Power (with no strings attached)
Beat the Climate Change Levy liabilities by using combined heat and power. Peter Walker is managing director of EcoCentroGen, specialist in financing the design, construction, operation and maintenance of energy-efficient and environmentally-responsible energy centres, providing energy on a metered ‘pay as you use’ basis.
If the company involved was to fund the energy efficient project, they would also benefit from Enhanced Capital Allowances (ECAs) where 100 per cent of the capital cost can be offset against profits, and therefore tax, in the first year of that investment.
Government legislation is moving forwards on promoting low carbon technology and renewable forms of energy production. In addition to the benefits above, a carbon reduction programme will present the opportunity to trade carbon reductions creating a revenue stream, and, if the energy source is renewable the door is opened to trading Renewable Obligations Certificates (ROCS) with utilities companies.
The barrier to this kind of low carbon project has usually been the availability of capital. Companies, understandably, usually want to invest their hard-earned cash in reinvestment into their core business to promote growth. The incentive to use the money for energy efficiency has not been significant enough.
Now there is a solution. They can achieve the benefits of CCL exemption, lower operating costs for utilities (power and thermal energy tariffs are actually lower than conventional tariffs) and make a significant contribution to carbon emissions reduction. The key here is that it doesn’t cost them a penny.
It may sound too good to be true but EcoCentroGen (ECG – www.EcoCentroGen.com) has produced a funding package which allows this to happen. Utilising CHP or renewable forms of power, heat and cooling generation together with private wire, community heating and cooling networks, ECG will deliver utilities on a ‘pay as you use’ basis. The entire project including design, construction, operation and maintenance is funded. This is not just a glorified leasing deal, but an ongoing energy management solution under a long term energy supply contract.
Specially developed software controls the output from the energy centres and manipulates information from intelligent metering devices on all utilities to provide automated billing. The software provides an Internet based customer relationship management portal which can be used by facilities managers and energy managers to constantly monitor energy use on a site.
This will include customised monthly reports and graphs showing usage as well as the ability to set alarms (even sending text or e-mail messages if thresholds are breached). The point here is to help the energy users maximise energy efficiency on an ongoing basis.
This portal can also be extended to allow other property and facilities management information to be moved from building occupiers and users to managers and support companies. For example, EcoCentroGen is currently designing an energy centre that will allow residential energy users to use the portal to report faults or service requirements. Depending on the type of request (including the ordering of a taxi or a pizza!), this information is passed to the relevant support company automatically and then monitored to conclusion.
The key to this element of the system is the installation of fibre optics with the other utilities. Not only does the fibre carry information from the utilities meters back to our servers for billing and CRM but it allows for the supply of all Broadband Internet based products to the site on a retail basis.
These can be as diverse as integrated security and CCTV, to voice over internet and video conferencing.
Applications software provision and all the benefits of ‘always on’ access are now available to commercial and residential users connected to the energy centre. Currently, these services are charged for on a low cost subscription basis but we are currently working on an optical meter which will allow broadband to be supplied on a ‘pay as you use’ basis as well. Broadband is a utility and therefore a natural part of the conventional utilities provision we fund.
Now a complete energy solution can be provided for sites requiring as little as 100kWe (kilowatts of electricity) to as much as 20Mwe (megawatts of electricity) all at zero cost. Commercial users get the benefit of CCL exemption as well as lower costs for utilities. This is the future for the provision of low carbon power and thermal energy and will allow time for advances in renewable technology, including waste to energy systems, to be developed so that not only will the UK make progress against our Kyoto target now, but will provide a sustainable energy solution into the future.