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  • Mind the Gap : BBC Costing the Earth

    Posted on October 16th, 2013 Jo No comments

    I listened to an interesting mix of myth, mystery and magic on BBC Radio 4.

    Myths included the notion that long-term, nuclear power would be cheap; that “alternative” energy technologies are expensive (well, nuclear power is, but true renewables are most certainly not); and the idea that burning biomass to create heat to create steam to turn turbines to generate electricity is an acceptably efficient use of biomass (it is not).

    Biofuelwatch are hosting a public meeting on this very subject :-
    http://www.biofuelwatch.org.uk/2013/burning_issue_public_event/
    “A Burning Issue – biomass and its impacts on forests and communities”
    Tuesday, 29th October 2013, 7-9pm
    Lumen Centre, London (close to St Pancras train station)
    http://www.lumenurc.org.uk/lumencontact.htm
    Lumen Centre, 88 Tavistock Place, London WC1H 9RS

    Interesting hints in the interviews I thought pointed to the idea that maybe, just maybe, some electricity generation capacity should be wholly owned by the Government – since the country is paying for it one way or another. A socialist model for gas-fired generation capacity that’s used as backup to wind and solar power ? Now there’s an interesting idea…




    http://www.bbc.co.uk/programmes/b03cn0rb

    “Mind the Gap”
    Channel: BBC Radio 4
    Series: Costing the Earth
    Presenter: Tom Heap
    First broadcast: Tuesday 15th October 2013

    Programme Notes :

    “Our energy needs are growing as our energy supply dwindles.
    Renewables have not come online quickly enough and we are increasingly
    reliant on expensive imported gas or cheap but dirty coal. Last year
    the UK burnt 50% more coal than in previous years but this helped
    reverse years of steadily declining carbon dioxide emissions. By 2015
    6 coal fired power stations will close and the cost of burning coal
    will increase hugely due to the introduction of the carbon price
    floor. Shale gas and biomass have been suggested as quick and easy
    solutions but are they really sustainable, or cheap?”

    “Carbon Capture and Storage could make coal or gas cleaner and a new
    study suggests that with CCS bio energy could even decrease global
    warming. Yet CCS has stalled in the UK and the rest of Europe and the
    debate about the green credentials of biomass is intensifying. So what
    is really the best answer to Britain’s energy needs? Tom Heap
    investigates.”

    00:44 – 00:48
    [ Channel anchor ]
    Britain’s energy needs are top of the agenda in “Costing the Earth”…

    01:17
    [ Channel anchor ]
    …this week on “Costing the Earth”, Tom Heap is asking if our
    ambitions to go green are being lost to the more immediate fear of
    blackouts and brownouts.

    01:27
    [ Music : Arcade Fire – “Neighbourhood 3 (Power Out)” ]

    [ Tom Heap ]

    Energy is suddenly big news – central to politics and the economy. The
    countdown has started towards the imminent shutdown of many coal-fired
    power stations, but the timetable to build their replacements has
    barely begun.

    It’ll cost a lot, we’ll have to pay, and the politicians are reluctant
    to lay out the bill. But both the official regulator and industry are
    warning that a crunch is coming.

    So in this week’s “Costing the Earth”, we ask if the goal of clean,
    green and affordable energy is being lost to a much darker reality.

    02:14
    [ Historical recordings ]

    “The lights have started going out in the West Country : Bristol,
    Exeter and Plymouth have all had their first power cuts this
    afternoon.”

    “One of the biggest effects of the cuts was on traffic, because with
    the traffic lights out of commission, major jams have built up,
    particularly in the town centres. One of the oddest sights I saw is a
    couple of ladies coming out of a hairdressers with towels around their
    heads because the dryers weren’t working.”

    “Television closes down at 10.30 [ pm ], and although the cinemas are
    carrying on more or less normally, some London theatres have had to
    close.”

    “The various [ gas ] boards on both sides of the Pennines admit to
    being taken by surprise with today’s cold spell which brought about
    the cuts.”

    “And now the major scandal sweeping the front pages of the papers this
    morning, the advertisement by the South Eastern Gas Board recommending
    that to save fuel, couples should share their bath.”

    [ Caller ]
    “I shall write to my local gas board and say don’t do it in
    Birmingham. It might be alright for the trendy South, but we don’t
    want it in Birmingham.”

    03:13
    [ Tom Heap ]

    That was 1974.

    Some things have changed today – maybe a more liberal attitude to
    sharing the tub. But some things remain the same – an absence of
    coal-fired electricity – threatening a blackout.

    Back then it was strikes by miners. Now it’s old age of the power
    plants, combined with an EU Directive obliging them to cut their
    sulphur dioxide and nitrous oxide emissions by 2016, or close.

    Some coal burners are avoiding the switch off by substituting wood;
    and mothballed gas stations are also on standby.

    But Dieter Helm, Professor of Energy Policy at the University of
    Oxford, now believes power cuts are likely.

    03:57
    [ Dieter Helm ]

    Well, if we take the numbers produced by the key responsible bodies,
    they predict that there’s a chance that by the winter of 2-15 [sic,
    meaning 2015] 2-16 [sic, meaning 2016], the gap between the demand for
    electricity and the supply could be as low as 2%.

    And it turns out that those forecasts are based on extremely
    optimistic assumptions about how far demand will fall in that period
    (that the “Green Deal” will work, and so on) and that we won’t have
    much economic growth.

    So basically we are on course for a very serious energy crunch by the
    winter of 2-15 [sic, meaning 2015] 2-16 [sic, meaning 2016], almost
    regardless of what happens now, because nobody can build any power
    stations between now and then.

    It’s sort of one of those slow motion car crashes – you see the whole
    symptoms of it, and people have been messing around reforming markets
    and so on, without addressing what’s immediately in front of them.

    [ Tom Heap ]

    And that’s where you think we are now ?

    [ Dieter Helm ]

    I think there’s every risk of doing so.

    Fortunately, the [ General ] Election is a year and a half away, and
    there’s many opportunities for all the political parties to get real
    about two things : get real about the energy crunch in 2-15 [sic,
    meaning 2015] 2-16 [sic, meaning 2016] and how they’re going to handle
    it; and get real about creating the incentives to decarbonise our
    electricity system, and deal with the serious environmental and
    security and competitive issues which our electricity system faces.

    And this is a massive investment requirement [ in ] electricity : all
    those old stations retiring [ originally built ] back from the 1970s –
    they’re all going to be gone.

    Most of the nuclear power stations are coming to the end of their lives.

    We need a really big investment programme. And if you really want an
    investment programme, you have to sit down and work out how you’re
    going to incentivise people to do that building.

    [ Tom Heap ]

    If we want a new energy infrastructure based on renewables and
    carbon-free alternatives, then now is the time to put those incentives
    on the table.

    The problem is that no-one seems to want to make the necessary
    investment, least of all the “Big Six” energy companies, who are
    already under pressure about high bills.

    [ “Big Six” are : British Gas / Centrica, EdF Energy (Electricite
    de France), E.On UK, RWE npower, Scottish Power and SSE ]

    Sam Peacock of the energy company SSE [ Scottish and Southern Energy ]
    gives the commercial proof of Dieter’s prediction.

    If energy generators can’t make money out of generating energy,
    they’ll be reluctant to do it.

    [ Sam Peacock ]

    Ofgem, the energy regulator, has looked at this in a lot of detail,
    and said that around 2015, 2016, things start to get tighter. The
    reason for this is European Directives, [ is [ a ] ] closing down some
    of the old coal plants. And also the current poor economics around [
    or surround [ -ing ] ] both existing plant and potential new plant.

    So, at the moment it’s very, very difficult to make money out of a gas
    plant, or invest in a new one. So this leads to there being, you know,
    something of a crunch point around 2015, 2016, and Ofgem’s analysis
    looks pretty sensible to us.

    [ Tom Heap ]

    And Sam Peacock lays the blame for this crisis firmly at the Government’s door.

    [ Sam Peacock ]

    The trilemma, as they call it – of decarbonisation, security of supply
    and affordability – is being stretched, because the Government’s
    moving us more towards cleaner technologies, which…which are more
    expensive.

    However, if you were to take the costs of, you know, the extra costs
    of developing these technologies off government [ sic, meaning
    customer ] bills and into general taxation, you could knock about over
    £100 off customer bills today, it’ll be bigger in the future, and you
    can still get that much-needed investment going.

    So, we think you can square the circle, but it’s going to take a
    little bit of policy movement [ and ] it’s going to take shifting some
    of those costs off customers and actually back where the policymakers
    should be controlling them.

    [ KLAXON ! Does he mean controlled energy prices ? That sounds a bit
    centrally managed economy to me… ]

    [ Tom Heap ]

    No surprise that a power company would want to shift the pain of
    rising energy costs from their bills to the tax bill.

    But neither the Government nor the Opposition are actually proposing this.

    Who pays the premium for expensve new energy sources is becoming like
    a game of pass the toxic parcel.

    [ Reference : http://en.wikipedia.org/wiki/Hot_potato_%28game%29 ]

    I asked the [ UK Government Department of ] Energy and Climate Change
    Secretary, Ed Davey, how much new money is required between now and
    2020.

    08:06

    [ Ed Davey ]

    About £110 billion – er, that’s critical to replace a lot of the coal
    power stations that are closing, the nuclear power stations that are [
    at the ] end of their lives, and replace a lot of the network which
    has come to the end of its life, too.

    So it’s a huge, massive investment task.

    [ Tom Heap ]

    So in the end we’re going to have to foot the bill for the £110 billion ?

    [ Ed Davey ]

    Yeah. Of course. That’s what happens now. People, in their bills that
    they pay now, are paying for the network costs of investments made
    several years, even several decades ago.

    [ Yes – we’re still paying through our national nose to dispose of
    radioactive waste and decommission old nuclear reactors. The liability
    of it all weighs heavily on the country’s neck… ]

    And there’s no escaping that – we’ve got to keep the lights on – we’ve
    got to keep the country powered.

    You have to look at both sides of the equation. If we’re helping
    people make their homes more inefficient [ sic, meaning energy
    efficient ], their product appliances more efficient, we’re doing
    everything we possibly can to try to help the bills be kept down,

    while we’re having to make these big investments to keep the lights
    on, and to make sure that we don’t cook the planet, as you say.

