3514120A-BEE AVONMOUTH SEVERNSIDE ENERGY MASTERPLANNING REPORT TECHNO-ECONOMIC ANALYSIS

CONFIDENTIAL MAY 2016 AVONMOUTH SEVERNSIDE ENERGY MASTERPLANNING REPORT FINAL ISSUE South Gloucestershire Council

Revision 2 Confidential

Project no: 3514120A-BEE Date: May 2016

WSP | Parsons Brinckerhoff WSP House 70 Chancery Lane London WC2 1AF

Tel: 020 7314 5000 www.wspgroup.com www.pbworld.com QUALITY MANAGEMENT

ISSUE/REVISION FIRST ISSUE REVISION 1 REVISION 2 REVISION 3

Remarks Draft for comment Comments Further comments addressed addressed

Date 24/12/16 11/02/16 01/04/16

Prepared by Laurie Eldridge Laurie Eldridge Laurie Eldridge

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Checked by Andrew Goodman Andrew Goodman Andrew Goodman Bruce Geldard Bruce Geldard

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Project number 3514120A-BEE 3514120A-BEE 3514120A-BEE

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PRODUCTION TEAM

WSP | PARSONS BRINCKERHOFF

Project Engineer Laurie Eldridge

Senior Project Engineer Andrew Goodman

Technical Director Bruce Geldard

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TABLE OF CONTENTS

1 INTRODUCTION ...... 1

2 HEAT DEMAND SUMMARY ...... 2 2.1 Cribbs Patchway...... 2 2.2 New Earth to Accolade Wines ...... 3 2.3 Southmead ...... 3 2.4 UWE...... 4

3 HEAT DEMAND PROFILING ...... 5

4 PIPELINE MODELLING ...... 8 4.1 Estimation of peaks ...... 8 4.2 Pipeline modelling ...... 11 4.3 Outputs ...... 12

5 CHP SIZING...... 17 5.1 New Earth Solutions ...... 18

6 THERMAL STORE SELECTION ...... 20

7 OTHER TECHNICAL INPUT TO THE MODELLING ...... 23 7.1 Carbon Factors ...... 23 7.2 Restrictions on number of starts...... 23 7.3 Boiler Efficiencies ...... 23 7.4 Energy Centre Parasitic Loads...... 23

8 FINANCIAL ANALYSIS ...... 24 8.1 Rationale ...... 24 8.2 Capex ...... 24 8.3 CHP CAPEX and maintenance ...... 24 8.4 Energy centre size ...... 25 8.5 Consumer side costs ...... 25 8.6 New development heat networks ...... 26 8.7 Other capex ...... 26 8.8 Summary of CAPEX ...... 26 8.9 Maintenance ...... 27 8.10 Replacement costs (Repex) ...... 27

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8.11 Operating income ...... 28 8.12 Consumer unit maintenance, metering and billing costs ...... 29 8.13 Heat Sales Prices ...... 29 8.14 Electricity sales ...... 30 8.15 Electrical import and gas...... 30 8.16 Purchase of heat from New earth Solutions ...... 31 8.17 Variation through time...... 31 8.18 CRC and other carbon taxation schemes ...... 31 8.19 RHI ...... 31

9 FINANCIAL RESULTS ...... 32 9.1 Cribbs...... 32 9.2 New Earth Solutions ...... 32 9.3 Southmead ...... 33 9.4 UWE...... 34

10 SENSITIVITY TO KEY LOADS – UWE NETWORK ...... 35 10.1 Introduction – linear heat density modelling...... 35 10.2 Linear heat density results ...... 35 10.3 Load Profiling ...... 37 10.4 Pipeline Modelling ...... 37 10.5 CHP modelling ...... 38 10.6 Financial inputs...... 39 10.7 Energy centre size ...... 39 10.8 Consumer side costs ...... 39 10.9 Summary of CAPEX ...... 39 10.10 Financial results...... 40

11 SOUTHMEAD NETWORK – FURTHER ANALYSIS ...... 41

12 FINANCIAL SENSITIVITY ...... 43 12.1 Energy costs / Prices ...... 43 12.2 Effect of RHI ...... 43

13 CARBON SAVINGS ...... 44

14 CONCLUSIONS ...... 45

15 STRATEGIC NETWORK ASSESSMENT ...... 46 15.1 Introduction ...... 46

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15.2 Methodology ...... 46 15.3 Heat Supply – Capacity and Costs ...... 46 15.4 Heat Loads and Network Route ...... 48 15.5 Capital Cost Estimates...... 52 15.6 Potential Volume Of Heat Supply ...... 59 15.7 Value Of Heat Supply ...... 60 15.8 Potential Return On Investment And Carbon Savings ...... 60

16 APPENDIX A: HEAT DEMAND PROFILES ...... 65

17 APPENDIX B: CONSUMER SIDE COST SUMMARY ...... 78

18 APPENDIX C: PHASED AVONMOUTH SEVERNSIDE NETWORK DEVELOPMENT ...... 80

19 APPENDIX D: PROCESS STEAM USE IN THE VICINITY OF SERC ...... 87

20 APPENDIX E: NEW EARTH SOLUTIONS ...... 89 20.1 Business Changes ...... 89

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TABLES

TABLE 2-1: HEAT DEMANDS CRIBBS PATCHWAY ...... 2 TABLE 2-2: BENCHMARKED HEAT DEMANDS – CRIBBS PATCHWAY ...... 3 TABLE 2-3: HEAT DEMANDS – NEW EARTH TO ACCOLADE WINES ...... 3 TABLE 2-4: HEAT DEMANDS - SOUTHMEAD ...... 3 TABLE 2-5: BENCHMARKED HEAT DEMANDS -SOUTHMEAD ...... 4 TABLE 2-6: HEAT DEMANDS - UWE ...... 4 TABLE 2-7: BENCHMARKED HEAT DEMANDS - UWE ...... 4 TABLE 4-1: SUMMARY OF LOAD FACTORS ...... 8 TABLE 4-2: CRIBBS PATCHWAY PEAK HEAT DEMANDS ...... 8 TABLE 4-3: ACCOLADE WINES HEAT PEAK DEMANDS ...... 9 TABLE 4-4: SOUTHMEAD NETWORK PEAK HEAT DEMANDS...... 9 TABLE 4-5: UWE NETWORK PEAK HEAT DEMANDS...... 9 TABLE 4-6: HIU RATINGS ...... 10 TABLE 4-7: FLOW AND RETURN TEMPERATURES ...... 12 TABLE 4-8: SUMMARY OF PIPELINE MODELLING OUTPUTS ...... 12 TABLE 5-1: SUMMARY OF CHP SIZES ...... 17 TABLE 5-2: SUMMARY OF CHP PERFORMANCE ...... 17 TABLE 8-1: CHP CAPEX ...... 24 TABLE 8-2: ENERGY CENTRE ESTIMATED FLOOR AREA ...... 25 TABLE 8-3: SUMMARY OF CONSUMER SIDE COSTS ...... 25 TABLE 8-4: OTHER CAPEX ...... 26 TABLE 8-5: SUMMARY OF CAPEX ...... 26 TABLE 8-6: MAINTENANCE COSTS ...... 27 TABLE 8-7: REPEX COSTS...... 28 TABLE 8-8: HEAT SALES PRICES ...... 29 TABLE 10-1 LINEAR HEAT DENSITY TESTING (LIST) ...... 36 TABLE 10-2: CORE UWE CHP CAPEX ...... 39 TABLE 10-3: ENERGY CENTRE ESTIMATED FLOOR AREA ...... 39 TABLE 10-4: SUMMARY OF CAPEX ...... 39 TABLE 13-1: ANTICIPATED CARBON SAVINGS ...... 44 TABLE 15-1: CAPITAL COSTS SCENARIO 1 ALL CLUSTERS - SERC AND NES ...... 55 TABLE 15-2: CAPITAL COSTS - SCENARIO 2 ALL CLUSTERS - SERC ONLY ...... 56 TABLE 15-3: SCENARIO 3 – CAPITAL COSTS CPNN AND SOUTHMEAD ONLY - SERC ONLY ...... 57 TABLE 15-4: CAPITAL COSTS - SCENARIO 4 - CPNN ONLY - SERC ONLY ...... 58 TABLE 15-5: CAPITAL COSTS - SCENARIO 5 – UWE TO CITY CENTRE LINK - SERC ONLY ...... 59 TABLE 15-6: DHW AND SPACE HEATING PROFILES ...... 65 TABLE 15-7: CRIBBS PATCHWAY ESTIMATED CIU COSTS ...... 78 TABLE 15-8: ACCOLADE WINES ESTIMATED CIU COSTS ...... 78 TABLE 15-9: SOUTHMEAD NETWORK ESTIMATED CIU COSTS ...... 78 TABLE 15-10: UWE NETWORK ESTIMATED CIU COSTS ...... 79

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FIGURES

FIGURE 3-1: CRIBBS PATCHWAY NETWORK ...... 6 FIGURE 3-2: ACCOLADE WINES HEAT DEMAND PROFILE...... 6 FIGURE 3-3: SOUTHMEAD NETWORK HEAT DEMAND PROFILE ...... 7 FIGURE 3-4: UWE NETWORK HEAT DEMAND PROFILE ...... 7 FIGURE 4-1: DOMESTIC HOT WATER DIVERSITY FACTORS ...... 11 FIGURE 4-2: CRIBBS PATCHWAY SCHEME ...... 13 FIGURE 4-3: NEW EARTH SOLUTIONS ...... 14 FIGURE 4-4: SOUTHMEAD ...... 15 FIGURE 4-5: UWE 16 FIGURE 6-1: CRIBBS PATCHWAY THERMAL STORE SELECTION ...... 20 FIGURE 6-2: SOUTHMEAD THERMAL STORE SELECTION ...... 21 FIGURE 6-3: UWE THERMAL STORE SELECTION ...... 21 FIGURE 9-1: 25-YEAR CUMULATIVE DISCOUNTED CASHFLOW, CRIBBS PATCHWAY ...... 32 FIGURE 9-2: 25-YEAR CUMULATIVE DISCOUNTED CASHFLOW, NEW EARTH SOLUTIONS ...... 33 FIGURE 9-3: 25-YEAR CUMULATIVE DISCOUNTED CASHFLOW, SOUTHMEAD...... 33 FIGURE 9-4: 25-YEAR CUMULATIVE DISCOUNTED CASHFLOW, UWE...... 34 FIGURE 10-1 LINEAR HEAT DENSITY RESULTS ...... 36 FIGURE 10-2: CORE UWE NETWORK PROFILE THROUGH THE YEAR ...... 37 FIGURE 10-3: CORE UWE NETWORK ...... 38 FIGURE 10-4: DISCOUNTED CUMULATIVE CASHFLOW – CORE UWE SCHEME ...... 40 11-1: SOUTHMEAD NETWORK LINEAR HEAT DENSITY...... 41 FIGURE 15-1: SERC TO ALL CLUSTERS ...... 51 FIGURE 15-2: ROUTE FROM UWE CLUSTER TO THE CITY CENTRE (TEMPLE & REDCLIFFE EC IN ST PHILIPS) ...... 52 FIGURE 18-1: 2019 NETWORK ...... 81 FIGURE 18-2: 2021 NETWORK ...... 82 FIGURE 18-3: 2023 NETWORK ...... 83 FIGURE 18-4: 2025 NETWORK ...... 84 FIGURE 18-5: 2027 NETWORK ...... 85 FIGURE 18-6: 2029 NETWORK ...... 86

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1 INTRODUCTION This report builds on the Avonmouth & Severnside Heat Network Study – Heat Mapping Report completed by WSP | Parsons Brinckerhoff (WSP | PB). Within this previous report, which formed the first phase of a study examining the potential for decentralised energy networks within the Avonmouth-Severnside area of South Gloucestershire, a number of heat clusters with the potential for decentralised energy networks were identified. Following a workshop to discuss these, four potential heat clusters were identified for further analysis:

à Cribbs Patchway à New Earth Solutions to Accolade Wines à Southmead à UWE

This report focuses on more detailed modelling of each of these clusters. This is set out in the following sections:

à Heat Demand Summary: Summarises heat demands as set out in the heat mapping report. Also includes benchmarks for those loads for which no demands had been available. à Load profiling: Heat demands were collected in the form of kilowatt-hours per annum. In order to model the operation of a CHP engine against these demands, it is necessary to have the variation throughout the year. This section sets out the process by which annual demands were converted into hourly profiles. à CHP sizing: This section focuses on the selection of an appropriately sized CHP engine to meet the heat demands. à Pipeline modelling: WSP | PB’s bespoke model was used to size and cost the pipe network required to supply the heat loads. This includes estimation of peak heat demands for each of the loads on the network. à Financial modelling: A full financial model was undertaken for each of the networks, in order to establish economic viability. à Sensitivity analysis: Financial sensitivity to key criteria. à Update of strategic network assessment: Following on from the initial heat networks proposition in the previous heat mapping report. à Conclusions and recommendations

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2 HEAT DEMAND SUMMARY This section sets out the loads which comprise each of the four clusters, as identified within the Heat Mapping Report:

à Cribbs Patchway à New Earth to Accolade Wines à Southmead à UWE 2.1 CRIBBS PATCHWAY

The following heat demands were collected for the Cribbs Patchway cluster:

Table 2-1: Heat demands Cribbs Patchway

Site Name Heat demand (kWh/yr) Aztec Hotel & Spa Unavailable CPNN - residential 14,166,000 CPNN - non-residential 21,305,000 Callicroft Primary School 185,000 Hilton Bristol Hotel Unavailable Holy Family Primary School 140,000 Patchway Community School 1000,000 Patchway Locality Hub 200,000 Rolls Royce 7,000,000 St Chad's Primary School 120,000 Stoke Lodge Primary School 200,000

For those loads where no heat demand was available, the following process was used to derive an estimate:

à Area of building and number of storeys established using Google Maps to give overall external floor area à Heat benchmark applied based on CIBSE Guide TM46 fossil fuel benchmarks and an assumed boiler efficiency of 80% à Total building heat demand calculated.

