Now that we have had our first blackout since 2008 in the UK should we be considering standby generators?
Alternatively, now that we can buy natural gas at 2.8p/kWh in the UK, while electricity prices are moving towards 20p/kWh, should we be considering natural gas generators to power our homes (or at least at peak times in the year when electricity costs are high)?
Well to answer the first question. I don’t think the grid has yet got so unstable that we need to install standby generators in our homes to keep the lights on. Having a power cut in one part of the UK for the first time in 10 years does not constitute a change in the reliability of the grid. So the answer to the first question is NO. It probably isn’t worth installing a standby generator just to address that once in 10 years event.
Should we be installing natural gas power generators in our home because gas prices are low? Now that is a more interesting question. If you look at the natural gas generators available in the market they operate at around 30% conversion efficiency which means for every kWh of electricity generated they consume 3.33kWh of natural gas. At 2.8p/kWh for natural gas this then means you can generate power at 9.5p/kWh which is quite a substantial saving against electricity at 20p/kWh (around 10p/kWh).
Looking at prices of generators they average around £500 per kWh (some with and some without a transfer switch – you would need this to meet G59 connection requirements). Assuming this is an installed price then the generator would only have to run 5000 hours in order to achieve a payback (less than a year).
Now there are a few challenges with generators. The first is that they are like cars. They can’t run continuous, they need maintenance and they can be a bit noisy especially if you neighbour is only 20 meters away.
If you factor in having to maintain the generator at a cost of say £10 per kW per year then the payback moves nearer to 6000 hours (reduced income due to operating expenses). Still the payback is still under 1 year which is good compared with solar or wind.
The bigger issue is probably noise. Albeit people suggest that these generators are low noise they are, however, equivalent to a car running continuous, which if that were happening next to you home I am sure you would not be too happy with your neighbour.
So payback is good but operating parameters is perhaps a bit more of a challenge.
What this does suggest is that these types of units would be perfect for stately homes or farms where the locating of a generator would be relatively simple and the operation of the generate would unlikely be a nuisance to anyone apart from the farmer and his/her partner.
Gas fired standby generators are perhaps an excellent options for farmers and estate owner. The interesting things is that these are exactly the people who will likely suffer from blackouts as they are rurally located and therefore more likely to be affected by weather and poor availability of supply. The only issue being that they are also the ones that are likely to be further from the gas network.
SO while there may be a commercial case for natural gas fired standby generators, that market has it challenges.
If you are a farmer or an estate owner that is located near a gas mains then perhaps it would be worth your while having a look at installing a natural gas fired generator. One question to ask is “what is the continuous operating rating of the plant?” If the sales man says 100 hours then that generator is not for you as you could be waiting 50 years before seeing a payback.