ECO4 and the Curious Incident of the PV in the Night-Time

3 August 2022

Our Director of Household Energy Services, Ian Preston, recently took to LinkedIn to share his thoughts following an email exchange with BEIS about the role of solar PV in ECO4. In order for solar PV to be considered a 'heating measure', Ian argues it should be installed alongside a hot water tank and solar diverter, but these aren't a requirement. Ian's thoughts are copied below:

Forgive the title but this really does seem like there’s a need for some detective work. I’ve just heard from the Energy Company Obligation (ECO) team at BEIS that under ECO4, Photovoltaic panels (PV) are going to be considered “equipment for the generation of heat” and fall within the regulation’s definition of “heating measures”.

Before I begin, let’s remind ourselves of another aspect of the ECO scheme that says any new heating system will need to be heat pump ready:

“We support all newly installed and fully replaced wet central heating systems (including both the heating appliance and emitters) to be installed as a ‘low temperature heating system’ through ECO4.”(1)

So essentially any new heating system needs to be heat pump ready.

Ok fine, now back to PV.

On behalf of CSE, I contacted BEIS to ask:

“If you are going to classify solar PV as “equipment for the generation of heat” then this must mean that the hot water tank is specified with a solar diverter, or you are installing a battery. Can you confirm that this is the case?”

BEIS responded to say:

“Hot water tanks are not required to be installed alongside. Whilst they would be advantageous it is possible for PV to provide electricity for the provision of space heating without them.”

I proceeded to send a very sarcastic response for which I apologise to BEIS. However, it’s clear that we’re missing several tricks here and if we make mistakes now then we are really undermining our ability to tackle fuel poverty and net zero.

1. Can PV contribute to heat meaningfully without storage? 

No. In the winter it’s coldest when it’s dark. There’s also less sunlight in winter. So, without a battery, or a hot water tank to convert the electricity to stored heat via a solar diverter, I don’t see how it meaningfully contributes to heat (albeit hot water through a diverter).

Are they suggesting that the householder waits to see that there’s some generation and then manually plugs in an electric heater to try and use the solar?

2. Are we missing a huge trick for net zero?

Yes.

Firstly, by installing PV without a hot water tank (if there isn’t one already) the heating system isn’t being prepared for a future heat pump installation.

Secondly, a hot water tank with a solar diverter opens up all sorts of network possibilities. When the network’s constrained a solar diverter can make sure the immersion heater switches off. If there’s spare capacity in the network and the householder is on a ‘time of use’ tariff they can have free hot water. Free hot water for a householder in fuel poverty… sounds good doesn’t it.

3. Is this all about Standard Assessment Procedure (SAP)?

Yes.

SAP is now the linchpin for measuring the impact of all government energy efficiency policy. Under the ECO we need to target low SAP properties and move them up two bands. This is going to be challenging and squeezing out the last few SAP points is going to take everything we can throw at it… the answer to this is PV!

I’m not against PV. Far from it, I am all for free electricity for our clients in fuel poverty who are struggling to afford their bills. But I’d like to see a PV install that’s configured to deliver maximum benefit to the householder i.e. also has a battery or hot water tank with a solar diverter.

What’s the issue?

Well, if you install a hot water tank then you might decrease the SAP rating (because you are now storing hot water). If you are replacing the hot water tank with a new whizzy one, then you are likely to gain minimum SAP points.

This all seems completely disjointed and there doesn’t seem to be any thought about future tariff options, grid impacts etc. We have an opportunity to make sure that the ECO is both smart and fair, but at the moment it’s just thinking about the issue with delivery today.

(1) Energy Company Obligation ECO4: 2022 – 2026, Government Response, pg. 56

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