Boiler Biomass CHP Gas Boiler Gas CHP Biomass Boiler Gas CHP
Number of Boilers/Engines 1 1 1 1 1 2
Total Capacity Thermal 800kW 833kW 788kW 927kW * 550kW 852kW
Total Capacity Electrical 0 333kW 0 1,820kW * 0 712kW
Pea
k
Heat Generation Technology Gas boiler Gas boiler Gas boiler Gas boiler Gas boiler Gas boiler
Number of Boilers/Engines 1 1 1 1 2 1
Total Capacity Thermal 530kW 530kW 530kW 530kW 1070kW 530kW
Total Capacity Electrical 0 0 0 0 0 0
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4.6 Energy Distribution Network
The energy distribution networks under consideration were largely influenced by the relative
locations of the anchor loads and heat supply options or energy centre locations.
Consideration was also given to geographic or human constraints whilst determining the
optimal network route, in addition to network length and associated heat losses.
. Both sites are expected to have
good connections to the utility services. Neither location is expected to raise any noise issues
as the current use is not residential (the nearest dwellings are 400m away). Similarly, air
quality is not expected to be a problem as gaseous emissions from the energy centres would
need to meet the statutory limits. This could easily be achieved by selecting the appropriate
stack height and in the case of biomass, fitting abatement equipment if required.
A comparison of the expected heat losses, capital cost and pumping energy requirements of
the networks for each of the potential energy centre locations was undertaken. The results
are shown in Table 4.4, below. As can be seen the capital costs associated with EC2 are
approximately 16% lower than EC1, the heat losses are also approximately 16% lower for EC2
and the pumping energy requirements are approximately 26% lower for EC2. For these
reasons EC2 was chosen as the preferred energy centre location in the subsequent technical
and financial assessments. Figure 3.8 shows the proposed heat distribution network. The
comparison provided does not take into account the individual expenses of the energy centre
and heat generation technologies but rather assesses the implications on the heat
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distribution network (pipe size, length etc) on the two proposed locations. Full details of the
CAPEX breakdown are provided in Appendix C.
Table 4.4: Comparison of Proposed Energy Centre Locations
EC1 – Industrial Area EC2 – College
Capital Cost £2,600,125 £2,180,283
Heat Losses 557 MWh/yr 467 MWh/yr
Pumping Requirements 103,103 kWh/yr 76,606 kWh/yr
Network Length 3530m 3034m
When designing a DHN it is preferred to opt for the shortest and most direct route to the heat
consumer’s plantroom. This methodology will secure the lowest running costs as heat loss
and pumping cost will be minimised. The route has been proposed after a site walkover
clarifying that this route is possible. Siting the energy centre at EC2 is more favourable in
terms of CAPEX, heat loss and pumping requirements. However, siting it at EC1 in the
industrial area is more appropriate from a planning perspective as it would be neighboured
by buildings of a similar type.
A number of potential pinch points exist for the proposed Coalville DHN.
Preferably
the road will be excavated in phases using prefabricated pipe elements, backfilling and
reinstatement of the road surface after testing. This is not expected to raise any significant
concerns. Where possible the pipework will be placed on the footpaths as opposed to on any
public road. Crossing the railway line would require engagement with Network Rail and may
incur additional costs for planning and permitting but there are no specific technical problems
anticipated based on the information obtained at this stage. The documentation of many
services is often not accurate which will lead to carrying out more test holes and eventually
change the route. For the actual design of the DHN system in Coalville, we have at this stage
not obtained any information about other services or sought any permits from Highways
England, utility companies or any local authorities.
4.6.1 Low Temperature Network
Specific consideration has been given to a low temperature network utilising the heat energy
contained within flooded mines as a heat source for a water source heat pump. Without a
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detailed site investigation and pumping tests it is not possible to fully determine the extent
or availability of the mine water resource, or whether a closed loop or open loop system
would be the most appropriate. However, based on information provided by the Coal
Authority, certain assumptions and inferences can be made about the resource and a broad
level analysis undertaken. Based on other monitoring stations nearby, it is assumed that a
water body with sufficient flow rate exists at a temperature of 11.7 °C at a depth of 75m.
Although drilling a borehole could be a viable option which could theoretically take place at
any suitable area on the network route that is over a section of flooded mine, for the purposes
of this assessment it has been assumed that access would be via an existing mine shaft on the
industrial estate on Comet Way to minimise costs. The shaft itself is located approximately
110m west of EC1. It is envisaged that a closed loop system could be deployed where energy
from the warm mine water could be absorbed in an antifreeze solution circulated in the
source loop of a conventional heat pump located at EC1. The heat pump working fluid, having
benefited from a temperature increase following compression, would be used to supply a
second heat exchange system attached to the heat distribution network. The low
temperature network would have a flow and return temperature of 55-35°C and therefore
would have fewer heat losses than a high temperature network.
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Figure 4.6: Temperature and COP of other Minewater Heat Recovery Projects10
A similar study undertaken by Wardell Armstrong in the City of Stoke on Trent found that
445kW of heat was recoverable from 122m depth via a standing column well with a 5 l/s bleed
circulation of minewater. Other projects at Freiberg and Rostov have achieved COPs of close
to 4 (see Figure 4.6) with a water temperature similar to those found within the Leicestershire
mine workings. It is also assumed that, with the exception of the fire station which will be
built to modern building standards, the remaining buildings will require a significant fabric
efficiency improvement for this technology to work. Detailed assessments should be
undertaken should this option progress to the next stage, however for modelling purposes it
is assumed the heating demand will be reduced by 44% (this is loosely in line with the CO2
reductions required by current Building Regulations) and the improvement costs will be
approximately similar to residential at £83/m2.
10 Ramos, R., Breede, K and Falcone, G. 2015. Geothermal heat recovery from abandoned mines: a systematicreview of projects implemented worldwide and a methodology for screening new projects. Environmental EarthScience V73, 6783-6795.
