How Market Regulatory Framework and Policy Affected the CHP Development in Meeting 2010 Targets in the UK

Abstract

The future UK combined heat and power (CHP) uptake depends on the policy and market regulatory framework. Since CHP produces up to 1MT carbon savings per GW power, the UK government recognizes its role in the reduction of carbon emissions. In addition, there are the potential contributions to the security, diversity, and competitiveness of energy supply, and to provide support in a competitive manufacturing industry for sustainable energy technologies in the UK (CHPA, 2006; Defra, 2004). In 2000, the UK government announced a target of achieving at least 10,000 MW_e of good quality CHP by 2010 (Defra, 2004). This article will present the existing policy and market regulations for CHP, and discuss how these issues affected CHP policy deployment for meeting 2010 targets. In addition, this article will discuss how the technology innovation, strong combined heat and power policy, and stabilized market regulations can enhance CHP development for future consideration.

Keywords:

• combined heat and power
• energy policy
• sustainable energy

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Erratum

Notes

¹“Zero carbon” here refers to a dwelling emissions rate less than or equal to 0, as calculated under the Standard Assessment Procedure 2005 methodology. This methodology only considers calculated CO₂ emissions from energy use for heating, ventilation, and lighting. Electricity from other sources is not included, and as such the dwelling need not be truly zero carbon to achieve “zero carbon” status.

²What portion of capital investment could be depreciated is debateable, as the device's application is split between personal use (for heating and/or electricity), and for commercial purposes. Additionally, if a large number of devices were in operation, the impact on public revenue may become more significant, and this measure may need alteration. A method where taxation is collected at the source (i.e., by the supplier), similar to that applied for personal interest payments in the UK banking system may be appropriate in that case.