What are the co-benefits of Solar, Battery, HP, EV, Tariff?

Hardware Heatpump
1

There’s lots of discussion around this question, how these different technologies and tariffs can combine to provide greater savings overall, how tariffs, solar and batteries can enable lower cost lower SPF/SCOP heat pump installs or greater savings with high performance installs.

With a lot of help from Claude I’ve built a new tool to explore this question. It integrates earlier work I did manually on the 15minute real world data based solar & demand matching into a new overall user interface which is pretty much all Claude’s doing. I did double check the embodied carbon references and have sanity checked the work at length..

As ever with a tool like this error bars on input assumptions will have a strong impact on the results. E.g one of the aspects of the financial modelling side that I think is hardest to answer is how will time of use tariff pricing evolve over the next 10-20 years. For the heat pump costing math in the model assumptions around lifetimes and how much of a system actually needs to be replaced after 15-20 years is also something that isnt currently captured by the tool.

For me the big take away so far is a reminder of just how large the carbon savings of switching these large ticket items can be, even taking into account embodied carbon. The carbon payback time looks to be very short 1.0-2.0 years. The model suggests the financial savings are more modest at 25-35%, these include capital cost and a 3% discount rate above inflation.

The main co-benefit for heat pumps is the agile tariff - as we probably expect. E.g in the default example adding a £12k install heat pump with SPF 4 on a flat tariff results in £134/year of savings (includes annualised capital costs - so yes there is payback there!). Combining the heat pump and agile increases savings to £475/year (though £160 of that is savings on standard electric demand). The additional benefit of adding 4 kWp of solar on top of that for the heat pump is only £36 out of the £113 that solar saves overall. A 10 kWh home battery on top of that with optimal dispatch agile arbitrage saves another ~£45.

https://openenergymonitor.org/tools/energy-ledger.html

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Claude also built this more specific heat pump co-benefit report page which also runs the full model behind the hood. This makes the balance between SCOP and install cost much easier to pick out:

https://openenergymonitor.org/tools/heatpump-cobenefits-live.html

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without the grant:

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the code for this is all available here: https://github.com/openenergymonitor/tools.

The grant is doing a lot of the heavy lifting as expected - but it looks like post grant - hitting an SCOP of 3.5-4.0 with a £7500-9000 install is probably where we need to be (this is with agile and a 6 kWp solar array and 10 kWh battery doing arbitrage). Another way to look at that chart is to draw a line of equivalent savings, and see if you can push out that much more performance for the extra install cost.

This is all of course running on agile prices over the last 12 months - which is probably the largest source of uncertainty and risk projecting financial savings forward. The balance will of course change if prices go up or down over time. My current thinking is that time of use tariff prices will go up over time as more people adopt them - I think for many of us early adopters the average agile prices we are paying today are actually below or too close to the cost of producing that electricity and maintaining the grid (based on the simple grid modelling tool I built earlier in the year UK Grid Simulator :sweat_smile:). I’m not totally convinced that the prices are scalable to everyone, I also think as heat pump start to really impact national demand those winter time of use prices will rise quite a bit. I could be wrong about this of course - it would be nice if I was!

All in conclusion so far is wow those carbon savings are huge! and being reminded of that has left me feeling more optimistic about this than before. It’s good that that the financials look ok and that there are some savings to be made, it’s also a lot of fun from a technology and playing with nice kit perspective!

Thanks to @John_Ewbank for sharing his battery dispatch solver which helped Claude then develop a different variant of it that gets most of the way in terms of savings performance. And thanks also to John for creating his solar calculator here https://solar.johnewbank.co.uk/ which I have used for validating a few overall results - definitely worth checking out his work on this as well and his write up on balcony solar: Is Balcony Solar Worth It? - John Ewbank

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Perhaps a good real world test! I thought I’d try and reproduce @Zarch’s all year energy cost of £633 that he discusses in one of his recent videos! :smiling_face_with_sunglasses:

Now I cant quite believe how close this is on the running cost subtotal: £635!!

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  • I entered 5.1 kWp solar
  • 16 kWh battery with optimal dispatch
  • 3.8 SPF heat pump, similar heat demand
  • 9000 miles EV driving

What’s more remarkable is that the running cost is similar even though the actual tariff Mick is on is different, intelligent go with 15 p/kWh export - so perhaps it’s a bit of a coincidence!

The model suggests £869 import, £442 export earnings and £209 standing charge. Micks actual figures are £965 import, export £545 and £213 standing charge.

What we can also see here is the massive 5.7 tons of carbon reduction per year, a 1.7 year carbon payback. The additional annualised capital costs above and beyond the cost Mick would have to pay anyway (Im guessing a bit on actual install costs here) if he was replacing a petrol car with another etc is maybe: assets petrol/gas ~£2500/year, assets ev,hp,solar, battery, ~£3400/year, but overall with lower running costs there is a ~£1900/year saving overall..