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Whilst it has not been considered in detail in the financial model, it is worth noting that there
is some potential for private wire electrical connections in the vicinity of the proposed
Coalville energy centre options. This is important for CHP generation because the electricity
could potentially be sold at a premium directly to end users rather than at the wholesale
generation prices. Allowance must still be given for increased capital installation costs so only
electrical loads near to the energy centres have been considered. For simplicity electrical
loads exceeding 100MWh/yr within 200m of the energy centre have been identified and are
reported in Table 4.5 below.
The above table suggests that, in theory, 860MWh of electricity per year could be supplied by
private wire if EC1 is adopted whilst 1,598MWh could be supplied via EC2. It is not known at
this stage whether any of these electrical loads would be interested in switching supplier to a
local generator and it is therefore recommended that further investigation into the viability
of private wire schemes be considered in the next phase of works.
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4.7 Financial Appraisal
The financial appraisal provides further details on the heat distribution network and
compares the financial viability of the energy generation technologies, collectively the DHN.
Cash flow models were applied to the DHN at 25 and 40-year project lifecycles. For each of
the lifecycle options, cash flow models were run at discount rates of 3.5%, 5% and 10%. No
debt finance has been considered in this phase of work so the networks were assessed based
on three primary funding scenarios:
i. A 20% HNIP grant towards the capital costs of the heat distribution network with
the remainder equity funded, together with energy centre qualification to the
Renewable Heat Incentive (RHI) where appropriate.
ii. No HNIP grant towards the capital costs of the heat distribution network so the
network completely equity funded, together with energy centre qualification to
the Renewable Heat Incentive (RHI) where appropriate.
iii. No HNIP grant towards the capital costs of the heat distribution network so the
network completely equity funded, and no energy centre qualification to the
Renewable Heat Incentive (RHI).
Quotations have been obtained for most of the equipment and materials required in the
Capex in addition to the fuel costs. When quotations for equipment, materials and fuels
where unavailable reasonable assumptions where made based on previous experience, other
reports and data sources. These are provided in full in the accompanying spreadsheets. For
CHP the modelled results assume 100% electricity export to grid to allow for a simple
comparison across the networks although the financial results could be improved if private
wire connections are used. Table 4.7 shows the financial assumptions made for the initial
assessment however some of the criteria will be tested in the subsequent sensitivity analysis.
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Table 4.6: Financial Assumptions
Financial Criteria Rate
Heat revenue inflation 2.70%
CPI Inflation 0.30%
RPI Inflation 1.10%
Gas price inflation 1.60%
Electricity price inflation 2.70%
Wood fuel costs inflation 2.50%
RHI Digression -1.00%
Rent (as percentage of capital costs) 1%
Insurance (as a percentage of capital costs) 1.50%
A sensitivity analysis has been undertaken on each of the modelled DHNs to show how the
financial outcomes change when adjustments are made to the models financial input criteria.
The sensitivity assessment is performed separately to the DHNs at 25 and 40-year project
lifecycles and 3.5%, 5% and 10% discount rates. The sensitivity assessment is applied to Capex,
Opex, and Fuel price and heat sales price at +/- 10% of the original modelled values.
Table 4.7, Table 4.8 and Table 4.9 show details of heat distribution network and a comparison
of the heat generation technologies. Table 4.10, Table 4.11 and Table 4.12 show the results
of the financial assessment for the DHN. Full details of what the costs include can be found in
Appendix C. Table 4.13 to Table 4.18 provides a sensitivity analysis which shows how the NPV
changes with adjustments to the financial input parameters.
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Table 4.8: Comparison of Baseload Energy Generation Technologies for the Coalville Network
1 2 3 4 5 6
Baseload TechnologyHoval STU WoodPellet Boiler 800
Small biomass airturbine CHP
Hoval Gas Boiler850
GE CHP (E)Imperitive Biomass
Boiler 550kWthPowerBloc EG-355
Fuel Source Wood Pellet Wood Chip Gas Gas Wood Chip Gas
Baseload Plant Capacity
Heat (kWth) 800 833 788 927 550 852
Electrical (kWe) 0 333 0 1,820 0 712
Baseload Plant Energy Generation
Heat (MWh/yr) 4,299 4,377 4,270 4,568 3,517 4,418
Electrical (MWh/yr) 0 1,751 0 8,972 0 3,692
Baseload Plant Module Capacities
Number of boilers/engines 1 1 1 1 1 2
Heat (kWth) 800 833 788 927 550 426
Electrical (kWe) 0 333 0 1820 0 356
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Table 4.9: Comparison of Peakload Energy Generation Technologies for the Coalville Network
1 2 3 4 5 6
Peakload PlantHoval GasBoiler 575
Hoval Gas Boiler 575 Hoval Gas Boiler 575 Hoval Gas Boiler 575 Hoval Gas Boiler 575 Hoval Gas Boiler 575
Peakload Plant Capacity
Heat (MWth) 0.53 0.53 0.53 0.53 1.07 0.53
Electrical (MWe) 0.00 0.00 0.00 0.00 0.00 0.00
Peakload Plant Energy Generation
Heat (MWh/yr) 473 395 502 204 1,255 354
Electrical (MWh/yr) 0 0 0 0 0 0
Peakload Plant Module Capacities
Number of boilers/engines 1 1 1 1 2 1
Heat (kWth) 533 533 533 533 533 533
Electrical (kWe) 0 0 0 0 0 0
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The following tables provide information on the sensitivity of the financial model to various criteria such as Capital Expenditure (CapEx),
Operational Expenditure (OpEx), fuel prices and, in the case of CHP, electricity sales price. For the purpose of this report only sensitivity figures
relating to the ‘with 20% HNIP Grant and RHI’ scenario have been presented.
Note: the greyed out line denotes that the energy option did not reach the criteria for HNIP eligibility.
