By Nigel A-F
8th June, 2018
Recently declared Government policy is that oil is to be removed from the fuel mix for rural estates by 2030.
Seems a long time away, but we already know that the deadline for new systems to qualify for the current 20-year heat subsidy regime is 1 April 2021. The implication is clear enough: schools and other estates need to be getting any oil systems converted to low-carbon alternatives before April 2021, or take the financial risk of doing it after the subsidy regime has closed.
Schools, at least, need to start considering their options during 2018 or at the very latest during 2019, because switching from oil cannot be done in a hurry without incurring undue risk. The right technology needs to be identified, which means getting hold of some trustworthy impartial advice. The finance needs to be put in place, either from within or through a 3rd party, as subsidies only start once an installation has been commissioned and registered with Ofgem. And, for schools, the programme needs to be approved by the Governing Body, which in our experience is likely to take some months. After all, it’s a significant investment. The installation project is likely to take from 4 to 8 months, so all told the lead time is 1 to 2 years.
Working back from the April 2021 deadline, it rather suggests planning should start during 2018 or at the very latest during 2019.
It’s not all doom and gloom. The subsidies are helpful. All depending on the detail at the site, the value of the subsidy over its 20-year life could be as high as £1M or more. Likewise, the net financial benefit in switching to a low-carbon alternative could be well over £1M.
Here’s a chart we’ve shown before. It’s a relatively small ground source heat pump system, but do please take a look at the average return on investment and eventual net benefit figures in the Performance overview box.
Ground Source Heat Pump returns chart: Fandangle Hall School. (Results based on a real school estate. Wouldn’t it be great if there was a real school called Fandangle Hall).