Innovative Green Electricity tariffs for the Renewable Home or Business

National Power

Big changes are taking place in the energy sector. Though the Big six energies companies still have the monopoly in the marketplace, the number of smaller independents is growing all the time. A revolution is taking place with the advent of independent energy suppliers, consumers generating their own solar power, dynamic pricing plans and smart homes.

No one can be blamed for being a little confused when confronting the choice of electricity tariffs available on the market today. There are hundreds of different tariffs to choose from so deciding which is the perfect one for you can be difficult. It is helpful that electricity tariffs are now tightly regulated which means that suppliers can’t offer more than four different tariffs to avoid some of the confusion. If you are just interested in price, then price comparison sites could work for you. However, these sites will be less helpful if you want to know how green each supplier is, where each supplier’s energy is coming from or whether their tariff is offering the best value for electric cars and home batteries.

With concern for the environment being a major reason for households to go solar it’s not surprising that they want to buy their non-solar electricity from renewable sources as well. Green electricity tariffs provide assurance that any electricity supplied to you is matched by electricity produced from renewable electricity sources. In order to prove the tariff’s green credentials all renewable generation comes with tracking certificates called REGOs. Most companies also do something additional to this such as investing in renewable generation, tree planting or giving to community energy funds etc. There are various styles of green electricity providers which can be for the most part categorised as:

  • Green electricity suppliers that invest in new renewable generation. These companies invest in new wind and solar farms, as well as other related technologies such as electric vehicle charging infrastructure. This group includes companies which are older and more established like Good Energy and Ecotricity.
  • Green electricity suppliers that pay into funds. A good example in this group is Marks and Spencer Energy. They pay a contribution per customer into the M&S Community Energy Fund.  This fund then provides grants to community energy projects across the country.
  • Green electricity supplier that plant trees. Many green electricity suppliers choose to plant trees as a way of providing additional carbon savings, including such companies as BulbOctopus EnergyOVO Energy and Green Star Energy.

You tend to find that the more well-established suppliers of green electricity buy electricity from their own wind and solar farms. The newer green electricity suppliers will source renewable power from the cheapest sources they can find. This can work out to be very cheap if the supply includes old hydropower stations which were paid for long ago. This means that you will sometimes find green electricity suppliers such as Bulb providing the cheapest power on the market.

Some suppliers are offering time-of-day tariffs. It’s a simple case of supply and demand as energy usually costs more on wholesale market at peak times. Basically, it costs different amounts to generate electricity at different times of the day. Energy suppliers will tend to pay more to obtain energy during the day which is typically the most expensive time as demand is high. It costs more to produce electricity at peak times between 4pm and 7pm and less in the middle of the night, and at weekends. This is why some energy providers offer time-of-use tariffs that charge lower rates to businesses & homeowners for the electricity they use at off-peak times. You may be familiar with Economy 7 tariffs which have been around for many years and historically encouraged the use of night-time electricity for electric heating. What we are now seeing are specific variants of this, especially for electric car charging.

There are a number of time-of-day tariffs specifically designed to encourage households to shift their demand to off-peak times. These tariffs have low overnight pricing, medium prices in the day and high pricing at peak times between 4 and 7pm.

To give an example, Green Energy UK offer the TIDE tariff which has the following price structure:

  • Off Peak time– 7.9p per kWh
  • Standard time – 16.3p kWh
  • Peak time – 32.5p kWh

In order to access a time-of-day tariff you will need to have a smart meter installed. You will be at a particular advantage if you have a battery storage system. Daytime demand will be largely covered by solar, and the battery will discharge to the home and cover your demand during those expensive peak time hours. This means that a household with a home battery might only be buying electricity at cheaper times regardless of when electricity is actually being used in the home. It is important to bear in mind however that your battery will operate differently throughout the year. You need to be sure that you can capture enough solar during the winter to fill the battery or you may find that you are importing expensive peak time electricity anyway.

You can get round this with a Tesla Powerwall which can partially top up your battery with cheap night-time electricity, whilst still leaving space for tomorrow’s solar generation. This an excellent way of ensuring that the only electricity you use is either your own solar or cheap night-time electricity.