Table 4.13: NPV Sensitivity Analysis for Coalville Network at 25-year project lifecycle and a 3.5% discount rate with 20% HNIP Grant & RHI
Table 4.14: NPV Sensitivity Analysis for Coalville Network at 40-year project lifecycle and a 3.5% discount rate with 20% HNIP Grant & RHI
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Table 4.15: NPV Sensitivity Analysis for Coalville Network at 25-year project lifecycle and a 5% discount rate with 20% HNIP Grant & RHI
Table 4.16: NPV Sensitivity Analysis for Coalville Network at 40-year project lifecycle and a 5% discount rate with 20% HNIP Grant & RHI
Table 4.17: NPV Sensitivity Analysis for Coalville Network at 25-year project lifecycle and a 10% discount rate with 20% HNIP Grant & RHI
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Table 4.18: NPV Sensitivity Analysis for Coalville Network at 40-year project lifecycle and a 10% discount rate with 20% HNIP Grant & RHI
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As can be seen in the financial analysis, the modelled Coalville DHN options are borderline
financially viable or financially unviable under most modelled conditions. Only gas CHP with
gas boilers (option 4) showed a positive NPV and this was only the case during a 40-year
project lifetime at a 3.5% discount rate and whilst supported by a 20% HNIP capital grant
towards the heat distribution network. The sensitivity analysis showed that the economic
outlook for option 4 could be improved if there was a reduction in OPEX and to a lesser extent
a reduction in fuel costs and an increase in the sales price of electricity. As it stands with no
sensitivity applied, option 4 has an IRR of -0.9% over a 25-year period and 3.8% over a 40-year
project lifecycle. This weak financial performance is primarily due to the Coalville DHN being
geographical large for the size of the heat load it would serve. The economics of the DHN
should be re-visited when significant additional heat loads become available, i.e. the
relocation of the Hermitage Leisure Centre to a town centre location in the next 5 years.
4.7.1 Low Temperature Alternative Network
Table 4.19 and Table 4.20 show details of Coalville low temperature heat distribution
network. Table 4.21, Table 4.22 and Table 4.23 show the results of the financial assessment
for this DHN. Full details of what the costs include can be found in Appendix C.
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As can be seen from Table 4.21, Table 4.22 and Table 4.23 none of the modelled scenarios
showed a positive NPV. This is largely due to the high operating costs associated with the
project notwithstanding the additional CAPEX involved with improving the building fabric
efficiency which wouldn’t be considered as part of other scenarios. The heat loads were
substantially reduced after the improved efficiency measures and without a substantial
temperature gradient the amount of energy that can be extracted from the mine is limited.
This project could be revisited in the future and may be more appropriate to a new
development on a smaller scale for instance for a single building.
4.8 Business as Usual
A business as usual (BAU) case has been considered for the Coalville network. The BAU cases
involve the financial analysis of the anchor loads on the network under a set of standard
conditions should a DHN not be implemented. The BAU cases have been modelled to use
modern gas boilers with the heat demands used in the DHN analysis. The gas purchase price
is modelled to be 2.55p/kWh which is the average price paid by a medium industrial business
in 2016. The gas boilers were assumed to have a 15 year life and be due for replacement in
the next 5 years with subsequent replacement costs applied at the appropriate times. Table
4.24 shows the BAU analysis.
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The BAU analysis has shown that modern gas boilers in the individual buildings can provide
the heat required by the anchor loads modelled on the Coalville network. It should be noted
this is an economic assessment only. The CO2 emissions stated represent the emissions
assuming current emission levels are maintained i.e. there are no technological
improvements to the replacement boilers that reduce emissions over the lifetime of the
project. There are therefore no CO2 savings associated with the BAU modelled case.
4.9 Future Opportunities
This stage of the feasibility study has focussed on the anchor loads identified as being core to
kick starting the DHN, however once a DHN is established there are some opportunities for
future growth, in particular, the redevelopment of the industrial estate around Vulcan Way,
the relocation of the Hermitage Leisure Centre to a town centre location in the next 5 years
and potentially an extension of the network to the community hospital, although this is some
distance away. There are also some opportunities to extend the network northwards
into the planned development areas that are there. If a network is
implemented it should be “futureproofed” to be compatible with potential growth, i.e. the
pipework specifications should allow for increased flow and there should be space at the
energy centre to add more equipment. The large development site to the south-east of the
town, the South East Coalville Sustainable Urban Extension, is too far away to be connected
the proposed Coalville network but could benefit from a separate DHN when sufficient anchor
loads become available.
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5 BROADNOOK GARDEN SUBURB
5.1 The Opportunity
The Broadnook Garden Suburb is a planned development located on land to the north of
Birstall in the Charnwood Borough (predominantly in the parish of Wanlip). The site is
identified within Charnwood Borough Council’s Local Plan Core Strategy (November 2015),
and is the subject of a planning application for around 1,650 homes, as well as a primary
school, community resource centre, health centre, and retail and commercial spaces. Figure
5.1 shows an overview of the site and a high resolution map is provided in Appendix A4.
Figure 5.1: Broadnook Garden Suburb Masterplan
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5.2 Potential Heat Loads from New Development
At the time of writing information regarding the form of the proposed development is limited,
therefore the demand for heat and power has been only broadly estimated in order to
provide an idea of scale. For non-domestic buildings, demand was estimated based on
expected floor areas provided by the developer alongside generic benchmark figures for each
building type. For domestic development demand was estimated using housing mix data from
another similar development as a proxy, alongside information from the Strategic Housing
Market Assessment (SHMA)11 , national space standards 12 and data from the National Energy
Efficiency Database (NEED) 13. The availability of the calculated demand was estimated over
time using information contained in the Strategic Housing Land Availability Assessment
(SHLAA) documentation. The demand estimates are purely indicative at this stage and will
need to be refined once more detailed information becomes available. Estimated energy
demands for this site are included in Appendix A3.
