Post-Carbon Home One

Where we were in May 2008

Where we are today

Before...	After...

 

What was done, what it cost and when we did it

Item	Date	Cost	Type	Comment
Double Glazing	n/a	none	Saving heat	Pre-installed. Probably the only eco-beneficial items the house had already!
Energy saving lightbulbs	May 2008	£400	Saving electricity	Spotlight-type from Lightbulbs Direct
Pipe Insulation	June 2008	£39	Saving heat	From a DIY store - fitted ourselves
Attic Lighting	June 2008	£55	Project overhead	Not a true eco-feature but necessary in order to insulate the attic ourselves
Loft Tank insulation	June 2008	£37	Saving heat	Fitted ourselves
New Loft Hatch	June 2008	£63	Saving heat	Fitted ourselves
Sheep's wool loft insulation	June through October 2008	£999	Saving heat	We added 200mm (2 layers of 100mm) on top of existing mineral wool. Purchased about 100m2 of sheeps wool (100mm deep) which cost us £999.
Attic flooring	June through October 2008	£618	Project overhead	An additional £618 was required for tools, wood and boarding gave us the storage space and access for future solar panel & boiler work via attic.
New kitchen door to garage	July 2008	£650	Saving heat	Old wooden door replaced with UPVc equivalent.
New door between garage and garden	July 2008	£650	Project overhead	Old wooden door replaced with UPVc equivalent.
Garage Door	July 2008	£1905	Project overhead	Rollover Garage Door fitted by SWR. Not an essential eco-item but replaced the broken original. New roll-up door has a foam interior sandwiched between aluminium and plastic exterior walls. Helps keep the warmth inside the fabric of the building as the boiler is in the garage. It works too. High embodied energy but gave us good security.
New Gas Boiler, TRV's & controller	August 2008	£2480	Saving heat	Fitted by a local plumber. This boiler is now only a backup for the wood-pellet boiler
Chimney Balloon	August 2008	£30	Saving heat	Fitted ourselves
Solar powered security lights	October 2008	£122	Saving electricity	Fitted ourselves but a big waste of money - later replaced by mains-powered versions that were much better
New Curtains	October 2008	£240	Saving heat	Thick lined curtains made to measure
Draught proofing & miscellanious insulation	October 2008	£80	Saving heat	Fitted ourselves
Energy saving security light	November 2008	£23	Saving electricity	Fitted ourselves
Radiator Foil	November 2008	£65	Saving heat	Fitted ourselves. We overspent on this due to an attempt to use double-sided sticky tape rather than wallpaper paste.
Energy saving security light	December 2008	£99	Saving electricity	Fitted ourselves
Cavity Wall Insulation	December 2008	£219	Saving heat	Inserted by Mark Group
Wood Burner Dovre 250	April 2009	£2720	Saving carbon - heat	Fitted by local company Nature's Warmth
A++ fridge/freezer	June 2009	£420	Saving electricity	Fitted ourselves. Replaced built-in units
Water butts and fittings	August 2009	£70	Saving water	Fitted ourselves
Kitchen LED lights	August 2009	£250 approx	Saving electricity	Fitted by local electrician (ceiling units) & ourselves (undercupboard units). Supplied by Wattlite & Lightbulbs Direct.
Biomass Boiler KWB Easy Fire for Wood Pellets	September 2009	£15590	Saving carbon - heat	Fitted by Green Systems UK Ltd. Cost was £15,590 - £1500 Low Carbon Building Program Grant = £14,090
Water Softener	September 2009	£1320	Project overhead	Not essential but we live in a hard water area
Barilla Solar Thermal hot water system & tank	April 2010	£3750	Saving carbon - heat	Fitted by British Eco - £1000 Low Carbon Building Program Grant = £2750
Photovoltaics 2.96kWp Mitsubishi panels & new consumer unit	April 2010	£13500	Saving carbon - electricity	Fitted by British Eco. New Consumer Unit fitted by local electrician.
Removal of trees from rear garden	June 2010	£855	Making growing space	Local tree surgeon. These were mostly 18ft leylandiis that screened the home from the south blocking out the sun all year round. The house is far warmer in winter now. Replaced with fruit trees that will not shade the house even when fully mature and lose their leaves in Autumn.
Replace plumbing & toilets with lo-flush & lo-use options	August 2010	£800	Saving water	Fitted by local plumbers
Replace all radiators	September 2010	£1450	Project overhead	Fitted by a local plumber. The originals had all rusted through so we opted for slightly larger units.
Fruit Trees	December 2010	£152	Making growing space	Planted ourselves. Replaced the leylandii removed earlier.

