The smart systems that are saving businesses energy

Window cleaners scaling an office building seen through an infra red camera
Significant savings: CHP plants allow businesses to be energy smart Credit: Alamy

When we generate electricity, we produce heat – lots of it. We lose most of it too. According to the Association for Decentralised Energy (ADE), we waste enough to heat every home in the UK.

Fortunately, wasted heat is a great opportunity for businesses. Generating electricity through a combined heat and power (CHP) plant will allow a company to use the heat produced for other processes, rather than paying for both heat and electricity separately.

This will create significant energy and costs savings and also the potential to sell any excess power they create back to the grid.

“CHP plants are the future for lots of large energy users,” says Phil Gilbert, director of energy solutions at E.ON. “Now that businesses know what can be done with wasted heat, they are saying, ‘If we don’t have a CHP plant, we should certainly be looking at one and, if we do, are we getting the best out of it?’”

Generating electricity through a CHP plant allows companies to use the heat produced for other processes

Behind CHP plants lies a straightforward process. An engine, which is powered by natural gas, biogas or liquid or solid biofuels, is linked to a generator that produces electricity for the site. The excess heat that is generated during the process is recovered from the engine and used separately – for example, to heat or cool buildings or to provide heat for facilities such as swimming pools.

For businesses, there is a clear cost advantage to recycling heat in this way. The ADE cites the example of Rotherham Hospital, which saved £273,000 and 1,300 tonnes of carbon over a 12-month period as a result of switching to CHP.

Yet it is not just large-scale operations, such as hospitals, big manufacturing businesses and universities that use CHP. Thanks to the savings on offer, it is also gaining in popularity among smaller organisations.

“The CHP plants that we’ve put in have resulted in energy savings of around 20 per cent over five years,” says Gilbert. “So we’re getting good traction with small manufacturers because 20 per cent off their energy consumption on production could give them an advantage over their competitors.”

While many businesses in the UK already have a CHP plant, they often fail to exploit its full potential, according to Gilbert. “They treat it as a back-up generation asset,” he says. “They don’t do anything with it.”

In fact, the best results come when CHP is integrated with other energy-efficient systems such as low-temperature hot-water systems and absorption cooling systems. Savings are also greater if a business has demand side response (where it is financially rewarded for reducing its electricity use at peak times).

Thanks to the savings on offer, it is also gaining in popularity among smaller organisations

As a system, CHP particularly suits organisations with high-energy requirements, such as farms, hospitals, hotels, leisure centres, manufacturing businesses, office blocks, prisons and universities. This is because of the level of savings involved.

While the main benefit of installing CHP is clearly the potential for lower energy costs, the system offers some other significant advantages for businesses, with a more flexible electricity supply and greater stability around costs, as gas prices are not exposed to the risk of increased third party charges.

Customers can plan energy production around their own processes and timings so that any energy generated outside of their peak times can be sold on, enabling them to profit from their own efficiency. Alternatively, they can store the energy for later, although they would need to invest in battery storage to do so.

“You could use your CHP plant to heat the swimming pool or for all the lighting in the facility at peak times,” says Gilbert. “Effectively you would almost disconnect the highest-consuming assets within your business from high-price tariffs.”

Finally, CHP plants are less harmful for the environment than conventional forms of energy generation since they typically produce 10 per cent less carbon dioxide emissions.

Every business has different requirements, which is why E.ON designs and develops customised power generation plants, sourcing the optimum technologies for each customer.

It can also help with financing. “The biggest hurdle for many customers is the capital outlay required to put the CHP plant in,” says Gilbert. “So we’re working across the business to help finance these projects for customers.”

E.ON can project manage the entire process of rolling out CHP, from planning and design to installation of the CHP plants. Once the plants are installed, it can also operate and maintain the CHP on a day-to-day basis.  So businesses that don’t want to waste their energy don’t have to worry about wasting their time either.

Download a free energy report here and for more information on energy saving solutions, visit eonenergy.com