Ground Source Heat Pump

Solutions for Social Landlords

Chris Davis
Commercial Director, Kensa Heat Pumps
 Ground source heat pumps in action
Client: Trent & Dove Housing
Project: Installation of ground source heat
pump systems, replacing electric heating
Supplier: Kensa Heat Pumps
Installed by: Kensa Contracting, GeoDrill,
J. Tomlinson
Number of properties: 133 bungalows
Funding: Non Domestic RHI and Energy
Company Obligation
ECO supplier: EdF Energy
Ground source heat pumps in action

133 bungalows, across 15 sites

Off the gas grid, in rural
Staffordshire
Heated by night storage heaters
Elderly residents
Ground source heat pumps: great idea, but.
Typical social landlord reaction to ground source heat pumps:
Like the technology in theory, but.
Cost is a barrier
Complex, high risk, difficult
Poor experiences with other technologies
Dont have enough information to
influence others

All can be an issue, but not if

Ground source heat pumps: great idea, but.
The scheme is well thought through and
planned;
You work with specialists with a track record
in the social sector;
The right properties in the right locations
are selected;
You take advantage of ALL the funding
options available;
You consider ALL the benefits
A different approach for social landlords
A different approach for social
landlords
Turnkey delivery
Innovative approach to the RHI
Support with up front capital
contribution
Longer term income stream
Fundable
Retrofit and new build
 About Kensa
UK manufacturer
Single technology solution provider
Established 1999
Based in Truro, Cornwall
Industry accredited
Over 4000 installations
Social housing specialists
UK market leader
Recently established delivery arm Kensa Contracting
 Ground Source Heat Pump Technology

Hot water cylinder Highly energy efficient space and

water heating solution
Radiator system Electrically driven appliance
Moves solar energy from the ground
Heat Pump into the property
Utilises collector pipework buried
Borehole in the ground
Typically one unit of electricity
produces between 3 and 4 units of
heat
 Ground Source Benefits
Tenant Benefits
Heating System Running Cost p/kWh
Lowest possible tenant heating and hot water
16
energy costs 14
Highest efficiency; unaffected by outside weather 12
conditions 10
8
Typical savings of around 50% vs night storage 6
heaters and 30% vs oil 4

No bulk fuel purchases 2

0
Lower standard rate electricity charges than split Gas LPG Oil boiler, Night Biomass HP, 250% HP, 300%
boiler, boiler, 70% storage, pellet efficient efficient
tariffs 70% 70% efficient 100% boiler,
Reduces cost of other household electrical efficient efficient efficient 85%
efficient
consumption
Fuel cost p/kWh Fuel cost p/useful kWh
Improved comfort, health, well-being, quality of life
 Ground Source Benefits
For a typical social home:
8,000kWh heating/hot water per year Heating System Running Cost p/kWh
16
14

Electrically heated: 12
10
784 per year running cost 8

+ supplementary heating costs 6

4
2

Ground source heat pump heated: 0

Gas LPG Oil boiler, Night Biomass HP, 250% HP, 300%
355 per year running cost boiler,
70%
boiler,
70%
70% storage, pellet efficient efficient
efficient 100% boiler,
efficient efficient efficient 85%
efficient

SAVING: 429 per year! Fuel cost p/kWh Fuel cost p/useful kWh
 Ground Source Benefits
Landlord Benefits
Planning exempt (no noise issues)
Lower CO2 emissions, improved
SAP ratings
Other building maintenance costs
reduced
E.g. less damp due to under heating
Minimal service & maintenance costs
No mandatory annual safety inspection
Minimal preventative maintenance
Extremely low lifetime ownership costs
20 25 year heat pump unit life expectancy
>100 year borehole life expectancy
 Renewable Heat Incentive
Designed to support 2020 Renewable Energy targets
15% of energy from renewable sources
Tariff based payment
Aimed at covering additional costs of a renewable heat technology
Two streams
Domestic
Non domestic
including residential district heating
 Non Domestic RHI
Opportunity for social housing (both new build and retro fit) to benefit from
adopting district systems supported by the Non Domestic RHI and ECO