Total ignores LCBP grant funding that no longer exists. Note that the costs above exclude a lot of incidental expenses such as tools and materials.

Cost Breakdown

The total project cost looks quite horrendous but matters are not as simple as they first appear. The above list actually excludes things such as a new fitted kitchen and security system because they had no bearing on the nature of the 'eco-retrofit'. This means they didn't contribute materially in either saving water, energy or carbon nor did they increase our capacity to grow our own food. A more accurate breakdown is thus (figures are now net of LCBP grants):

Since the project kicked off on the day we moved into the house we had no baseline. So we asked our friends at the Superhomes charity to supply us with starting figures used in their own assessment. (Our thanks to Gordon Glass, John Doggart and Richard Macphail for this.) They supplied figures for our home using the NHERS rating system that was tested by BRE. (It should have a 95% accuracy. NHER covers more energy use than does the current SAP assessment.) According to this measurement Superhome 59 should use 38,322kWh (“units”) of energy per year broken down into 34,231 for Gas and 4,101kWh for Electric.

We ran these numbers through our current Gas and Electric bills from NPower and calculated that this should be costing us £1,827 per year. The average UK household bill is £1,334. Today our gas usage is zero because we heat are home by wood. Electrical usage is 2,940kWh per year which is a 28% decrease. However we generate about 2,800kWh per year so are, effectively 95% self sufficient - unfortunately the sun goes away at night leading us to import energy. The billed import is 1,860kWh per year. Thus the bottomline electricity cost is £280 a year.

But what about all that wood fuel? We use about 4,515kg of wood pellets per year which equates 20,600kWh of space and water heating. That is a 40% saving on heating, but wood isn’t free. It costs about £0.25p/kg (pellets) which is about £1,100 a year. Add in the cost of electricity imports, logs for the wood burning stove in the lounge, maintenance & cleaning then the total cost to heat and power Superhome 59 is NOW £1,780 a year.

Only a saving of £80 a year? But still this is not the whole picture. That number is distorted because we used a renewable heat solution. It isn’t cheap. There is no current Government support mechanism for domestic renewable heat but this is slated to arrive in 2013. Until then there is one other significant support mechanism we haven’t mentioned yet: the Feed In Tariff. We get paid for the solar electricity we produce and we get paid well; about £1,600 per year in total (including payments for exporting electricity to the grid). This is tax free and increases every year with inflation.

So the total NET payment every year to heat and light our home is only £180. So we are saving £1,650 every year. Aha (I hear you ask) but what did it all cost? The total project cost was a startling £49,000 of which £4000 was not related to energy (for example: saving water, growing our own food, providing loft storage, and so on). Even at £45k that is a significant outlay by anyone’s standards. Most people will never earn that amount of money in any year, most will never buy a car for that amount, most could only dream of what that sort of money could yield in terms of luxury holidays. But, of course, you can borrow that money against your mortgage, if so lucky, to invest in your home. So the real question is: what’s the payback? Or, to put it another way: why not just invest that money somewhere else?

Now the maths could get complicated depending upon the discount rate you apply and assumptions about fossil fuel prices. But if we strip away the complexity and just use today’s prices then we get a payback of around 27 years - or about the length of a mortgage. To put it another way the return on investment is about 3.7% pa. (We didn’t compound the interest because you will need that to pay your bloated gas & electric bills.)