    [ Tom Heap ]

    You mention the lights going out. There are predictions that we’re
    headed towards just 2% of spare capacity in the system in a few years’
    time.

    Are you worried about the dangers of, I don’t know, maybe not lights
    going out for some people, but perhaps big energy users being told
    when and when [ sic, meaning where ] they can’t use power in the
    winter ?

    [ Ed Davey ]

    Well, there’s no doubt that as the coal power stations come offline,
    and the nuclear power plants, er, close, we’re going to have make sure
    that new power plants are coming on to replace them.

    And if we don’t, there will be a problem with energy security.

    Now we’ve been working very hard over a long time now to make sure we
    attract that investment. We’ve been working with Ofgem, the regulator;
    with National Grid, and we’re…

    [ Tom Heap ]

    …Being [ or it’s being ] tough. I don’t see companies racing to come
    and fill in the gap here and those coal power plants are going off
    soon.

    [ Ed Davey ]

    …we’re actually having record levels of energy investment in the country.

    The problem was for 13 years under the last Government
    [ same old, same old Coalition argument ] we saw low levels of investment
    in energy, and we’re having to race to catch up, but fortunately we’re
    winning that race. And we’re seeing, you know, billions of pounds
    invested but we’ve still got to do more. We’re not there. I’m not
    pretending we’re there yet. [ Are we there, yet ? ] But we do have the
    policies in place.

    So, Ofgem is currently consulting on a set of proposals which will
    enable it to have reserve power to switch on at the peak if it’s
    needed.

    We’re, we’ve, bringing forward proposals in the Energy Bill for what’s
    called a Capacity Market, so we can auction to get that extra capacity
    we need.

    So we’ve got the policies in place.

    [ Tom Heap ]

    Some of Ed Davey’s policies, not least the LibDem [ Liberal Democrat
    Party ] U-turn on nuclear, have been guided by DECC [ Department of
    Energy and Climate Change ] Chief Scientist David MacKay, author of
    the influential book “Renewable Energy without the Hot Air” [ sic,
    actually “Sustainable Energy without the Hot Air” ].

    Does he think the lights will dim in the second half of this decade ?

    [ David MacKay ]

    I don’t think there’s going to be any problem maintaining the capacity
    that we need. We just need to make clear where Electricity Market
    Reform [ EMR, part of the Energy Bill ] is going, and the way in which
    we will be maintaining capacity.

    [ Tom Heap ]

    But I don’t quite understand that, because it seems to me, you know,
    some of those big coal-fired power stations are going to be going off.
    What’s going to be coming in their place ?

    [ David MacKay ]

    Well, the biggest number of power stations that’s been built in the
    last few years are gas power stations, and we just need a few more gas
    power stations like that, to replace the coal
    , and hopefully some
    nuclear power stations will be coming on the bars, as well as the wind
    farms that are being built at the moment.

    [ Tom Heap ]

    And you’re happy with that increase in gas-fired power stations, are
    you ? I mean, you do care deeply, personally, about reducing our
    greenhouse gases, and yet you’re saying we’re going to have to build
    more gas-fired power stations.

    [ David MacKay ]

    I do. Even in many of the pathways that reach the 2050 target, there’s
    still a role for gas in the long-term, because some power sources like
    wind and solar power are intermittent, so if you want to be keeping
    the lights on in 2050 when there’s no wind and there’s no sun, you’re
    going to need some gas power stations there
    . Maybe not operating so
    much of the time as they do today, but there’ll still be a role in
    keeping the lights on.

    [ KLAXON ! If gas plants are used only for peak periods or for backup to
    renewables, then the carbon emissions will be much less than if they are
    running all the time. ]

    [ Tom Heap ]

    Many energy experts though doubt that enough new wind power or nuclear
    capacity could be built fast enough to affect the sums in a big way by
    2020.

    But that isn’t the only critical date looming over our energy system.
    Even more challenging, though more distant, is the legally binding
    objective of cutting greenhouse gas emissions in 2050.

    David MacKay wants that certainty to provide the foundation for energy
    decisions, and he showed me the effect of different choices with the
    “Ultimate Future Energy App”. I was in his office, but anyone can try it online.

    [ David MacKay ]

    It’s a 2050 calculator. It computes energy demand and supply in
    response to your choices, and it computes multiple consequences of
    your choices. It computes carbon consequences. It also computes for
    you estimates of air quality, consequences of different choices;
    security of supply, consequences; and the costs of your choices.

    So with this 2050 calculator, it’s an open source tool, and anyone can
    go on the web and use the levers to imagine different futures in 2050
    of how much action we’ve taken in different demand sectors and in
    different supply sectors.

    The calculator has many visualisations of the pathway that you’re choosing
    and helps people understand all the trade-offs… There’s no silver
    bullet for any of this. If I dial up a pathway someone made earlier,
    we can visualise the implications in terms of the area occupied for
    the onshore wind farms, and the area in the sea for the offshore wind
    farms, and the length of the wave farms that you’ve built, and the
    land area required for energy crops.

    And many organisations have used this tool and some of them have given
    us their preferred pathway. So you can see here the Friends of the
    Earth have got their chosen pathway, the Campaign to Protect Rural
    England, and various engineers like National Grid and Atkins have got
    their pathways.

    So you can see alternative ways of achieving our targets, of keeping
    the lights on and taking climate change action. All of those pathways
    all meet the 2050 target, but they do so with different mixes.

    [ Tom Heap ]

    And your view of this is you sort of can’t escape from the scientific
    logic and rigour of it. You might wish things were different or you
    could do it differently, but you’re sort of saying “Look, it’s either
    one thing or the other”. That’s the point of this.

    [ David MacKay ]

    That’s true. You can’t be anti-everything. You can’t be anti-wind and
    anti-nuclear and anti-home insulation. You won’t end up with a plan
    that adds up.

    [ KLAXON ! But you can be rationally against one or two things, like
    expensive new nuclear power, and carbon and particulate emissions-heavy
    biomass for the generation of electricity. ]

    [ Tom Heap ]

    But isn’t that exactly kind of the problem that we’ve had, without
    pointing political fingers, that people rather have been
    anti-everything, and that’s why we’re sort of not producing enough new
    energy sources ?

    [ David MacKay ]

    Yeah. The majority of the British public I think are in favour of many
    of these sources, but there are strong minorities who are vocally
    opposed to every one of the major levers in this calculator. So one
    aspiration I have for this tool is it may help those people come to a
    position where they have a view that’s actually consistent with the
    goal of keeping the lights on.

    [ Tom Heap ]

    Professor MacKay’s calculator also computes pounds and pence,
    suggesting that both high and low carbon electricity work out pricey
    in the end.

    [ David MacKay ]

    The total costs of all the pathways are pretty much the same.
    “Business as Usual” is cheaper in the early years, and then pays more,
    because on the “Business as Usual”, you carry on using fossil fuels,
    and the prices of those fossil fuels are probably going to go up.

    All of the pathways that take climate change action have a similar
    total cost, but they pay more in the early years, ’cause you have to
    pay for things like building insulation and power stations, like
    nuclear power stations, or wind power, which cost up-front, but then
    they’re very cheap to run in the future.

    [ KLAXON ! Will the cost of decommissioning nuclear reactors and the
    costs of the waste disposal be cheap ? I think not… ]

    So the totals over the 40 or 50 year period here, are much the same for these.

    [ Tom Heap ]

    The cheapest immediate option of all is to keep shovelling the coal.
    And last year coal overtook gas to be our biggest electricity
    generation source, pushing up overall carbon emissions along the way
    by 4.5%

    [ KLAXON ! This is not very good for energy security – look where the
    coal comes from… ]

    As we heard earlier, most coal-fired power stations are scheduled for
    termination, but some have won a reprieve, and trees are their
    unlikely saviour.

    Burning plenty of wood chip [ actually, Tom, it’s not wood “chip”, it’s
    wood “pellets” – which often have other things mixed in with the wood,
    like coal… ] allows coal furnaces to cut the sulphur dioxide and nitrous
    oxide belching from their chimneys to below the level that requires their
    closure under European law.

    But some enthusiasts see wood being good for even more.

    16:19

    [ Outside ]

    It’s one of those Autumn days that promises to be warm, but currently
    is rather moist. I’m in a field surrounded by those dew-laden cobwebs
    you get at this time of year.

    But in the middle of this field is a plantation of willow. And I’m at
    Rothamsted Research with Angela Karp who’s one of the directors here.

    Angela, tell me about this willow I’m standing in front of here. I
    mean, it’s about ten foot high or so, but what are you seeing ?

    [ Angela Karp ]

    Well, I’m seeing one of our better varieties that’s on display here.
    We have a demonstration trial of about ten different varieties. This
    is a good one, because it produces a lot of biomass, quite easily,
    without a lot of additional fertilisers or anything. And as you can
    see it’s got lovely straight stems. It’s got many stems, and at the
    end of three years, we would harvest all those stems to get the
    biomass from it. It’s nice and straight – it’s a lovely-looking, it’s
    got no disease, no insects on it, very nice, clean willow.

    [ Tom Heap ]

    So, what you’ve been working on here as I understand it is trying to
    create is the perfect willow – the most fuel for the least input – and
    the easiest to harvest.

    [ Angela Karp ]

    That’s absolutely correct, because the whole reason for growing these
    crops is to get the carbon from the atmosphere into the wood, and to
    use that wood as a replacement for fossil fuels. Without putting a lot
    of inputs in, because as soon as you add fertilisers you’re using
    energy and carbon to make them, and that kind of defeats the whole
    purpose of doing this.

    [ KLAXON ! You don’t need to use fossil fuel energy or petrochemicals or
    anything with carbon emissions to make fertiliser ! … Hang on, these
    are GM trees, right ? So they will need inputs… ]

    [ Tom Heap ]

    And how much better do you think your new super-variety is, than say,
    what was around, you know, 10 or 15 years ago. ‘Cause willow as an
    idea for burning has been around for a bit. How much of an improvement
    is this one here ?