It should be noted that this is a fairly crude approach and more refined data would need to be gathered at the next stage of design. However, these heat demands are sufficient at this high- level feasibility stage.

The calculations undertaken are set out below:

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Table 2-2: Benchmarked heat demands – Cribbs Patchway

Area from Benchmark Benchmarked Google Maps Number (2006) heat demand Site Name (m2) of floors Use type (kWh/m2/yr) (kWh/annum) Aztec Hotel & Spa 5500 2.5 Hotel 264 3,630,000 Hilton Bristol Hotel 6200 2 Hotel 264 3,274,000

2.2 NEW EARTH TO ACCOLADE WINES

This is a very small network which provides a link between the New Earth Solutions renewable energy plant and Accolade Wines. As the New Earth Solutions plant is solely providing (i.e. not using) heat, there is no associated demand listed.

It is noted that there are other potential heat demands in this area but these are, in the main, small privately owned businesses. Typically it could be expected that such loads might join a network that is already in operation but would not be relied on as part of a base case business plan. We have therefore not included these in the demands identified at this stage.

Table 2-3: Heat demands – New Earth to Accolade Wines

Site Name Heat demand (kWh/annum) Accolade Wines 4,165,000 New Earth N/A

2.3 SOUTHMEAD

Heat demands collated for the Southmead network are summarised in the table below:

Table 2-4: Heat demands - Southmead

Heat demand Site Name (kwh/annum) Badocks Wood Primary - Southmead Childrens’ Centre 120,000 BAE systems 1,094,000 Charborough Road Primary School 170,000 Filton Sports & Leisure Centre Unavailable Horfield Leisure Centre 1,518,000 South Gloucestershire & Stroud College Unavailable Southmead Hospital 28,508,000

One of the potential additional loads on this network is Airbus. This has a significant heat demand of 22.8GWh – and so could nearly double the heat demands. It has been excluded as it is now understood that the campus has a fully decentralised heating system with around 500 different combustion appliances mainly in the 10-500kW range. Many are warm air or other types not readily converted to L/MPHW without significant expenditure.

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A benchmarking process was followed to establish heat demands for the remaining loads, as set out in Section 2.1. The outcomes of the benchmarking are set out in the table below:

Table 2-5: Benchmarked heat demands -Southmead

Benchmark Area from Benchmark ed heat Google Number of (2006) demand Site Name Maps floors Use type (kWh/m2/yr) (kWh/yr) Sports Filton Sports & Leisure centre Centre 2400 1 (dry) 264 633,600 South Gloucestershire & Stroud College 8750 3 School 120 3,150,000

2.4 UWE

Heat demands of the network in and around UWE are summarised in the table below:

Table 2-6: Heat demands - UWE

GIS ID Heat demand (kWh/annum) Bristol Rovers/ UWE stadium 4,980,000 Frenchay Hospital 2,936,000 Harry Stoke 7,245,000 Hewlett Packard 1,523,000 Higher Education Funding Council None Holiday Inn Bristol-Filton None Land East of Coldharbour Lane 2,818,000 Land East of Harry Stoke 11,986,000 MoD Filton Abbey Wood 8,994,000 Romney House 289,000 UWE 6,768,000 The outputs from benchmarking are summarised in the table below: Table 2-7: Benchmarked heat demands - UWE Area from Number Benchmark Benchmarked Google of Use (2006) heat demand GIS ID Maps floors type (kWh/m2/yr) (kWh/annum) Higher Education Funding Council 1500 3 Office 96 432,000 Holiday Inn Bristol-Filton 6250 2 Hotel 264 3,300,000

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3 HEAT DEMAND PROFILING It is proposed that the clusters are initially supplied with heat from gas-fired CHP engines, with back up and peaking heat supplied by gas boilers. Gas-fired CHP is proposed as the base case for feasibility: it is a well-proven, reliable technology, with engines available from a wide range of manufacturers. Compared to biomass solutions, it is low risk from a planning / fuel supply and storage perspective.

The hourly variation in heat demand throughout the year is used to assess the operation of the CHP engines, and select appropriately sized models. Annual heat demands were therefore converted into hourly heat profiles using WSP | PB’s in-house load profiling tool.

This tool uses assumed daily heat demand profiles for space heating and domestic hot water (DHW), with separate profiles for weekday and weekend demands and an assumed percentage split between the two. Hot water demands are assumed to remain constant throughout the year, whilst space heating demands vary inversely with external temperature (it is assumed that heating is required once the external temperature drops below 15.5°C)

The following main use types were used for profiling purposes:

à Hospital à Hotel à Leisure centre (with pool) à Leisure centre (dry) à Residential à Office à Stadium à School à University uses1

In addition, particular profiles were developed for Accolade Wines and the BAE Filton Cribbs Patchway New Neighbourhood development.

These profiles are illustrated in appendix A.

1 Comprising offices, refectory, student union and student accommodation.

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The resultant annual profiles for the four networks set out above are illustrated in the subsequent diagrams:

Figure 3-1: Cribbs Patchway Network

Cribbs Patchway network 70,000

60,000

50,000 ) W k (

d 40,000 n a m e

d 30,000 t a e H 20,000

10,000

- 1 7 3 9 5 1 7 3 9 5 1 7 3 9 5 1 7 3 9 5 1 7 3 9 5 1 7 3 9 5 1 7 3 6 3 9 6 3 9 6 2 9 6 2 9 5 2 9 5 2 8 5 2 8 5 1 8 5 1 8 4 1 8 4 1 2 5 7 0 3 5 8 1 3 6 9 1 4 7 9 2 5 7 0 3 5 8 1 3 6 9 1 4 7 9 2 5 1 1 1 1 2 2 2 2 3 3 3 3 4 4 4 5 5 5 5 6 6 6 6 7 7 7 7 8 8 Hour through year

Figure 3-2: Accolade Wines heat demand profile

Accolade Wines 600

500

) 400 W k ( d n a 300 m e d t a e

H 200

100

- 3 1 9 7 5 3 1 9 7 5 3 1 9 7 5 3 1 9 7 5 3 1 9 7 5 3 1 9 7 5 1 9 7 5 5 1 7 3 9 4 0 6 2 8 3 9 5 1 7 2 8 4 0 6 1 7 3 9 5 0 6 2 8 4 9 5 1 2 5 7 0 2 5 8 0 3 5 8 0 3 6 8 1 3 6 9 1 4 6 9 1 4 7 9 2 4 7 9 2 5 1 1 1 1 2 2 2 2 3 3 3 3 4 4 4 4 5 5 5 5 6 6 6 6 7 7 7 7 8 8 Hour through year

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Figure 3-3: Southmead Network heat demand profile

Southmead network 20,000

18,000

16,000

14,000 ) W

k 12,000 ( d n a 10,000 m e d t

a 8,000 e H 6,000

4,000

2,000

- 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 3 6 9 2 5 8 1 4 8 1 4 7 0 3 6 9 2 5 9 2 5 8 1 4 7 0 3 6 0 3 6 9 2 5 8 1 4 2 4 6 9 1 3 6 8 0 3 5 7 0 2 4 6 9 1 3 6 8 0 3 5 7 0 2 4 7 9 1 3 6 8 0 3 5 1 1 1 1 2 2 2 2 3 3 3 3 3 4 4 4 4 5 5 5 5 6 6 6 6 6 7 7 7 7 8 8 8 Hour through year

Figure 3-4: UWE network heat demand profile

UWE Network 50,000

45,000

40,000

35,000 ) W k ( 30,000 d n a 25,000 m e d

t 20,000 a e H 15,000

10,000

5,000

- 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 3 6 9 2 5 8 1 4 8 1 4 7 0 3 6 9 2 5 9 2 5 8 1 4 7 0 3 6 0 3 6 9 2 5 8 1 4 2 4 6 9 1 3 6 8 0 3 5 7 0 2 4 6 9 1 3 6 8 0 3 5 7 0 2 4 7 9 1 3 6 8 0 3 5 1 1 1 1 2 2 2 2 3 3 3 3 3 4 4 4 4 5 5 5 5 6 6 6 6 6 7 7 7 7 8 8 8 Hour through year

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4 PIPELINE MODELLING 4.1 ESTIMATION OF PEAKS

Decentralised energy pipe networks need to be sized in order to serve the peak loads which will be encountered. The higher the peak demand, the larger the pipe diameter required. Peak loads were derived from the annual loads presented in Section 2; the methodology is set out in the following two sections.

NON-DOMESTIC LOADS

To convert from annual heat demands (in kWh) to peak heat demands (kW), load factors were applied. Load factors are given by the following equation:

) × 8760 ℎ (ℎ = i.e it is a representation of the “peakiness” of ℎ the heat demand throughout the course of a year.

Load factors were derived from the daily space heating and DHW profiles set out in the previous section and are summarised in the table below:

Table 4-1: Summary of Load Factors Use type Overall load factor Accolade Wines 90% Hospital 28% Hotel 15% Leisure Centre (With Pool) 33% Office 7% Stadium 15% School 8% Sports centre (dry) 13% UWE - office use 10% UWE - refectory 16% UWE – Student halls of residence 20% UWE – Student Union 15% BAE Filton - CPNN - non-residential 11%

Applying these load factors to the annual figures for each load leads to the following totals for each network:

Table 4-2: Cribbs Patchway Peak Heat Demands

Annual heat Peak heat Site Name demand (MWh) Load factor demand (MW) Aztec Hotel & Spa 3,630 15% 2.76 BAE Filton - CPNN - residential 14,166 N/A Residential

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BAE Filton - CPNN - non-residential 21,305 11% 22.11 Callicroft Primary School 185 8% 0.26 Hilton Bristol Hotel 3,274 15% 2.49 Holy Family Primary School 140 8% 0.20 Patchway Community School 1,000 8% 1.43 Patchway Locality Hub 200 7% 0.33 Rolls Royce 7,000 7% 11.42 St Chad's Primary School 120 8% 0.17 Stoke Lodge Primary School 200 8% 0.29

Table 4-3: Accolade Wines Peak Heat Demands

Annual heat Peak heat Site Name demand (MWh) Load factor demand (MW) Accolade Wines 4165 90% 0.53

Table 4-4: Southmead Network Peak Heat Demands

Annual heat Peak heat Site Name demand (MWh) Load factor demand (MW) Badocks Wood Primary - Southmead Childrens Centre 120 8% 0.17 BAE systems 1,094 7% 1.79 Charborough Road Primary School 170 8% 0.24 Filton Sports & Leisure Centre 634 13% 0.56 Horfield Leisure Centre 1,518 33% 0.53 South Gloucestershire & Stroud College 3,150 8% 4.50 Southmead Hospital 28,508 28% 11.62

Table 4-5: UWE Network Peak Heat Demands

Annual heat Peak heat GIS ID demand (MWh) Load factor demand (MW) Bristol Rovers/ UWE stadium 4,980 15% 3.82 Frenchay Hospital 2,936 N/A Residential Harry Stoke 7,245 N/A Residential Hewlett Packard 1,523 7% 2.48 Higher Education Funding Council 432 7% 0.71 Holiday Inn Bristol-Filton 3,300 15% 2.51 Land East of Coldharbour Lane 2,818 N/A Residential Land East of Harry Stoke 11,986 N/A Residential

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MoD Filton Abbey Wood 8,993 7% 15.67 Romney House 289 7% 0.47 Office use 2,835 10% 3.24 Refectory Use 193 16% 0.14 UWE2 Student halls 3,561 20% 2.03 Student union 179 15% 0.14

DOMESTIC LOADS

Domestic peak loads are calculated in a different manner to non-residential loads. This is because significant diversity in demands for hot water needs to be taken into account. For example, while the units in a block of flats will have similar heat demand profiles, each dwelling will experience its peak demand at a slightly different time. As such, the peak domestic demand on the network will be lower than that calculated by multiplying the number of dwellings by the per-dwelling peak heat demand.

