CHALLENGING HOW WE GENERATE AND USE ENERGY.

© RESCo 2015-2025.

Rhondda Energy Services Company (RESCo) will be established as a limited company with shareholders. Within this organisation it will employ key individuals to govern the business and will stand as a social enterprise with the primary function of trading to support a social purpose. Like any organisation, RESCo aims to generate profits, but it seeks to principally reinvest those surpluses in the organisation or in the community to enable it to deliver on its social objectives. The accepted definition of a social enterprise is: “A social enterprise is a business with primarily social objectives whose surpluses are principally reinvested for that purpose in the business or in the community, rather than being driven by the need to maximise profit for shareholders and owners.” (Social Enterprise – a strategy for success, DTI, 2004). The key elements that define an organisation as a social enterprise are:

its planned activity has social aims;

its organisational structure is democratic and participative;

its planned activity has social benefits, specifically related to their community; and

financial sustainability is a primary goal of the organisation. Rhondda Energy Services Company will embrace a variety of ways of working that will embody the following characteristics:

it will gain independence and autonomy through trading;

it will be entrepreneurial, innovative, with risk-taking behaviour;

it will adopt flexible and adaptable practices;

it will have a customer and community focus;

it will engage with its stakeholders;

it will have democratic and participative management;

it will deliver socially and/or environmentally as well as financially; and

it will become financially viable, gaining its income from selling goods and services.

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RHONDDA ENERGY SERVICES COMPANY – A Social Enterprise.

The primary ambition of RESCo is to enable a significant number of domestic properties in the Rhondda Valley to become energy independent. This will be achieved by investing profits that the organisation produces into technology that allows individual homeowners to produce a significant volume of their own electrical energy and domestic heating requirement. There is an overriding desire to free as many homes as possible from reliance on the national grid network. RESCo will seek to generate renewable energy within the Rhondda Valley from various sources, including wind, hydropower, biomass, solar and biogas (anaerobic digestion). The organisation will review options to purchase technology directly and will seek to enter into partnerships with private companies, individuals and public-sector bodies who hold similar ambitions for this community.

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COMMUNITY INVEST IN RENEWABLE ENERGY GENERATION

COMMUNITY ENERGY FED-BACK TO THE GRID-NETWORK TO CLAIM GOVT SUBSIDIES (RHI, ROC, FiT, etc).

PROFITS FROM SUBSIDIES USED TO PURCHASE RENEWABLE GENERATING SYSTEMS FOR INDIVIDUAL HOUSEHOLDS - SUBSIDIES PAID BACK TO COMMUNITY FOR FURTHER INVESTMENT IN GENERATING TECHNOLOGIES

PRINCIPLES OF SOCIALLY RESPONSIBLE TRADING

Biomass can be obtained from plantations and

woodland growing in the region.

Energy crops can be grown locally to

enhance degraded landscapes

The average 3-bedroom household will use 4152 kilowatts of electricity a year at an average cost of 16p per kilowatt. £664 per house average (1). This energy is supplied to 26 million households in the UK via 22 companies (2). The supply of electricity to the UK’s 26million homes is worth £17.25billion to these companies each year. This figure does not include heating costs, which could add up to a further £1000 to the annual fuel bill. More than 60% of all energy used at domestic levels goes to heating space and water. There are currently more than 2.3million households in the UK that are unable to pay their electricity bill upon demand: these households are determined as living in fuel poverty (3). When a household fails to pay for the electricity that it has used, the supply company will do what it can to help, which, in the vast majority of cases, results in a “payment plan” based on energy use that is agreed on the establishment of a direct monthly payment made through the householder’s bank account. If the householder is unable to pay for electricity according to the energy supply company’s demand then a meter can be installed, where energy can be bought on demand. “People on standard meters have a choice of online, fixed, green, dual fuel and discounted tariffs, as well as often receiving a discount for paying by direct debit. But energy firms tend to offer just one tariff to prepayment customers, and it is usually much more expensive than the best buys. How much extra prepayment customers pay depends on which expert you ask. Comparison site Confused.com puts the figure as high as £300 a year, Moneysupermarket just over £200 and uSwitch at about £163” (4).