    [ Angela Karp ]

    Quite a bit. So, these are actually are some of the, if you like,
    middle-term varieties. So we started off yielding about 8 oven-dry
    tonnes per hectare, and now we’ve almost doubled that.

    [ Tom Heap ]

    How big a place do you think biomass can have in the UK’s energy
    picture in the future ?

    [ Angela Karp ]

    I think that it could contribute between 10% and 15% of our energy. If
    we were to cultivate willows on 1 million hectares, we would probably
    provide about 3% to 4% of energy in terms of electricity, and I think
    that’s kind of a baseline figure. We could cultivate them on up to 3
    million hectares, so you can multiply things up, and we could use them
    in a much more energy-efficient way.

    [ KLAXON ! Is that 4% of total energy or 4% of total electricity ?
    Confused. ]

    [ Tom Heap ]

    Do we really have 3 million hectares going a-begging for planting willow in ?

    [ Angela Karp ]

    Actually, surprisingly we do. So, people have this kind of myth
    there’s not enough land, but just look around you and you will find
    there’s lots of land that’s not used for cultivating food crops.

    We don’t see them taking over the whole country. We see them being
    grown synergistically with food crops.

    [ KLAXON ! This is a bit different than the statement made in 2009. ]

    [ Tom Heap ]

    But I’d just like to dig down a little bit more into the carbon cycle
    of the combustion of these things, because that’s been the recent
    criticism of burning a lot of biomass, is that you put an early spike
    in the amount of carbon in the atmosphere, if you start burning a lot
    of biomass, because this [ sounds of rustling ], this plant is going
    to be turned into, well, partly, CO2 in the atmosphere.

    [ Angela Karp ]

    Yes, I think that’s probably a simple and not totally correct way of
    looking at it. ‘Cause a lot depends on the actual conversion process
    you are using.

    So some conversion processes are much more efficient at taking
    everything and converting it into what you want.

    Heat for example is in excess of 80%, 90% conversion efficiency.

    Electricity is a little bit more of the problem. And there, what
    they’re looking at is capturing some of the carbon that you lose, and
    converting that back in, in carbon storage processes, and that’s why
    there’s a lot of talk now about carbon storage from these power
    stations.

    That I think is the future. It’s a question of connecting up all parts
    of the process, and making sure that’s nothing wasted.

    20:02

    [ Tom Heap ]

    So, is wood a desirable greener fuel ?

    Not according to Almuth Ernsting of Biofuelwatch, who objects to the
    current plans for large-scale wood burning, its use to prop up coal,
    and even its low carbon claims.

    [ Almuth Ernsting ]

    The currently-announced industry plans, and by that I mean existing
    power stations, but far more so, power stations which are in the
    planning process [ and ] many of which have already been consented –
    those [ biomass ] power stations, would, if they all go ahead,
    require to burn around 82 million tonnes of biomass, primarily wood,
    every year. Now by comparison, the UK in total only produces around
    10 million tonnes, so one eighth of that amount, in wood, for all
    industries and purposes, every year.

    We are looking on the one hand at a significant number of proposed,
    and in some cases, under-construction or operating new-build biomass
    power stations, but the largest single investment so far going into
    the conversion of coal power station units to biomass, the largest and
    most advanced one of which at the moment is Drax, who are, have
    started to move towards converting half their capacity to burning wood
    pellets.

    [ Tom Heap ]

    Drax is that huge former, or still currently, coal-fired power station
    in Yorkshire, isn’t it ?

    [ Almuth Ernsting ]

    Right, and they still want to keep burning coal as well. I mean, their
    long-term vision, as they’ve announced, would be for 50:50 coal and
    biomass.

    [ Tom Heap ]

    What do you think about that potential growth ?

    [ Almuth Ernsting ]

    Well, we’re seriously concerned. We believe it’s seriously bad news
    for climate change, it’s seriously bad news for forests, and it’s
    really bad news for communities, especially in the Global South, who
    are at risk of losing their land for further expansion of monoculture
    tree plantations, to in future supply new power stations in the UK.

    A really large amount, increasingly so, of the wood being burned,
    comes from slow-growing, whole trees that are cut down for that
    purpose, especially at the moment in temperate forests in North
    America. Now those trees will take many, many decades to grow back
    and potentially re-absorb that carbon dioxide, that’s if they’re
    allowed and able to ever grow back.

    [ Tom Heap ]

    There’s another technology desperate for investment, which is critical
    to avoiding power failure, whilst still hitting our mid-century carbon
    reduction goals – CCS – Carbon Capture and Storage, the ability to
    take the greenhouse gases from the chimney and bury them underground.

    It’s especially useful for biomass and coal, with their relatively
    high carbon emissions, but would also help gas be greener.

    The Chancellor has approved 30 new gas-fired power stations, so long
    as they are CCS-ready [ sic, should be “capture ready”, or
    “carbon capture ready” ].

    Jon Gibbons is the boss of the UK CCS Research Centre, based in an
    industrial estate in Sheffield.

    [ Noise of processing plant ]

    Jon’s just brought me up a sort of 3D maze of galvanized steel and
    shiny metal pipes to the top of a tower that must be 20 or so metres
    high.

    Jon, what is this ?

    [ Jon Gibbons ]

    OK, so this is our capture unit, to take the CO2 out of the combustion
    products from gas or coal. In the building behind us, in the test rigs
    we’ve got, the gas turbine or the combustor rig, we’re burning coal or
    gas, or oil, but mainly coal or gas.

    We’re taking the combustion products through the green pipe over
    there, bringing it into the bottom of the unit, and then you can see
    these big tall columns we’ve got, about 18 inches diameter, half a
    metre diameter, coming all the way up from the ground up to the level
    we’re at.

    It goes into one of those, it gets washed clean with water, and it
    goes into this unit over here, and there it meets an amine solvent, a
    chemical that will react reversibly with CO2, coming in the opposite
    direction, over packing. So, it’s like sort of pebbles, if you can
    imagine it, there’s a lot of surface area. The gas flows up, the
    liquid flows down, and it picks up the CO2, just mainly the CO2.

    [ Tom Heap ]

    And that amine, that chemical as you call it, is stripping the CO2 out
    of that exhaust gas. This will link to a storage facility.

    What would then happen to the CO2 ?

    [ Jon Gibbons ]

    What would then happen is that the CO2 would be compressed up to
    somewhere in excess of about 100 atmospheres. And it would turn from
    being a gas into something that looks like a liquid, like water, about
    the same density as water. And then it would be taken offshore in the
    UK, probably tens or hundreds of kilometres offshore, and it would go
    deep, deep down, over a kilometre down into the ground, and basically
    get squeezed into stuff that looks like solid rock. If you go and look
    at a sandstone building – looks solid, but actually, maybe a third of
    it is little holes. And underground, where you’ve got cubic kilometres
    of space, those little holes add up to an awful lot of free space. And
    the CO2 gets squeezed into those, over time, and it spreads out, and
    it just basically sits there forever, dissolves in the water, reacts
    with the rocks, and will stay there for millions of years.

    [ Tom Heap ]

    Back in his office, I asked Jon why CCS seemed to be stuck in the lab.

    [ Jon Gibbons ]

    We’re doing enough I think on the research side, but what we really
    need to do, is to do work on a full-scale deployment. Because you
    can’t work on research in a vacuum. You need to get feedback –
    learning by doing – from actual real projects.

    And a lot of the problems we’ve got on delivering CCS, are to do with
    how you handle the regulation for injecting CO2, and again, you can
    only do that in real life.

    So what we need to do is to see the commercialisation projects that
    are being run by the Department of Energy and Climate Change actually
    going through to real projects that can be delivered.

    [ Tom Heap ]

    Hmm. When I talk to engineers, they’re always very passionate and
    actually quite optimistic about Carbon Capture and Storage. And when
    I talk to people in industry, or indeed read the headlines, not least
    a recent cancellation in Norway, it always seems like a very bleak picture.

    [ Jon Gibbons ]

    I think people are recognising that it’s getting quite hard to get
    money for low carbon technologies.

    So – recent presentation we had at one of our centre meetings, was
    actually a professor from the United States, Howard Herzog. And he
    said “You think you’re seeing a crisis in Carbon Capture and Storage.
    But what you’re actually seeing is a crisis in climate change
    mitigation.”

    [ KLAXON ! Priming us for a scaling back of commitment to the
    Climate Change Act ? I do hope not. ]

    Now, Carbon Capture and Storage, you do for no other purpose than
    cutting CO2 emissions to the atmosphere, and it does that extremely
    effectively. It’s an essential technology for cutting emissions. But
    until you’ve got a global process that says – actually we’re going to
    get on top of this problem; we’re going to cut emissions – get them to
    safe level before we actually see people dying in large numbers from
    climate change effects – ’cause, certainly, if people start dying,
    then we will see a response – but ideally, you’d like to do it before
    then. But until you get that going, then actually persuading people to
    spend money for no other benefit than sorting out the climate is
    difficult.

    There’s just no point, you know, no country can go it alone, so you
    have to get accommodation. And there, we’re going through various
    processes to debate that. Maybe people will come to an accommodation.
    Maybe the USA and China will agree to tackle climate change. Maybe
    they won’t.

    What I am fairly confident is that you won’t see huge, you know,
    really big cuts in CO2 emissions without that global agreement. But
    I’m also confident that you won’t see big cuts in CO2 emissions
    without CCS deployment.

    And my guess is there’s about a 50:50 chance that we do CCS before we
    need to, and about a 50:50 chance we do it after we have to. But I’m
    pretty damn certain we’re going to do it.

    [ Tom Heap ]

    But we can’t wait for a global agreement that’s already been decades
    in the making, with still no end in sight.

    We need decisions now to provide more power with less pollution.

    [ Music lyrics : “What’s the plan ? What’s the plan ?” ]

    [ Tom Heap ]

    Dieter Helm, Professor of Energy Policy at the University of Oxford
    believes we can only deliver our plentiful green energy future if we
    abandon our attitude of buy-now pay-later.