The following peak demands are assumed per dwelling, based on typical heat interface unit ratings:

Table 4-6: HIU ratings Peak space heating demand 3.5 kW Peak DHW demand 30 kW

The diversity curve of hot water consumption is developed from data provided in technical DH guidance for designers (Standard DS 439:2009), and is illustrated below:

2 Note: Demands for UWE shown here are taken from work carried out by WSP | PB for UWE, August 2015

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Figure 4-1: Domestic hot water diversity factors

Domestic hot water diversity 1.00

0.90

0.80

0.70 r o

t 0.60 c a f y t i s

r 0.50 e v i d W

H 0.40 D

0.30

0.20

0.10

- 0 100 200 300 400 500 600 700 Number of dwellings

The resultant diversified peak heat demands are summarised in the table below:

Table 4-7: Diversified peak residential demands, Cribbs Patchway

Annual heat Peak heat demand Site Name demand (MWh) (MW) BAE Filton - CPNN - residential 14,166 36.10

Table 4-8: Diversified peak residential demands, UWE

Annual heat Peak heat demand GIS ID demand (MWh) (MW) Frenchay Hospital 2,936 2.57 Harry Stoke 7,245 6.10 Land East of Coldharbour Lane 2,818 2.83 Land East of Harry Stoke 11,986 10.17

4.2 PIPELINE MODELLING

WSP | PB’s proprietary pipeline model was used to model the pipe networks. This allows the diameter of pipe lengths to be calculated, DH network pumps to be sized, and indicative heat loss and network cost to be calculated.

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The inputs to the model are peak heat demand for each load connected to the network, flow and return temperatures, and network geometry.

Flow and return temperatures are here reproduced from the London Heat Network Manual3, which sets out best practice in this area.

The following flow and return temperatures are used, these are based on a combination of the London Heat Network Manual and WSP | PB’s experience of best practice in the construction of decentralised energy networks:

Table 4-9: Flow and return temperatures Temperature Source Primary flow 90°C District heating manual for London4 Primary return (Domestic space heating) 55°C District heating manual for London Primary return (DHW) 25°C District heating manual for London Primary return (non-domestic hot water) 55°C District heating manual for London

Non-domestic buildings can accept higher primary side temperatures, with temperatures of up to 110°C standard. If residential developments are served by hydraulically separated networks which in turn serve each property, then higher temperature flow in primary mains is possible, which will increase temperature differentials and minimise pipe diameters. On the other hand, heat losses will be higher, therefore higher temperatures would only be used when demands are high - for example when outside temperatures are below 5°C – so as to minimise heat losses through the year. The potential for such improvements would be considered in future, more detailed, feasibility studies.

4.3 OUTPUTS

The table below summarises the outputs from pipeline modelling. Series 2 insulation5 has been assumed throughout.

Table 4-10: Summary of pipeline modelling outputs Network option Network cost Total trench Total load at Pump Annual heat length (m) energy centre power losses (MWth) (kWe) (MWh/annum) Cribbs Patchway £8,450,000 7498 20.8 252 2194 New Earth Solutions £1,316,000 1507 1.3 6 355 Southmead £5,117,000 5543 6.1 41 1464 UWE £7,647,000 8265 47.3 396 2386

Indicative pipe diameters for the networks are shown in the following diagrams and tables. These show the pipe to the boundary of each stakeholder, and are schematics only.

3 http://www.londonheatmap.org.uk/Content/uploaded/documents/LHNM_Manual2014Low.pdf 4 The DH manual for London recommends a temperature of 110-80°C. 90°C has been selected here as the maximum safe temperature for hot water to enter dwellings. 5 Three insulation levels are available – 1, 2 and 3, of which 3 is the highest and 1 the lowest. Series 2 is generaly recommended for projects in the UK.

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Figure 4-2: Cribbs Patchway Scheme

Cost per m Diameters Length of this diameter in this Total cost for pipe (trench) (£ (nominal) (mm ID) option (m) diameter (£) capex) 50 £638 760 £484,615 65 £690 1,039 £716,809 80 £753 - £0 100 £873 24 £21,084 125 £979 1,284 £1,257,514 150 £1,099 126 £138,683 200 £1,232 788 £970,435 250 £1,380 2,204 £3,040,991 300 £1,430 1,273 £1,819,767

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Figure 4-3: New Earth Solutions6

Cost per m Diameters Length of this diameter in this Total cost for pipe (trench) (£ (nominal) (mm ID) option (m) diameter (£) capex) 65 £690 1,507 £1,039,830

6 Please note that while shorter routes may be feasible to connect these loads we are not currently able to guarantee this and so have taken a conservative position for this high level study. We also note that this longer route may provide additional opportunities for other loads to connect particularly on the business parks at the junction of St Andrews Rd and Kings Weston Lane

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Figure 4-4: Southmead

Cost per m Diameters Length of this diameter in this Total cost for pipe (trench) (£ (nominal) (mm ID) option (m) diameter (£) capex) 50 £638 995 21,502 65 £690 1,579 38,664 80 £753 214 5,512 100 £873 - - 125 £979 - - 150 £1,099 1,219 43,581 200 £1,232 1,536 57,908

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Figure 4-5: UWE

Cost per m Diameters Length of this diameter in this Total cost for pipe (trench) (£ (nominal) (mm ID) option (m) diameter (£) capex) 65 £690 1,079 £744,518 80 £753 30 £22,230 100 £873 - £0 125 £979 2,018 £1,976,475 150 £1,099 1,039 £1,141,800 200 £1,232 1,818 £2,239,428 250 £1,380 1,814 £2,502,772 300 £1,430 25 £36,050 350 £1,584 442 £699,501

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5 CHP SIZING The Cribbs Patchway, Southmead and UWE networks are to be provided with heat from a Combined Heat and Power (CHP) engine during the initial stages of the project (i.e. before a link to a waste heat supply is implemented). The one exception is the network which links New Earth Solutions and Accolade Wines – here heat is provided from the Energy from Waste plant at the former.

Initial CHP size was calculated assuming that the CHP meets 70% of annual heat demand over 6,000 hours. This is a rough, first-pass indicator which has been found by WSP | PB to indicate a suitable starting point for CHP selection, and provides a good base figure for testing different sizes. This formula is set out below:

× 70% 6000 ℎ = The resultant sizes are set out in the table below, alongside the engines modelled.

Table 5-1: Summary of CHP sizes Network Annual heat Estimated CHP CHP(s) Option heat demand (GWh) size (kW) modelled output (kW) Cribbs Patchway 51.2 5,980 2 x J616 5292 2 x J620 6600 J620 & J616 5946 New Earth 4.2 N/A N/A N/A

Southmead 35.2 4,110 2 x J420 2928 2 x J612 3970 2 x J616 5292 UWE 51.2 5,980 2 x J612 3970 2 x J616 5292 J616 & J612 5946

The performance of the CHPs listed in the table above is set out below:

Table 5-2: Summary of CHP performance Thermal output Engine name Electrical output (kW) (kW) Energy input kW(gross) J420 1487 1464 3,916 J612 2000 1985 5,068 J616 2679 2646 6,756 J620 3352 3300 8,440 J624 4401 4108 10,709

Initial modelling of the different CHP options against the heat loads showed that the following CHPs performed best against the loads in terms of heat output and run hours:

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Table 5-3: Summary of CHPs modelled Network Annual heat Estimated CHP CHP(s) Option heat demand (GWh) size (kW) modelled output (kW) Cribbs Patchway 51.2 5,980 2 x J620 6600 New Earth 4.2 N/A N/A N/A Southmead 35.2 4,110 2 x J612 3970 UWE 51.2 5,980 2 x J616 5292

These engines were thus taken forwards to the next stage of modelling.

5.1 NEW EARTH SOLUTIONS

As already discussed, it is proposed that Accolade Wines receives heat from New Earth Solutions. The potential heat supply from New Earth Solutions is greater than the peak demand at Accolade and so should be able to supply the total heat demand except for during periods of maintenance. It is therefore assumed that 90% of Accolade Wines’ heat demand is met in this way. The remaining 10% is assumed to be served from existing gas boilers at Accolade Wines

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6 THERMAL STORE SELECTION The use of thermal storage can improve CHP operation through decoupling heat demand and supply. This means that at times when heat demand is greater than CHP output, heat can be drawn down from the thermal store without the need to operate top up boiler plant. When demand is less than CHP output, excess heat can be used to charge the store, leading to a smoother CHP operating regime (i.e. the engine does not need to switch on and off so frequently).

In order to select an appropriate store size, for each scheme CHP option, a range of thermal store capacities was modelled, from 0 to 500m3. Two graphs are displayed below: one showing the effect of varying thermal store size on the heat output from the CHPs, and the second showing the effect on number of starts (based on a maximum of two starts per day). Engine restarts increase the ‘wear and tear’ on an engine, and are hence undesirable in general. Graphs showing number of starts and overall heat output against thermal store size are set out below.

Figure 6-1: Cribbs Patchway Thermal Store Selection

Cribbs Network - Effect of Changing TS size 34,000,000 1,200

33,500,000

) 1,000 m m u

33,000,000 u n n n n a a / 800

h 32,500,000 r e W p k s ( t t r

u 32,000,000 600 a t p s t u d o 31,500,000 e t n i a 400 b e h m o P 31,000,000 C H C 200 30,500,000

30,000,000 - - 100 200 300 400 500 600 Thermal store size (m3)

Total heat supply Total starts

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Figure 6-2: Southmead thermal store selection

Southmead Network - Effect of Changing TS Size 22,600,000 300.00

22,500,000 250.00 ) m

22,400,000 m u u n n n n a 200.00 a /

h 22,300,000 r e W p k ( s t t r

u 22,200,000 150.00 a t p s t u d o e t 22,100,000 n i a b e 100.00 h m o P C

H 22,000,000 C 50.00 21,900,000

21,800,000 0.00 0 100 200 300 400 500 600 700 Thermal store size (m3)

Total heat output Total starts

Figure 6-3: UWE thermal store selection

UWE Network - Effect of Changing TS Size 29,500,000 800.00

29,000,000 700.00

) 28,500,000 600.00 m m u u n n n n a a / 28,000,000 500.00 h r e W p k s ( t t r

u 27,500,000 400.00 a t p s t u d o e t n i

a 27,000,000 300.00 b e h m o P C H

C 26,500,000 200.00

26,000,000 100.00

25,500,000 0.00 - 100 200 300 400 500 600 Thermal store size (m3)

Total heat output Total starts

The trend of the curves illustrated above shows that with increasing thermal store size, the number of annual restarts decreases, whilst overall annual heat output increases. Engine suppliers would typically limit restarts to a maximum of 2 per day in maintenance contracts, and the use of thermal storage will help to achieve this whilst maintaining a higher level of heat recovery. A greater number of restarts will have an impact on guarantees on availability and increase maintenance costs.

Another key consideration is the financial implications of thermal storage. Although increasing thermal store size leads to overall financially beneficial outcomes, these need to be set off against the capital cost of the store.

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Looking at the UWE network, increasing the thermal store size by 20m3 at an extra CAPEX of £20,000 leads to an extra £1200 income per year, so a payback period of around 17 years. It is noted that these costs and revenues are quite conservative at this stage and a further more detailed assessment of the benefits of large thermal stores should be undertaken in next stage studies.

In particular it is known that larger stores will have a lower per m3 capital cost and that CHP maintenance costs are quite sensitive to hours of operation. The potential for load shifting – ie generating electricity when market values are high, whilst storing heat for use at night when electricity is cheaper, should also be considered. Finally, a future assessment of the benefit of larger thermal storage for the strategic network should be considered.

As such, it is proposed for this study to keep the size of the thermal store at a minimum, with size selected primarily to avoid an excessive number of starts. Using this rationale leads to the following thermal store selections:

Network Selected thermal store size (m3) Cribbs 150 Southmead 100 UWE 150

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7 OTHER TECHNICAL INPUT TO THE MODELLING

This section summarises all other technical inputs to the modelling.

7.1 CARBON FACTORS

DEFRA emissions factors for company reporting are used. These are:

à 0.50029kgCO2/kWh for electricity

à 0.18639kgCO2/kWh for gas 7.2 RESTRICTIONS ON NUMBER OF STARTS

All CHPs modelled were restricted to two starts per day. Additional starts create extra wear on the engine and increase maintenance costs

7.3 BOILER EFFICIENCIES

We have assumed that the efficiency of new top-up boilers is 85%.

7.4 ENERGY CENTRE PARASITIC LOADS The predominant parasitic load at the energy centre is for pumping demands. These are set out in Table 4-10.