5.3 Heat Load Profile
The Broadnook profile accounts for all heat loads noted in Appendix A3 at the completion
year (2027) of the development. A sample of the modelled demands for the residential,
commercial and total profile are shown in Figure 5.2. As can be seen the total combined
profile shown in purple is mostly impacted by the residential profile (blue) while the
commercial profile has less of an impact. This is because the residential profile accounts for
62% of the annual heat demand and the commercial profile only 38%. The total annual
demand for the Broadnook network without losses is 15,964MWh. The generated profile is
based on a number of assumptions. There are 1650 dwellings which have been split evenly
across the build types (detached, semi-detached, terrace and flat). The occupancy profiles
have been split at 30% occupancy profile 1, 60% occupancy profile 2 and 10% occupancy
profile 3.
11 http://www.charnwood.gov.uk/pages/strategichousingmarketassessment12 https://www.gov.uk/government/publications/technical-housing-standards-nationally-described-space-standard13 https://www.gov.uk/government/collections/national-energy-efficiency-data-need-framework
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Figure 5.2: Heat Demand Profile for the Broadnook Network
The modelled profile is less “peaky” than the other networks modelled but can still be
smoothed using a moving average to account for the storage capacity of the network itself
(water retained in the pipework). The Broadnook network has a storage buffering capacity of
approximately 15 hours. The impact of this on the final demand profile is shown in Figure 5.3.
As a result, the peak demand is approximately half that of the non-buffered profile.
Figure 5.3: Heat Storage Buffering Effect on Broadnook Network
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5.4 Potentially Viable Energy Supply Options and Energy Centres
The Broadnook network has a number of technologies that are suitable for consideration. A
summary of the technologies being considered are shown in Table 5.1. Consultation was
undertaken with Advance Tapes to determine the potential viability of recovering waste heat
within their manufacturing process but due to distance and geographic constraints a
connection to the Broadnook network was determined to be unfeasible. It was also
established through consultation with Biffa that the AD plant to the east of Broadnook at
Wanlip did not have any waste heat available for export.
Table 5.1: Heat Generation Technology Considered for Broadnook DHN
Network Option Baseload Peakload
Broadnook Network Biomass Boilers
Biomass CHP
Gas Boilers
Gas CHP
Gas Boilers
The target baseload capacity was 75% of the heat demand, with the peak load plant aiming
to provide the remaining heat. Based on the capacity of the individual boilers and CHP systems
the baseload modules couldn’t always meet exactly 75% but multiple modules were used to
reach a capacity that was as close as possible to this size.. The number of units in each of the
scenarios varies due to capacity of the individual modules being modelled., In some cases,
based on quoted plant costs, it was preferable to use a larger number of lower capacity
modules to come closer to the 75% baseload rather than a lower number of higher capacity
modules. This has the additional benefit for a new development of allowing a phased
deployment of the network as construction progresses. Details of the Broadnook heat
generation technology options are shown in Table 5.2 below.
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Table 5.2: Broadnook Heat Generation Technology Options
Broadnook Heat Generation Technology Options
1 2 3 4 5 6
Bas
e
Heat Generation Technology Biomass Boiler Biomass CHP Gas Boiler Gas CHP Biomass Boiler Gas CHP
Number of Boilers/Engines 3 4 2 2 1 5
Total Capacity Thermal 2,925kW 3,333kW 3,708kW 3,122kW * 2,000kW 3,275kW
Total Capacity Electrical 0 1,333kW 0 7,280kW * 0 2,660kW
Pea
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Heat Generation Technology Gas boiler Gas boiler Gas boiler Gas boiler Gas boiler Gas boiler
Number of Boilers/Engines 4 2 2 2 1 2
Total Capacity Thermal 1,296kW 1,066kW 648kW 1,066kW 4,150kW 1,066kW
Total Capacity Electrical 0 0 0 0 0 0
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5.5 Energy Distribution Network
The Broadnook energy distribution network connects commercial loads to the west and the
northeast of the development and residential properties towards the centre and the far west.
The proposed Broadnook energy centre is located towards the southwest of the development
approximately central to the northern and western branches of the network with good access
from the A46 and A6. Estimates of the cost, heat losses and pumping requirement is shown
in Table 5.3 below and a map of the DHN is shown in Figure 5.4. The heat distribution network
modelled is indicative and should be re-assessed once the heat loads on the network can be
confirmed. Full details of the capital costs are provided in Appendix C.
Table 5.3: Details of the Broadnook Heat
Distribution Network
Capital Cost £2,260,500
Heat Losses 946 MWh/yr
Pumping Requirement 566 MWh/yr
Network Length 3125m
08/08/2016Drawn By:
Checked By:
Date:
Date:J Wilkinson
1 : 6000@ A3
S. Allen 22/08/2016
Containsr Open OS Data. Contains public sector information licensed under the Open Government Licence v2.0
Figure 5.6PE10591
-1.1267° : -52.6953°
BNG Ref:
OS 100km Grid:
Long : Lat DMS
Long : Lat DD
448836 : 318009 SK 129
-1° 7' 36.12" : 52° 41' 43.03"
Landranger Ref:
1 : 750 000
Broadnook Heat NetworkCharnwood District
Leicestershire
Wardell Armstrong LLPWheal Jane Earth Science ParkBaldhu, Truro, TR3 6EH
Tel: +44 (0) 1872 560738email: [email protected]: www.wardell-armstrong.com
200Metres0
Heat Distribution Network
Broadnook Energy Centre
Figure 5.4
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5.6 Financial Appraisal
The financial appraisal provides further details on the heat distribution network and
compares the financial viability of the energy generation technologies, collectively the DHN.