Electricity tariffs can go one step further with real-time pricing meaning that instead of banding pricing by time of day, the price actually varies every half-hour through the year. The market leader with this approach is the Octopus Agile tariff.  Once signed up, they will send you the next day’s prices at 4pm, so you can look at these and determine when to use electricity.  If national demand is low and there is a lot of renewable generation from for example, offshore wind, then prices may be very low.  If the reverse is true and demand is high and renewable generation low, prices will be high such as on winter evenings, when the weather is still.

Interestingly though the Agile tariff is likely to follow a similar profile to the TIDE tariff which means that once again you could avoid high prices by having a home battery (especially with a Tesla Powerwall) and only ever importing electricity at the cheapest times.

The price of each unit of energy on some of these time-of-day tariffs can change throughout a 24-hour period and even on different days of the week.

These tariffs are ideal for businesses if they are able to be flexible with how and when energy is used as it can save them money. It could be worth businesses considering changing their routines so that they could move to off-peak usage for some if not all of their main energy consuming activities.

These businesses would have to be on a time-of-use energy tariff, and either have a half-hourly (HH) meter or a smart meter fitted.

An HH electricity meter sends half-hourly meter readings to your energy supplier. This automated process lets a business owner accurately monitor their energy use and the times their business uses the most energy, helping them to look for ways to use it more efficiently.

Some large businesses are required by law to have an HH meter fitted. If you are a company that regularly uses 100kW of electricity in a half hour period, you will be required to install an HH electricity meter. Businesses that fall into this category include factories, supermarkets, large offices, and warehouses. You can choose to have an HH meter installed if your business uses 70kW or more in a half hour period.

With the arrival of the electric car a number of new electricity tariffs to support electric vehicle charging have come onto the market in recent years offering cheaper night-time rates. This makes it possible for electric vehicle owners to charge and run their cars as cheaply as possible and makes it less attractive to charge at peak times which if high volumes were reached could be problematic for the grid. To see a completely up-to-date list of night-time rates you are advised to check Zapmap’s list of EV tariffs.

Businesses that don’t have an HH meter can have a smart meter installed instead. They send regular meter readings to your energy supplier automatically so you will only be charged for what you use, putting an end to estimated billing.

Smart meters also allow you to monitor your company’s or household’s energy consumption accurately so you can identify when the peak usage times come into play.

All UK businesses and households must have been offered a smart meter by suppliers by the end of 2024 as part of a rollout by the government although this deadline may be delayed as a result of the coronavirus pandemic.

It’s essential that before you commit to a time-of-use tariff you ensure that it’s right for your business or household as you could end up paying more than on your previous tariff.

You can make significant savings if you can use a large proportion of your energy in off peak periods or can change your routines to accommodate this. But if you’re tied to using the bulk of your energy during peak times the time-of-use tariff may actually cost you more than other tariffs.

However, having an HH or smart meter and being incentivised by a time -of-use tariff could motivate you to plan how to use your energy more efficiently. The more you can use energy efficiently the bigger the potential for saving on your bills.

An added bonus to this, is that time-of-use tariffs help to reduce the pressure on the UK energy infrastructure at peak times.

Of course, price isn’t the only concern for customers choosing a tariff and the generation mix received. It’s also becoming more common for tariffs to offer local supply or supply that comes from specific sources.

This is where the future of energy generation can have a part to play in bringing communities together. For example, municipal tariffs such as the not-for-profit Robin Hood Energy or Bristol Energy ensure that their energy supply comes form generation in the local area.

It’s still early days for peer-to peer trading of electricity but the distributed generation and sale of electricity could cut out the need for traditional utilities to act as the middleman in the future.

As you can see there are a multitude of tariffs out there making it important to do your research thoroughly before making your choice. It’s worthwhile talking to your electricity supplier to determine exactly how each tariff will work so you can plan for the change in advance. As with all financial transactions always make sure you compare the different options before you commit to a switch.

A Look at the Smart Export Guarantee Six Months On

Last year the government unveiled a new scheme to be launched in January 2020 that would compensate people who produced more electricity than they needed. The new SEG scheme duly came into force as planned in January. The scheme requires all energy suppliers with at least 150,000 domestic customers (including the big six, such as EDF Energy and Npower, and smaller companies such as Ovo and Bulb) to buy surplus solar, wind or other renewable energy generated by its customers under the smart export guarantee (SEG). This means that homeowners can be compensated for the electricity that they put back into the grid. Offering an SEG tariff is optional for smaller companies.