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8 FINANCIAL ANALYSIS 8.1 RATIONALE

As has been mentioned, the heat clusters set out within this report form the constituent parts of a wider Avonmouth-Severnside heat network. In order to facilitate these networks to link up at a future date, the following approach is taken:

à Containerised CHP, allowing the engine to be removed when a wider network develops, fed from SERC or another lower carbon heat source. However, each cluster still retains a purpose-built energy centre, which contains top-up boilers, pumps, etc. and will provide peaking supply to the cluster in the wider network case. à Boiler plant is assumed to be retained at UWE and the MoD. In the former case, this follows the approach taken by UWE in terms of their approach of distributed plant rooms when implementing CHP on the campus. In the case of the latter, it is assumed that the MoD would require some degree of control to be retained over their heat supply. 8.2 CAPEX

Indicative energy centre costs are based on the following items:

Item Cost Source

Costs based on supplier CHP engine See Table 8-1 quotes

Thermal storage £1,000 per cubic metre Based on quotes from suppliers Utility Connections £195,000 per network Estimate Energy centre building £1650/m2. Building costs are based on the space requirements of the energy centre plant. Mechanical processes and £90 per kW installed capacity Spon’s all-in gas fired boiler controls cost of £91 to £99 per kW. Includes gas train, controls, flue, plantroom pipework, valves and insulation, pumps and pressurisation unit. Distribution pipework Costs set out in Table 4-10.

8.3 CHP CAPEX AND MAINTENANCE

CHP CAPEX is listed in the table below. For the sake of convenience, maintenance costs are provided alongside.

Table 8-1: CHP CAPEX Scheme CHPs chosen Capital cost (total) Maintenance cost (£/operating hour per CHP) for 15-year agreement Cribbs 2 X J620 2 x £1,325,500= £25.36 £2,651,000

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New Earth N/A N/A N/A Southmead 2 x J612 2 x £921,500 = £17.99 £1,843,000 UWE 2 X J616 2 x £1,090,000= £21.22 £2,180,000

8.4 ENERGY CENTRE SIZE

The area required by the energy centre is based upon previous designs carried out by WSP | Parsons Brinckerhoff. The estimated floor area required is set out in the table below:

Table 8-2: Energy centre estimated floor area Network Estimated energy centre size (m2) Cribbs 1120 New Earth Solutions N/A – it is assumed that any necessary plant (heat exchanger and pumps) will be housed within New Earth Solutions Southmead 840 UWE 750

It should be noted that these sizes are indicative and for costing only.

8.5 CONSUMER SIDE COSTS

The cost of domestic heat interface units and non-domestic heat substations are included within the capital cost of the different scheme options. A domestic HIU cost of £1200 per dwelling has been used, based upon an average HIU cost. Commercial heat interface unit cost depends on the unit size, and is based upon quotes obtained from suppliers. These are summarised below, with full details in an appendix to this document.

Table 8-3: Summary of consumer side costs Network Total residential HIU cost Number of Overall CIU cost properties non-domestic connections Cribbs 2750 £3,300,000 12 £1,225,000 New Earth 0 N/A 27 £54,000 Southmead 0 N/A 8 £232,000 UWE 4240 £5,088,000 15 £409,000

7 One CIU for Accolade Wines, and assumed one CIU at the interface between New Earth Solutions and the DH network

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8.6 NEW DEVELOPMENT HEAT NETWORKS

The cost of the heat network on each new development site also needs to be taken into account. It is not within the scope of this work to design each new development plot network, and so the following approximation has been used:

For each dwelling:

à 5m of DN 80 main spine at £500/m – total of £2500 à 3m of DN25 connection from main spine to dwelling at £350/m – total of £1050 à Final connection cost to HIU of £250 à Thus a total per dwelling cost of £3800. Note all costs are for soft dig.

It should be noted that this is a very high-level approach and detailed analysis will be required to establish more accurate plot level costs. This is outside the scope of this commission, however.

8.7 OTHER CAPEX

The following additional items of capital expenditure are included:

Table 8-4: Other capex Item Cost Professional fees 12% of CAPEX (excluding pipework) Contingency 20% of CAPEX (excluding pipework)

8.8 SUMMARY OF CAPEX

Summaries of capital expenditure for the four schemes are set out in the table below:

Table 8-5: Summary of CAPEX Cribbs New Earth Southmead UWE CHP £2,651,000 N/A £1,843,000 £2,180,000 engines Thermal £150,000 N/A8 £100,000 £150,000 storage Utility £195,000 £195,000 £195,000 £195,000 connections Energy £1,848,000 N/A £1,386,000 £1,238,000 centre building

8 With a total heat output of 8MWth, the heat output from the plant is far greater than the demands of Accolade Wines. As such, thermal storage is not required, as it is assumed that there will always be heat supply when desired.

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Mechanical £1,875,000 £100,0009 £550,000 £2,396,00010 process and controls Transmissio £8,450,000 £1,040,000 £5,117,000 £9,363,000 n pipework

On site pipe £10,450,00 N/A N/A £16,112,000 network 0 HIU £3,300,000 N/A N/A £5,088,000 (domestic) CIU £1,225,000 £54,000 £232,000 £409,000 (Commercia l) Professional £1,349,000 £80,000 £517,000 £1,399,000 fees (at 12%) Contingency £2,249,000 £70,000 £861,000 £2,331,000 (20%) TOTAL £33,742,00 £1,539,000 £10,801,000 £40,861,000 0

8.9 MAINTENANCE

The following items of plant and system maintenance are included:

Table 8-6: Maintenance costs Plant item Unit Notes

Gas CHP p/kWhe From supplier quotes for a range of CHP engine sizes M&E £/annum 1% of back up boiler CAPEX DH pipework £/annum 1% of capital outlay following a 2- year warranty period.

8.10 REPLACEMENT COSTS (REPEX)

End of service life replacement costs are included within the modelling and are set out in the table below. Pipework has a 45 to 50 year life, and so its replacement is not included within the scope of this study.

9 To cover pumping and peripheries 10 Based on a peak network demand of 47MW minus the peak demands of UWE at 6MW and MoD at 14.7MW

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Table 8-7: REPEX costs Anticipated lifetime (years) Replacement cost as percentage of CAPEX Gas CHP unit 15 70% Energy Centre Building 40 40% Back up gas boilers 30 50% Residential HIUs 15 75% CIUs 25 75%

8.11 OPERATING INCOME

CONNECTION CHARGES

Connection charges are levied by ESCOs on new developments which connect to the network, as developers are able to avoid the cost of installing boilers/ associated energy centre plant. A connection charge is only applicable to new developments (as there is no such saving for existing buildings), i.e. the following:

à Cribbs Patchway New Neighbourhood (Cribbs network) à Bristol Rovers/UWE stadium (UWE network) à Harry Stoke (UWE network) à Land East of Harry Stoke (UWE network) à Land east of Coldharbour Lane (UWE network)

The following connection charges are used:

Residential £4000/dwelling

Non-residential £150/kWth

Whilst connection charges are not normally possible for existing buildings capital contributions in lieu of replacement of existing plant can often be included in final commercial agreements. The potential for these contributions would need to be examined on a case by case basis during future more detailed studies.

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8.12 CONSUMER UNIT MAINTENANCE, METERING AND BILLING COSTS

Item Cost per annum Domestic customers Account management £85 Heat Trust £5 Bi Annual HIU maintenance £25 Total per annum £115 Commercial customers Account management £400 Annual CIU inspection and maintenance £100 Total per annum £500

8.13 HEAT SALES PRICES

When obtaining heat supply from boilers, there are a number of elements which need to be taken into account – i.e. the price of heat is more than the price of the gas which goes into the boiler. These elements are the following:

à Cost of gas, taking into account the efficiency of boilers which would have been required (under a gas boiler “base case” scenario) to generate heat. à Gas supplier’s standing charge à Boiler maintenance à Boiler replacement

These elements are all taken into account when deriving the cost of heat sold to customers, so this price is higher than gas cost.

The following heat sales prices are used, as within the Cribbs Patchway New Neighbourhood Heat Network Feasibility Study11. Heat prices are indexed through time in line with gas cost as per DECC Quarterly Price Projections, November 2015 (Gas Services Rate, Central Scenario)

Table 8-8: Heat sales prices Customer type Price (p/kWh) New Residential 10.5 New Non-Residential 7 Existing Residential 10 Existing Non-Residential 5.6

11 Cribbs Patchway New Neighbourhood Heat Network Feasibility Study, WSP | Parsons Brinckerhoff, September 2015

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A lower sales price is assumed for Accolade Wines of 3.5p/kWh; this is because the site will retain its own gas boilers, with New Earth Solutions providing base load only.

8.14 ELECTRICITY SALES

The following electrical sales prices are used:

Price (p/kWh) Private Wire 10.5 Grid Export 4.5

EMBEDDED GENERATION

Western Power Distribution (WPD) was contacted to assess whether potential energy centre locations lie in network constrained areas. The general feeling was that the proposed locations do not currently lie in areas of excessive constraint; however levels of generation applications in north Bristol have increased substantially over the last 1-2 years and therefore some level of upstream reinforcement of the network is likely.

WPD can undertake a Budget Estimate, free of charge, which provides indicative costs for the connection to an appropriate point on the network, and it is recommended that the local network be considered in future, more detailed, feasibility studies.

‘LICENCE LITE’

Licence Lite is a mechanism under which a higher value can be obtained for electricity by smaller generators. Its implementation is currently being investigated in London, where the GLA recently issued an Invitation to Negotiate (ITN) to embedded generators, on their proposals for selling the GLA electricity for its ‘Licence Lite’ supplies. This information, once gathered will be assessed and modelled and the stakeholders consulted for indication as to how the Licence Lite scheme will work in practice.

There may be serious barriers to the procurement of privately generated electricity in this manner, but this will only become apparent once the market is tested both commercially and contractually. The current aim is to develop a scheme, and begin operations in spring 2016, after which the situation will be more apparent, and the viability of such a scheme in the Avonmouth Severnside region can be investigated.

8.15 ELECTRICAL IMPORT AND GAS

Electrical and gas purchase prices are based on DECC price projections12. The following 2016 base year prices are used:

Utility 2016 cost (p/kWh) Gas (Services rate) 3.25 Electricity (Services rate) 11.25

12 https://www.gov.uk/government/collections/energy-and-emissions-projections

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8.16 PURCHASE OF HEAT FROM NEW EARTH SOLUTIONS

The price at which heat would be purchased from New Earth Solutions is not known. Thus in this report, analysis is carried out to establish the maximum price at which heat would need to be purchased such that the scheme is viable.

It should be noted that heat will be recovered from the gasification process and not the steam turbine, and so the cost of heat only needs to reflect investment in the scheme and a small margin to make the scheme worthwhile to New Earth Solutions. A heat purchase price of 0.5p/kWh is assumed.

8.17 VARIATION THROUGH TIME

For the purposes of modelling, it has been assumed that construction occurs in 2019, with operation in 2020. This approach can be adapted to a later start date, with the only change being a minor variation in utility prices. All utilities prices are modelled as varying through time in line with DECC price projections (central scenario), November 2015.

8.18 CRC AND OTHER CARBON TAXATION SCHEMES

It should be noted that the Treasury is currently undertaking a review into reforming the carbon reporting and taxation regime for UK businesses. A consultation, entitled Reforming the business energy efficiency tax landscape ran between September and November 2015. Whilst at the time of writing the outcomes of this are not known, there may well be changes to the carbon tax regimes, including CRC, over the next few years. As such, representing carbon taxation and incentives within modelling is outside the scope of this report. However, a DH scheme will result in savings for loads connecting to the network from this perspective.

8.19 RHI

The supply of heat from New Earth Solutions is able to profit from RHI. It is not certain at this stage what level of RHI could be generated - RHI for heat from combustion of municipal solid waste biomass is worth 2.03p/kWh per kWh of heat from the renewable fraction of waste; assuming a deemed 50% biogenic fraction of that waste gives a RHI of around 1p/kWh. Biogenic fractions for the NES plant could be higher than this as there is significant pre-sorting of waste.

If the plant were to become CHPQA accredited then the RHI tariff could be as high as 4.17p/kWh – again assuming a 50% biogenic fraction would give an RHI value of around 2.1p/kWh of heat supplied.

For the purposes of modelling, we assume a RHI value of 2p per kWh.

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9 FINANCIAL RESULTS This section sets out the financial outputs of the modelling. Results are presented as discounted cumulative cashflows over a 25 year time period, at a discount rate of 12%. This is also presented as a net present value (NPV) at the same discount rate.