    [ KLAXON ! Does he mean a kind of hire purchase energy economy ?
    I mean, we’re still paying for nuclear electricity from decades ago,
    in our bills, and through our taxes to the Department of Energy and
    Climate Change. ]

    [ Dieter Helm ]

    There’s a short-term requirement and a long-term requirement. The
    short-term requirement is that we’re now in a real pickle. We face
    this energy crunch. We’ve got to try to make the best of what we’ve
    got. And I think it’s really like, you know, trying to get the
    Spitfires back up again during the Battle of Britain. You know, you
    patch and mend. You need somebody in command. You need someone
    in control. And you do the best with what you’ve got.

    In that context, we then have to really stand back and say, “And this
    is what we have to do to get a serious, long-term, continuous, stable
    investment environment, going forward.” In which, you know, we pay the
    costs, but of course, not any monopoly profits, not any excess
    profits, but we have a world in which the price of electricity is
    related to the cost.”

    [ KLAXON ! Is Dieter Helm proposing state ownership of energy plant ? ]

    29:04

    [ Programme anchor ]

    “Costing the Earth” was presented by Tom Heap, and made in Bristol by
    Helen Lennard.

    [ Next broadcast : 16th October 2013, 21:00, BBC Radio 4 ]

  • High Stakes Energy Chutzpah

    Posted on October 15th, 2013 Jo No comments





    Image Credit : Carbon Brief


    After Gordon Brown MP, the UK’s former Prime Minister, was involved in several diplomatic missions around the time of the oil price spike crisis in 2008, and the G20 group of countries went after fossil fuel subsidies (causing easily predictable civil disturbances in several parts of the world), it seemed to me to be obvious that energy price control would be a defining aspect of near-term global policy.

    With the economy still in a contracted state (with perhaps further contraction to follow on), national interest for industrialised countries rests in maintaining domestic production and money flows – meaning that citizens should not face sharply-rising utility bills, so that they can remain active in the economy.

    In the UK, those at the fringe of financial sustainability are notoriously having to face the decision about whether to Eat or Heat, and Food Banks are in the ascendance. Various charity campaigns have emphasised the importance of affordable energy at home, and the leader of the Labour Party, Ed Miliband MP has made an energy price freeze a potential plank of his policy ahead of the push for the next General Election.

    The current Prime Minister, David Cameron MP has called this commitment a “con”, as his political counterpart cannot determine the wholesale price of gas (or power) in the future.

    This debate comes at a crucial time in the passage of the UK Energy Bill, as the Electricity Market Reform (EMR), a key component of this legislation has weighty subsidies embedded in it for new nuclear power and renewable energy, and also backup plants (mostly Natural Gas-fired) for periods of high power demand, in what is called the “Capacity Market“. These subsidies will largely be paid for by increases in electricity bills, in one way or another.

    The EMR hasn’t yet passed into the statute books, so the majority of “green energy taxes” haven’t yet coming into being – although letters of “comfort” may have been sent to to (one or more) companies seeking to invest in new nuclear power facilities, making clear the UK Government’s monetary commitment to fully supporting the atomic “renaissance”.

    With a bucketload of chutzpah, Scottish and Southern Energy (SSE) and Electricite de France’s Vincent de Rivaz blamed green energy policies for contributing to past, current and future power price rises. Both of these companies stand to gain quite a lot from the EMR, so their blame-passing sounds rather hollow.

    The Daily Mail and the Daily Telegraph have seemed to me to be incendiary regarding green energy subsidies, omitting to mention that whilst the trajectory of the cost of state support for renewable energy is easily calculated, volatility in global energy markets for gas and oil – and even coal – are indeterminable. Although “scandal-hugging” (sensation equals sales) columnists and editors at the newspapers don’t seem to have an appreciation of what’s really behind energy price rises, the Prime Minister – and Ed Davey MP – have got it – and squarely placed the responsibility for energy price rises on fossil fuels.

    The price tag for “green energy policies” – even those being offered to (low carbon, but not “green”) nuclear power – should be considerably less than the total bill burden for energy, and hold out the promise of energy price stabilisation or even suppression in the medium- to long-term, which is why most political parties back them.

    The agenda for new nuclear power appears to be floundering – it has been suggested by some that European and American nuclear power companies are not solvent enough to finance a new “fleet” of reactors. In the UK, the Government and its friends in the nuclear industry are planning to pull in east Asian investment (in exchange for large amounts of green energy subsidies, in effect). I suspect a legal challenge will be put forward should a trade agreement of this nature be signed, as soon as its contents are public knowledge.

    The anger stirred up about green energy subsidies has had a reaction from David Cameron who has not dispensed with green energy policy, but declared that subsidies should not last longer than they are needed – probably pointing at the Germany experience of degressing the solar power Feed-in Tariff – although he hasn’t mentioned how nuclear subsidies could be ratcheted down, since the new nuclear programme will probably have to rely on state support for the whole of its lifecycle.

    Meanwhile, in the Press, it seems that green energy doesn’t work, that green energy subsidies are the only reason for energy bill rises, we should drop the Climate Change Act, and John Prescott MP, and strangely, a woman called Susan Thomas, are pushing coal-fired power claiming it as the cheaper, surer – even cleaner – solution, and there is much scaremongering about blackouts.




    http://www.mirror.co.uk/news/uk-news/john-prescott-its-coal-power-2366172

    John Prescott on why it’s coal power to the people

    12 Oct 2013

    We can’t just stand back and give these energy companies money to burn.

    It’s only 72 days until Christmas. But the greedy big six energy companies are giving themselves an early present. SSE has just announced an inflation-beating 8.2 per cent price rise on gas and electricity.

    The other five will soon follow suit, no doubt doing their best to beat their combined profit from last year of £10billion.

    Their excuse now is to blame climate change. SSE says it could cut bills by £110 if Government, not the Big Six, paid for green energy ­subsidies and other environmental costs, such as free loft insulation.

    So your bill would look smaller but you’d pay for it with higher taxes. Talk about smoke and mirrors.

    But Tory-led governments have always been hopeless at protecting the energy security of this country.

    It’s almost 40 years since Britain was hit by blackouts when the Tories forced the UK into a three-day week to conserve energy supplies.

    But Ofgem says the margin of ­security between energy demand and supply will drop from 14 per cent to 4 per cent by 2016. That’s because we’ve committed to closing nine oil and coal power stations to meet EU ­environmental law and emissions targets. These targets were meant to encourage the UK to move to cleaner sources of energy.

    But this government drastically reduced subsidies for renewable energy such as wind and solar, let Tory energy ministers say “enough is enough” to onshore wind and failed to get agreement on replacing old
    nuclear power stations.

    On top of that, if we experience a particularly cold winter, we only have a reserve of 5 per cent.

    But the Government is committed to hundreds of millions pounds of subsidies to pay the energy ­companies to mothball these oil and coal power stations. As someone who ­negotiated the first Kyoto agreement in 1997 and is involved in its replacement by 2015, it is clear European emissions targets will not be met in the short term by 2020.

    So we have to be realistic and do what we can to keep the lights on, our people warm and our country running.

    We should keep these oil and coal power stations open to reduce the risk of blackouts – not on stand-by or mothballed but working now.

    The former Tory Energy minister John Hayes hinted at this but knew he couldn’t get it past his Lib Dem Energy Secretary boss Ed Davey. He bragged he’d put the coal in coalition. Instead he put the fire in fired.

    We can’t just stand back and give these energy companies money to burn. The only energy security they’re interested in is securing profit and maximising taxpayer subsidies.

    That’s why Ed Miliband’s right to say he’d freeze bills for 20 months and to call for more ­transparency.

    We also need an integrated mixed energy policy – gas, oil, wind, nuclear and, yes, coal.




    http://www.oxfordmail.co.uk/yoursay/letters/10722697.Bills_have_risen_to_pay_for_policy_changes/?ref=arc

    Letters

    Bills have risen to pay for policy changes

    Tuesday 8th October 2013

    in Letters

    THE recent Labour Party pledge to freeze energy bills demonstrated how to have a political cake and eat it. The pledge is an attempt to rectify a heinous political mistake caused by political hubris and vanity.

    In 2008, the then energy minister, Ed Miliband, vowed to enact the most stringent cuts in power emissions in the entire world to achieve an unrealistic 80 per cent cut in carbon emissions by closing down fully functioning coal power stations.

    He was playing the role of climate saint to win popularity and votes.

    I was a member when Ed Miliband spoke in Oxford Town Hall to loud cheers from numerous low-carbon businesses, who stood to profit from his legislation. I was concerned at the impact on the consumer, since it is widely known that coal power stations offer the cheapest energy to consumers compared to nuclear and wind.

    So I wrote to Andrew Smith MP at great length and he passed on my concerns to the newly-formed Department of Energy and Climate Change that had replaced the previous Department of Energy and Business.

    This new department sent me a lengthy reply, mapping out their plans for wind turbines at a projected cost to the consumer of £100bn to include new infrastructure and amendments to the National Grid. This cost would be added to consumer electricity bills via a hidden green policy tariff.
    This has already happened and explains the rise in utility bills.

    Some consumers are confused and wrongly believe that energy companies are ‘ripping them off’.

    It was clearly stated on Channel 4 recently that energy bills have risen to pay for new policy changes. These policy changes were enacted by Ed Miliband in his popularity bid to play climate saviour in 2008. Energy bills have now rocketed. So Ed has cost every single consumer in the land several hundred pounds extra on their bills each year.

    SUSAN THOMAS, Magdalen Road, Oxford




    LETTERS
    Daily Mail
    14th October 2013

    [ Turned off: Didcot power station’s closure could lead to power cuts. ]

    Labour’s power failures will cost us all dear

    THE Labour Party’s pledge to freeze energy bills is an attempt to rectify a horrible political mistake. But it might be too late to dig us out of the financial black hole caused by political vanity.

    In 2008, then Energy Minister Ed Miliband vowed to enact the most stringent cuts in power emissions in the world to achieve an unrealistic 80 per cent cut in carbon emissions by closing down coal power stations. He was playing the role of climate saint to win votes.

    I was in the audience in Oxford Town Hall that day and recall the loud cheers from numerous representatives of low-carbon businesses as his policies stood to make them all rather wealthy, albeit at the expense of every electricity consumer in the land.

    I thought Ed had become entangled in a spider’s web.

