Hot water boiler equipment - A guide to equipment eligible for Enhanced Capital Allowances

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Hot water boiler
equipment
A guide to equipment eligible for
Enhanced Capital Allowances
Hot water boiler equipment                        2

Contents
Introduction                                 03

Background                                   03

Setting the scene                            03

Benefits of purchasing ETL listed products   03

Hot water boiler equipment eligible
under the ECA scheme                         04

  Hot water generators                       05

  Combustion control                         06

  Heat recovery                              06

  Boiler system control                      07

Further information                          08
Hot water boiler equipment                                                                                                                    3

Introduction                                                                       Benefits of purchasing ETL listed products
ECAs are a straightforward way for a business to improve                           Many hot water boilers and their distribution systems have
its cash flow through accelerated tax relief. The scheme                           been in place for years, even decades. Developments in
encourages businesses to invest in energy saving plant                             modern hot water boiler technology means that efficiencies
or machinery specified in the ETL to help reduce carbon                            of newer boilers have now advanced significantly. ETL
emissions, which contribute to climate change.                                     listed hot water boiler equipment offers a range of savings
                                                                                   opportunities when compared to equipment not designated
The Energy Technology List (ETL) is a register of products
                                                                                   as energy saving. The degree of savings that can be
that may be eligible for 100% tax relief under the
                                                                                   achieved is dependent upon the nature of the current
Enhanced Capital Allowance (ECA) scheme for energy
                                                                                   installation as well as the new equipment that is installed.
saving technologies1. The Carbon Trust manages the list
and promotes the ECA scheme on behalf of government.                               When replacing equipment, businesses are often tempted
                                                                                   to opt for that with the lowest capital cost; however, such
This leaflet gives an overview of hot water boiler
                                                                                   immediate cost savings can prove to be a false economy.
equipment specified on the ETL and illustrates the
                                                                                   Considering the life cycle cost before investing in equipment
reductions in energy bills that can be realised by investing
                                                                                   can help enhance the cash flow benefits still further.
in qualifying ETL energy saving equipment over non-
qualifying equipment.                                                              The ECA scheme provides businesses with 100% first
                                                                                   year tax relief on their qualifying capital expenditure
                                                                                   and the ETL specifies the energy saving technologies
Background
                                                                                   that are supported by the ECA scheme. This means that
The ETL comprises two lists: the Energy Technology                                 businesses can write off the whole cost of the equipment
Criteria List (ETCL) and the Energy Technology Product List                        against taxable profits in the year of purchase. This can
(ETPL). The ETCL defines the performance criteria that                             provide a cash flow boost and an incentive to invest in
equipment must meet to qualify for ECA scheme support;                             energy saving equipment which normally carries a price
the ETPL is the list of products that have been assessed                           premium when compared to less efficient alternatives.
as being compliant with ETCL criteria.
                                                                                   This leaflet illustrates the reductions in energy
                                                                                   consumption, carbon emissions and energy bills that can
Setting the scene                                                                  be realised by investing in qualifying ETL energy saving
                                                                                   equipment over non-qualifying equipment.
In 2005, the UK commercial sector consumed around
350,000GWh of fossil fuel at a cost of £16,500 million. The
generation of hot water accounts for around 15% of fossil
                                                                                     Important
energy use in buildings and about 3% in industry, totalling
around 22,000GWh per year2.                                                          Business purchasing equipment must check the
                                                                                     ETPL at the time of purchase in order to verify
Hot water boilers and water heaters provide low or
                                                                                     that the named product they intend to purchase is
high-temperature hot water for uses such as industrial
                                                                                     designated as energy saving equipment. Hot water
processes, space heating and the direct use of hot water
                                                                                     boiler equipment that meets the ETL eligibility
for activities such as washing.
                                                                                     criteria but is not listed on the Energy Technology
The diagram on page 4 shows the typical structure of a                               Product List (ETPL) at the time of purchase is
hot water boiler. Many of the component technologies are                             not eligible for an ECA, even if it meets the ETL
included on the ETL, and their energy saving properties                              eligibility criteria.
are described to the right.

  Eligibility
1	           for ECAs is based on a number of factors. Visit http://etl.decc.gov.uk/etl to find out more.
2	Based   on data reported in the DTI Digest of UK Energy Statistics published in 2006.
Hot water boiler equipment                                                                                                                               4

Hot water boiler equipment eligible                                            The following baseline scenario has been used for
under the ECA scheme3                                                          comparison unless otherwise indicated:

The following sections describe the hot water boiler                           • Currently total installed capacity of 2MW from
equipment specified as energy saving under the ECA                               two gas fired hot water boilers.
scheme. The diagram below illustrates these ECA-eligible
                                                                               • Burner 2-stage control.
components and their relationship to each other.
                                                                               • Annual boiler efficiency 84% net.
Using the stated baseline scenario the potential financial
(£), energy (kWh) and carbon savings (tonnes CO2) have                         • Average boiler load 75%.
been calculated for replacing the component parts of
                                                                               • Annual utilisation 8,000h.
the hot water boiler with ETL qualifying equipment to
highlight the potential savings that can be achieved.                          • Fuel price 3p/kWh.