You are most likely to benefit from this scheme if you have solar panels, but you will also qualify if your home produces, renewable energy from wind, hydro, micro combined heat and power or anaerobic digestion.

The SEG has replaced the previous feed-in tariff (FIT), which is no longer available to new customers. Although both schemes reward at-home electricity production there are a few essential differences. FIT tariffs are funded by a levy on all energy bills and because home electricity production is paid for at a rate set by energy regulator Ofgem there is no need for homeowners to shop around. Another significant difference in the two schemes is that with the FIT tariff the homeowner is compensated for all home electricity produced whether or not it is fed back into the national grid. This is not the case with the SEG which focuses on Individual energy companies paying home electricity producers directly for the electricity they feed into the National Grid which is then available for others to use. The SEG scheme tends to be less generous than the FIT and for this reason it is recommended that you wait until your FIT contract has ended before moving to an SEG tariff.

In order to take advantage of the SEG scheme, you must sign up to a dedicated SEG tariff. The energy supplier you choose will set the rate paid for the electricity you export. As some deals are better than others it’s best to shop around.

It will come as no surprise that now private companies control the prices of SEG tariffs that the amount that you get back for your excess energy production varies somewhat between tariffs.

The Solar trade Association (STA) has produced data which reveals that the three best-value tariffs will pay you more than five times the amount you would get for the energy you produce from the worst-value tariff.

Social Energy pays 5.6p/kWh, while Octopus and Eon both offer fixed tariffs paying 5.5p/kWh. In comparison, the lowest-paying company pays just 1p/kWh. However, this is better than the dismal 0.5/kWh that was the lowest offer in January 2020.

The tariff you are offered could make a big difference to how much you earn depending of course on how much you’re able to export.

A household with a fairly typical solar panel set-up could earn £69 more a year (£84 vs £15) with the highest-paying tariff rather than the lowest-paying.

This figure is worked out based on tariffs available as of August 2020 for a 4kWp system exporting 1,500kWh of electricity to the grid in a year. To put this into context, the average household uses 2,900kWh electricity in a year.

The Solar trade Association keeps a list of tariffs and updates when required as below:

Variable   
 ProviderTariff NameTariff Rate
 Octopus EnergyOutgoing AgilePegged to half-hourly wholesale rate
Fixed-Rate tariffs        
 SupplierTariff NameTariff Type (fixed, currently fixed* or variable rate)Tariff LengthTariff RatePayment CycleIncludes Battery StorageRequirement to be on the suppliers’ import tariff?
1Social Energy^Smarter ExportCurrently FixedNo Fixed End Date5.6p3 monthsYes (must be SE battery)Yes
2Octopus EnergyOutgoing FixedFixed12-month fixed term5.5pMonthlyYesYes
E.ON EnergyFix & Export ExclusiveFixed12-month fixed term5.5pUnknownUnknownUnknown
4Bulb EnergyExport PaymentsFixedNo Fixed End Date5.38p3 monthsYesNo
5OVO EnergyOVO SEG TariffFixed12-month fixed term4.0p3 monthsCase by case basisNo
ScottishPowerSmart Export Variable TariffCurrently FixedNo Fixed End Date4.0p6 monthsUnknownNo
7SSESmart Export TariffFixedNo Fixed End Date3.5p12 monthsCase by case basisYes
EDF EnergyExport+EarnFixed12-month fixed term3.5p3 monthsNoNo
Shell EnergySEG V1 TariffCurrently FixedNo Fixed End Date3.5p12 monthsUnknownYes
Green Network EnergySEG TariffCurrently FixedNo Fixed End Date3.5pQuarterlyNoNo
11British GasExport & Earn FlexCurrently FixedNo Fixed End Date3.2p6 monthsYesNo
12E.ON EnergyFix & ExportFixed12-month fixed term3.0pUnknownUnknownUnknown
UtilitaSmart Export GuaranteeUnknownUnknown3.0pUnknownUnknownUnknown
AvroSmart Export TariffUnknownUnknown3.0pUnknownUnknownUnknown
15Utility WarehouseUW Smart Export GuaranteeFixedNo Fixed End Date2.0pQuarterlyNoNo
16EE SEG January2020v.1Currently FixedNo Fixed End Date1.0pUnknownUnknownUnknown

*Currently Fixed means that the supplier has specified a fixed rate but has not fixed this for a specific timeframe / the supplier has caveated that the current fixed price might change in the future

^Offering tariffs on a voluntary basis

Shell Energy has recently launched a new type of tariff that is slightly different to SEG tariffs.