Cash flow models were applied to the DHN at 25 and 40-year project lifecycles. For each of
the lifecycle options, cash flow models were run at discount rates of 3.5%, 5% and 10%. No
debt finance has been considered in this phase of work so the networks were assessed based
on three primary funding scenarios:
i. A 20% HNIP grant towards the capital costs of the heat distribution network with
the remainder equity funded, together with energy centre qualification to the
Renewable Heat Incentive (RHI) where appropriate.
ii. No HNIP grant towards the capital costs of the heat distribution network so the
network completely equity funded, together with energy centre qualification to
the Renewable Heat Incentive (RHI) where appropriate.
iii. No HNIP grant towards the capital costs of the heat distribution network so the
network completely equity funded, and no energy centre qualification to the
Renewable Heat Incentive (RHI).
Quotations were obtained for most of the equipment and materials required in addition to
the likely fuel costs. When quotations for equipment, materials and fuels were unavailable
reasonable assumptions were made based on previous experience, other reports and data
sources. These are provided in full in the accompanying spreadsheets. For CHP options, the
modelled results assume 100% electricity export to the grid to allow for a simple comparison
across the networks, although the financial results could be improved if private wire
connections were used. Table 5.4 shows the financial assumptions made for the initial
assessment, however some of the criteria will be tested in the subsequent sensitivity analysis.
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Table 5.4: Financial Assumptions
Financial Criteria Rate
Heat revenue inflation 2.70%
CPI Inflation 0.30%
RPI Inflation 1.10%
Gas price inflation 1.60%
Electricity price inflation 2.70%
Wood fuel costs inflation 2.50%
RHI Digression -1.00%
Rent (as percentage of capital costs) 1%
Insurance (as a percentage of capital costs) 1.50%
A sensitivity analysis has been undertaken on each of the modelled DHNs to show how the
financial outcomes change when adjustments are made to the models financial input criteria.
The sensitivity assessment was undertaken at 25 and 40-year project lifecycles and 3.5%, 5%
and 10% discount rates. The sensitivity assessment was applied to Capex, Opex, fuel price and
heat sales price at +/- 10% of the original modelled values.
Table 5.5, Table 5.6 and Table 5.7 show details of heat distribution network and a comparison
of the heat/energy generation technologies. Table 5.8, Table 5.9 and Table 5.10 show the
results of the financial assessment for the DHN. Full details of what the costs include can be
found is Appendix C. Table 5.11 to Table 5.16 give the sensitivity analysis results showing how
the NPV changes with adjustments to the financial input parameters.
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Table 5.5: Details of the Broadnook Heat Distribution Network
Heat Distribution Network
Heat supply
Heat Demand (MWh/yr) 16,910
Losses (MWh/yr) 946
Total Heat Required (MWh/yr) 17,856
DHN Losses/Total Heat Req 5.30%
Heat Distribution Network Lifetime 40
Initial Capital Costs
Heat Distribution Network £2,055,000
Contingency £205,500
Other Capital Costs £0
Total Initial Capital Costs £2,260,500
Annual costs
Rent/Wayleaves £0
Maintenance £5,000
Business Rates £0
Insurance £0
Pumping cost £44,967
Annual Costs £49,968
Decommissioning Costs £45,210
As percentage of Capital Costs 2%
Revenue Streams
Heat sales £/kWh 0.035
Heat revenue £558,752
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The following tables provide information on the sensitivity of the financial model to various criteria such as Capital Expenditure (CapEx),
Operational Expenditure (OpEx), fuel prices and, in the case of CHP, electricity sales price. For the purpose of this report only sensitivity figures
relating to the ‘with 20% HNIP Grant and RHI’ scenario have been presented.
Note: the greyed-out line denotes that the energy option did not reach the criteria for HNIP eligibility.
Table 5.11: NPV Sensitivity Analysis for Broadnook Network at 25-year project lifecycle and a 3.5% discount rate with 20% HNIP Grant & RHI
Table 5.12: NPV Sensitivity Analysis for Broadnook Network at 40-year project lifecycle and a 3.5% discount rate with 20% HNIP Grant & RHI
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Table 5.13: NPV Sensitivity Analysis for Broadnook Network at 25-year project lifecycle and a 5% discount rate with 20% HNIP Grant & RHI
Table 5.14: NPV Sensitivity Analysis for Broadnook Network at 40-year project lifecycle and a 5% discount rate with 20% HNIP Grant & RHI
Table 5.15: NPV Sensitivity Analysis for Broadnook Network at 25-year project lifecycle and a 10% discount rate with 20% HNIP Grant & RHI
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Table 5.16: NPV Sensitivity Analysis for Broadnook Network at 40-year project lifecycle and a 10% discount rate with 20% HNIP Grant & RHI
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As can be seen from the financial analysis, there are two leading options, GE Gas CHP with
peak lopping gas boilers (option 4) and gas boilers exclusively (option 3). Option 4 is the
financially strongest option overall but both options have positive NPVs in all of the modelled
scenarios with the exception of the option 3 under a 10% discount rate. It should be noted
that neither of these options qualifies for the RHI and option 3 is excluded from the 20% HNIP
capital grant. Option 4 also returns the highest IRR’s across the three scenarios and across
both the 25 year and 45 year project lifetimes. The Hoval gas CHP with gas boilers (option 6)
is a financially viable option with positive NPVs but only at 3.5% and 5% discount rates over a
40 year project lifetime. The sensitivity analysis has shown that gas boilers (option 3) are
relatively resilient to all of the sensitivities modelled while the CHP options are significantly
affected by variations in OPEX, fuel price and the electricity sales price.
5.7 Business as Usual
A business as usual (BAU) case has been considered for the Broadnook network. The BAU
cases involve the financial analysis of the anchor loads on the network under a set of standard
conditions should a DHN not be implemented. The BAU cases have been modelled to use
modern gas boilers with the heat demands used in the DHN analysis. The gas purchase price
is modelled to be 2.55p/kWh which is the average price paid by a medium industrial business
in 2015. The gas purchase price is modelled to be 2.55p/kWh which is the average price paid
by a medium industrial business in 2016. The gas boilers were assumed to have 5 years left of
a 15 year life with replacement costs applied at appropriate times. Table 5.17 shows the BAU
analysis.