So what is the opportunity cost? You could have put the money in the bank. If you reckon the economy will grow at an average of 3% pa for the next 30 years then it MIGHT still be worth it. Of course there are other investment packages out there depending upon the level of risk you wish to take. In our case investing in our home was a zero risk strategy hence we should only use the lowest estimate. Of course this slightly misses the point.

Even if you had stuck the money in the bank mostly every penny of interest you earn would have gone on your gas and electric bill. So you are just standing still. Your capital may be more liquid than ours but our home is still our home. We get somewhere to live that is warm and comfortable. You still have to live in your cold and draughty house. Which brings us to the next point: carbon.

It is fun to figure out whether such an investment is worth it in terms of Carbon Dioxide saved. Europe has a Carbon Trading Market known as the EU ETS. In November 2012 one tonne of CO2 trades at just £6.58. So our £45k would have bought 6,838 tonnes of CO2. If I take the payback period of 27 years then in that period Superhome 59 saved just 211 tonnes of CO2. Putting it another way: it was 32 times more expensive to save carbon via a home retrofit than simply retiring carbon credits on the free market. My 211 tonnes earns me just £1,388 at today’s ETS price.

The bottomline is this: we generate 95% of our own electricity, cut our electric bill by 28% and our heating bill by 40%. However the sledgehammer we used proved to be so expensive that it only becomes worth it because of the Feed In Tariff. Even then the total project payback is quite low and only slightly better than leaving your money in the bank. Then you have to factor in the cost of replacing the renewable energy devices. The photovoltaics may well last 40 or 50 years but the electronic box of tricks that connects it to the grid will need replacing within 10 to 20 years.

Then there is that biomass boiler. It might last no more that 15 to 20 years. If you replace a gas boiler it might set you back £1,800 whilst the wood pellet boiler might cost £9,000. There is nothing clear cut about this decision. What you get is satisfaction. It isn’t about being smug. It is about security. Whilst everyone else’s bills went up 7% in 2012 ours went up by 1.3%. We have disconnected ourselves for the ugly death spiral of fossil fuels.

If we knew this would it have changed anything? To that the answer is truly “no”. Definitely not. What if we frittered that money away on holidays and fast cars? After 27 years we would have no cars, no holidays and we would STILL be paying through the nose to heat and light our home. So it was a wise investment because in year 28 it is still costing us less. Maybe not that much less – the Feed In Tariff ends after 25 years – but this home will probably stand for a hundred years or more with its carbon footprint 90% lower than similar homes.

Earlier we mentioned the FiT ends after 25 years and we didn’t really account for this in the payback period of 27 years. In reality we have two years without that £1600 FiT payment which means £3200. Without FiT the payback pa was only £80. This would leave us another 40 years to pay back totalling 67 years. Obviously this is so far out in the future that it is really hard to tell what will happen. This certainly reduces the APR to 1.5% hence lower than “normal” economic growth and investment returns.

The other factor that wasn’t fully disclosed above was the heat input from the lounge wood burning stove. This was fully costed but wasn’t accounted for in the 40% heat load reduction. We use roughly 3m³ of logs pa. Below we have looked up the kWh by volume of wood and have corrected that saving figure but it won’t change the payback.

There is a third element of saving that wasn't included and that was water usage. We are on a meter and pay only £5 a month for water as we are low users. However we had already discounted the costs of water saving from the total capital costs, so this element was excluded.

The conclusion remains thus: the project had good payback on all elements apart from the Renewable Heat element: the biomass boiler. That gave us our biggest “carbon hit” but it made the carbon savings very expensive. Once these high costs are pro rata’d across the entire project it makes it look very unnattractive. The Renewable Heat Incentive for Domestic UK Residences arrives (after a long wait) in 2013. It will probably be 2014 before we really know its true contribution. All things being equal the RHI should restore the payback for the project and make the result worthwhile.