    I was concerned at the impact on the consumer as it’s widely known that coal power stations offer the cheapest energy to consumers.

    I contacted the Department of Energy and Climate Change and it sent me a lengthy reply mapping out its plans for energy projects and wind turbines – at a projected cost to the consumer of £100 billion – including new infrastructure and national grid amendments.

    It explained the cost would be added to consumer electricity bills via a ‘green policy’ tariff. This has now happened and explains the rise in utility bills.

    Some consumers wrongly believe the energy companies are ripping them off. In fact, energy bills have risen to pay for policy changes.

    The people to benefit from this are low-carbon venture capitalists and rich landowners who reap subsidy money (which ultimately comes from the hard-hit consumer) for having wind farms on their land.

    Since Didcot power station closed I’ve suffered five power cuts in my Oxford home. If we have a cold winter, we now have a one-in-four chance of a power cut.

    The 2008 legislation was a huge mistake. When power cuts happen, people will be forced to burn filthy coal and wood in their grates to keep warm, emitting cancer-causing particulates.

    Didcot had already got rid of these asthma-causing particulates and smoke. It emitted mainly steam and carbon dioxide which aren’t harmful to our lungs. But the clean, non-toxic carbon dioxide emitted by Didcot was classified by Mr Miliband as a pollutant. We are heading into a public health and financial disaster.

    SUSAN THOMAS, Oxford




    http://www.europeanvoice.com/article/2013/october/ceos-demand-reform-of-eu-renewable-subsidies/78418.aspx

    CEOs demand reform of EU renewable subsidies
    By Dave Keating – 11.10.2013

    Companies ask the EU to stop subsidising the renewable energy sector.

    The CEOs of Europe’s ten biggest energy companies called for the European Union and member states to stop subsidising the renewable energy sector on Friday (11 October), saying that the priority access given to the sector could cause widespread blackouts in Europe over the winter.

    At a press conference in Brussels, Paolo Scaroni, CEO of Italian oil and gas company ENI, said: “In the EU, companies pay three times the price of gas in America, twice the price of power. How can we dream of an industrial renaissance with such a differential?”

    The CEOs said the low price of renewable energy as a result of government subsidies is causing it to flood the market. They called for an EU capacity mechanism that would pay utilities for keeping electric power-generating capacity on standby to remedy this problem.

    They also complained that the low price of carbon in the EU’s emissions trading scheme (ETS) is exacerbating the problem…




    http://www.dailymail.co.uk/debate/article-2458333/DAILY-MAIL-COMMENT-Press-freedom-life-death-matter.html

    Well said, Sir Tim

    Days after David Cameron orders a review of green taxes, which add £132 to power bills, the Lib Dem Energy Secretary vows to block any attempt to cut them.

    Reaffirming his commitment to the levies, which will subsidise record numbers of inefficient wind farms approved this year, Ed Davey adds: ‘I think we will see more price rises.’

    The Mail can do no better than quote lyricist Sir Tim Rice, who has declined more than £1million to allow a wind farm on his Scottish estate. ‘I don’t see why rich twits like me should be paid to put up everybody else’s bills,’ he says. ‘Especially for something that doesn’t work.’

  • Wind Powers Electricity Security

    Posted on August 17th, 2013 Jo No comments




    Have the anti-wind power lobby struck again ? A seemingly turbulent researcher from Private Eye magazine rang me on Thursday evening to ask me to revise my interpretation of his “Keeping The Lights On” piece of a few weeks previously. His article seemed at first glance to be quite derogatory regarding the contribution of wind power to the UK’s electricity supply. If I were to look again, I would find out, he was sure, that I was wrong, and he was right.

    So I have been re-reviewing the annual 2013 “Electricity Capacity Assessment Report” prepared by Ofgem, the UK Government’s Office of Gas and Electricity Markets, an independent National Regulatory Authority. I have tried to be as fair-minded and generous as possible to “Old Sparky” at Private Eye magazine, but a close re-reading of the Ofgem report suggests he is apparently mistaken – wind power is a boon, not a burden (as he seems to claim).

    In the overview to the Ofgem report, they state, “our assessment suggests that the risks to electricity security of supply over the next six winters have increased since our last report in October 2012. This is due in particular to deterioration in the supply-side outlook. There is also uncertainty over projected reductions in demand.” Neither of these issues can be associated with wind power, which is being deployed at an accelerating rate and so is providing increasing amounts of electricity.

    The report considers risks to security of the electricity supply, not an evaluation of the actual amounts of power that will be supplied. How are these risks to the security of supply quantified ? There are several metrics provided from Ofgem’s modelling, including :-

    a. LOLE – Loss of Load Expectation – the average number of hours per year in which electricity supply does not meet electricity demand (if the grid System Operator does not take steps to balance it out).

    (Note that Ofgem’s definition of LOLE is difference from other people’s “LOLE is often interpreted in the academic literature as representing the probability of disconnections after all mitigation actions available to the System Operator have been exhausted. We consider that a well functioning market should avoid using mitigation actions in [sic] regular basis and as such we interpret LOLE as the probability of having to implement mitigation actions.”)

    b. EEU – Expected Energy Unserved (or “Un-served”) – the average amount of electricity demand that is not met in a year – a metric that combines both the likelihood and the size of any shortfall.

    c. Frequency and Duration of Expected Outages – a measure of the risk that an electricity consumer faces of controlled disconnection because supply does not meet demand.

    The first important thing to note is that the lights are very unlikely to go out. The highest value of LOLE, measured in hours per year is under 20. That’s 20 hours each year. Not 20 days. And this is not anticipated to be 20 days in a row, either. Section 1.11 says “LOLE, as interpreted in this report, is not a measure of the expected number of hours per year in which customers may be disconnected. For a given level of LOLE and EEU, results may come from a large number of small events where demand exceeds supply in principle but that can be managed by National Grid through a set of mitigation actions available to them as System Operator. […] Given the characteristics of the GB system, any shortfall is more likely to take the form of a large number of small events that would not have a direct impact on customers.”

    Section 2.19 states, “The probabilistic measures of security of supply presented in this report are often misinterpreted. LOLE is the expected number of hours per year in which supply does not meet demand. This does not however mean that customers will be disconnected or that there will be blackouts for that number of hours a year. Most of the time, when available supply is not high enough to meet demand, National Grid may implement mitigation actions to solve the problem without disconnecting any customers. However, the system should be planned to avoid the use of mitigation actions and that is why we measure LOLE ahead of any mitigation actions being used”. And Section 2.20, “LOLE does not necessarily mean disconnections but they do remain a possibility. If the difference between available supply and demand is so large that the mitigation actions are not enough to meet demand then some customers have to be disconnected – this is the controlled disconnections step in Figure 14 above. In this case the [System Operator] SO will disconnect industrial demand before household demand.”

    And in Section 2.21. “The model output numbers presented here refer to a loss of load of any kind. This could be the sum of several small events (controlled through mitigation actions) or a single large event. As a consequence of the mitigation actions available, the total period of disconnections for a customer will be lower than the value of LOLE.”

    The report does anticipate that there are risks of large events where the lights could go out, even if only very briefly, for non-emergency customers : “The results may also come from a small number of large events (eg the supply deficit is more than 2 – 3 gigawatts (GW)) where controlled disconnections cannot be avoided.” But in this kind of scenario two very important things would happen. Those with electricity contracts with a clause permitting forced disconnection would lose power. And immediate backup power generation would be called upon to bridge the gap. There are many kinds of electricity generation that can be called on to start up in a supply crisis – some of them becoming operational in minutes, and others in hours.

    As the report says in Section 2.24 “Each [Distribution Network Operator] DNO ensures it can provide a 20% reduction of its total system demand in four incremental stages (between 4% and 6%), which can be achieved at all times, with or without prior warning, and within 5 minutes of receipt of an instruction from the System Operator. The reduction of a further 20% (40% in total) can be achieved following issue of the appropriate GB System Warning by National Grid within agreed timescales”.

    It’s all about the need for National Grid to balance the system. Section 2.9 says, “LOLE is not a measure of the expected number of hours per year in which customers may be disconnected. We define LOLE to indicate the number of hours in which the system may need to respond to tight conditions.”

    The report also rules some potential sources of disruption of supply outside the remit of this particular analysis – see Section 3.17 “There are other reasons why electricity consumers might experience disruptions to supply, which are out of the scope of this assessment and thus not captured by this model, such as: Flexibility : The ability of generators to ramp up in response to rapid increases in demand or decreases in the output of other generators; Insufficient reserve : Unexpected increases in demand or decreases in available capacity in real time which must be managed by the System Operator through procurement and use of reserve capacity; Network outages : Failures on the electricity transmission or distribution networks; Fuel availability : The availability of the fuel used by generators. In particular the security of supplies of natural gas at times of peak electricity demand.”

    Crucially, the report says there is much uncertainty in their modelling of LOLE and EEU. In Section 2.26, “The LOLE and EEU estimates are just an indication of risk. There is considerable uncertainty around the main variables in the calculation (eg demand, the behaviour of interconnectors etc.)”

    (Note : interconnectors are electricity supply cables that join the UK to other countries such as Ireland and Holland).

    Part of the reason for Ofgem’s caveat of uncertainty is the lack of appropriate data. Although they believe they have better modelling of wind power since their 2012 report (see Sections 3.39 to 3.50), there are data sets they believe should be improved. For example, data on Demand Side Response (DSR) – the ability of the National Grid and its larger or aggregated consumers to alter levels of demand on cue (see Sections 4.7 to 4.10 of the document detailing decisions about the methodology). A lack of data has led to certain assumptions being retained, for example, the assumption that there is no relationship between available wind power and periods of high demand – in the winter season (see Section 2.5 and Sections 4.11 to 4.17 of the methodology decisions document).

    In addition to these uncertainties, the sensitivity cases used in the modelling are known to not accurately reflect the capability of management of the power grid. In the Executive Summary on page 4, the report says, “These sensitivities only illustrate changes in one variable at a time and so do not capture potential mitigating effects, for example of the supply side reacting to higher demand projections.” And in Section 2.16 it says, “Each sensitivity assumes a change in one variable from the Reference Scenario, with all other assumptions being held constant. The purpose of this is to assess the impact of the uncertainty related to each variable in isolation, on the risk measures. Our report is not using scenarios (ie a combination of changes in several variables to reflect alternative worlds or different futures), as this would not allow us to isolate the impact of each variable on the risk measures.”