Domestic Non Domestic

Coverage Individual domestic properties Residential district, commercial

Includes retro fit Yes Yes
Includes new build No Yes
Tariff payment 7 years 20 years
Measurement Deemed Metered
Paid on Renewable heat only All heat
Tariff rates Modest requires fuel cost saving to Attractive GSHP rates recently doubled
produce payback
Can be used in conjunction with ECO* No Yes
 Micro District ground source heating
Individual Kensa Shoebox Each home has own
heat pump in each home radiators, hot water cylinder
and controls
Shared ground array, serving No heat loss through
2 or more properties district pipework

No need to apportion
Designed, delivered and energy bills
installed by Kensa

New build or retrofit

Eligible as district heating
for ECO and RHI purposes
No need for a plant room
Scalable and versatile
 Energy Company Obligation (ECO)
Provides an upfront capital subsidy
Typically 20-25% of the total cost

Supports district heating schemes

District heating now confirmed as a primary measure
Rural areas attractive

Grant level dependent on CO2 savings

Displacement of electric heating is preferable

Ofgem recently confirmed 40 year lifetime for district ground source heat pump systems
EdF Energy has provided Kensa customers with over 1m in ECO funding for GSHP
projects
 The Unique Kensa Shoebox Heat Pump
Designed to be installed inside the property;
Small, compact dimensions fits in a standard airing
cupboard;
6kW model ideal for social housing retro fits;
Ultra-quiet, using twin, low output compressors;
Up to 65C flow temperature (R134a refrigerant), so
able to cope with domestic hot water with no need for
back up;
Designed for use with standard heating controls.
 Kensas process Access ECO funding
RHI compliance and application
Comprehensive system warranty
Remote access meter readings
Compliance Ongoing technical support
& Support
Responsive maintenance

Tenant liaison
On site project management
Drilling contractors
Delivery
Feasibility study
Heating system contractors
Clear cost and return analysis
Commission and hand over Feasibility &
Design Property survey and EPC
Geotechnical survey
Full system design (incl MCS,
borehole array, mechanical)
 GSHP System Costs and Returns
I N V E ST M E N T C O ST S VS I N C O M E ST R E A MS
25,000

Typical 2 bedroom bungalow, 8000kWh/yr

20,000
Additional cost
Budget NSH (before ECO subsidy), RHI over 20
replacement, 10,000 years, 16,500
ECO, 3,000 15,000
3,500

10,000
INSTALLED
COST: ECO
5,000
13,500 Budget NSH
subsidy,
3,000
replacement
cost, 3,500
0
Additional
landlord Investment costs Income streams
contribution,
7,000 TOTAL RHI INCOME OVER 20 YEARS: 16,500
Kensa funding
Options for micro-district or individual properties
Kensa finance packages typically cover the borehole
and ground source heat pump installation
RHI income offsets cost of finance
Landlord may need to provide some contribution
towards the internal heating system
Up to the value of a NSH replacement system
Dependent on energy demand/house size, fully
funded schemes are possible
 New build
Non Domestic RHI model also applies in new build Example: New Linx Housing
Not possible with Domestic RHI 53 unit development

Ofgem has confirmed RHI payments are allowable even if Micro district ground source heat pump system
in receipt of an HCA grant (although some conditions Accesses funding through HCA and RHI
apply)
Allows social housing new build to benefit from:
20 year RHI income stream
Cost effective
Lowest possible tenant running costs
Lowest lifetime ownership costs long service lifetime and
no mandatory annual servicing requirement
 Conclusions
Changes to the Non Domestic RHI tariffs have created opportunities in the social
housing sector for district ground source heat pump systems
Such systems are technically robust and can be delivered at lower capital cost
(when compared to stand alone single property installations)
ECO funding can provide upfront capital subsidy, to circa 25% of the project cost
Long term financial returns can be compelling
GSHP-based systems deliver the lowest running costs to the tenant and the
lowest lifetime ownership costs for the landlord
Both retrofit and new build projects will benefit from the RHI income