It does go to prove that the three key elements to de-carbonising UK housing stock will be the three key UK Government Policies: FiT, the RHI and the Green Deal. (The Green Deal was not relevant for this project because it didn’t exist and we funded the improvements ourself – this was probably a good things as we avoided interest charges that way.) Most homes will need one or more of these options. To go the “whole-hog” you will need all three and plenty of cash upfront. Currently not for the faint-hearted.

So that's the philosophical argument based upon the entire cost of the project. What happens if we break down the paybacks into separate chunks? So we split the project into three technology types:

1. Insulation/solar thermal & the savings in heating/hot water

2. Electricity and the savings in electricity usage

3. Photovoltaics and the feed-in-tariff

Earlier we omitted an estimate for how much heat from the wood burning stove contributes to the home. After digging through some numbers from the Centre for Alternative Technology we came up with a rough number of 4000kWh pa (not far from the 3320kWh estimated by the BRE baseline calculator for the old gas fire). Then there are the solar thermal panels which contribute about 2700kWh pa to hot water needs. So all together the saving over the BRE baseline is 20% which is half the 40% we originally estimated, based upon the wood pellet boiler alone. This isn’t the entire story though because now 2700kWh pa is FREE from the sun. This element can be discounted from the running costs. The effective saving is thus 28%.

We know that annually our gas heating & hot water bill should be £1,250 pa. How much did we spend on making our home warmer via insulation and using the power of the sun? About £6500. Hence the saving of 28% is £350 a year off the gas bill. This is a payback of 18 years at 5.3% APR. Not bad but not exciting either.

Lets scrutinise the numbers again. Ours was an expensive investment in that we chose sheep wool insulation. That wasn’t cheap. You can get your attic insulated for FREE so we have slightly exaggerated the costs. We also included the cost of removing trees from the south of the property in order to boost solar gain. Over half that cost was contributed by the solar thermal panels though and these have no current government support mechanism.

What happens if we take the sheep wool & solar thermal out and assume free loft insulation? The cost falls to only £1750. We will have to pay an additional amount for that 2700kWh pa hot water in a higher gas bill. The energy saved drops to 20% or £250 per year. This investment pays back in 14 years at a 7% APR. Even better.

What about the solar thermal panels by themselves? They would have saved 2700kWh pa on the baseline of 34,231kWh pa. That is about 8% (remember that most of your heat load is for space heating, only a small amount goes into hot water and, of that, solar thermal contributes about 50-60% at best). 8% of £1250 is just shy of £100 a year. Payback is thus 37 years on a system that cost £3700. So, without government support solar thermal isn’t attractive by itself.

Moving on to number 2: electricity. We know already that we saved 28% on the usage (2900kWh pa versus a BRE baseline of 4100kWh pa). Cost per year of electricity at baseline would have been about £540. A 28% saving is £150 a year. What did we spend? About £1200. Thus the payback is about 13 years at 7.7% APR.

Finally, number 3: photovoltaics.  They cost us £13,500 to install. We got a £1000 grant from the old Low Carbon Building Program. Total = £12,500. Annual return is £1,600 from the Feed In Tariff (FiT) yielding an 8 year payback at nearly 13% APR. In fact the Feed in Tariff (as it was) was so lucrative that it almost pays for the ENTIRE project by itself. The FiT has subsequently been cut significantly in line with reduction in costs of the photovoltaic panels. Paybacks are now in the region of 16 years. To get that in perspective we installed photovoltaics on our previous home in 2005. Even with half the cost paid by the Low Carbon Building Program Grant it would still have taken 35 years to pay back the cost. We should look on the bright side.

So, what have we learnt? You can cut your energy bills by somewhere between 20% and 30% EASILY and save enough to pay that money back inside 15 years. At current interest rates that is much better than money in the bank and would be a very shrewd investment in your home. In fact energy saving is now a better investment than solar panels which give you an indication as to where your priorities should lie.

So, question: why if these technologies have a good payback did the entire Superhome59 project NOT have a good payback? Answer: simply put, “renewable heat” (solar thermal and the wood-powered boiler) have lousy-to-non-existent payback. They save a heck of a lot of carbon: a 90% saving in this case, but it wasn’t economic by itself.