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In 2013, the former secretary of state for energy and climate change, Ed Davey, announced “a community energy revolution”. Under the unlikely slogan “Power to the people”, last year the government explained what this meant (5): “Local communities will be able to take control of their energy bills and help transform the energy system ... In the future, the generation of electricity by communities themselves could put pressure on energy suppliers to drive down prices, creating warmer homes, cutting carbon emissions and diversifying the UK’s energy mix.” The big six companies who currently dominate the supply of energy in this country, would, the government promised, be replaced with “the big sixty thousand”

Less than 12 months later the Financial Conduct Authority (FCA) changed the rules under which energy co-operatives could be established and has since been rejecting attempts to establish new energy co-ops on the grounds that they sell the electricity they produce on to the grid, rather than to their members (6). Transforming the energy system, according to current Govt. thinking, means:

Communities can generate energy, but have to export that energy back to the national grid.

Communities can claim Govt. subsidies for feeding this electricity back into the national grid.

Communities can use these subsidies to buy energy-saving technologies that they can donate or lease to community members who can claim further energy production subsidies.

Community energy is attractive to both private and public-sector investors because Govt. subsidies offer a guaranteed fixed return on their investment over a determined number of years, depending on the technology being used to generate the energy. While this may seem to be an ideal solution to reducing the nation’s reliance on fossil fuels, the truth is that by being limited to selling electricity back to the national grid, community energy projects do little more than sustain the hold that large generating companies have over energy supply. Added to this, most community energy projects, to date, seem to focus on a limited range of technologies, mostly large PV solar arrays, hydro-electric and wind turbines. These technologies do not create long-term employment opportunities for local people after they have been installed and are operational.

COMMUNITY ENERGY

The need to create new community energy models has never been so obvious!

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Electricity is currently supplied to the majority of houses in the UK via networks of high-voltage cables, hanging from pylons, which start their march across the countryside from vast power stations, hydroelectric dams or enormous windfarms. It has been claimed that more than 60% of the energy generated via these technologies is lost to network inefficiencies before it reaches the consumer (7). The ‘golden-egg’ in terms of energy production is delivered when individuals can gain access to technology that enables them to generate their own electrical and thermal energy in their home. Further benefits are gained when consumers are able to produce this energy and then use it when it is needed. Currently, the only way that householders can generate electrical energy is via photovoltaic solar panels. A system capable of producing a peak of 1kilowatt of electricity an hour would cost about £2500 fully installed and would be expected to generate about 850kWe/yr., which is about 20% of the average household annual requirement. It is a fact that biomass, either taken from forest residues, waste sources or from energy crops (short rotation willow, alder or poplar) and energy grasses (Miscanthus & Sida), offer the homeowner a more reliable means of generating both electrical and thermal energy all year round. Rhondda Energy Services Company has spent the past 18months encouraging a number of global companies to work together to produce a biomass-based Home Micro-Generating Unit capable of providing individual homeowners with the means to generate their entire energy requirement themselves. This technology has been designed specifically for this project.

Anyone who understands power distribution will tell you that maximum efficiencies

are achieved when both electrical and thermal energy is generated as close as

possible to the point of use.

Prosumer (noun) - a consumer who produces their own energy.

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The use of locally-grown biomass to generate renewable energy offers many advantages over other forms of energy generation.

Technologies such as biomass gasification, where gases (syngas) are directed through specialised engines to produce electrical and thermal energy, can be operated continuously over long periods (24 hours x 350days/yr.). On average, 1kilogram of biomass can produce 1kilowatt of electrical energy and between 2-3kilowatts of thermal energy via the water-cooling process attached to the engine. Production of electrical energy via this process can attain efficiency levels exceeding 85%.

Biomass offers the best solution to individual homeowners to generate both electrical and thermal energy at micro-scales. Unlike the intermittent nature of solar energy, biomass offers a more consistent approach to generating controllable levels of energy which suit individual homeowner requirements, thus eliminating the need to waste energy by delivering it back to the grid network.

The biomass supply chain, in its current state, is probably the most inefficient method of delivering energy to consumers, leaving clear opportunities for massive gains in efficiency to be made via alternative models of harvesting and processing biomass for energy purposes.

Community energy projects based around any other generating technology fail to create long-term employment opportunities for local people.