9.1 CRIBBS

The discounted cumulative cashflow graph for the Cribbs Patchway network, together with the 25- year NPV at a 12% discount rate, is set out below:

Figure 9-1: 25-year cumulative discounted cashflow, Cribbs Patchway

Discounted Cumulative Cashflow (£) £10,000,000

£5,000,000

£0 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 20362037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050

-£5,000,000

-£10,000,000

-£15,000,000

-£20,000,000 Year 2 x JMS JMS 620

25-year NPV, 12% discount rate 25-year NPV, 6% discount rate

2 x JMS JMS 620 £5,499,000 £19,046,000

9.2 NEW EARTH SOLUTIONS The discounted cumulative cashflow graph for the New Earth Solutions-Accolade Wines link, together with the 25-year NPV at a 12% discount rate, is set out below

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Figure 9-2: 25-year cumulative discounted cashflow, New Earth Solutions

Discounted Cumulative Cashflow (£) £400,000 £200,000 £0 -£200,000 20192020202120222023202420252026202720282029203020312032203320342035203620372038203920402041204220432044204520462047204820492050 -£400,000 -£600,000 -£800,000 -£1,000,000 -£1,200,000 -£1,400,000 -£1,600,000 -£1,800,000 Year New Earth Solutions

25-year NPV, 12% discount rate 25-year NPV, 6% discount rate

New Earth Solutions £144,000 £1,235,000

9.3 SOUTHMEAD

The discounted cumulative cash flow graph for the Southmead network, together with the 25-year NPV at a 12% discount rate, is set out below:

Figure 9-3: 25-year cumulative discounted cashflow, Southmead

Discounted Cumulative Cashflow (£) £0 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 20362037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050

-£2,000,000

-£4,000,000

-£6,000,000

-£8,000,000

-£10,000,000

-£12,000,000 Year 2 x J612

25-year NPV, 12% discount rate 25-year NPV, 6% discount rate

2 x J612 -£2,738,000 £2,316,000

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9.4 UWE Figure 9-4: 25-year cumulative discounted cashflow, UWE

Discounted Cumulative Cashflow (£) £0 2019 2020 2021 2022 20232024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050

-£5,000,000

-£10,000,000

-£15,000,000

-£20,000,000

-£25,000,000 Year 2 x J616

Discounted Cumulative Cashflow (£) £4,000,000

£2,000,000

£0 2019 2020 2021 2022 20232024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 -£2,000,000

-£4,000,000

-£6,000,000

-£8,000,000

-£10,000,000

-£12,000,000

-£14,000,000 Year 2 x J616

25-year NPV, 12% discount rate 25-year NPV, 6% discount rate

2 x J616 -£2,276,000 £10,375,000

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10 SENSITIVITY TO KEY LOADS – UWE NETWORK 10.1 INTRODUCTION – LINEAR HEAT DENSITY MODELLING

The effect of reducing the number of connected loads– i.e. increasing the linear heat density of the pipe route was carried out for the UWE network, in order to seek to improve the financial viability of this scheme.

In order to examine the best loads to form a “core” network, WSP | Parsons Brinckerhoff assessed the heat loads using our bespoke linear heat density model.

This model is based around the understanding that commercial viability is a product of the relationship between the length of pipework and the connected load for a potential heat network. . Essentially it is quantifying the balance between income (linked to heat sales volumes) that could be generated through connection to a load, against an indicator of the cost to make that connection (network length).

The model developed by PB is innovative in that it generates a progression of loads that could be connected. This means that starting from an anchor customer, the model looks at the additional length of network required to connect to each of the other loads on the scheme, and the resulting linear heat density (i.e. demand divided by length of connection) of the marginal addition of each. The most ‘linear-heat-dense’ connection is selected, and then the process begins again. This iterative approach delivers a ranked order of likely connection viability for the identified potential loads on the scheme.

10.2 LINEAR HEAT DENSITY RESULTS

The following graph shows the progressive linear heat density of the overall network with increasing numbers of load points connected:

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Figure 10-1 Linear heat density results

Overall network LHD (MWh p.a. / m) vs load (kW p.a.) 9.0

8.0

7.0

6.0

5.0

4.0

3.0

2.0

1.0

- 0 5,000,000 10,000,000 15,000,000 20,000,000 25,000,000 30,000,000 35,000,000 40,000,000 45,000,000 50,000,000

This graph should be interpreted in conjunction with the following list of demands points / loads that correspond to the addition of load to the network read from left to right on the graph above, i.e. MoD Filton Abbey Wood represents the leftmost point on the graphic:

Table 10-1 Linear heat density testing (list) 1 MoD Filton Abbey Wood 2 Bristol Rovers/ UWE stadium 3 Hewlett Packard 4 Land East of Harry Stoke 5 Harry Stoke 6 Holiday Inn Bristol-Filton 7 Land East of Coldharbour Lane 8 Higher Education Funding Council 9 Frenchay Hospital 10 Romney House

The graph should be considered cumulatively – i.e. the first point represents the heat density of a network supplying solely MoD Abbey Wood, the second a network supplying MoD Abbey wood and Bristol Rovers/UWE stadium.

It can be seen that the highest heat density is achieved by including the first five loads (plus UWE, at which the energy centre is modelled as located). It is this network which is analysed in the subsequent sections:

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10.3 LOAD PROFILING

The hourly profile for the core UWE network load is illustrated in the image below:

Figure 10-2: Core UWE network profile through the year

Core UWE Network 45,000

40,000

35,000

) 30,000 W k (

d 25,000 n a m

e 20,000 d t a e

H 15,000

10,000

5,000

- 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 3 6 9 2 5 8 1 4 8 1 4 7 0 3 6 9 2 5 9 2 5 8 1 4 7 0 3 6 0 3 6 9 2 5 8 1 4 2 4 6 9 1 3 6 8 0 3 5 7 0 2 4 6 9 1 3 6 8 0 3 5 7 0 2 4 7 9 1 3 6 8 0 3 5 1 1 1 1 2 2 2 2 3 3 3 3 3 4 4 4 4 5 5 5 5 6 6 6 6 6 7 7 7 7 8 8 8 Hour through year

The annual heat demand for this network is 41.5GWh/annum (note that this higher than in the LHD graph because of the inclusion of UWE).

10.4 PIPELINE MODELLING Table 10-2: UWE core network pipeline modelling outputs Network option Network cost Total trench Total peak load at Pump Annual heat length (m) energy centre power losses (MWth) (kWe) (MWh/annum) Core UWE £4,453,000 4299 37.5 260 1370

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Figure 10-3: Core UWE network

Table 10-3: UWE core network modelling pipe lengths and cost

Cost per m Diameters Length of this diameter in this Total cost for pipe (trench) (£ (nominal) (mm ID) option (m) diameter (£) capex)

125 £979 57 £55,902 150 £1,099 142 £156,540 200 £1,232 1,818 £2,239,428 250 £1,380 1,814 £2,502,772 300 £1,430 467 £667,441

10.5 CHP MODELLING

There is little difference between the annual heat demands of the full and core UWE networks, and as such the same CHP sizes are modelled.

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10.6 FINANCIAL INPUTS

The following financial inputs were used within the modelling for the core UWE network:

Table 10-4: Core UWE network CHP CAPEX Scheme CHPs chosen Capital cost (total) Maintenance cost (£/operating hour per CHP) for 15-year agreement Core UWE 2 X J616 2 x £1,090,000= £21.22 £2,180,000

10.7 ENERGY CENTRE SIZE Table 10-5: Core UWE network energy centre estimated floor area Network Estimated energy centre size (m2) UWE 700

10.8 CONSUMER SIDE COSTS Table 10-6: Core UWE network consumer site costs Network Total residential HIU cost Number of Overall CIU cost properties non-domestic connections

Core UWE 3200 £3,840,000 12 £335,000

10.9 SUMMARY OF CAPEX Table 10-7: Summary of CAPEX Core UWE CHP engines £2,180,000 Thermal storage £150,000 Utility connections £195,000 Energy centre building £1,155,000 Mechanical process and controls £1,512,00013 Transmission pipework £5,622,000 New development distribution pipework £12,160,000 HIU (domestic) £3,840,000 CIU (Commercial) £335,000 Professional fees (at 12%) £1,124,000 Contingency (20%) £1,873,000 TOTAL £30,146,000

13 Based on a peak network demand of 37.5MW minus the peak demands of UWE at 6MW and MoD at 14.7MW

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10.10 FINANCIAL RESULTS Figure 10-4: Discounted cumulative cashflow – core UWE scheme

Discounted Cumulative Cashflow (£) £0 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 20292030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 -£2,000,000

-£4,000,000

-£6,000,000

-£8,000,000

-£10,000,000

-£12,000,000

-£14,000,000

-£16,000,000

-£18,000,000 Year 2 x J616

25 year NPV at 12% discount 25 year NPV at 6% discount rate rate

2 x J616 -£843,000 £8,809,000

These results can be compared to the full UWE cluster:

Table 10-8: Financial comparison of UWE network options

25-year NPV, 12% discount rate 25-year NPV, 6% discount rate

Full UWE Cluster -£2,276,000 £10,375,000

Core UWE Cluster -£843,000 £8,809,000

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11 SOUTHMEAD NETWORK – FURTHER ANALYSIS

The Southmead network is the most poorly performing of the schemes, and so it was proposed that further analysis, as for the UWE cluster, be carried out to establish whether a configuration exists which is financially viable. The linear heat density graph is provided in the figure below:

11-1: Southmead network linear heat density

Overall network LHD (MWh p.a. / m) vs load (kW p.a.) 1.3

1.2

1.2

1.1

1.1

1.0

1.0 0 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000

As with the UWE network, this graph should be read in conjunction with the table below, from left to right, i.e. Horfield Leisure Centre represents the leftmost point on the graph.

1 Horfield Leisure Centre 2 South Gloucestershire & Stroud College 3 Filton Sports & Leisure Centre 4 Charborough Road Primary School 5 Badocks Wood Primary - Southmead Children’s Centre

It can be seen that the linear heat density is extremely low for any combination of loads (compare LHDs for this scheme to those for the UWE network) and as such there does not exist a “core” network which would have a greater likelihood of viability than the full selection of loads.

It is noted that the one element that could radically alter the potential for this scheme would be the inclusion of loads at Airbus and related industries around Filton. As indicated in earlier sections the site has advised that there would need to be significant investment in on site systems to

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convert these to use LTHW. Such an assessment is beyond the scope of this study but further investigation to consider the potential benefits should be considered. This could allow for a future network based around the Airbus site with significant electrical as well as heat loads generating income for the scheme.

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12 FINANCIAL SENSITIVITY A sensitivity analysis was carried out to establish the effect of varying the following items:

à Primary energy costs à Energy sales prices à Project lifetime à Discount rate à RHI (or other incentive) support levels. 12.1 ENERGY COSTS / PRICES

This section examines the results of varying the DECC price projection scenario, showing the effect of high and low gas and electricity prices as compared to the reference scenario which has been used within the main body of the report. Heat sales prices are indexed against gas purchase price, and so the variation in cost through the years is reflected here as well.

Network 25-year NPV with DECC 25-year NPV with DECC 25-year NPV with DECC Reference Scenario Low Scenario High Scenario NPV – 12% NPV -6% NPV – 12% NPV – 6% NPV -12% NPV – 6% Cribbs £5,499,000 £19,046,000 £4,879,000 £18,816,000 £4,170,000 £16,357,000

New Earth £144,000 £1,235,000 -£254,000 £596,000 £608,000 £2,007,000 Southmead -£2,738,000 £2,316,000 -£2,375,000 £3,367,000 -£4,552,000 -£1,079,000 UWE -£2,276,000 £10,375,000 -£3,116,000 £9,794,000 -£3,281,000 £8,270,000

Again, the different price scenarios do not have too great an impact on the schemes’ financial performances.

12.2 EFFECT OF RHI

This section shows the effect of removing RHI from the New Earth network:

Network 25-year NPV including RHI 25-year NPV excluding RHI NPV – 12% NPV -6% NPV – 12% NPV – 6% New Earth £144,000 £1,235,000 -£503,000 £181,000

It can be seen that reducing RHI from 2p/kWh of heat supplied from New Earth Solutions to 0p/kWh has a fairly significant impact on the financial viability of the scheme, and will require an increased heat sales price in order to make up this shortfall.

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13 CARBON SAVINGS Results are presented as carbon savings over a gas boiler base case. It should be noted that there is a difference in the way that carbon is measured for CRC monitoring purposes and under the DEFRA reporting methodology. The differences are set out below:

à CRC: CRC is charged on the carbon associated with gas used in top-up boilers and the full site electrical consumption. Gas used in CHPs is not included. à DEFRA: Overall carbon is the sum of carbon associated with gas and electrical import. Electricity sold to the grid is treated as “carbon negative” – i.e. it reduces the overall carbon sum. Table 13-1: Anticipated carbon savings Scheme Overall carbon generated per Carbon savings over gas boiler annum (tonnes/yr) base case per annum (tonnes/yr) Cribbs 3,576 9,303 Accolade Wines 0 1,026 Southmead 1,697 7,035 UWE 4,377 8,650 Core UWE network 2,553 7,817

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14 CONCLUSIONS This report examined the development of heat networks in four clusters:

à Cribbs Patchway à New Earth Solutions to Accolade Wines à Southmead à UWE

The Cribbs Patchway network performs well financially, with a payback period of around eight years under a 12% discount rate and is also able to achieve significant carbon savings of around 9300 tonnes per annum over a gas boiler base case. The UWE cluster is also a strong performer, paying back in around seventeen years, and a “core” UWE network would also perform well, paying back in around fourteen years.