    Thus, the numbers that are output by the modelling are perforce illustrative, not definitive.

    What “Old Sparky” at Private Eye was rattled by in his recent piece was the calculation of Equivalent Firm Capacity (EFC) in the Ofgem report.

    On page 87, Section 3.55, the Ofgem report defines the “standard measure” EFC as “the amount of capacity that is required to replace the wind capacity to achieve the same level of LOLE”, meaning the amount of always-on generation capacity required to replace the wind capacity to achieve the same level of LOLE. Putting it another way on page 33, in the footnotes for Section 3.29, the report states, “The EFC is the quantity of firm capacity (ie always available) that can be replaced by a certain volume of wind generation to give the same level of security of supply, as measured by LOLE.”

    Wind power is different from fossil fuel-powered generation as there is a lot of variability in output. Section 1.48 of the report says, “Wind generation capacity is analysed separately given that its outcome in terms of generation availability is much more variable and difficult to predict.” Several of the indicators calculated for the report are connected with the impact of wind on security of the power supply. However, variation in wind power is not the underlying reason for the necessity of this report. Other electricity generation plant has variation in output leading to questions of security of supply. In addition, besides planned plant closures and openings, there are as-yet-unknown factors that could impact overall generation capacity. Section 2.2 reads, “We use a probabilistic approach to assess the uncertainty related to short-term variations in demand and available conventional generation due to outages and wind generation. This is combined with sensitivity analysis to assess the uncertainty related to the evolution of electricity demand and supply due to investment and retirement decisions (ie mothballing, closures) and interconnector flows, among others.”

    The report examines the possibility that wind power availability could be correlated to winter season peak demand, based on limited available data, and models a “Wind Generation Availability” sensitivity (see Section 3.94 to Section 3.98, especially Figure 64). In Section 3.42 the report says, “For the wind generation availability sensitivity we assume that wind availability decreases at time of high demand. In particular this sensitivity assumes a reduction in the available wind resource for demand levels higher than 92% of the ACS peak demand. The maximum reduction is assumed to be 50% for demand levels higher than 102% of ACS peak demand.” Bear in mind that this is only an assumption.

    In Appendix 5 “Detailed results tables”, Table 34, Table 35 and Table 37 show how this modelling impacts the calculation of the indicative Equivalent Firm Capacity (EFC) of wind power.

    In the 2018/2019 timeframe, when there is expected to be a combined wind power capacity of 8405 megawatts (MW) onshore plus 11705 MW offshore = 20110 MW, the EFC for wind power is calculated to be 2546 MW in the “Wind Generation Availability” sensitivity line, which works out at 12.66% of the nameplate capacity of the wind power. Note : 100 divided by 12.66 is 7.88, or a factor of roughly 8.

    At the earlier 2013/2014 timeframe, when combined wind power capacity is expected to be 3970 + 6235 MW = 10205 MW, and the EFC is at 1624 MW or 15.91% for the “Wind Generation Sensitivity” line. Note : 100 divided by 15.91 = 6.285, or a factor of roughly 6.

    “Old Sparky” is referring to these factor figures when he says in his piece (see below) :-

    “[…] For every one megawatt of reliable capacity (eg a coal-fired power
    station) that gets closed, Ofgem calculates Britain would need six to
    eight
    megawatts of windfarm capacity to achieve the original level of
    reliability – and the multiple is rising all the time. Windfarms are
    not of course being built at eight times the rate coal plants are
    closing – hence the ever-increasing likelihood of blackouts. […]”

    Yet he has ignored several caveats given in the report that place these factors in doubt. For example, the sensitivity analysis only varies one factor at a time and does not attempt to model correlated changes in other variables. He has also omitted to consider the relative impacts of change.

    If he were to contrast his statement with the “Conventional Low Generation Availability” sensitivity line, where wind power EFC in the 2013/2014 timeframe is calculated as a healthy 26.59% or a factor of roughly 4; or 2018/2019 when wind EFC is 19.80% or a factor of roughly 5.

    Note : The “Conventional Low Generation Availability” sensitivity is drawn from historical conventional generation operating data, as outlined in Sections 3.31 to 3.38. Section 3.36 states, “The Reference Scenario availability is defined as the mean availability of the seven winter estimates. The availability values used for the low (high) availability sensitivities are defined as the mean minus (plus) one standard deviation of the seven winter estimates.”

    Table 30 and Table 31 show that low conventional generation availability will probably be the largest contribution to energy security uncertainty in the critical 2015/2016 timeframe.

    The upshot of all of this modelling is that wind power is actually off the hook. Unforeseen alterations in conventional generation capacity are likely to have the largest impact. As the report says in Section 4.21 “The figures indicate that reasonably small changes in conventional generation availability have a material impact on the risk of supply shortfalls. This is most notable in 2015/16, where the estimated LOLE ranges from 0.2 hours per year in the high availability sensitivity to 16 hours per year in the low availability sensitivity, for the Reference Scenario is 2.9 hours per year.”

    However, Section 1.19 is careful to remind us, “Wind generation, onshore and offshore, is expected to grow rapidly in the period of analysis and especially after 2015/16, rising from around 9GW of installed capacity now to more than 20GW by 2018/19. Given the variability of wind speeds, we estimate that only 17% of this capacity can be counted as firm (ie always available) for security of supply purposes by 2018/19.” This is in the Reference Scenario.

    The sensitivities modelled in the report are a measure of risk, and do not provide absolute values for any of the output metrics, especially since the calculations are dependent on so many factors, including economic stimulus for the building of new generation plant.

    Importantly, recent decisions by gas-fired power plant operators to “mothball”, or close down their generation capacity, are inevitably going to matter more than how much exactly we can rely on wind power.

    Many commentators neglect to make the obvious point that wind power is not being used to replace conventional generation entirely, but to save fossil fuel by reducing the number of hours conventional generators have to run. This is contributing to energy security, by reducing the cost of fossil fuel that needs to be imported. However, the knock-on effect is this is having an impact on the economic viability of these plant because they are not always in use, and so the UK Government is putting in place the “Capacity Mechanism” to make sure that mothballed plant can be put back into use when required, during those becalmed, winter afternoons when power demand is at its peak.




    Private Eye
    Issue Number 1345
    26th July 2013 – 8th August 2013

    “Keeping the Lights On”
    page 14
    by “Old Sparky”

    The report from energy regulator Ofgem that sparked headlines on
    potential power cuts contains much new analysis highlighting the
    uselessness of wind generation in contributing to security of
    electricity supply, aka the problem of windfarm “intermittency”. But
    the problem is being studiously ignored by the Department of Energy
    and Climate Change (DECC).

    As coal power stations shut down, windfarms are notionally replacing
    them. If, say, only one windfarm were serving the grid, its inherent
    unreliability could easily be compensated for. But if there were
    [italics] only windfarms, and no reliable sources of electricity
    available at all, security of supply would be hugely at risk. Thus the
    more windfarms there are, the less they contribute to security.

    For every one megawatt of reliable capacity (eg a coal-fired power
    station) that gets closed, Ofgem calculates Britain would need six to
    eight megawatts of windfarm capacity to achieve the original level of
    reliability – and the multiple is rising all the time. Windfarms are
    not of course being built at eight times the rate coal plants are
    closing – hence the ever-increasing likelihood of blackouts.

    […]

    In consequence windfarms are being featherbedded – not only with
    lavish subsidies, but also by not being billed for the ever-increasing
    trouble they cause. When the DECC was still operating Plan B, aka the
    dash for gas ([Private] Eye [Issue] 1266), the cost of intermittency
    was defined in terms of balancing the grid by using relatively clean
    and cheap natural gas. Now that the department has been forced to
    adopt emergency Plan C ([Private] Eye [Issue] 1344), backup for
    intermittent windfarm output will increasingly be provided by dirty,
    expensive diesel generators.




    Private Eye
    Issue 1344
    12 – 25 July 2013

    page 15
    “Keeping the Lights On”

    As pandemonium breaks out in newspapers at the prospect of electricity
    blackouts, emergency measures are being cobbled together to ensure the
    lights stay on. They will probably succeed – but at a cost.

    Three years ago incoming coalition ministers were briefed that when
    energy policy Plan A (windfarms, new nukes and pixie-dust) failed, Plan B
    would be in place – a new dash for gas ([Private] Eye [Issue] 1266).

    Civil servants then devised complex “energy market reforms” (EMR) to make
    this happen. It is now clear that these, too, have failed. Coal-fired power
    stations are closing quicker than new gas plants are being built. As energy
    regulator Ofgem put it bluntly last week: “The EMR aims to incentivise
    industry to address security of supply in the medium term, but is not able
    to bring forward investment in new capacity in time.”

    Practical people in the National Grid are now hatching emergency Plan C.
    They will pay large electricity users to switch off when requested;
    encourage industrial companies and even hospitals to generate their own
    diesel-fired electricity (not a hard sell when the grid can’t be relied
    on); hire diesel generators to make up for the intermittency of windfarms
    ([Private] Eye [Issue] 1322); and bribe electricity companies to bring
    mothballed gas-fired plants back into service.

    Some of these steps are based on techniques previously used in extreme
    circumstances, and will probably keep most of the lights on. But this
    should not obscure the fact that planning routine use of emergency
    measures is an indictment of energy policy. And since diesel is much
    more expensive and polluting than gas, electricity prices and CO2
    emissions will be higher than if Plan B had worked.

    […]

    ‘Old Sparky’




  • Ed Davey : Polish Barbecue

    Posted on July 12th, 2013 Jo 1 comment



    This week, both Caroline Flint MP and Ed Balls MP have publicly repeated the commitment by the UK’s Labour Party to a total decarbonisation of the power sector by 2030, should they become the governing political party. At PRASEG’s Annual Conference, Caroline Flint said “In around ten years time, a quarter of our power supply will be shut down. Decisions made in the next few years […] consequences will last for decades […] keeping the lights on, and [ensuring reasonably priced] energy bills, and preventing dangerous climate change. […] Labour will have as an election [promise] a legally binding target for 2030. […] This Government has no vision.”