Rather than paying you directly for the electricity you export to the grid you earn credits for energy exports during the summer months which means that you are then able to get a discount of up to £150 on your winter energy bills. Unlike the SEG, it’s targeted solely at solar-panel owners.

It is being marketed by Shell as a solution to at-home waste but there is a significant cost attached to this tariff. In order to take advantage of this tariff you have to own a SonnenBatterie to store solar energy. This is because the battery allows you to capture electricity so that you can use it another time. This in turn maximises the benefits of having solar panels. The downside to this is that SonnenBatteries are among one of the pricier home energy storage batteries on the market starting from £6,499.

On top of that the import tariff Shell offers is relatively expensive, priced at £1,016 a year for a household that uses a medium amount of energy. The import tariff allows you to buy gas, and any electricity you need when the amount you generate from your solar panels isn’t enough. This tariff will only save you £111 on the energy price cap for customers on a standard or default tariff, which limits how much suppliers can charge per unit of energy.

However, it is worth taking into consideration that Shell says their customers will be able to get up to £150 off their winter energy bills, which is quite likely to be more money than most solar panel owners could expect to make by selling their energy to another customer using SEG.

The Shell tariff works on the basis that those on this tariff will be able to produce up to 75% of their own electricity. The caveat to this is that when you need to import gas and electricity it will most likely be more expensive than other suppliers.

Solar panels continue to become less expensive to buy but you should not expect any earnings for SEG to cover the cost of installing solar panels any time soon.

Despite this there are still many good reasons to get solar panels. Most homeowners will be happy to hear that a solar PV system can reduce their energy bills which combined with the SEG earnings will cut the solar payback time quite considerably. You can also bask in the glow of being self-sufficient if you produce your own electricity though you’ll also need an energy storage battery to make this a reality. Most important of all is being able to reduce your carbon footprint by becoming a sustainable consumer and helping protect the future of the human race.

Can Power Hungry AI Help Fight Climate Change?

Artificial intelligence

AI can do remarkable things. Just recently researchers at OpenAI in San Francisco reported that they had worked out an algorithm that was capable via trial and error of manipulating the pieces of a Rubik’s cube using a robotic hand. However, it took 1,000 desktop computers plus a dozen machines operating specialised graphics chips crunching intensive calculations for several months.

Evan Sparks, CEO of Determined AI, a start-up that provides software to help companies manage AI projects, estimated that this process may have consumed about 2.8 gigawatt-hours of electricity which is roughly equal to the output of three nuclear power plants for an hour.

The extraordinary advances produced by artificial intelligence such as computers learning to recognise imagesconversebeat humans at sophisticated games, and drive vehicles need huge amounts of computing power and electricity to devise and train algorithms. AI experts are increasingly realising that these energy demands are too great in the face of climate change.

Sasha Luccioni, a postdoctoral researcher at Mila, an AI research institute in Canada said:

“The concern is that machine-learning algorithms in general are consuming more and more energy, using more data, training for longer and longer.”

It’s not only a worry for academics but for companies too across many industries that are beginning to use AI. There is growing concern that the technology will worsen the climate crisis. Evan Sparks says that his company is already working with a pharmaceutical company which is using enormous AI models.

He added:

“As an industry, it’s worth thinking about how we want to combat this.”

Some AI researchers are looking at ways to offset their emissions and using tools to track the energy demands of their algorithms. There is a growing appetite for algorithms that burn fewer kilowatts.

A sophisticated code is being developed by Sasha Luccioni that can be added to an AI program to track the energy use of individual computer chips.

Sasha Luccioni and others are keen that companies not only track the performance of code but also include some measure of energy or carbon footprint.

She says:

“Hopefully, this will go toward full transparency. So that people will include in the footnotes ‘we emitted X tons of carbon, which we offset.’”