A link between New Earth Solutions and Accolade Wines has a funding gap which would need to be met in order for the scheme to break even, even at a very low heat purchase price from New Earth Solutions. The exact nature of the heat demand at Accolade Wines should also be confirmed, to ensure that the supply from New Earth Solutions is appropriate (it is understood that the clean in place demand is provided, in part, from recovered hot water from the onsite compressor cooling system, and only top-up heat required).

The Southmead network performs less well; this is largely because it is unable to recoup much of the initial outlay through connection fees, as is the case with the Cribbs Patchway and UWE networks. However, when considering a wider Avonmouth-Severnside network, it can be seen that this network occurs in between the Cribbs Patchway and UWE clusters. It may well be worth connecting up some of the loads which occur close to this main trunk route, although it is not recommended that the network be extended to Badcock’s Wood Primary, Southmead Hospital or Horfield Leisure Centre. Further consideration should also be given to the potential for alterations at Airbus to enable connections as this would radically impact on the economics of any scheme in this area. Additional work should also be carried out to establish the costs and design of heat networks on the new developments, namely Cribbs Patchway, the Frenchay Hospital site, Land East of Coldharbour Lane, Land East of Harry Stoke and Harry Stoke.

It should be noted that all schemes have been modelled with electricity generated being sold to the grid. This should be considered as the most conservative scenario, with the possibility of a higher price possible through sale via a private wire network or under Licence Lite scenarios. However, it should be borne in mine that the CHPs are interim heat sources pending a wider heat network being developed and connection to other low carbon heat sources. As such, any private wire network could only be a temporary solution, and could well overstate the financial performance of the schemes examined.

Finally, as mentioned within the report, regulation around carbon taxation and incentives is likely to change, and should this come into place, consideration should be given as to how this has the potential to improve or decrease the financial viability of the DH schemes examined.

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15 STRATEGIC NETWORK ASSESSMENT 15.1 INTRODUCTION The prospect of large scale heat sources in the Avonmouth and Severnside area to serve heat demands across a wide area is exciting and potentially transformative for energy supply in the area. Large scale sources of waste heat are routinely used on the continent to supply large urban areas, with key examples being in Copenhagen, Rotterdam and Helsinki. The supply of heat from Energy from Waste plants would not be unique in the UK, Sheffield and Nottingham have had systems in place for many years, and more recently Coventry has taken the first steps in developing a network through a relatively small connection from their EfW plant to council buildings.

The common factor in all of these schemes has been significant input from the local authority in providing or underwriting investment in what amounts to very large scale infrastructure. There has also been a very key role for the local authorities in helping with town planning, land issues and the crossing of major infrastructure.

In order to understand the value of investing time and resources in the development of such a scheme South Gloucestershire has asked for an initial high level assessment of the potential benefits. This section sets out the methodology used by WSP | Parsons Brinckerhoff in undertaking this high level assessment and the results of the assessment.

15.2 METHODOLOGY WSP | Parsons Brinckerhoff has utilised the following approach to this high level assessment:

1. Assess the potential scale and costs of heat supply 2. Identify potential major heat loads and routes to connect these 3. Establish a high level estimate of capital costs of connection to major load centres 4. Assess the potential level of heat supply that could be provided by the network 5. Assess the potential value of this heat supply 6. Assess the potential return on investment and carbon savings that could result 7. Identify key risks to the delivery and tasks for a next stage assessment 15.3 HEAT SUPPLY – CAPACITY AND COSTS

HEAT SUPPLY CAPACITY A range of heat sources has been identified, with the main immediate opportunities being:

Company Size Fuel Technology Status Heat Potential

20MWth (potential to 32 Municipal Mass Burn with In construction due SITA -SERC increase at increased MWe Waste Steam Turbine operational in 2016. cost) Financing- Balfour Beatty 11 Pyrolysis with expected Investments & Biomass up to 8MW. MWe Steam Turbine operational late Nexterra 2017. Pyrolysis and New Earth Refuse 8 Gasification Solutions – Derived Operational Estimated up to 8MW MWe feeding a steam Avonmouth A Fuel turbine generator

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It is noted that the New Earth Solutions (NES) plant would initially supply its heat to Accolade Wines and potentially other users in the surrounding development area. Given the large potential heat demands around the site, and its location at some distance from the other two major potential supplies, it is not expected that this plant would contribute initially to a strategic network.

Should other supplies in the area - NES Avonmouth B and Cylamax for example – come online, then a further network from the Avonmouth area or connection to the Severnside strategic network could be considered in the future. The NES ‘B’ plant is not however considered further in this initial assessment.

Another potential very large source of heat was also identified adjacent to the SITA SERC plant. Seabank 1 started operations in 1996 and Seabank 2 in 2001. The Due to their plants are less efficient Scottish and operational status the than the proposed CCGT Southern 1,140 Combined cycle potential for a steady Gas stations which may be Energy – MWe gas turbine supply of heat suitable built. As of 2011 they no Seabank 1&2 for district heating is longer operate as base low. load generation but instead are operating intermittently.

As indicated this plant does not operate reliably but as its operation is likely to be in peak electrical demand periods – typically in winter – it may be possible to utilise heat from this source into a large scale network to add to peak supply capacity. This source is not considered as a base case for the Severnside strategic network but could be assessed at the next stage in terms of future potential expansions.

The overall scale of heat supply to the strategic network is therefore taken to be some 28MWth for the base case. This scale of supply is relatively small if considered in the context of peak demands for the area but would be considered large for a base load CHP type supply. Typically a base load supply such as a CHP plant will serve loads with peaks up to 10 times the base load capacity but with good design and use of thermal storage can supply 60-70% of the annual heat demands for these loads. It could conservatively be considered that, operating as base load a Severnside strategic network could serve over 200MWth of peak load with the majority of the annual heat supply.

HEAT SUPPLY COSTS Both the main potential heat supply sources would be derived from steam extraction from steam turbines. Such extraction has an impact on the electrical output of the turbine and as such there is a cost of heat production to cover the loss of revenue associated with the lost electricity production. The ratio of heat output to loss of electrical output is termed the Z factor and varies depending on the specifics of the steam turbine system design.

Both of the main potential heat supply sources should also be eligible for incentive payments under the Renewable Heat Incentive (RHI) programme. For the SERC plant RHI would be payable on the biogenic content of the heat delivered to buildings connected to the heat network (i.e. not including heat losses). For municipal solid waste, the biogenic content is typically assumed to be 50 percent of the fuel.

It is noted that the RHI rates payable for the two main heat sources would be different. For Energy from Waste the applicable RHI rate is that for ‘large biomass’ plants. For the Nexterra biomass scheme there is a specific biomass CHP tariff available.

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The table below set out the key assumptions that go into an assessment of the cost of heat extracted from each plant.

Project Name SERC Nexterra Notes Heat Capacity 20 8 MW Supply Type Steam Steam Turbine Turbine extract extract Incentive Mechanism RHI RHI Eligible Y Y Heat supply Z factor May vary with level of heat 5 5 extracted Value of electrical output Nexterra value includes ROC £50.00 £96.00 /MWh buy out price Value of Incentive £22.40 £41.00 /MWh Proportion of output 50% 100% eligible Adjustment for losses Assume losses only in 85% 85% transmission main to cluster energy centres Cost of Heat – before £10.00 £19.20 /MWh incentive Value of incentive £9.52 £34.85 /MWh

Cost of heat net of Note Nexterra cost of heat is £0.48 (£15.65) /MWh incentive negative Assumed cost of heat to Margin includes for include pump costs and management and operational margin for generator £5 £1 /MWh costs related to heat offtake and act as an incentive to maximise heat offtake.

We note that the cost of heat to the network operator from Nexterra has been assumed to be positive in spite of the larger margin that this creates as compared with the cost of heat from SERC. This assumption has been made at this early stage in development to recognise the following additional costs and risks related to the Nexterra plant:

1. The Nexterra plant is assumed to bring the heat to a connection point adjacent to the SERC plant thus incurring additional costs. 2. There are significant risks related to the RHI scheme for this type of plant and these would need to be recognised in the heat offtake arrangement 3. The operational costs for eg pumping and losses for the Nexterra plant are higher than for the SERC plant due to its location

The actual arrangements for heat offtake should be explored with both operators at the next stage. 15.4 HEAT LOADS AND NETWORK ROUTE HEAT LOADS This initial high level assessment assumes that the cluster energy demands identified earlier in this report can be supplied via a transmission main connection to a single “Energy Centre” for each cluster rather than being formed of individual connections to end users. This obviously assumes that the clusters have already been developed at least to some extent and the final arrangements may be different. This assumption does allow for a simple initial test of both the

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level of cluster development that may allow for the scheme to be viable and also of sensitivity of the scheme to single large connections (eg MOD Abbey Wood or Cribbs Patchway New Neighbourhood).

The heat loads considered in this assessment have been updated based on the loads identified in the earlier sections of this report and are replicated in the following tables for convenience:

Cribbs Patchway (EC at CPNN) Heat demand (MWh/annum) 804 CPNN 35,472 87 Rolls Royce 7,000 92 Patchway Locality Hub 200 93 Callicroft Primary School 185 65 Patchway Community School 1,000 78 St Chad's Primary School 120 58 Aztec Hotel & Spa 3,630 49 Hilton Bristol Hotel 3,274 90 Holy Family Primary School 140 86 Stoke Lodge Primary School 200 Totals (Base Loads) 51,221 Implied peak (11% Load Factor) 53 MW Potential additional Loads Demand (MWh) 45 Cavendish Nuclear 271 114 Charlton Hayes 9,063 Totals (Potential Additional Loads) 9,334

Southmead (EC at Southmead) ID Name (Base Loads) Demand (MWh) 360 Southmead Hospital 28,508 385 Horfield Leisure Centre 1,518 210 Charborough Rd Primary School 170 215 Filton Sports & Leisure Centre 634 156 S Glos & Stroud College 3,150 346 Badocks Wood Primary 120 Totals (Base Loads) 34,101 Implied peak (13% load factor) 30 MW Potential additional Loads Demand (MWh) 172 GKN Aerospace 179 170 Airbus 22,752 Totals (Potential Additional Loads) 22,931

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UWE (Energy Centre at UWE) ID Name (Base Loads) Demand (MWh) 157 Land East of Harry Stoke 11,986 188 Harry Stoke 7,245 302 Hewlett Packard 1,523 308 UWE 6,768 274 MoD Filton Abbey Wood 8,993 332 Higher Education Funding Council 432 343 Bristol Rovers / UWE stadium 4,980 359 Land East of Coldharbour Lane 2,818 383 Romney House 289 350 Frenchay Hospital 2,936 245 Holiday Inn Bristol-Filton 3,300 Totals 51,270 Implied peak (13% Load Factor) 49 MW

In summary the total available loads are: CPNN Southmead UWE Total Base load (MWh/annum) 51,221 34,101 51,270 136,592 Implied peak for Base (MW) 53 30 49 132 Potential additional loads (MWh/annum) 9,334 22,931 - 32,265 Overall total potential (MWh/annum) 60,554 57,032 51,270 168,857

As agreed at the priority sites workshop the Emersons Green cluster has not been included in this assessment. Once the network had reached UWE a decision would need to be taken on whether to progress to Emersons Green or perhaps continue to develop towards Bristol City Centre where a much denser set of loads would be available. This decision would however be predicated on the network having reached as far as UWE and sufficient heat supply remaining to justify further expansion.

The decision was therefore taken at this stage to undertake the study based on the Cribbs Patchway, Southmead and UWE clusters identified. An assessment of the potential viability of a connection from UWE/MOD to the proposed new Temple and Redcliffe schemes energy centre at St Phillips has also been undertaken.

NETWORK ROUTE

The network route, and hence lengths of pipework required, has been developed as described in the Heat Mapping Report. Should the scheme prove viable on this initial assessment then the proposed routes will be investigated in more detail to assess technical viability, level of risk and potential alternatives, including two route options which extend down from the UWE cluster to the Bristol City Centre at St Philips Marsh, where an energy centre is proposed on the site of the old Great Western Refuse Transfer Station, taking into account the social housing blocks which lie to the North of St. Philips. The route is generally as shown in Figure 15-1 below. The 2 route options which extend to the City Centre are shown in Figure 15-2.