    And when I was in an informal conversation group with Ed Davey MP and Professor Mayer Hillman of the Policy Studies Institute at a drinks reception after the event hosted by PRASEG, the Secretary of State for Energy and Climate Change seemed to me to also be clear on his personal position backing the 2030 “decarb” target.

    Ed Davey showed concern about the work necessary to get a Europe-wide commitment on Energy and Climate Change. He took Professor Hillman’s point that carbon dioxide emissions from the burning of fossil fuels are already causing dangerous climate change, and that the risks are increasing. However, he doubted that immediate responses can be made. He gave the impression that he singled out Poland of all the countries in the European Union to be an annoyance, standing in the way of success. He suggested that if Professor Hillman wanted to do something helpful, he could fly to Poland…at this point Professor Hillman interjected to say he hasn’t taken a flight in 70 years and doesn’t intend to now…and Ed Davey continued that if the Professor wanted to make a valuable contribution, he could travel to Poland, taking a train, or…”I don’t care how you get there”, but go to Poland and persuade the Poles to sign up to the 2030 ambition.

    Clearly, machinations are already afoot. At the PRASEG Annual Conference were a number of communications professionals, tightly linked to the debate on the progress of national energy policy. Plus, one rather exceedingly highly-networked individual, David Andrews, the key driver behind the Claverton Energy Research Group forum, of which I am an occasional participant. He had ditched the normal navy blue polyester necktie and sombre suit for a shiveringly sharp and open-necked striped shirt, and was doing his best to look dapper, yet zoned. I found him talking to a communications professional, which didn’t surprise me. He asked how I was.

    JA : “I think I need to find a new job.”
    DA : “MI6 ?”
    JA : “Too boring !”

    What I really should have said was :-

    JA : “Absolutely and seriously not ! Who’d want to keep State Secrets ? Too much travel and being nice to people who are nasty. And making unbelievable compromises. The excitement of privilege and access would wear off after about six minutes. Plus there’s the risk of ending up decomposing in something like a locked sports holdall in some strange bathroom in the semblance of a hostelry in a godforsaken infested hellhole in a desolate backwater like Cheltenham or Gloucester. Plus, I’d never keep track of all the narratives. Or the sliding door parallel lives. Besides, I’m a bit of a Marmite personality – you either like me or you really don’t : I respond poorly to orders, I’m not an arch-persuader and I’m not very diplomatic or patient (except with the genuinely unfortunate), and I’m well-known for leaping into spats. Call me awkward (and some do), but I think national security and genuine Zero Carbon prosperity can be assured by other means than dark arts and high stakes threats. I like the responsibility of deciding for myself what information should be broadcast in the better interests of the common good, and which held back for some time (for the truth will invariably out). And over and above all that, I’m a technologist, which means I prefer details over giving vague impressions. And I like genuine democratic processes, and am averse to social engineering. I am entirely unsuited to the work of a secret propaganda and diplomatic unit.”

    I would be prepared to work for a UK or EU Parliamentary delegation to Poland, I guess, if I could be useful in assisting with dialogue, perhaps in the technical area. I do after all have several academic degrees pertinent to the questions of Energy and Climate Change.

    But in a room full of politicians and communications experts, I felt a little like a fished fish. Here, then, is a demonstration. I was talking with Rhys Williams, the Coordinator of PRASEG, and telling him I’d met the wonderful Professor Geoff Williams, of Durham Univeristy, who has put together a system of organic light emitting diode (LED) lighting and a 3-D printed control unit, and, and, and Rhys actually yawned. He couldn’t contain it, it just kind of spilled out. I told myself : “It’s not me. It’s the subject matter”, and I promptly forgave him. Proof, though, of the threshold for things technical amongst Westminster fixers and shakers.

    Poland. I mean, I know James Delingpole has been to Poland, and I thought at the time he was possibly going to interfere with the political process on climate change, or drum up support for shale gas. But I’m a Zero Carbon kind of actor. I don’t need to go far to start a dialogue with Poland by going to Poland – I have Poles living in my street, and I’m invited to all their barbecues. Maybe I should invite Professor Mayer Hillman to cycle over to Waltham Forest and address my near neighbours and their extended friendship circle on the importance of renewable energy and energy efficiency targets, and ask them to communicate with the folks back home with any form of influence.

  • Birdcage Walk : Cheesestick Rationing

    Posted on July 12th, 2013 Jo 1 comment


    Yesterday…no, it’s later than I think…two days ago, I attended the 2013 Conference of PRASEG, the Parliamentary Renewable and Sustainable Energy Group, at the invitation of Rhys Williams, the long-suffering Coordinator. “…Sorry…Are you upset ?” “No, look at my face. Is there any emotion displayed there ?” “No, you look rather dead fish, actually”, etc.

    At the prestigious seat of the Institute of Mechanical Engineers (IMechE), One Birdcage Walk, we were invited down into the basement for a “drinks reception”, after hearing some stirring speeches and intriguing panel discussions. Despite being promised “refreshments” on the invitation, there had only been beverages and a couple of bikkies up until now, and I think several of the people in the room were starting to get quite hypoglycemic, so were grateful to see actual food being offered.

    A market economy immediately sprang up, as there was a definite scarcity in the resources of cheesesticks, and people jostled amiably, but intentionally, so they could cluster closest to the long, crispy cow-based snacks. The trading medium of exchange was conversation. “Jo, meet Mat Hope from Carbon Brief, no Maf Smith from Renewable UK. You’ve both been eviscerated by Delingpole online”, and so on.

    “Welcome to our own private pedestal”, I said to somebody, who it turned out had built, probably in the capacity of developer, a sugarcane bagasse Combined Heat and Power plant. The little table in the corner had only got room around it for three or at most four people, and yet had a full complement of snack bowls. Bonus. I didn’t insist on memorising what this fellow told me his name was. OK, I didn’t actually hear it above the hubbub. And he was wearing no discernible badge, apart from what appeared to be the tinge of wealth. He had what looked like a trailing truculent teenager with him, but that could have been a figment of my imagination, because the dark ghost child spoke not one word. But that sullenness, and general anonymity, and the talkative gentleman’s lack of a necktie, and his slightly artificial, orange skin tone, didn’t prevent us from engaging wholeheartedly in a discussion about energy futures – in particular the default options for the UK, since there is a capacity crunch coming very soon in electricity generation, and new nuclear power reactors won’t be ready in time, and neither will Carbon Capture and Storage-fitted coal-fired power plants.

    Of course, the default options are basically Natural Gas and wind power, because large amounts can be made functional within a five year timeframe. My correspondent moaned that gas plants are closing down in the UK. We agreed that we thought that new Combined Cycle Gas Turbine plant urgently needs to be built as soon as possible – but he despaired of seeing it happen. He seemed to think it was essential that the Energy Bill should be completed as soon as possible, with built-in incentives to make Gas Futures a reality.

    I said, “Don’t wait for the Energy Bill”. I said, “Intelligent people have forecast what could happen to Natural Gas prices within a few years from high European demand and UK dependence, and are going to build gas plant for themselves. We simply cannot have extensions on coal-fired power plants…” He agreed that the Large Combustion Plant Directive would be closing the coal. I said that there was still something like 20 gigawatts of permissioned gas plant ready to build – and with conditions shaping up like they are, they could easily get financed.

    Earlier, Nigel Cornwall, of Cornwall Energy had put it like this :-

    “Deliverability and the trilemma [meeting all three of climate change, energy security and end-consumer affordability concerns] [are key]. Needs to be some joined-up thinking. […] There is clearly a deteriorating capacity in output – 2% to 5% reduction. As long as I’ve worked in the sector it’s been five minutes to midnight, [only assuaged by] creative thinking from National Grid.”

    However, the current situation is far from bog standard. As Paul Dickson of Glennmont Partners said :-

    “£110 billion [is needed] to meet the [electricity generation] gap. We are looking for new sources of capital. Some of the strategic institutional capital – pension funds [for example] – that’s who policy needs to be directed towards. We need to look at sources of capital.”

    Alistair Buchanan, formerly of Ofgem, the power sector regulator, and now going to KPMG, spent the last year or so of his Ofgem tenure presenting the “Crunch Winter” problem to as many people as he could find. His projections were based on a number of factors, including Natural Gas supply questions, and his conclusion was that in the winter of 2015/2016 (or 2016/2017) power supply could get thin in terms of expansion capacity – for moments of peak demand. Could spell crisis.

    The Government might be cutting it all a bit fine. As Jenny Holland of the Association for the Conservation of Energy said :-

    “[Having Demand Reduction in the Capacity Mechanism] Not our tip-top favourite policy outcome […] No point to wait for “capacity crunch” to start [Energy Demand Reduction] market.”

    It does seem that people are bypassing the policy waiting queue and getting on with drawing capital into the frame. And it is becoming more and more clear the scale of what is required. Earlier in the afternoon, Caroline Flint MP had said :-

    “In around ten years time, a quarter of our power supply will be shut down. Decisions made in the next few years. Consequences will last for decades. Keeping the lights on, and [ensuring reasonably priced] energy bills, and preventing dangerous climate change.”

    It could come to pass that scarcity, not only in cheesesticks, but in electricity generation capacity, becomes a reality. What would policy achieve then ? And how should Government react ? Even though Lord Deben (John Gummer) decried in the early afternoon a suggestion implying carbon rationing, proposed to him by Professor Mayer Hillman of the Policy Studies Institute, it could yet turn out that electricity demand reduction becomes a measure that is imposed in a crisis of scarcity.

    As I put it to my sugarcane fellow discussionee, people could get their gas for heating cut off at home in order to guarantee the lights and banks and industry stay on, because UK generation is so dependent on Natural Gas-fired power.

    Think about it – the uptake of hyper-efficient home appliances has turned down owing to the contracting economy, and people are continuing to buy and use electronics, computers, TVs and other power-sucking gadgets. Despite all sizes of business having made inroads into energy management, electricity consumption is not shifting downwards significantly overall.

    We could beef up the interconnectors between the UK and mainland Europe, but who can say that in a Crunch Winter, the French and Germans will have any spare juice for us ?