A team at UMass Amherst produced a research paper that revealed how training a single large NLP (neuro-linguistic programming) model may consume as much energy as a car over its entire lifetime, including the energy needed to build it. Recent advances in natural language processing, which is an AI technique that helps machines parse, interpret, and generate text have proven particularly power-hungry.

Huge banks of computers often have to run for days and sometimes weeks in order to train a powerful machine-learning algorithm.

It has been estimated by the department of energy that data centres account for about 2 percent of total US electricity usage and that worldwide they consume about 200 terawatt hours of power per year which amounts to more than what some countries consume.  Significant growth in computing and communications technology is predicted in the years leading up to 2030. These technologies could consume between 8% and 20% of the world’s electricity with data centres accounting for a third of that.

In the last few years companies offering cloud computing services have been looking at ways to offset their carbon emissions with different degrees of success. Google, for example, claims ‘zero net carbon emissions’ for its data centres due to its extensive renewable energy purchases. Microsoft have declared that they have a plan to become ‘carbon negative’ by 2030 by offsetting all of the carbon produced by the company over its history. OpenAI signed a deal to use Microsoft’s cloud last year.

Many of the AI industry’s top thinkers believe that AI itself can help fight climate change. Success in the development of AI in recent years has led many to question how this technology could help with one of the greatest dangers facing humanity, climate change. A research paper originating from some of the field’s best-known thinkers last year gives a number of examples of how machine learning could help prevent human destruction.

The authors of the paper which include DeepMind CEO Demis Hassabis, Turing award winner Yoshua Bengio, and Google Brain co-founder Andrew Ng say that AI could be “invaluable” in diminishing and avoiding the worse effects of climate change though they do not think it is a “silver bullet” but believe political action is seriously needed too.

The paper suggests a number of fields where machine learning could be put to good use.

Despite the fact that electricity systems are “awash with data” very little is being done to take advantage of this information. Machine learning could help by forecasting electricity generation and demand, allowing suppliers to better integrate renewable resources into national grids and reduce waste. Google’s UK lab DeepMind has demonstrated this sort of work already, using AI to predict the energy output of wind farms.

It’s important to remember that greenhouse gases aren’t just emitted by engines and power plants but come from the destruction of trees, peatland, and other plant life. Plant life has captured carbon through the process of photosynthesis over millions of years with deforestation and unsustainable agriculture leading to this carbon being released back into the atmosphere. AI and satellite imagery can be used to monitor agricultural emissions and deforestation by pinpointing where this is happening in order to protect these natural carbon sinks.

AI can be used to help scientists find new materials by giving them the potential to model the properties and interactions of never-before-seen chemical compounds. At the moment 9% of all global emissions of greenhouse gases comes from the production of concrete and steel.  Machine learning could help reduce this number by creating low carbon alternatives to these materials.

As we see greater effects from climate change in the coming decades, driven by highly complex systems such as changes in cloud cover and ice sheet dynamics, AI could prove to be invaluable. Modelling these changes will undoubtedly help scientists predict extreme weather events, like droughts and hurricanes, which in turn will help governments protect against their worst effects.

The transportation sector currently accounts for a quarter of global energy-related CO2 emissions, with two-thirds of this generated by road users. In the same way that machine learning can help with electricity systems it could make this sector more efficient, by reducing the number of wasted journeys, increasing vehicle efficiency, and shifting freight to low-carbon options like rail.

Though energy consumed in buildings accounts for another quarter of global energy-related CO2 emissions, it presents some of “the lowest-hanging fruit” for climate action. Reducing wasted energy from buildings can be easily tackled by adding just a few smart sensors to monitor air temperature, water temperature, and energy use. Buildings are long-lasting and are very unlikely to have been retrofitted with new technology. Energy usage could be reduced by 20% in a single building and large-scale projects could monitor whole cities to have an even greater impact.

Some scientists are very hopeful that ways could be found to make clouds more reflective or to create artificial clouds using aerosols so that we could reflect more of the Sun’s heat back into space. This example of AI’s use is more extreme and speculative than others and modelling the potential side-effects of any schemes is hugely important. Geoengineering a more reflective earth presents significant “governance challenges” ahead.