                                                                               • Carbon emissions for gas is 0.1836 kgCO2/kWh.

Figure 1 Hot water boiler equipment potentially eligible under the ECA scheme

  The
3	   descriptions of the hot water boiler equipment given in this leaflet are examples only. The formal criteria and details governing the ECA scheme can
  be found at http://etl.decc.gov.uk/etl
Hot water boiler equipment                                                                                                                            5

Hot water generators                                                          Hot water boilers up to 400kW
                                                                              ECA listed condensing, gas and oil-fired hot water boilers,
There are several types of hot water generators eligible
                                                                              at outputs up to and including 400kW, typically offer fuel
under the ECA scheme, described below. Please note
                                                                              savings of around 3%5 when compared to boilers with
that biomass boilers are covered by a separate technology
                                                                              efficiencies that meet the minimum standards specified in
information leaflet.
                                                                              the Boiler Efficiency Directive.

Hot water boilers
The ECA scheme covers products that modulate their                               Potential annual savings shown are based on
output to match heating demand, avoiding the heat losses                         installing an ETL 200kW boiler (compared to a
associated with the purge cycles that occur when burners                         unit that only meets the minimum requirements
are repeatedly switched on and off to provide the overall                        of the Boiler Efficiency Directive), which runs at an
required output.                                                                 average load of 75% for 3,000h/year on gas priced
                                                                                 at 3p/kWh.
Two main types of hot water boiler are included within the
                                                                                 • £405.
ECA scheme:
                                                                                 • 13,500kWh.
• High efficiency hot water boilers with rated outputs
  greater than 400kW.                                                            • 2.5 tonnes CO2.

• Condensing hot water boilers (of all rated outputs).
                                                                              Gas-fired condensing water heaters
High efficiency hot water boilers are listed under two
                                                                              Dedicated water heaters enable the separate provision
categories depending on whether they are designed with
                                                                              of hot water and space heating. This avoids the energy
high temperature (>105ºC)/high pressure (>6bar) outputs,
                                                                              wastage that arises from the cycling of boilers (repeatedly
or as low temperature/low pressure boilers.
                                                                              turning them on and off) to maintain the temperature of
                                                                              water heating circuits and tanks when space heating is
Hot water boilers over 400kW
                                                                              not required.
Boilers covered by the ECA scheme with outputs over
400kW achieve net thermal efficiencies of at least 93%,                       Three different types of gas-fired condensing water heater
and can provide fuel savings of around 8% compared4 to                        are included within the ECA scheme. Each of which must
the average hot water boiler currently installed in the UK.                   be able to deliver maximum efficiencies of at least 102%
                                                                              on a fuel net calorific value basis:

                                                                              • Storage water heaters rated at up to 150kW.
  Potential annual savings from replacing the
  boilers in the baseline scenario with ETL boilers.                          • Non-storage – instantaneous circulator type
  • £28,800.                                                                    water heaters.

  • 960,000 kWh.                                                              • Non-storage – non-instantaneous, circulator type water
                                                                                heaters which can generate larger volumes of hot water,
  • 176 tonnes CO2.
                                                                                either instantaneously or via a separate storage vessel.

                                                                              ETL listed condensing gas-fired water heaters typically
                                                                              use 9%-16% less fuel than the non-ETL products on
                                                                              the market6.

                                                                              Potential annual savings are based on installing an ETL
                                                                              150kW storage water heater (compared with a lower
                                                                              efficiency alternative), which runs at an average load of
                                                                              75% for 3,000h/year on gas priced at 3p/ kWh.

                                                                              • £1,013.

                                                                              • 33,750kWh.

                                                                              • 6.2 tonnes CO2.

4	Based
        on a simple comparison between minimum ETL efficiency of 93% net and estimated net thermal efficiency of 84% for boilers in the installed base.
  Based
5	      on a comparison of UK seasonal efficiency (SEDBUK www.sedbuk.com) values for gas fired boilers that just meet the requirements of each of
  these criteria.
  Based on a simple comparison between the ETL requirement of 102% net and the range of efficiencies for alternative products estimated as 86% net
6	

  to 93% net.
Hot water boiler equipment                                                                                                                           6

Combustion control                                                          Heat recovery
It is crucial to ensure accurate control of the amounts of                  Fitting an economiser to a boiler increases the surface
fuel and air passing through a burner, to ensure complete                   area across which heat can be transferred, enabling a
combustion whilst minimising the energy used heating air.                   greater proportion of the heat to be recovered from the
                                                                            boiler flue gases. This heat can be recycled, and is typically
Burners combust boiler fuel to generate heat. Burners
                                                                            used for preheating boiler inlet water or to fulfil low-grade
and their control systems can have a major impact on
                                                                            heat demands. As a result, fuel consumption is decreased
overall boiler efficiency.
                                                                            and boiler efficiency increased.

