- Significant savings over oil and gas boilers
- A sustainable alternative to fossil fuels
- Potential regular rebate through the Non-Domestic RHI scheme
If your business heats air or water with an oil or gas boiler, it’s worth looking at the savings you could enjoy by switching to biomass.
What is biomass?
A commercial biomass boiler burns plant matter (typically wood chips, wood pellets or logs) instead of fossil fuels.
A biomass boiler can do everything that a gas or oil boiler can – it just uses a different fuel.
As most biomass fuels are sustainably produced, switching to biomass not only saves money, but is also a more environmentally-conscious choice.
Calculating the savings
A commercial biomass boiler powered with wood chips can provide heat as cheaply as 3.1p/kWh. For wood pellets this can be 4.4p/kWh. For comparison, gas can be 4.9p/kWh and heating oil 5.8p/kWh (all figures from the Biomass Energy Centre: note, these are example figures which will fluctuate).
Although one or two pence doesn’t sound much, if your business is a large energy user you will find the cost difference can be significant.
The costs and return on investment will vary for every commercial biomass system.
Our renewable energy consultants can advise you on feasibility for your business, and explore costing scenarios with you.
It’s very important to consider the fuel type before choosing your commercial biomass system. Fuels are not interchangeable: you cannot use pellets in a woodchip boiler, for example – so you will need to look carefully at the pros and cons of each fuel.
As well as the cost of fuel, you should also consider issues such as boiler capacity, availability of fuel sources, and the handling, delivery and storage of fuel.
Our consultants can explain all the considerations to help you decide.
Capital outlay and funding
With the numerous commercial biomass options, the capital costs for a system will vary greatly. For comparison, the Energy Saving Trust has estimated a domestic system would cost £14,000 to £19,000 – so expect at least that much, and probably more, depending on your business.
Capital grants for renewable energy systems in the UK have been curtailed in recent years. We can offer finance – take a look at our funding page for more information.
There is also a tax benefit to consider. Biomass boilers are included in the government’s ECA (Enhanced Capital Allowance) scheme, allowing businesses to claim 100% first year capital allowance, if the model is listed on the government’s Energy Technology List. There is a long list of qualifying products, and we work with many of the brands – so your choice won’t be limited!
Biomass systems for non-domestic installations are charged at the full rate of VAT.
Government RHI rebate
Commercial biomass boilers qualify for the government’s Non-Domestic Renewable Heat Incentive (RHI) scheme, which pays the owner a sum for each unit of heat generated. The Ofgem site shows the latest rates, which depend on the size and type of biomass system.
Please note, as from 5th October 2015 biomass fuel needs to meet sustainability requirements to qualify for non-domestic RHI payments. This Ofgem guide provides more information: Ofgem Easy Guide to Sustainability
Our fully-inclusive commercial biomass service
We offer a full biomass service including energy audits, feasibility studies, system design, costing and ROI scenarios – right through to installation by our own MCS-accredited expert team. We’ll also advise and help with planning consent, if required; and with registering your system. We also provide ongoing service contracts.