But this is just the experience of one home. What do other people think? Figures from the Energy Saving Trust are somewhat more optimistic per technology:

• Energy efficient light bulbs payback in 6 months

• Loft insulation payback in 2 to 6 years

• Hot water tank insulation payback in 1 year

• Double glazing payback in 5 years

• Heating controls payback in 2 to 5 years

• Draught proofing payback in 3 years

• Replace old boiler payback in 4 to 5 years

• Cavity wall insulation payback in 3 years

We actually employed EVERY one of these technologies. We can’t explain the differences between our numbers and theirs. We wouldn’t read too much into it. There are far more pessimistic numbers out there. In 2006 the Royal Institute of Chartered Surveyors (RICS) ran the numbers and came up with this, very different, conclusion:

• Cavity wall insulation payback in 5 years

• Loft insulation payback in 13 years

• Hot water cylinder & pipe insulation payback in 38 years

• Replace old boiler payback in 38 years

• Heating controls payback in 34 years

• Double glazing payback in 124 years

• Solar hot water payback in 208 years

Clearly experience shows that the RICS numbers are way too pessimistic given today’s gas and electric prices. Likewise our experiences suggest that the EST are slightly exaggerating their case.

So, bottom-line - was it worth it? Yes for insulation. Yes for saving electricity. Yes for photovoltaics (but ‘no’ if there was no Feed-in Tariff). No for solar thermal. No for wood-powered boilers (if you are on mains gas). Overall? Just about worth it in terms of money but definitely worth it for the intangibles.

In 2013 the Renewable Heat Incentive (“RHI”) rolls in for wood-powered boilers and solar thermal. Therefore these numbers will change and we will be re-writing this page all over again come 2014 – a year after the introduction of the RHI. We will not count our chickens however it can only get better for renewable heat. We should expect the payback periods to be reduced and the return on our investment to blossom.

All this and a lovely warm, modern, house to-boot. It’s a no-brainer. A few more facts and figures for you:

• Estimated reduction in Carbon Footprint: >90%

• Actual savings: >4.5tonnes pa

• Minimum expected lifetime of the retrofit: >25 years

• Total savings = 25 x 4.5 = 113 tonnes minimum resulting in a carbon cost of £347/tonne

• Total home energy used per annum = 30,240kWh (comprises of stove 4000kWh, wood pellet space & water heating 20,600kWh, electrical 2942kWh & solar hot water 2700kWh)

• Total living-space floor area = 124m²

• Footprint now 243kWh/m² pa*

*For a Passivhaus the total primary energy use for all appliances, domestic hot water, and space heating/cooling must be less than 120kWh/m² pa.

What we will do next

We plan a solar conservatory for the rear garden but it would prove to have a very high cost for very small benefit. It can't be justified for carbon footprint reasons so would have to be a lifestyle/comfort choice. We have considered putting an air-source heat pump on the conservatory - just to tick that box! There is a plan to remove the bathroom over the garage and convert the space to have a larger bedroom and smaller en suite. This would remove some pipework from the garage ceiling. Thus the garage ceiling can be insulated from below to keep the living space above somewhat warmer. As part of this project we are considering doing a super-professional-insulation job of the over-garage living space. This might include interior wall insulation. This space is a big problem as it is always the coldest space in the home acting as a reverse radiator sucking heat our of our home and dumping it into the garage and garden. It is a hole we wish to plug.

The loft is another area we can improve upon as some celotex can go between the rafters and we think we could purchase some sealed pads of insulation we could move around between storage items rather than having fixed insulation. However we would have to move the TV aerial out of the attic as the foil-covered insulation would rob us of our TV reception.

From there on we are into the fantasy-areas. If we could we would refit all the double-glazing with Passivhaus-standard wood framed triple glazed units (starting with the north-facing side of the building).

December 2011: full thermal imaging survey