How Caldera aims to drive an economic boom with the UK’s renewable energy

Since time immemorial, the British weather has been a cruel joke – the wind, the rain, the general but reliable misery of it all.

But could it be, in a world determined (at last) to eradicate carbon from energy production, that the source of misery for so many generations could actually drive an economic boom – one that could rival that of North Sea oil in the 70s and 80s?

That’s the view of James Macnaghten, CEO of Caldera, one of a number of companies seeking to tackle the “net zero emissions by 2050” conundrum facing the UK.

“In the UK, we have lots of wind and solar generation – and much more planned – but as an island, we have very few cables connecting us to neighbouring countries,” he says.

He points out that the huge energy sector in Europe is seeking to decarbonise quickly – which potentially opens up opportunities for UK renewables, but only if we solve the energy storage or the cable connection problem.

“We have such good access to the North Sea, and we could become a major player in North Sea renewables if we build enough towers and blades – all of which delivers an amazing opportunity to create jobs,” he says.

“We could be world leaders in offshore wind, which would be a bigger boon than North Sea oil. Rather than making the transition to net zero a cost, it makes it a benefit.”

However, without a solution to the problem of storing or “transporting” the excess renewable energy generated, the incentive to produce more wind or solar power is limited, potentially undermining the whole net-zero ambition.

The projected cost of hitting net zero is astronomical, with one estimate putting it at £450bn; coming off the back of a pandemic that has pushed government borrowing to £394bn, it’s starting to look like the sums just don’t – or can’t – add up.

The current solution favoured by the government to decarbonise home energy is the heat pump. The average cost of these is £5,000, but in order for them to be at their most effective, many homes in the UK may have to be retrofitted with insulation – which can send the cost soaring towards £20,000.

But Caldera thinks there is another way: one that could be cheaper to install, but also further incentivises the growth of the renewable energy sector in the UK.

Asked to put it in simple terms, Macnaghten describes the unit – a heat battery – as “a big lump of material that we heat up with electricity when renewables are generating. That sits inside a vacuum vessel like a thermos flask to keep the heat in, and when the homeowner wants central heating and hot water, we use the heat from the unit.”

So far, so simple; but the problem Caldera is trying to solve isn’t just about providing carbon-free heating. It’s also about making sense of renewable energy.

“There is a flaw in renewables without the storage aspect, and that is what we are trying to fix,” says Macnaghten.

“We throw away 6 per cent of all energy generated by wind turbines, which is enough to heat 320,000 homes a year. The amount of renewable energy that we put into the grid is going to increase by two-and-a-half times in the next 10 years, and we are already throwing stuff away.”

For renewable energy to fulfil its promise, it needs to be available at the same time the demand is there; and for obvious reasons, that will never be possible unless an efficient way of storing that energy (or heat) is found.

Of course, Caldera is not the only company exploring how excess renewable energy can be stored and released. But to date, the options have been complex and costly, as Macnaghten and his partner (and COO of the company) Guy Winstanley found out.

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“We started out in this area 12 years ago, trying to build a grid-scale energy system storing megawatts of energy for the national grid,” explains Winstanley.

“That project was about storing energy in very hot and cold tanks, and using the difference in heat to store and generate electricity in different ways. We built large 80-tonne pressurised steel vessels. It was the most enormous project – engineering at its best.

“But we realised along the way that the economics weren’t there, and that took us off onto a much-lower-cost energy-store system.”

Which turned out to be Caldera and its heat batteries. They realised that storing heat, rather than power, was the way forward – and judging by a recent investment round, they’re not alone.

A crowdfunding effort secured more than £1.5m from over 1,300 investors, both institutional and individual, delivering 200 pre-orders along the way.

But before they start fulfilling those orders, Macnaghten and Winstanley need to prove their bold concept – and, once they have done so, approach the government, to get on its radar in the same way the heat-pump crowd have.

“The discourse at the moment is ‘it’s heat pumps or nothing’, and we need to establish a level playing field,” says Macnaghten.

To secure that level playing field, they will be placing ten test units around the country this year to be run throughout the winter, with commercial sales due to start in April next year.

“For us to go to the government, we need to show the batteries work well and are reliable. We are doing some work to show that there is a benefit to decarbonising heating for less money – which could, in turn, save the whole system money,” says Macnaghten.

With the same government support that heat-pump providers currently receive, such as a reduction in VAT and grants to offset the buyer’s outlay, Macnaghten and Winstanley believe they could get the cost of their unit and its installation down to the same level as a standard boiler.

And for them, that finally starts to make the widespread and reliable use of renewable energy to heat the UK’s homes a reality, without limiting the amount of energy we use.

“There is a preoccupation with reducing the amount of energy we use, which we believe is missing the point. We want net zero carbon, not zero energy,” says Macnaghten.