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Phew. I thought you were gonna tell me I was miles away!! :rofl:

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You are real life @Zarch! it was more a relief on my side that I could get the model to reproduce your excellent results :sweat_smile:

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A few refinements to the install cost vs SCOP view:

  • Option to change heat delivered (more heat demand makes savings easier to achieve!)
  • Refined solar and battery pricing based roughly on Octopus solar costing tool.
  • Boiler efficiency at 85%
  • Better contrast on the table numbers so that it’s easier to read.

It really shows the impact of the recent price cap changes with gas at 7.33p/kWh (that should probably be an editable option).

https://openenergymonitor.org/tools/heatpump-cobenefits-live.html

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I not convinced that solar will combine well with Agile in the long term as on days with good solar we will start to see lower Agile rates.

Did you look at a basic Fogstar battery without solar?

I have been questioning what turning of the heatpump and using a log stove on the most costly days of the year would do… Eg reduce electricity usage on the days it most helps the grid. (But only if the log stove have no capital cost.)

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Yes I agree. You can already see that the value of the solar in the model is reduced significantly when you switch from price cap flat rate to agile and I would also expect those day time agile prices to fall over time.

Interestingly it looks like @John_Ewbank’s more advanced battery algorithm is getting 2x the running cost savings in that configuration £333/year running cost saving vs £150/year with my simpler battery dispatch model - looks like I will have to revisit that!

I get similar running cost savings when solar is included e.g £855/year vs £860/year in John’s model but with battery only the savings seem to diverge.

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It’s sad that you’ve made @Zarch obsolete.

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I was also thinking of the difference in capital cost of a 32kwh Fogstar battery compared to most battery quotes for much lower capacity. But at present prices are unstable as installer are using up their stock and long delays on new orders from Fogstar as increased worldwide demand for the cells along with unpredictable shipping.

When I have played with the maths, a large battery on Octopus IO or Agile reduced the return on investment of solar and solar reduced the return on investment of the battery. But I don’t believe the fixed PV export payments can last.

We have the national issues that a reduction in a homes electricity usage due to PV will increase the grid balancing costs while reducing how much that home pays towards the grid operating costs… Also unpredictable uptake of “balcony solar”.

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I dont think that would ever be possible and certainly not with a theoretical model :sweat_smile:

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Agreed, and that should ultimately feed back to higher prices over time for the electric that does still need to be imported.. or ever rising standing charges.

The other is that wholesale based price signals such as agile dont reflect actual generating costs when generation becomes mostly paid for through CFD’s. We still ultimately have to pay the top up subsidy rate when the wholesale price is below the strike price and vice versa.

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I think there is a bug here (please excuse me if not!):

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For example, looking at £9K, I would have thought the payback time should go down as the SCOP goes up, but is the other way around.

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Yea the idea there is that it’s saying it’s cheaper than the boiler initially as the install cost e.g £6000 - £7500 grant = -£1500 and a new boiler is £3000 and so even though you have higher running costs the system is cheaper until e.g year 2.7 and after that it’s more expensive.

Maybe I just set those to never or n/a?

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Got it :slight_smile: I’d tend to go with “never” as I guess you just pocket the cash one time, it’s not an ongoing thing but entirely up to you!

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Thanks @awjlogan I’ve changed those to n/a - agreed the > was confusing.

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Ok lots of updates:

Co-benefit table tool

  • Option to view simple payback in years instead of combined running cost and annualised asset cost savings. This highlights that the systems that had small annualised savings actually have very long payback times.

  • Option to change gas price and compare with a flat electric price.

https://openenergymonitor.org/tools/heatpump-cobenefits-live.html

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Energy Ledger

  • Mode toggle at the top to switch between: Running costs only, Running costs + assets and Carbon modes.
  • Simple payback, IRR and crossover year when comparing with 5% alternative shares ISA investment.
  • Fixed missing 5% VAT on Agile prices! Though I am using region D Merseyside and North Wales which is a relatively expensive region already.. I should really use a more central figure.

https://openenergymonitor.org/tools/energy-ledger.html

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That’s pretty crazy, Selecting second hand petrol kona vs second hand kona EV and then everything else. Looking at this from the perspective of the extra upfront above the cost that would have been incurred anyway with a boiler swap or next second hand petrol car and an ISA investment. The full stack has a crazy low return on investment!?

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Dropping the petrol price to £1.32/litre and gas price to 5p/kWh, equivalent boiler swap to £2000 and increase heat pump install cost to £13k, it’s still very good:

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can anyone see any holes in this?

We might not see complete annihilation of export earnings over the next 5 years, especially with the battery doing arbitrage..

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The BUS grant and agile are doing a lot of heavy lifting.. removing those and export earnings gives a less favourable but still not too bad result (second hand EV case)

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then of course its also about timing with the point at which the assets were going to be replaced anyway and what happens if you are retiring them early.. i guess with the car you get the value it’s worth at that point in time but for the boiler if it’s relatively new and has plenty of years left its another matter.

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“Start”? :grinning_face_with_smiling_eyes: Been that way for a few years now. But the value of solar is far from just the output on rare sunny days.