UK needs German lessons
August 1st 2008 The UK should follow the example being shown by Germany, which is taking radical
steps to stimulate its already relatively healthy market for microgeneration and
renewable technologies, according to British sustainability firm Baxi-SenerTec
German domestic and
commercial users of
combined heat and power
(CHP) and photovoltaics (PV) already
receive a guaranteed premium price
for any electricity they generate
themselves and sell back to the grid.
From January 1 next year they will
receive an additional financial
incentive with the introduction of a
payment for using their own
electricity.CHP owners will receive
between 11.59 and 13 Euro cents for
every kWh they generate made up of
a quarterly agreed price from their
utility company, an 'avoided network
usage'payment for not taking power
from the Grid and an additional CHP
bonus of 5.11 cents. PV users receive
49 cents because of the far higher cost
of buying and installing PV systems.
The German parliament has just
passed the CHP Act, which
guarantees these generous feed-in
and own usage tariffs until 2016
allowing users to invest in CHP
engines with confidence.At the same
time,Germany has introduced a 10%
surcharge on fossil fuels providing
further incentive for users to invest in
alternative energy sources.
German utility companies have
the responsibility for administering
the feed-in system and making the
payments to individual users.This
avoids the bureaucracy and
complexity issues that discouraged
so many UK consumers from
claiming their grants under the Clear
Skies and Low Carbon Buildings
Programme. In Germany, the utility
pays and then claims the money
back from the Government.
Private grid
Germany is trying to create a
localised 'private'grid system made
up of thousands of individual
microgenerators to reduce
dependence on large, centralised
power stations. Such a network is
already up and running in part of
the Black Forest.
"Feed-in tariffs are proving
extremely successful in Germany
and I would urge the UK to consider
a similar system," says Matt Johler,
export manager of Baxi-SenerTec,
the UK owned CHP manufacturer
based in Bavaria.
"In 1999 the German market was
very similar to the UK market today,
but the incentives have totally
transformed the commercial
environment in favour of
microgeneration. Under the new
regulations, microgenerators now
have the same rights as the large
utility companies and power stations.
"CHP has the best payback of any
of the sustainable technologies
whatever the market conditions,"says
Mike Malina, consultant to the M&E
Sustainability campaign."The German
model is an ideal one for the UK to
follow because it shows what can be
achieved by using financial incentives.
"If the UK government is serious
about cutting carbon emissions and
improving our security of energy
supply, it must stand up to the utility
companies and impose a feed-in
tariff system that guarantees
consumers a fair price for energy
they generate themselves."
Misguided
The amount of CHP generated in the
UK has nearly doubled in the past
decade, from 3.68GW in 1998 to
5.55GW in 2006.But Graham Meeks,
director of the Combined Heat and
Power Association,believes the
government can do more to ensure
the technology reaches its full
potential:"Without effective and
enduring incentives to make these
investments,our next generation of
power stations will simply replicate the
failings of the past and continue with a
needless waste of valuable heat."
Subsidy
The UK remains the exception when
it comes to providing incentives for
microgeneration, according to David
Shaw, business manager of Baxi-
SenerTec (UK).
"We are almost alone in Europe in
having no policies aimed at
providing continuous support for a
mass market for microgeneration
technologies,"he says."We estimate
that a 25% capital subsidy for CHP
would lead to 18 million units being
installed by 2030.This would reduce
the country's CO2 emissions by 24
million tonnes a year and eliminate
the need for the proposed new
generation of nuclear power stations.
"Gas-fired CHP is the most
appropriate microgen technology
for the UK as we have a relatively
plentiful supply of natural gas and it
can be easily retrofitted to existing
heating systems,"adds Mr Shaw.
Many experts suggest that a
minimum feed-in tariff of 5p/kWh
should be imposed to give
consumers the incentive to produce
their own electricity.However, this
proposal was voted down in the
debate over the UK Energy Bill this
year and, although the House of
Lords is considering amendments,
only PV is being considered as a
potential beneficiary of feed-in tariffs. More articles from Baxi-SenerTec UK: | 