According to the authors of the research paper, it’s a “common misconception that individuals cannot take meaningful action on climate change.” It is true however that people do need to know how they can help.  Machine learning could be used to calculate an individual’s carbon footprint and indicate what small changes they could make to reduce it. This could be a very useful too to reduce your carbon footprint. An individual might learn that they need to use public transport more, buy meat less often; or reduce their electricity use in their house. Adding up individual actions can create a big cumulative effect.

Getting to the point when AI can handle all the things, we would like it to do, to help with the climate crisis will require some pretty substantial upgrades to the computing infrastructure that underlies it.

Though many people are not aware of this, AI is a technology that is transforming every walk of life. It is a wide-ranging tool that enables people to rethink how we integrate information, analyse data, and use the resulting insights to improve decision making.

Good Energy to Introduce First Home Heat Pump Tariff in the UK

good energy banner

Good Energy, the Chippenham-based 100% renewable power company has set out plans to launch a new flexible tariff for heat pumps in the Autumn. The idea behind the new tariff is to help customers make the most of the government’s recently announced £2bn Green Homes Grant scheme. The new Green Homes Grant is being introduced in September to support energy efficiency improvements across England. The new tariff will be offered to customers to coincide with when the government begins accepting applications for the grant and will be ideal for those homeowners planning to use the grant to electrify their home heating system.

The Chancellor, Rishi Sunak, has said that homeowners can claim up to £5,000 or in some cases up to £10,000 towards green home improvements. Homeowners may be able to receive help with the cost of installing an air source heat pump which is a greener electrified heating system and an excellent alternative to gas central heating. Cost has long been seen as a major barrier to installing energy efficiency upgrades and technologies such as heat pumps both in upfront installation costs and the electricity used to run them.

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The government’s £2bn green support package for homeowners has been welcomed by the renewable energy industry, climate change activists and environmentalists.

Air source heat pumps absorb heat from the air and can even extract heat when temperatures are as low as -15°C. The heat is absorbed at low temperature into a fluid. This fluid passes through a compressor, increasing the temperature and transfers that higher temperature heat to the heating and hot water circuits of the house.

The number of homes with heat pumps had already been predicted to double by 2025 even before the government’s announcement.

The new offering from Good Energy, claims to be ‘UK’s first-ever heat pump tariff’ and is set to offer cheaper rates at certain periods during the day, while the national electricity grid is greener and experiencing lower demand. Good Energy describe their new tariff as ‘competitive’ which could mean that homeowners will significantly reduce the cost involved in operating a heat pump system.

Good Energy’s heat pump tariff will offer homeowners two key features:

  • Competitive unit rates to benefit heat pump users with higher electricity consumption
  • Cheaper unit rates at specific times of the day, allowing customers to use their heat pumps more cost effectively during key periods

At the moment most homes in the UK are kept warm with fossil fuels in the form of gas. Julia Davenport, founder and chief executive of Good Energy believes that the UK is faced with a massive task in decarbonising the UK. She thinks that the innovative heat pump tariff would help the Green Homes Grant go even further towards delivering its aim of weaning the UK’s homes off gas powered boilers and lowering carbon emissions.

Julia Davenport said:

“This tariff will be designed to make it as easy and affordable as possible for people to get rid of dirty gas heating their home and start using clean electricity from renewables.”

Heat pump technology is also eligible for subsidies under the Renewable Heat Incentive (RHI), a government scheme which provides financial support to homeowners who install renewable heating systems, for seven years.

heat pump

However, it is currently unclear whether heat pumps installed as part of the Green Homes Grant will be eligible for the RHI. 

The UK’s housing stock is currently responsible for more than a fifth of the country’s emissions and there is increasing pressure on the government to make further investments that go beyond their £3bn energy efficiency package to decarbonise homes.

The Confederation of British Industry has asked the government to ban conventional gas fired boilers by 2025 in order to expedite the uptake of green heating alternatives such as heat pumps and hydrogen ready boilers.

There is no doubt that there is some progress being made in bringing about a green recovery after the pandemic but is enough being done to fulfil the UK’s goal of net-zero carbon emissions by 2050?