The two routes which link up the North Fringe with Bristol City have been selected to run between the most promising cluster in this study; UWE and the city centre via paths which avoid major constraints, crossing major infrastructure at the least disruptive locations; minor roads and disused railway lines turned into cycle paths have been used in preference to major roads to minimise disruption and cost of the installation.

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The M32 represents a significant physical barrier which needs to be crossed to arrive at St Philips, this is most easily executed in two locations; the roundabout which runs under the Overpass adjacent to Eastville Park, and the cycle path adjacent to the roundabout over the underpass at St Pauls, where the M32 ends.

Figure 15-1: SERC to All Clusters

The pipe lengths for the main elements of the route are shown in the table below:

Connections Trench length (m) SERC to CPNN EC (load 804) 7,200 CPNN EC (804) to Southmead EC (360) 7,678 Southmead EC (360) to UWE (308) 4,310 UWE to City Centre 7,450

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Figure 15-2: Route from UWE Cluster to the City Centre (Temple & Redcliffe EC in St Philips)

15.5 CAPITAL COST ESTIMATES CAPITAL COST ELEMENTS

The capital costs for the network are made up of the following key elements:

à Heat extraction and distribution equipment at the heat source à Pipework and installation (trenching, welding fittings etc.) à Major infrastructure crossings – e.g. motorways, railways and waterways à Interface equipment at each heat demand connection à Project Costs including design, project management and contractor costs à Contingencies NETWORK DESIGN ASSUMPTIONS

A key element in assessing these costs is the assumptions around the way in which the pipe network would be designed and operated. For the purposes of this assessment the following assumptions have been made.

à The network will operate as a transmission main with variable flow and temperature and will be hydraulically isolated from connections at consumers à The network will be designed to operate at higher temperature and pressures to minimise the pipe sizes and heat losses that will result

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à The operating temperatures at maximum demands will be § Flow: 110°C § Return: 70°C

Note – ideally return temperatures on the primary network will be closer to 50°C for new developments, based on internal building system designs for 40°C returns and the local (secondary) network achieving 45°C, As there are a significant number of existing buildings however, a higher temperature will be allowed for initially. It should be expected that tariffs for connection will incentivise lower return temperatures and that the Network Operator would work with customers to reduce temperatures through modernisation of internal systems over time.

à The pipe size will be designed to achieve pressure drops around 100 Pa/m as per District Heating Manual for London guide lines for main pipes à The overall design pressure for the network (including pumping losses, static head and static margins) will not exceed 16bar (1.6MPa).

Based on these design criteria the transmission network has been modelled initially at 350mm nominal diameter pre-insulated district heating pipe allowing supply of up to 35MWth of heat (28MW from the two heat suppliers plus 7MWth for central thermal storage).

HEAT SUPPLY INTERFACES

The interfaces will incorporate:

à Steam pipework and control valve connection to the steam turbine à Steam to hot water heat exchangers and condensate recovery connections à District heating system controls and power supplies à District heating system pumps and water treatment equipment à Thermal stores à Pipework and valving to the boundary of the site à Associated civil and builders works

The costs for these systems are based on previous projects of a similar scale based on the works being instructed and managed by the heat supplier. No additional project costs are therefore included on top of these costs.

PIPEWORK AND INSTALLATION

Costs for pipework are taken from recent quotes for major pipework systems for “hard dig” (i.e. under roads) in London. They allow for contractors detailed design, prelims and traffic management and can also be seen to include a London weighting. We note that some key elements of pipework installation could be in soft dig areas and also that traffic management along most of the route would not be as significant as would normally be required in London.

The costing strategy provides a robust high end estimate of network costs to allow the potential for viable development to be tested – i.e. the basis of a decision about whether to proceed to a more considered assessment, or not. We have used a fully risked price which allows for dealing with unknowns.

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Based on our experience of the price differentials, and the design and prelims elements included in the costs quoted, we propose not to apply additional project costs and to apply a lower rate of contingency for this element.

MAJOR INFRASTRUCTURE CROSSINGS

We have not undertaken a detailed assessment of the requirements or opportunities for specific infrastructure crossings at this stage. We have identified the following major infrastructure crossings and made assumptions about the type of crossing that may be required.

à M49 at Farm Lane – assume pipe jack under motorway à M5 at Hollywood Lane - assume trenched in road under motorway – no extra cost à A4018 Double Carriage way at Hollywood Lane – assume trench with significant traffic management à Avonmouth railway at BAE Filton – assume pipe bridge adjacent to existing road bridge à Railway at MOD – assume pipe bridge adjacent to existing road bridge

Cost estimates are based on recent quotations for pipe bridges, thrust bored and pipe jacking installations to cross a combination of rail, road and river infrastructure.

HEAT INTERFACES AT LOAD CONNECTION POINT

As noted above we have currently assumed a single connection at each cluster “Energy Centre”. This interface would comprise 100% dual heat exchange substations including controls, power supplies etc. We have assumed that this substation installation could be installed within an existing structure and connected alongside existing heat supply systems without major modifications.

PROJECT COSTS

At this stage we have included high level estimates of costs for route surveying, design, specification , procurement, contractor prelims, overhead and profits (except where noted above) and contingencies reflective of the low level of certainty that can be achieved at this early stage.

COST ESTIMATES

In order to allow testing of a number of variations, the capital cost estimates have been broken out into elements related to specific sections of the system. Total costs for a variety of options are presented as follows:

à Scenario 1 - All clusters – SERC and Nexterra supplies à Scenario 2 - All clusters – SERC only (Note all base loads identified could be supplied by SERC) à Scenario 3 - CPNN and Southmead only – SERC only à Scenario 4 - CPNN only – SERC only à Scenario 5 – Link from UWE to City Centre – NB this assessment is based on the assumption that the network has already reached UWE and only considers the additional network costs to extend to the City Centre

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Table 15-1: Capital Costs Scenario 1 All Clusters - SERC and NES Item Cost Notes estimate (£k) Heat extraction and distribution 3,050 £1,650 at SERC equipment at the heat source £1,000k at Nexterra Plus 800m3 thermal store £400k Pipework and installation 27,827 350mm pipework incl trench, install, make good, (trenching, welding fittings etc) design and prelims - £1700/m trench

SERC to Cribbs EC – 7,200m Cribbs EC to Southmead EC – 7,680m Southmead EC to UWE – 4310m

Major infrastructure crossings 1,250 M49 at Farm Lane – £750k – eg motorways, railways and M5 at Hollywood Lane - no extra cost waterways A4018 Double Carriage way at Hollywood Lane – £100k Avonmouth railway at BAE Filton – assume pipe bridge adjacent to existing road bridge - £200k Railway at MOD – assume pipe bridge adjacent to existing road bridge £200k

Interface equipment at each 270 3 connections at £90k per connection heat demand connection Project Costs including design, 1,004 Next stages development including PM survey, project management and design, specification and procurement (no legal contractor costs or financial advice included) - £400k Owners Engineer and PM post procurement - £300k 20% Contractor Prelims OH &P (except supply interface and pipework)

Contingencies 505 20% (except supply interface and pipework) Totals 33,906

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Table 15-2: Capital Costs - Scenario 2 All Clusters - SERC only Item Cost Notes estimate (£k) Heat extraction and 2,050 £1,650k at SERC distribution equipment at the Plus 800m3 thermal store @ £400k heat source Pipework and installation 27,827 350mm pipework incl trench, install, make good, (trenching, welding fittings design and prelims - £1700/m trench etc) 300mm pipework incl trench, install, make good, design and prelims - £1300/m trench SERC to Cribbs EC – 7,200m Cribbs EC to Southmead EC – 7,680m Southmead EC to UWE - 4310m Major infrastructure crossings 1,250 M49 at Farm Lane – £750k – eg motorways, railways and M5 at Hollywood Lane - no extra cost waterways A4018 Double Carriage way at Hollywood Lane – £100k Avonmouth railway at BAE Filton – assume pipe bridge adjacent to existing road bridge 200k Railway at MOD – assume pipe bridge adjacent to existing road bridge £200k Interface equipment at each 270 3 connections at £90k per connection heat demand connection

Project Costs including 1,004 Next stages development including PM survey, design, project management design, specification and procurement (no legal or and contractor costs financial advice included) - £400k Owners Engineer and PM post procurement - £300k

20% Contractor Prelims OH &P (except supply interface and pipework)

Contingencies 505 20% (except supply interface and pipework) Totals 32,906

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Table 15-3: Scenario 3 – Capital Costs CPNN and Southmead only - SERC only Item Cost Notes estimate (£k) Heat extraction and 2,050 £1,650k at SERC distribution equipment at Plus 800m3 themal store @ £400k the heat source Pipework and £ 350mm pipework incl trench, install, make good, installation (trenching, 22,224 design and prelims - £1700/m trench welding fittings etc) 300mm pipework incl trench, install, make good, design and prelims - £1300/m trench SERC to Cribbs EC – 7,200m Cribbs EC to Southmead EC – 7,680m

Major infrastructure 1,050 M49 at Farm Lane – £750k crossings – eg M5 at Hollywood Lane - no extra cost motorways, railways A4018 Double Carriage way at Hollywood Lane – and waterways £100k Avonmouth railway at BAE Filton – assume pipe bridge adjacent to existing road bridge 200k

Interface equipment at 180 2 connections at £90k per connection each heat demand connection Project Costs including 946 Next stages development including PM survey, design, project design, specification and procurement (no legal or management and financial advice included) - £400k contractor costs Owners Engineer and PM post procurement - £300k

20% Contractor Prelims OH &P (except supply interface and pipework)

Contingencies 435 20% (except supply interface and pipework) Totals 26,885

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Table 15-4: Capital Costs - Scenario 4 - CPNN only - SERC only Item Cost Notes estimate (£k) Heat extraction and 2,050 £1,650k at SERC distribution equipment at the heat source Plus 800m3 themal store £400k Pipework and installation £ 350mm pipework incl trench, install, make (trenching, welding fittings 12,240 good, design and prelims - £1700/m trench etc) 300mm pipework incl trench, install, make good, design and prelims - £1300/m trench SERC to Cribbs EC – 7,200m

Major infrastructure crossings 850 M49 at Farm Lane – £750k – eg motorways, railways and M5 at Hollywood Lane - no extra cost waterways A4018 Double Carriage way at Hollywood Lane – £100k

Interface equipment at each 90 1 connections at £90k per connection heat demand connection

Project Costs including 888 Next stages development including PM design, project management survey, design, specification and procurement and contractor costs (no legal or financial advice included) - £400k Owners Engineer and PM post procurement - £300k 20% Contractor Prelims OH &P (except supply interface and pipework)

Contingencies 366 20% (except supply interface and pipework) Totals 16,484

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Table 15-5: Capital Costs - Scenario 5 – UWE to City Centre Link - SERC only Item Cost Notes estimate (£k) Heat extraction and n/a Assumes network already reached UWE - no distribution equipment at the additional costs for extraction heat source

Pipework and installation £ 9,685 (trenching, welding fittings etc) 300mm pipework incl trench, install, make good, design and prelims - £1300/m trench UWE to City Centre – 7,450m

Major infrastructure crossings n/a Route makes use of existing crossings of M32 – eg motorways, railways and etc waterways

Interface equipment at each 90 1 connections at £90k per connection heat demand connection

Project Costs including 518 Next stages development including PM design, project management survey, design, specification and procurement and contractor costs (no legal or financial advice included) - £200k Owners Engineer and PM post procurement - £300k 20% Contractor Prelims OH &P (except supply interface and pipework)

Contingencies 122 20% (except supply interface and pipework) Totals 10,415

15.6 POTENTIAL VOLUME OF HEAT SUPPLY

The actual volume of heat that can be supplied will depend on a number of factors including; the profile of demand; the extent to which mis-matches between supply and demand can be addressed by thermal storage (both central and local); and the down time for maintenance of the heat supply system. For the purposes of the assessment we have assumed the heat supply will be able to meet up to 85% of the demand of the identified clusters with the remainder provided by local top up and standby boiler plant..

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15.7 VALUE OF HEAT SUPPLY à Assessing the value of the heat supply is potentially a complex area. There are a large number of factors to be considered including: à The commercial arrangements between strategic network operator and the cluster operators à The end user customer types – e.g. domestic, large industrial or public sector à The off-set cost of fuel – e.g. gas into boilers à The off-set cost of carbon – e.g. CCL, CRC or EUETS payments may be avoided by the cluster operator à Any displacement of income - e.g. the revenue a cluster operator may obtain from operation of gas fired CHP to generate electricity à The off set of plant maintenance costs - e.g. the cluster operator may reduce maintenance costs for boilers etc. à The offset of plant installation or replacement costs – for a cluster expansion or end of life replacement of boilers and/or CHP units

All these elements would need to be the subject of detailed assessment in future stages - and would ultimately be finalised only through commercial negotiations.