In 2014, the Welcome to our Woods Project, with the support of private business in the area, established a unique business model based around a 350hectare woodland/plantation site growing in the community, which is owned by the Welsh Government and managed on behalf of the people of Wales by National Resources Wales (NRW). The model, known as The FEZ Plan (8) sets out an ambition by the community to develop several micro-business projects based around the supply of wood from local softwood plantations and broadleaved woodlands. Timber will form the primary produce, cut to provide these businesses with the raw materials required to manufacture a range of products, with the waste from this operation being further utilized to grow food and to generate energy via domestic-scale pellet-stoves and anaerobic digestion at appropriate scales. There is a belief that this approach is the most efficient way to utilize wood growing close to communities. Additional to the effort to utilize woody-biomass growing locally, will be a parallel ambition to encourage both private and public landowners to grow energy crops such as Sida and Miscanthus on marginal land and on land where traditional methods of agriculture are failing. This work will be supported by Aberystwyth University under the Beacon Project. The FEZ Plan has an ambition to create up to 15 new micro-businesses, which will collectively employ more than 30 local people by 2017.

BIOMASS-BASED COMMUNITY ENERGY

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1. SOLAR THERMAL FOR 500 LITRE WATER TANK - £2500 (ex. VAT).

Can only be used for domestic hot water – not space heating. RHI Payments – 19.51p/kWh UK household demand for hot water 9kWh/day – 3300kWh annual.

2. 200 LITRE DOMESTIC WATER TANK - £250 (ex. VAT). 3. 12-25kWh BIOCOAL/WHITE PELLET STOVE WITH HOT WATER BOILER - £3300 (ex. VAT). RHI Payment - 8.93P/kWh - £16,100 over 7 years. 4. 500 LITRE HOT WATER ACCUMULATOR TANK - £750 (ex. VAT). 5. 1.5kWe/hr STEAM-BASED MICRO TURBINE - £5000 (ex. VAT). RHI payments to be determined. 6. 250W BLACK FRAMED SOLAR PV WINAICO PANEL x 4 - £2000 installed (ex. VAT). RHI payment – 12.92p/kWh. Expected annual output 850kWe/yr.

7. 48VOLT VITRON INVERTER 10kWe PEAK - £3000 (ex. VAT). 8. 12kWe ENERSYS BATTERY STORAGE SYSTEM - £2500 (ex. VAT). 9. WASTE WATER HEAT RECOVERY TANK – PRE-HEATING DOMESTIC WATER - £450 (ex VAT).

COMPLETE DOMESTIC-SCALE MICRO-GENERATING UNIT.

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RENEWABLE ENERGY WILL BE GENERATED IN TWO DISTINCT PHASES: PHASE ONE: in order to secure inward investment into the project, phase one will involve the placement of a range of generating technologies with the primary intention of generating funds from Government subsidies, which will be used to deliver the ambition detailed in Phase Two. 1. Secured support of appropriate technology partners to enable the ambition.

2. Determine potential of local resources and develop partnerships with owners.

3. Locate suitable sources of funding, business partners and develop community-based investment portfolio.

ENVIROPOWER TECHNOLOGIES (USA)

RESCo – PHASE ONE

DISCOURAGE THIS ENCOURAGE THIS

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4. Detail ambition to representatives of local communities, Welsh Government, National Resources Wales, Cynnal Cymru and local councils. 5. Develop business plan to determine levels of revenue, costs and profit, and other income streams. 6. Establish manufacturing base to build majority of technology in the community – pellet stoves, solar panels, small hydro, wind turbines and anaerobic digesters. Create 25jobs from this ambition. PHASE TWO: 1. Roll-out of Home Micro-Generating Units across the region. 2. Increase generating capacity via subsidies gained from renewable technologies.

References: 1. http://www.electricityprices.org.uk/average-electricity-bill/ 2. http://switch.which.co.uk/energy-suppliers/energy-companies-rated.html 3. http://www.theguardian.com/society/2015/jan/09/working-households-fuel-poverty-rising-energy-bills-policy-exchange 4. http://www.theguardian.com/money/2013/apr/20/energy-bills-prepay-meters-cost-poorer-households 5. http://changeworksblog.org/2013/08/26/community-energy-fortnight/ 6. http://www.theguardian.com/environment/georgemonbiot/2015/jan/23/community-energy-companies-big-six-big-society

7. http://www.off-grid.net/2010/04/11/60-of-power-is-lost-in-the-grid-exclusive/ 8. The FEZ Plan – Thomas I & Edwards R, 2015 (available upon request).

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