Diageo’s Whisky Distillery is Set to Become Carbon Neutral

Diageo's Whisky

Diageo’s whisky distillery is joining a growing number of businesses that are serious about reducing their carbon emissions. Distilleries historically require large heat loads to turn grain into one of mankind’s oldest vices, alcohol. But Diageo’s new 72,000 square foot distillery is going electric and being designed to be completely carbon neutral.

By switching to renewable electricity rather than using a traditional natural gas facility, Diageo says it should be able to avoid producing more than 117,000 metric tons of annual carbon emissions.

Andrew Jarrick, North American environmental sustainability manager at Diageo said:

“This is an opportunity to build a new distillery from the ground up. It’s not every day you get that opportunity.” 

According to Diageo, the Kentucky facility is set to be one of the largest carbon neutral distilleries in North America. The facility is currently being built with completion expected by mid-202. The firm says that it will ultimately produce 10 million proof gallons of whisky primarily Bulleit whiskey and employ about 30 full-time brewers.

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There are three large heat requirements involved in the distilling process: first to cook the grain into mash; then as steam to capture the ethanol in what’s known as a distillation column; and finally, for drying the leftover grain for other uses.

The first step and the biggest hurdle to jump for Diageo was moving away from using fossil fuels for this heat production.

Andrew Jarrick said:

“The distillery industry is built on very traditional ways of thinking and relies very heavily on time-tested methodologies. We want to produce the same liquid every time. The biggest challenge was to maintain that process integrity, but also move on from traditional fossil fuels.”

The facility will no longer use traditional equipment but instead 22-foot tall high voltage jet electrode boilers from Precision Boilers, a company based in the US, will take its place. Electric boilers have the advantage of needing less maintenance but most importantly, by not using fossil fuels less greenhouse gases are emitted. Gabriel Dauphin, vice president of sales and marketing at Precision Boilers, explained to Greenbiz via email that the boilers use conductive and resistive properties to carry an electric current and generate steam. 

Gabriel Dauphin also explained that fossil fuel burners have to reach a certain minimum energy output before turning off whereas electric boilers can be turned down to any level before closing down completely as well as being able to reach the desired heat level almost straight away. For this reason, he said that boilers are much more accurate and almost 100% efficient with the benefit of zero emissions.

Once Andrew Jarrick and his team had decided to make the bold move to electric boilers they chose to electrify as much as possible in the operation. No stone was left unturned in their quest to reduce their carbon footprint. All lighting in the facility will use LEDs, all vehicles on the property will be electric and the atmospheric heat systems put in place for the comfort of employees are likely to use electricity rather than a fossil fuel source. Further to that the company is also installing occupancy sensors, lower ceilings, and exterior solar panels to help increase energy efficiency.

The plan is for Diageo to get 100% of its electricity needs for the site from renewable sources through partnerships with East Kentucky Power Cooperative and Inter-County Energy. These companies are aiming to provide a combination of solar and wind energy to power the distillery.

Carrying on with its carbon neutral promise the facility proposes to also be zero waste to landfill by distributing the dry leftover grain to organisations that can use it for animal feed.

Electric boilers were the most important factor for getting this project to carbon neutral. If Diageo is to deliver on its commitment to net zero carbon emissions, it will need to go electric across all of its operations and source 100% of its electricity from renewable sources by 2030.

Diageo is not the only distillery aiming to be carbon neutral at this time. Scotland’s first carbon neutral whisky distillery is under construction in Huntly, Aberdeenshire. In this case the whisky distillery will be powered by burning wood chips which will help to reduce their carbon emissions.

Chivas, the French owned company that produces whisky has selected Glentauchers, on Speyside, to lead the way in going 100% green friendly. Glentauchers is just off the A95 between Keith and Aberlour in Scotland. The aim is for the site to be 90% carbon-neutral within the next 18 months with Chivas switching an investment in heating power for the site to biofuels.

Chivas is looking to reduce greenhouse gases and emissions by a further 20% over the next two years. The company claims to have already cut them by one third over the past decade. Further to this the firm’s new Good Times from a Good Place plan also includes a commitment to cut its carbon emissions by 50% and increase its positive impact on the environment by 2030.

Chivas has also said it would also make sure every packaging component was 100% sustainably sourced by 2022.

The whisky industry continues to undergo an energy revolution. Distilleries are preparing for the impact of climate change and dealing with the many challenges that their industry has to face in order to become carbon neutral.