Hot Water Cylinders: The Hidden Hero Of The Future Energy System

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Categories: Blog
Published: 17th May 2021

The Ubiquitous Storage Empowering Response (USER) Project was awarded Government funding in 2019 to demonstrate the demand-side-response potential of hot water cylinders. Jeff House, Head of External Affairs at Baxi Heating, considers the role these hot water cylinders have to play in the future energy system.

The past couple of years have proven that the UK is committed to being greener, with the clearest example of this being our collective net zero carbon target by 2050. An agreed method of how we achieve this goal, however, is less clear. At present, the UK’s green energy grid has a heavy dependence on intermittent energy sources, such as wind-power and solar-power. Indeed, over the next decade as we transition towards a decentralised, lower carbon energy system, over 50% of the UK’s electricity is expected to come from such sources. This reliance can cause challenges in maintaining a secure and reliable energy system. The USER Project is supporting efforts to make the future electricity grid optimised and customer-centric.

The USER Project solution is simple, in that it builds upon the technology already present in a third of UK homes. There are currently estimated to be 9 million hot water cylinders in UK households today, with a combined thermal storage capacity (TSC) of 100GWh. Despite many homeowners removing cylinders rather than replacing them over the past 20 years, this storage potential is only expected to grow; 600,000 heat pump co-located cylinders are set to be installed per year by 2028, and all new homes will be built ‘zero carbon ready’ from 2025.

Baxi Heating is committed to the optimisation of these cylinders so that they may become integral to the future energy system. The USER Project consortium – ourselves, Levelise, Ecuity A Gemserv Company, Energy Systems Catapult and Durham University – is trialling AI-led technology that transforms hot water cylinders like Baxi’s into valuable demand-side-response assets. Through an attached ‘smart hub’, each hot water cylinder can act as a thermal battery, as the cylinder’s immersion heater turns on and off based on the needs of the user and the electricity grid. In short, by reacting to fluctuations in the frequency of the grid, these hot water cylinders provide a load which can contribute to the energy service or Firm Frequency Response, and store energy for later use. This, combined with being optimised for the current energy price, will lead to a reduction in hot water cost, as well as the ability to reduce carbon.

The technology developed as part of the USER Project can also be part of an optimised home energy system, bringing together solar PV and batteries. With little disruption to the home, the technology is able to bring a true demand side response (DSR) solution that empowers households to play a role in the future energy system.

We are keen to begin the transition to a greener electricity grid using this innovative technology, and have begun to trail its usage in 350 homes. With one third of installations now complete despite the obstacles brought about by COVID-19, the project has reached over 80% of its 1MW capacity target. Reaching this milestone allows us to create a virtual power plant that has the size to offer ancillary services solely from domestic hot water tanks, ergo improving the stability of the electricity grid.

The homes participating in our trial are a diverse mix of private lettings, housing associations and student accommodation, and are geographically distributed across the country. All are different, and all are collaborating to deliver commercial-scale energy services. This is only possible by means of the AI-based cloud optimisation service that Levelise has been fine-tuning and refining for the past 8 years, which currently operates the first domestic-only virtual power plant in UK.

As part of the USER project, Baxi Heating hopes to support the emergence of a future energy system which provides domestic homeowners with a cost-effective decarbonisation pathway. We look forward to providing further updates on the trial as time goes on.