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The BAU analysis has shown that modern gas boilers in the individual buildings can provide
the heat required by the anchor loads modelled on the Broadnook network. It should be
noted this is an economic assessment only. The CO2 emissions stated represent the emissions
assuming current emission levels are maintained i.e. there are no technological
improvements to the replacement boilers that reduce emissions over the lifetime of the
project. There are therefore no CO2 savings associated with the BAU modelled case.
5.8 Future Opportunities
This stage of the feasibility study has focussed on the “as planned” development at
Broadnook. It is possible that sometime in the future the development may be extended. If a
network is implemented it should be “futureproofed” to be compatible with potential growth,
ie the pipework specifications should allow for increased flow and there should be space at
the energy centre to add more equipment.
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6 RAMSCLIFF AVENUE
6.1 The Opportunity
Ramscliff Avenue is located towards the south side of Donisthorpe, to the south of Acresford
Road. Ramscliff Avenue hosts a mix of privately owned and Council owned properties which
were built in the 1950s and are not connected to the gas grid. The properties are currently
primarily heated by solid fuel back boilers. There are 53 properties in total under Council
ownership which are being considered for the DHN. Properties under private ownership have
not been considered in this assessment at this phase but could potentially be included at a
later stage. Land adjacent to Ramscliff Avenue is under Leicestershire County Council
ownership and should this land be developed for housing it could create a larger network in
the future.
6.2 Potential Heat Loads from Existing Buildings
The majority of the dwellings on Ramscliff Avenue are 1950s system built semi-detached or
terraced homes. Most of these houses have insulated walls with concrete cladding and solid
fuel boilers with radiators (the data provided by North West Leicestershire Council indicates
that one house on the street has electric heating). It is noted that the Council has a
commitment to replace all solid fuel heating systems with an alternative by 2025.
Address data provided by North West Leicestershire Council for council-owned properties on
Ramscliff Avenue was plotted using OS coordinates in order to show which of the properties
on the street were under the Council’s management and were therefore more likely to agree
to be connected to a district heating scheme. Note that some of the address points did not
fall exactly within a building outline and therefore there may be some level of error here that
would need to be considered should any scheme progress further.
6.3 Potential Heat Loads from Existing Buildings
The Council owned dwellings heat loads have been estimated using the house type and data
from the National Energy Efficiency Data Framework (NEED). Table 6.1 shows the heat
demand for Ramscliff Avenue.
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Table 6.1: Heat Demand for Ramscliff Avenue
Variable Demand
Total Heat Demand 751,500 kWh
6.4 Heat Load Profile
The Ramscliff Avenue profile accounts for all individual dwellings summarised in Appendix A3.
A sample of the modelled demand profile for the dwellings is shown in Figure 6.1. The total
annual demand for the Ramscliff Avenue network without losses is 751,500 kWh. The
generated profile is based on a number of assumptions. There are 53 dwellings which have
been split across the build types according to information provided by the Client. The
occupancy profiles have been split at 25% occupancy profile 1, 25% occupancy profile 2 and
50% occupancy profile 3.
Figure 6.1: Heat Demand Profile for Ramscliff Avenue Network
The modelled profile is “peaky” with the peak load being approximately 3 times the average.
Due to its relatively small size, the network has a heat storage capacity of only 20 minutes
which will not have a substantial smoothing effect on the modelled profile. Storage tanks
could be implemented to allow for a more smoothened demand profile and to reduce the
boiler capacity. Figure 6.1 shows the smoothened profile with a maximum of 10 hours storage
which reduces the peak load by approximately half.
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Figure 6.2: Ramscliff Avenue Heat Load Profile (after Smoothing)
6.5 Potentially Viable Energy Supply Options and Energy Centres
In terms of suitable heating technologies, options are limited for Ramscliff Avenue. Gas and
gas CHP have been discounted as the cluster is not connected to the gas network. Biomass
boilers have been considered and CHP could have potential although without any fixed anchor
loads the electricity would be exported to the national grid. Water in a flooded mineshaft
could also potentially be used as a heat source for a low temperature DHN in conjunction with
a water sourced heat pump (WSHP) and there are one or two shaft in the vicinity, so this
option has been considered. It is also likely that GSHPs or ASHPs, which do not need a DHN
may be a cheaper option, so these have also been assessed.
As a result of the low temperature heat produced by heat pumps, the buildings being served
by them have to have a high thermal efficiency. The buildings at Ramscliff Avenue do not
currently have a high enough fabric efficiency to permit the connection of heat pumps and
therefore the costs and constraints associated with improving the building efficiency must be
included within the assessment. Although the dwellings at Ramscliff Avenue have undergone
some thermal efficiency upgrades, they would have to be brought up to the thermal efficiency
standard required in the current Building Regulations for a heat pump to operate effectively.
The costs associated with this have been included within the financial appraisal. Upgrading
the building fabric would also reduce the modelled heat demands noted in section 6.2.
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Two options have been modelled for GSHPs and ASHPs, one with no grant and a second with
a 20% grant. Heat pumps have been modelled for space heating requirements only. The
dwellings post improvement energy requirement is based on the dwelling floor area and the
Zero Carbon Hubs Fabric Energy Efficiency Standard (FEES) with an additional 10%.
6.5.1 Biomass Boilers and Biomass CHP
As Ramscliff is off the gas grid, biomass technologies are the only options available to supply
heat to a standard DHN. Without the option for gas boilers for peak lopping, biomass boilers
and CHP have been sized to meet 100% of the peak load. For some of the modelled scenarios
the boilers are oversized as there are fewer options available. Details of the potential biomass
heat/ energy generation options available at Ramscliff Avenue are shown in Table 6.2
(Options 1-4).
