Project Summary
The project will explore how fuel cell micro-Combined Heat and Power (CHP) systems can provide UPS functionality for individual homes as well as support to other nearby homes which depend on direct electrification to provide heat, power and mobility.
Fuel cell technology can generate at efficiencies equivalent to the highest efficiency central generation plant even at micro-generation level. Its location within the LV network further ensures that system losses are minimised, byproduct heat can be utilised, and local balancing is more easily achieved. This results in increased resilience and lower operating costs for consumers and the energy system.
Innovation Justification
FREE presents a novel solution which builds upon previous work by LCP Delta and NPG in Community DSO {NIC) and Resilient Customer Response {SIF and NIA) exploring how embedded electricity storage and generation can be used in local networks, improving resilience and reliability for customers whilst reducing the stress on networks and generation. Whilst existing approaches and counterfactuals have largely explored how upstream mechanisms (e.g. system lexibility, grid scale storage, H2 to power) can be used, this suite of projects (FREE, CDSO, and RCR) take a highly innovative approach of addressing these issues in local communities and in customers properties to provide highly efficient cross vector capabilities at the point of use, and 'real' resilience by not relying on upstream networks.
The Free project is aligned with the aims of Innovation Challenge 2
• It proposes an innovative technology configuration allowing islanded network operation in resilience events with new network management and operation processes to enable this.
• Alongside the technical concept, LCP Delta will be exploring new tools and methods to support this operation including novel approaches to analysing and forecasting resilience needs building upon Al techniques for forecasting.
• Embedding fuel cells in local communities provides greater system flexibility and efficiency, reducing the need for centralised fossil power generation for peak demands.
• The cross vector integration of heating and electricity at the demand side will allow for more flexibility on networks and improve the utilisation of intermittent renewables and minimise curtailment.
FREE is considered highly innovative because:
• It combines local electricity generation with the potential for islanded networks under resilience events, alongside offsetting centralised fossil generation under normal operation conditions.
• It provides a cross vector solution to improving resilience for customers, reducing network impacts, alongside providing system benefits using established, albeit early stage, fuel cell technologies.
• It provides the basis for site scale individual or communal heating and power schemes supporting low carbon housing policy and district heating policy alongside mitigating network reinforcement.
Whilst Resilient Customer Response CR and CDSO are built on prior innovation work by proposing solutions which combine local communities and market drivers with existing network topology, FREE takes this further by embedding reliable cross vector operation within local networks. We are not aware of any other projects exploring this approach and objective.
The project concept and this bid has drawn on external stakeholder engagement. During the Discovery Phase, a workshop and 1-2-1 engagement was conducted with energy suppliers, fuel cell manufacturers and housing developers to test and refine the proposition. The work has also drawn extensively on LCP Delta's research and stakeholder engagement covering more broadly the network sector, heating market players and innovative service providers.
Whilst the central fuel cell technology is established, a robust technical analysis is required in Alpha to demonstrate the technical viability of network integration prior to conducting field trials. The novel connection, control, and power flow analysis is beyond BAU activities and the proposed SIF funding enables a suite of analysis to be conduced to de-risk a field trial with customers, drawing additionally on RCR and CDSO. The research will move the concept through TRL 3 and 4 to prepare for a TRL 5 field trial project.
Our work across innovation (network and non-network projects) has informed this bid:
• Understanding of the market dynamics, counterfactuals and need to consider the soft and hard factors in feasibility.
• The need to robustly address all areas of innovation to incrementally move the concept forwards with no significant challenges or barriers.
• The need to engage with the broader network community, alongside the broader stakeholders involved in delivery the concept and the next trial stage.
Impacts and Benefits
FREE will support a resilient and low carbon electricity supply to individual homes. This builds on existing resilience trials involving home or communal energy storage, or back-up fossil fuelled generation, by providing long duration embedded electricity supply to individual homes based on high efficiency low or zero carbon fuels.
The counterfactual
The FREE concept is considered in the context of a decarbonising energy system with key demands including transport and heating being electrified. As our problem statement demonstrates, this would increase strain on the network and increase customers risk due to greater reliance on a single vector.
Economic modelling
The Discovery phased economic modelling considered the costs and benefits associated with FREE implementation relative to a counterfactual using electric heat pumps and PV for domestic heating demand. The modelling include a range consumer, network and societal impacts referenced below. For the Alpha submission we have included an additional green H2 powered fuel cell option, and have increased costs for the communal strategy with the inclusion of heat network costs. Whilst the CBA covers a range of direct benefits, we believe that a much wider range of system and customer benefits will also be realised through a more reliable and resilient electricity network.
Overall cost benefit
Full details are in the CBA spreadsheet and can be summarised:
• Option 1 (individual fuel cells): No returns and therefore rejected.
• Option 2: Positive NPV of £749k. The phased reduction in fossil fuel use results in some early years carbon costs, but these are offset by the capital and societal; benefits.
• Option 3 (Option 2 with green H2): Positive NPV of £99k. Carbon costs removal is offset by higher hydrogen fuel costs (based on LCP Delta LCOH modelling).
Both communal solutions with and without hydrogen show a cost benefit and will be considered in Alpha.
Customer benefits
• Future network resilience events may increase in frequency or duration with increased impact as customers become more reliant. Options 2 and 3 currently assume societal benefits associated with 500 interruption events across the case studies, and a combined 90,000 lost load minutes.
• Financial modelling shows that a positive NPV could result in marginally lower energy bills for customers if a suitably business case can access the resilience value
Network and system benefits
Local CHP generation combined with improved resilience provides a range of system benefits:
• Low carbon gas CHP generation directly reduces peak electricity system demand from central gas peaking generation.
• Microgrid (island mode) operation can further reduce peak electricity demand, alongside providing customer resilience.
These combined mitigate the need for electricity network reinforcement. A conservative 1 /3 capacity reduction for new housing development connections was calculated in Discovery, with the added benefit of speeding up new development connections.
Environmental benefits
Benefits associated with the reduced use of peaking power generators (which are expensive and carbon intensive) are not realised in the CBA due to the templates use of average carbon factors. Fossil use (and transitioning to low/zero carbon gas) in CHP with heat offtake is more efficient and lower carbon than CCGT or OCGT peaking generation.
Additional and new revenues
• Dispatchable generation in embedded CHP assets can be aggregated to capture significant system flexibility values using innovative business models.
• Innovative propositions will help local communities benefit from reduced infrastructure connection costs alongside the broader FREE system cost benefits. Community DSO is exploring this and will inform FREE.
• Cross vector integration at customer homes could deliver new efficiency related revenues, and enable local balancing with the use of innovative business models to equitably benefit all customers.