Burners with controls
                                                                            Flue gas economisers
The level of improvement that can be achieved by
                                                                            Flue gas economisers recover heat from the boiler flue
upgrading burners depends on the age and design of the
                                                                            gases before they are released to the atmosphere. This
boiler system. Fuel savings of 3%-5% may result7 from
                                                                            allows the heat to be recycled, and raises boiler system
upgrading to burners whose heat output is modulated
                                                                            efficiency. Installing a specified energy saving ETL flue gas
to ensure that it matches the heat demand. The benefits
                                                                            economiser can provide fuel savings of more than 3%.
are greatest in applications where the output needs to be
frequently adjusted to meet variations in demand.
                                                                              Potential annual savings from adding a flue gas
                                                                              economiser to the boiler system in the baseline
  Potential annual savings when replacing the
                                                                              scenario
  burners used in the baseline scenario with ETL
  listed burners.                                                             • £10,600.

  • £10,800.                                                                  • 360,000 kWh.

  • 360,000 kWh.                                                              • 66 tonnes CO2.

  • 330 tonnes CO2.

                                                                            Condensing economisers
                                                                            Condensing economisers recover heat from boiler flue
Retrofit burner control systems
                                                                            gases including the latent heat in the water vapour
Microprocessor-based burner control systems offer
                                                                            produced from combustion. They are used mainly for
precise and reproducible control of the fuel and air flows.
                                                                            boilers fired on natural gas. Installing a specified energy
These can be retrofitted to existing burners to improve
                                                                            saving ETL condensing economiser can provide fuel
fuel efficiency. Savings are achieved through reducing
                                                                            savings of 9%-15%8.
the excess oxygen level in the flue gas, and depend
on the quality of the controls replaced. For example, a
3.5% reduction in the flue gas oxygen level can improve                       Potential annual savings from adding a
efficiency by around 2%. Although this is lower than the                      condensing economiser to the boiler system in
improvements that may be available from complete burner                       the baseline scenario.
replacement, the improvement in efficiency that can be
                                                                              • £43,200.
achieved means that this is still an attractive option.
                                                                              • 1.44 million kWh.

  Potential annual savings from replacement of the                            • 264 tonnes CO2
  burner controls used on both the burners in the
  baseline scenario.
  • £7,200.
  • 240,000 kWh.
  • 44 tonnes CO2.

  Steam
7	     and High Temperature Hot Water Boilers (CTV052) the Carbon Trust.
  Estimate
8	       based on adding to a boiler of 93% net thermal efficiency (ETL minimum) – leading to efficiencies from 102% net to 109% net depending on
  system constraints.
Hot water boiler equipment                                                                                         7

Boiler system control                                         Potential annual savings from adding a heat
                                                              management controller to a 450kW (three 150kW
Inadequate or incorrect application of boiler system
                                                              boilers) heating system operating for 3,000 hours/
control can increase fuel consumption by 15%-30%
                                                              year at an average of 50% load where a 20% fuel
compared to a well-controlled system9.
                                                              saving is achieved.

Heating management controllers (for wet heating               • £4,050.
systems)                                                      • 135,000 kWh.
Heat management controllers reduce fuel consumption
                                                              • 24.8 tonnes CO2.
by adapting boiler firing and heat distribution patterns to
match variations in heat demand. They shut off boilers
during pre-set periods of no demand, and respond to
changing weather conditions by providing heat when
needed to protect from frost, and by adjusting the starting   Information for purchasers
time to the minimum needed to reach the required
                                                              For further information about the ECA scheme,
temperature in time for use.
                                                              the Energy Technology List (ETL) and other
They are available either as standalone units for direct      Technology Information Leaflets in the series
control of boilers, burners and other wet heating system      please visit http://etl.decc.gov.uk or contact
components, or as add-ons for incorporation into other        the Carbon Trust on +44 (0)300 330 0657 or
control systems. The energy savings available depend on       email ECAQuestions@carbontrust.co.uk.
the functionality, configuration and set-up of any existing
system.

9   Heating Control (CTG057), the Carbon Trust.
Hot Water
    water boiler
          Boiler equipment
                 Equipment                                                                                            8

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The Enhanced Capital Allowance Scheme for energy saving equipment is run by the Carbon Trust
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Published in the UK: February 2014.
© The Carbon Trust 2014. All rights reserved. ECA758
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