For the purposes of this assessment we have established a common heat value as follows:

Cost offset Value (£/MWh) Notes Natural gas 26.00 Based on commodity price of 2.0p/kWh plus 30% for transport and supplier margins CCL 1.95 Rate as of 1 April 2016 CRC 3.05 Based on £16/Tonne CO2 and 191kg CO2/MWh gas Total cost of gas 31.00 Cost of boiler Heat 36.47 Based on seasonal boiler efficiency of 85% Value of heat 35.00 Small discount to overall cost

15.8 POTENTIAL RETURN ON INVESTMENT AND CARBON SAVINGS OUTLINE CASH FLOWS

The tables below present an outline assessment of the costs and revenues for a potential strategic network. An indication of the potential carbon savings, assuming that heat offset is from boilers at 85% efficiency, is also provided.

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Scenario 1 CPNN Southmead and UWE Base Heat Load MWh 136,592

Heat supplied 85% 116,103 Heat Revenue £35.00 £4,063,607 Heat Costs £3.0014 £348,309 Net Revenue £3,715,298 Capital Costs £33,905,800 Simple payback years 9.1 CO2 savings Te/year 26,089

Scenario 2 CPNN Southmead and UWE

Base Heat Load MWh 136,592

Heat supplied 85% 116,103 Heat Revenue £35.00 £4,063,607 Heat Costs £5.00 £580,515 Net Revenue £3,483,092 Capital Costs £32,905,800 Simple payback years 9.4 CO2 savings Te/year 26,089

Scenario 3 CPNN Southmead

Base Heat Load MWh 85,321

Heat supplied 85% 72,523 Heat Revenue £35.00 £2,538,312 Heat Costs £5.00 £362,616 Net Revenue £2,175,696 Capital Costs £26,885,200 Simple payback years 12.4

CO2 savings Te/year 16,296

14 Heat cost for this option is based on weighted average of Nexterra and SERC heat costs – heat from Nexterra would likely be prioritised but this heat source could only supply approximately 50% of the total system demand based on typical 8000hrs per year operation for this type of plant

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Scenario 4 CPNN Base Heat Load MWh 51,221

Heat supplied 85% 43,538 Heat Revenue £35.00 £1,523,815 Heat Costs £5.00 £217,688 Net Revenue £1,306,127 Capital Costs £16,483,600 Simple payback years 12.6 CO2 savings Te/year 9,783

Scenario 5 UWE to City Centre Base Heat Load MWh 58,76215

Heat supplied 85% 49,948 Heat Revenue £35.00 £1,748,170 Heat Costs £5.00 £249,739 Net Revenue £1,498,431 Capital Costs £10,414,600 Simple payback years 7.0 CO2 savings Te/year 11,224

15 This is the current estimate of the heat demand for the Temple and Redcliffe District heating load serving; Redcliffe phases 1, 2a and 2b and St Philips. The pipe would link up the UWE cluster (which is the most viable and closest load to the City Centre) with the proposed Energy Centre at the Great Western Refuse Transfer Station in St Philips. The load is subject to change, pending BCC approval.

It should be noted that in this assessment we have not included for operational costs other than pumping and costs of heat losses which are incorporated in the costs of heat. It is assumed that the maintenance of the plant at the heat supply points would be undertaken by the heat suppliers. It is not at this stage clear how the network would be managed and owned. There would be some maintenance costs associated with the heat interfaces at the heat users. There would also be some costs associated with the administration of the metering and billing. These costs should be relatively minor in relation to the volumes of heat being provided.

DISCUSSION

Of necessity, this high level assessment can only provide an indication of the potential economic performance of a scheme of this type. It is very unlikely that the whole of the network from SERC to UWE could be installed as a single project. The build out of this type of scheme is likely to take place over 5 – 10 years and so simple payback assessments are a very blunt tool. The level of assumption required to develop a more sophisticated financial assessment without significant further investigation would, however, mean that the assessment would be at the same time more complex and likely less helpful. We have therefore stuck with simple payback to provide a clear initial indication of likely viability.

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This then raises the question: what payback period should be expected/may be required? The infrastructure that makes up the vast majority of the capital costs of the network would be very long life assets. Typically design life for these pipe networks are 40 years or more and networks installed in the 1960s and 1970s are still operational without wholesale network replacements. In this context paybacks of 10-15 years are not excessive. It would however not be normal for private companies in the DH industry to invest to this level with such long returns anticipated. This type of investment is typically only undertaken by regulated industry with a monopoly – e.g. water and electrical distribution.

It can also be seen that the likely initial network connection from SERC to Cribbs Patchway provides the longest payback and could therefore be considered the most problematic. To understand the sensitivity of this initial installation to heat loads we have sought to find at what total connected heat load payback would fall below 10 years. The results of this sensitivity are shown in the table below:

Scenario 4 CPNN Base Heat Load MWh 65,000 Heat supplied 85% 55,250 Heat Revenue £35.00 £1,933,750 Heat Costs £5.00 £276,250 Net Revenue £1,657,500 Capital Costs £16,483,600 Simple payback 9.9

This implies that an additional 13.8GWh of demand, a 27% increase, would be required to reduce the payback by around 3 years.

Alternatively we considered at what level of heat revenue price the same goal could be achieved with the following result:

Scenario 4 CPNN 51,221 Base Heat Load MWh

Heat supplied 85% 43,538 Heat Revenue £43.00 £1,872,115 Heat Costs £5.00 £217,688 Net Revenue £1,654,428 Capital Costs £16,483,600 Simple payback 10.0

So the same goal would be achieved if the value of heat increased to £43.00 per MWh. This corresponds to a base gas price of 3.15p/KWh with the same carbon (CCL) cost or a carbon price of £45/Te CO2 with the same gas price.

In summary we would suggest that a strategic network as set out in the section would provide a return on investment but that such investment would not be straightforward to obtain in the private sector. It is likely that funding for the scheme would either require a significant level of public investment at low cost or for the finance to be underwritten to a large extent by a public body.

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16 APPENDIX A: HEAT DEMAND PROFILES Table 16-1: DHW and space heating profiles

DHW profiles Space heating profiles Hotel Leisure centre (with pool) Leisure centre (dry) Residentia l Office

Stadium15 Combined hot water/space heating profile:

15 Profile obtained from previous project undertaken by WSP | PB. Demands shown here are the general, non-match day loads (e.g. office space, banqueting, shops, conference facilities etc)

School University - offices Student Union Refectory Student halls of residence The following are the specially developed profiles:

DHW profiles Space heating profiles BAE Filton - CPNN (non-domestic uses)

Note – the profile for CPNN was developed through considering the percentage make-up of the non-residential heat demands by use type Accolade Wines N/A

Note – Accolade Wines has 24 hour operation. Gas use is fairly steady throughout the year, with the only use of gas being for office hot water and clean in place (CIP) use. There is no site space heating. 17 APPENDIX B: CONSUMER SIDE COST SUMMARY

A summary of consumer side CIU costs is provided below.

Table 17-1: Cribbs Patchway estimated CIU costs Site name CIU size CIU cost Atkins 2,067 £31,000 Aztec Hotel & Spa 2,763 £34,000 BAE Filton - CPNN - non-residential 22,110 £925,000 Callicroft Primary School 264 £16,000 Cavendish Nuclear 442 £19,000 Hilton Bristol Hotel 2,491 £33,000 Holy Family Primary School 200 £15,000 Patchway Community School 1,427 £28,000 Patchway Locality Hub 326 £17,000 Rolls Royce 11,415 £76,000 St Chad's Primary School 171 £15,000 Stoke Lodge Primary School 285 £16,000 Total cost £ 1,225,000

Table 17-2: Accolade Wines estimated CIU costs Site name CIU size CIU cost Accolade Wines 1,251 £ 27,000

Table 17-3: Southmead Network estimated CIU costs Site name CIU size CIU cost Badocks Wood Primary - Southmead Childrens Centre 171 £ 15,000 BAE systems 1,785 £ 30,000 Charborough Road Primary School 243 £ 16,000 Filton Sports & Leisure Centre 556 £ 20,000 GKN Aerospace 293 £ 16,000 Horfield Leisure Centre 525 £ 20,000 South Gloucestershire & Stroud College 4,495 £ 39,000 Southmead Hospital 11,623 £ 76,000 Total cost £ 232,000 Table 17-4: UWE network estimated CIU costs Site name CIU size CIU cost Bristol Rovers/ UWE stadium 3,829 £37,000 Frenchay Hospital Harry Stoke Hewlett Packard 2,484 £33,000 Higher Education Funding Council 705 £22,000 Holiday Inn Bristol-Filton 2,511 £33,000 Land East of Coldharbour Lane Land East of Harry Stoke MoD Filton Abbey Wood 14,666 £84,000 Romney House - 6 digit read 471 £19,000 Thales UWE LOADS T-block - office/laboratories 1,033 £25,000 Ecc - exhibition / conference facilities 895 £24,000 W - refectory 137 £14,000 Energy centre - plant Fbl p1 - academic/office 806 £23,000 Fbl p2 - academic/office 456 £19,000 Library zone - library Canopy - prof. Services (office) 47 £13,000 Canopy student accom. (p3) - student accommodation 827 £23,000 Student union - student union 136 £14,000 Sa2 (p2) - student accommodation 1,206 £26,000 Total cost £409,000 18 APPENDIX C: PHASED AVONMOUTH SEVERNSIDE NETWORK DEVELOPMENT

This section presents images illustrating the phased development of a network (though clusters joining together) across the Avonmouth Severnside region, and the growth of potential new development loads over a 10 year time frame. Figure 18-1: 2019 network Figure 18-2: 2021 network Figure 18-3: 2023 network Figure 18-4: 2025 network Figure 18-5: 2027 network Figure 18-6: 2029 network 19 APPENDIX D: PROCESS STEAM USE IN THE VICINITY OF SERC

Following the Priority Sites and Risk Workshop held at SERC on 4th November 2015, this project was asked to present the considerations for supplying a limited amount of high-grade heat to potential customers in the vicinity of SERC. This heat would be either in the form of steam, or high temperature hot water (HTHW).

It is believed that the proposition of affordable steam or HTHW may be attractive to manufacturers with heat intensive processes and thus support this strategy, although to date no suitable users have been identified in the vicinity of SERC.

Avonmouth and Severnside is a popular location for chilled distribution centres, and there is the potential to develop a low-carbon ‘cool zone’ powered by steam driven absorption chillers utilising steam from SERC. The considerations for this are outlined in the previously issued report: “Avonmouth & Severnside Heat Mapping Report”.

But there are a number of other industries which rely heavily on steam for manufacturing and processing. These are the types of businesses which would benefit most from a contract to supply low carbon heat directly from SERC. Some of those industries are listed below.

Industry Heat Requirement: Description

Brewing & distilling Steam and water required for brewing & distilling as well as bottle washing, cleaning in place (CIP) and sterilisation.

Food and beverage manufacture Uses include proving of bread, steam pasteurisation, fat rendering, potato peeling, and blanching, as well as sterilisation and cleaning as with brewing and distilling.

Oil & petrochemical Many uses across the industry, including petrochemical processing.

Pharmaceuticals Sterilisation, process use and general HVAC. Note that process 'clean steam' is subject to strict purification standards. Paper and pulp industry Steam treatment of wood prior to pulping.

Tyre manufacture Used in the curing part of the process to stimulate the chemical reaction between the rubber and other materials.

Universities & research Sterilisation and process use.

Waste water & sewage sludge Thermal hydrolysis of sludge to kill pathogens prior to anaerobic digestion.

These industries are often familiar with the beneficial economics of installing Combined Heat and Power plant on their own sites. Hence the key potential benefits of a high-grade heat DEN for these industries may be:

à The avoided capital cost of the installation of CHP or other low-carbon plant à The avoided space requirement for substantial heat generation plant à The avoided planning requirement for flues for on-site boiler plant (assuming that the DEN is configured to provide sufficient resilience to meet industry needs) à The additional low carbon benefit that could arise from a DEN à The ‘renewable’ component of the DEN heat supply à Avoiding the need to reject ‘low-grade’ heat under an on-site CHP configuration (e.g. applies to sites where there the higher-grade heat requirements are not matched by low-grade heat requirements) 20 APPENDIX E: NEW EARTH SOLUTIONS 20.1 BUSINESS CHANGES

During the project, in discussions with employees of the New Earth Energy Recovery facility in Avonmouth, information came to light regarding the ownership of the business, and the technology. For the purpose of avoiding confusion and to maintain the terminology used during the project, the plant has been referred to as New Earth Solutions during the course of this report.

Moving forwards, stakeholder should be aware that New Earth Solutions, which developed the thermal technology implemented at Avonmouth has sold their technology business, previously called NEAT (New Earth Advanced Thermal) to a collection of private investors. This new company is called Syngas Products Ltd. The site in Avonmouth which houses the thermal treatment power generation plant has also been sold, and is now operated as Avonmouth Bio-power Energy.