Table 6.2: Ramscliff Heat Generation Technology Options
1 2 3 4
Bas
e
Heat Generation
Technology
Biomass
Boiler
Biomass
Boiler
Biomass
Boiler
Biomass CHP
Number of
Boilers/Engines 4 1 1 2
Total Capacity Thermal 240kW 175kW 360kW 160kW
Total Capacity Electrical 0 0 0 90kW
Pea
k
Heat Generation
Technology
Not required Biomass
Boiler
Not required Biomass
Boiler
Number of
Boilers/Engines 0 1 0 1
Total Capacity Thermal 0 60kW 0 60kW
Total Capacity Electrical 0 0 0 0kW
6.5.2 Minewater Heat Recovery
The mine water heat recovery option (Option 5) involves pumping minewater from a nearby
borehole at Saltersford Brook where the water would be transferred to a single heat pump
housed in the energy centre. At this stage a heat exchanger would transfer the heat to a
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closed loop heat pump system and transferred across the heat distribution network. It was
decided that as a nearby borehole exists close to the site, it would be preferred to utilise this
existing access to the flooded mine rather than incurring the costs of drilling a new borehole
when it is not known if the mine water reservoir extends beneath the estate. The system
consists of a 60kWth closed loop water source heat pump that would increase the mine water
from 11.6 °C to a maximum flow of 55 °C and a return of 25 °C. It is assumed a COP of 3.9
would be achieved based on a review of case studies from other mine water heat recovery
schemes.
6.5.3 GSHPs
Standalone GSHPs (Option 6) which have been modelled to be deployed as individual heat
pumps at each property. Single heat pumps with individual ground mains where chosen
opposed to communal ground mains as they can be built out in a more incremental manor.
The heat pumps have been sized based on the Kensa Heat Pumps approximate sizing
guidelines for efficient buildings with an additional 20% capacity factor. The ground main
would be installed in shallow trenches or boreholes in the gardens of each property. After
improving the building fabric Table 6.3 shows the details of the GSHP option.
Table 6.3: Ramscliff Avenue GSHP (Option 6)
Unit Capacity
(kW)
Number
Required
Small 3.5 1
Medium 4.3 20
Large 6 32
6.5.4 ASHPs
Standalone ASHPs (Option 7) have been sized based on the Kensa Heat Pumps approximate
sizing guidelines for efficient buildings with an additional 20% capacity factor. After improving
the building fabric, Table 6.4 shows the details of the ASHP option.
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Table 6.4: Ramscliff Avenue ASHP (Option 7)
Unit Capacity
(kW)
Number
Required
Small 4.8 21
Medium 8.3 32
Large 11 0
6.6 Energy Distribution Network
The heat distribution network is small in size by comparison to the other networks as it only
services properties on one street and is shown in Figure 6.3 below. The Ramscliff Avenue
energy centre would be located on green disused space towards the east of Ramscliff Avenue
and the heat distribution network tracks almost the whole length of the street. A second
section of the network runs southeast along a field boundary to the south of Ramscliff avenue
towards the borehole at Saltersford Brook with the potential for an extension across
Measham Road to the borehole at Oakthorpe Bungalow. Table 6.5 shows a comparison of the
proposed heat networks for the standard biomass energy centres and the extended mine
water heat recovery route. Full details of the network costs are provided in Appendix C.
Table 6.5: Comparison of Proposed Heat Networks
Biomass Energy
Centre
Mine Water Heat
Recovery Route
Capital Cost £308,750 £924,320
Heat Losses 60 MWh/yr 66 MWh/yr
Pumping Requirements 17 MWh/yr 51 MWh/yr
Network Length 480m 1437m
09/08/2016Drawn By:
Checked By:
Date:
Date:J Wilkinson
1 : 3 500@ A3
Figure 6.2PE10591
-1.5314° : 52.7215°
BNG Ref:
OS 100km Grid:
Long : Lat DMS
Long : Lat DD
431650 : 313899 SK 128
-1° 31' 52.87 : 52° 43' 17.3"
Landranger Ref:
1 : 750 000
Ramscliff Heat NetworkNorth West Leicestershire District
Leicestershire
Wardell Armstrong LLPWheal Jane Earth Science ParkBaldhu, Truro, TR3 6EH
Tel: +44 (0) 1872 560738email: [email protected]: www.wardell-armstrong.com
S Allen 22/08/2016
Containsr Open OS Data. Contains public sector information licensed under the Open Government Licence v2.0
Council Owned Dwellings
Minewater Extraction Borehole
Ramscliff Energy Centre
Heat Distribution Network
Minewater Pipeline
Potential Minewater Extension
200Metres0
Figure 6.3
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6.7 Financial Appraisal
The financial appraisal provides further details on the heat distribution network and
compares the financial viability of the energy generation technologies, collectively the DHN.
Cash flow models were applied to the DHN at 25 and 40-year project lifecycles. For each of
the lifecycle options, cash flow models were run at discount rates of 3.5%, 5% and 10%. No
debt finance has been considered in this phase of work so the networks were assessed based
on three primary funding scenarios:
i. A 20% HNIP grant towards the capital costs of the heat distribution network with
the remainder equity funded, together with energy centre qualification to the
Renewable Heat Incentive (RHI) where appropriate.
ii. No HNIP grant towards the capital costs of the heat distribution network so the
network completely equity funded, together with energy centre qualification to
the Renewable Heat Incentive (RHI) where appropriate.
iii. No HNIP grant towards the capital costs of the heat distribution network so the
network completely equity funded, and no energy centre qualification to the
Renewable Heat Incentive (RHI).
Quotations were obtained for most of the equipment and materials required in addition to
the likely fuel costs. When quotations for equipment, materials and fuels where unavailable
reasonable assumptions where made based on previous experience, other reports and data
sources. These are provided in full in the accompanying spreadsheets. For CHP options, the
modelled results assume 100% electricity export to the grid to allow for a simple comparison
across the networks, although the financial results could be improved if private wire
connections were used. Table 6.6 below shows the financial assumptions made for the initial
assessment, however some of the criteria will be tested in the subsequent sensitivity analysis.
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Table 6.6: Financial Assumptions for Ramscliff
Avenue
Financial Criteria Rate
Heat revenue inflation 2.70%
CPI Inflation 0.30%
RPI Inflation 1.10%
Gas price inflation 1.60%
Electricity price inflation 2.70%
Wood fuel costs inflation 2.50%
RHI Digression -1.00%
Rent (as percentage of capital costs) 1%
Insurance (as a percentage of capital costs) 1.50%
A sensitivity analysis has been undertaken on each of the modelled DHNs to show how the
financial outcomes change when adjustments are made to the models financial input criteria.
The sensitivity assessment was undertaken at 25 and 40-year project lifecycles and 3.5%, 5%
and 10% discount rates. The sensitivity assessment was applied to Capex, Opex, fuel price and
heat sales price at +/- 10% of the original modelled values.
6.7.1 Biomass Heat Generation
Table 6.7, Table 6.8 and Table 6.9 show details of heat distribution network and a comparison
of the heat generation technologies. Table 6.10, Table 6.11 and Table 6.12 show the results
of the financial assessment for the DHN. Full details of what the costs include can be found is
Appendix C. Table 6.13: to Table 6.18 give the sensitivity analysis results showing how the
NPV changes with adjustments to the financial input parameters.
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I
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Table 6.13: NPV Sensitivity Analysis for Ramscliff Network at 25-year project lifecycle and a 3.5% discount rate with 20% HNIP Grant & RHI
Table 6.14: NPV Sensitivity Analysis for Ramscliff Network at 40-year project lifecycle and a 3.5% discount rate with 20% HNIP Grant & RHI
Table 6.15: NPV Sensitivity Analysis for Ramscliff Network at 25-year project lifecycle and a 5% discount rate with 20% HNIP Grant & RHI
Table 6.16: NPV Sensitivity Analysis for Ramscliff Network at 40-year project lifecycle and a 5% discount rate with 20% HNIP Grant & RHI
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Table 6.17: NPV Sensitivity Analysis for Ramscliff Network at 25-year project lifecycle and a 10% discount rate with 20% HNIP Grant & RHI
Table 6.18: NPV Sensitivity Analysis for Ramscliff Network at 40-year project lifecycle and a 10% discount rate with 20% HNIP Grant & RHI
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As can be seen from the financial analysis none of the biomass heat generation technologies
result in a positive NPV for the Ramscliff network even when benefitting from a 20% capital
grant towards the distribution network and the RHI support for the generation. The sensitivity
analysis has shown that even under economically favourable conditions, the networks remain
at a negative NPV in all cases.
6.7.2 Mine water Heat Recovery
Table 6.19 shows details of heat distribution network. Table 6.20, Table 6.21 and Table 6.22
show the results of the financial assessment for the DHN across the three primary funding
scenarios. Full details of what the costs include can be found in Appendix C.
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As can be seen from the financial analysis the minewater heat recovery network does not
provide a positive NPV under any of the modelled scenarios.
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6.7.3 GSHPs and ASHPs
Table 6.23 shows details of the heat pump options comparison Table 6.24 shows the results
of the financial assessment for the heat pump options. Full details of what the costs include
can be found in Appendix C.
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As can be seen from the financial analysis none of the heat pump options provide a positive
NPV under any of the modelled scenarios, however they are still probably the most cost
effective solution.
6.8 Business as Usual
For the purpose of comparative emissions, the business as usual (BAU) case assumes the
existing heating requirements are currently fulfilled by domestic coal boilers. Further
consideration of the BAU case has not been given for the Ramscliff Avenue network because
the NWLDC has committed to replacing the existing heating systems in the near future.
6.9 Future Opportunities
This stage of the feasibility study has focussed on the Council owned housing at Ramscliff
Avenue. The properties under private ownership could potentially also be connected to a
network if one was developed. Leicestershire County Council own some land adjacent to
Ramscliff Avenue. Should this land be developed for housing, it would create an opportunity
for enlarging a network in the future. Any network that is implemented should be
“futureproofed” to be compatible this potential growth, ie the pipework specifications are
compatible with this and there is space at the energy centre for more equipment.
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7 ST MATTHEWS AVENUE
7.1 The Opportunity
St Matthews Avenue is located at Worthington, approximately 1km north of Newbold. St
Matthews Avenue hosts a mixture of privately owned and Council owned properties built in
the 1950s that are not connected to the gas grid. The properties are currently primarily
heated by solid fuel back boilers. There are 61 properties in total under Council ownership
which are being considered for the DHN. Properties under private ownership have not been
considered in this assessment at this phase but could potentially be included at a later stage.
7.2 Potential Heat Loads from Existing Buildings
The majority of the dwellings on St Matthew’s Avenue are 1950s system built semi-detached
or terraced homes. Most of these houses have insulated walls with concrete cladding and
solid fuel boilers with radiators. Address data provided by North West Leicestershire Council
for council-owned properties on St Matthew’s Avenue was plotted using OS coordinates in
order to show which of the properties on the street were under the Council’s management,
and were therefore more likely to agree to be connected to a district heating scheme. Note
that some of the address points did not fall exactly within a building outline and therefore
there may be some level of error here that would need to be considered should any scheme
progress further. It is noted that the Council has a commitment to replace all solid fuel heating
systems with an alternative by 2025.
The Council owned dwellings heat loads have been estimated using the house type and data
from the National Energy Efficiency Data Framework (NEED). Table 7.1 shows the heat
demand for St Matthews Avenue.
Table 7.1: Heat Demand for St Matthews Avenue
Variable Demand
Total Heat Demand 808,000 kWh