    If new, efficient gas-fired power plants are not built starting now, and wind farms roll out is not accelerated, the Generation Gap could mean top-down Energy Demand Reduction measures.

    It would certainly be a great social equaliser – Fuel Poverty for all !

  • Ed Davey MP, closer

    Posted on July 10th, 2013 Jo 2 comments

    Closer up, Ed Davey MP doesn’t look anything like Wayne Rooney, the soccer star, which is a good thing really, as that impression, drawn from paparazzi photographs mostly, made me fear I could get overwhelmed by alcohol-fuelled footballer charisma or overpowering aftershave, of which Ed Davey appeared to have neither. He did keep flashing an annoying gold signet ring, but he seems to have his sideburns well under control, and my attention was really drawn to the fact that he looks a lot slimmer than last year when he spoke at last year’s Parliamentary Renewable and Sustainable Energy Group or “PRASEG” do, doing a very passable Rooney impression, somehow. As we spoke this evening, in the basement of One Birdcage Walk, I don’t know what he thought I was thinking, but I was wondering : has Ed Davey MP got a “podge coach” ? Or is he indulging in a spot of extra-curricular skin-on-skin activity ? Or is he merely in competition with Ed Balls MP ? It can be so hard to differentiate between one upwardly-mobile and upwardly-weighted political Ed and another these days, and find yourself a Unique Selling Point in Generation Ed.

    I asked the Minister, the Secretary of State for Energy and Climate Change, over some very garlicky olive nibbles, and some evil wasabi peanuts, and some OK OJ, whether I could possibly have heard aright in his comments about Community Energy. Somewhere in the building, a masonry drill had started to rumble, and Ed D had made a reference to “drilling” as he opined on the meaning of “local energy”. I thought he meant shale gas development, and I was hoping to clarify if he really did mean that or not. No. I was wrong. It was a joke.

    Well, OK then. Onwards and outwards. “…So, Ed, I read recently that you would be prepared to consider a bid to build new nuclear reactors from GE Hitachi, who have purchased the company Horizon, which already have planning options in the UK at approved sites. You said you would be prepared to consider them instead of Electricite de France. You’ve said you have a level of strike price in mind, and you’re not prepared to go above it, despite EdF proposals. So, Ed, did you know that in February 2011, you know, just before the Multiple Nuclear Reactor Accident at Fukushima Dai-ichi in Japan, that 24 (actually, it turns out it’s 35) of GE Hitachi’s nuclear reactors in the USA had been warned that they were out of safety compliance owing to buckled control rods ? And that the Nuclear Regulatory Commission had issued a fix notice ? Would reactors in the UK built by GE Hitachi going to be of the same design ?” Ed Davey, wiser than his seemingly youthful football-short wearing years would allow, advised me to address my concerns to the Office for Nuclear Regulation, who would, of course, vet each design thoroughly.

    After which helpful direction, I observed Mayer Hillman, Emeritus Professor of the Policy Studies Institute, regale the slimline Ed D with the news that the Climate Change Act is remiss as it does not include climate change feedbacks in its calculations for the necessary UK carbon emissions reductions. He is right, actually, but it’s a tough argument to push. The IPCC’s Fourth Assessment Report couldn’t include climate change feedback effects, because there were no reliable numbers. In the Fifth Assessment Report, there will be numbers, as Ed Davey noted. I noticed that Ed Davey was as calm as a sleeping dolphin, one eye watchfully open, but he was actually awake and listening, and not being dismissive. I thought to myself, actually, he’s rather polite, and I rather warmed to him. Not too much, of course, because otherwise the climate could have risked significant change.

  • London : Array, Invest, Divest

    Posted on July 8th, 2013 Jo No comments

    Showcasing the London Array offshore wind farm in the last week at its official launch, the UK’s Prime Minister David Cameron said “[…] We are making this country incredibly attractive to invest in […] When it comes to green energy, I think we have one of the clearest, most predictable investment climates. And we’re going to add to that by completing the Energy Bill this year. So, we will have a fantastic market for investors to come and build in. […]” (see below).

    I think developers of solar energy in Britain would disagree quite extensively with his claim that there is a stable regime for green energy. The most effective stimulus tool, the Feed-in Tariff, was applauded and then mauled in short succession by the Conservative-Liberal-Democrat Coalition Government. Installation rates have simply not recovered from chewings from the Treasury attack dog. It’s been boom and then bust, bust, bust, with flurries of activity in summer, but not much more :-

    https://www.gov.uk/government/statistical-data-sets/weekly-solar-pv-installation-and-capacity-based-on-registration-date

    And this despite the yappy enthusiasm (perhaps “big, hairy”, or “big, sexy” ambition) that Greg Barker MP and his Dachshund, Otto, have for sun-fired electricity generation :-

    http://www.solarpowerportal.co.uk/news/barker_once_more_quotes_22gw_by_2020_solar_ambition_2356

    http://www.utilityweek.co.uk/news/news_story.asp?id=198770&title=National+Grid+analysis+clouds+Barker%27s+20GW+solar+ambition

    The Energy Bill should have been finished a long time ago, and I’m pretty sure it would have been, apart from the insane obsession with new nuclear power, which all along was predicted to consist of several kinds of big, chunky subsidy, and shows no signs of being anything other than a bankrolling exercise, even now (and too late to bridge Alistair Buchanan‘s “Crunch Winter” of 2015/2016).

    http://www.bloomberg.com/news/2013-07-02/edf-nuclear-deal-in-u-k-may-take-a-few-months-.html
    “EDF Nuclear Deal in U.K. May Take ‘A Few Months’ : By Alex Morales – Jul 2, 2013 : The U.K. may take “a few months” to agree the price that Electricite de France SA (EDF) will get for power from Britain’s first new nuclear power station in two decades, Energy Secretary Ed Davey suggested. The government has been in talks for months with EDF to agree a so-called strike price the French utility will get for power from a planned plant at Hinkley Point in southwest England. Davey told Parliament’s multi-party Energy and Climate Change Committee he won’t sign a contract with EDF unless it represents “value for money” for consumers. “Even if we agree in the next few months, a nuclear reactor at Hinkley point won’t be producing until the end of this decade at best,” Davey said today. “They have been very constructive negotiations. They are taking some time, and that’s because they are very complicated.”

    http://www.telegraph.co.uk/finance/newsbysector/energy/10164435/Rival-nuclear-companies-cheaper-than-EDF-Ed-Davey-suggests.html
    “[…] Mr Davey told The Guardian that EDF was aware of the strike price that he would agree to and that he was “not going to budge an inch”. He said: “Sometimes people said it is EDF or bust. I would like to do a deal with EDF but we don’t have to. I was in Korea and Japan recently talking to other investors and vendors. Their interest in the UK market was massive. I got the very strong impression that the sort of price I was happy to agree with EDF, they could match.” In the same interview he said: “We have other nuclear options. Hitachi are very live options. They bought Horizon only last year and their pace of progress is truly impressive.” He noted that Hitachi had delivered four reactors “on time and on budget”. […]”

    But the most serious contention that I have with David Cameron’s remarks is his painting a picture that the UK needs international capital to reach down from geostationary orbit, or where it is a bit lower, in transcontinential flight at 35,000 feet, to touch and bless the UK with its gilded finger of providence.

    Don’t we have any investors in Britain ? We may have only a few, small British companies that can build green energy for us, but we do have a lot of wealth lurking within these very shores, or representatives of a lot of wealth. Could we not demand that those who shore their cash in Britain, and take advantage of cheap corporate tax deals, invest in British green energy ? Could we not make green energy investment a sine qua non of the residence or passsage of wealth in and through the City of London ?

    Many people in Great Britain have pensions, and those pensions have funds, and those funds have fund managers. There’s a lot of money, right there. What are the criteria that govern pension pot investment ?

    And then there’s the banks. Almost everyone in the UK has a bank account. Are the banks held to policies to direct finance and investment towards green energy and clean tech ? Do their customers demand it ?

    Why does the UK Government not stipulate that “best value for money” as a criteria on all contracts of procurement – and investment – has to be matched by “best carbon emissions reduction potential” ?

    Or are we in such an austere position that we need to offer huge, fattened sweeteners from the Treasury tax honeypot, and permission to raise already high power prices for customers, to any international engineering firm prepared to pour concrete here, so that they can arrange for the finance this guarantees ? Why are we in a position where we are being forced to throw public money and billpayer burdens at private companies to guarantee new energy build ?

    This looks like a worse deal than PFI. In fact, it is much, much worse that the Private Finance Inititative, or the revamped new acronyms that replaced it. This is the wholesale gifting of large amounts of annual tax revenue and fingerlicking kilowatt hour prices to large, transnational corporations. If the economy gets worse, which it probably will, these big new construction projects may never get completed. And the new national energy infrastructure that does manage to get built won’t even be ours. Unless they go wrong, in which case the country will have to pay to mop them up. Or at the end of life, when the taxpayers and billpayers will need to pay to decommission nuclear reactors and dispose of radioactive waste.

    And while we’re on the subject of investment, I need to point out that not all big infrastructure projects are alike. Some development is good, some bad. I don’t really see how the Olympic building spree can be compared in any way to what’s necessary for creating a decarbonised energy system. And building larger ports, and roads, and airports, anticipates higher levels of traded goods – the kind of economic growth that caused climate change in the first place.

    If David Cameron wants to crow about big projects and be praised for it, he needs to de-select examples that are unsustainable.

    There really needs to be more focus on what we really need for the future, and that requires discernment in investment. It requires moving away from high consumption models of economy, of divesting from stocks and shares in waste, pollution, carbon emissions and unnecessary trade.

    Invest, yes, but divest, also.

    http://thinkprogress.org/climate/2013/06/25/2213341/invest-divest-obama-goes-full-climate-hawk-in-speech-unveiling-plan-to-cut-carbon-pollution/

    http://www.operationnoah.org/PR_southwark_resolution
    “4 July 2013: The Diocese of Southwark passed a resolution yesterday (3 July 2013) calling on the General Synod of the Church of England to consider disinvestment from fossil fuels.”




    https://www.gov.uk/government/news/prime-minister-champions-inward-investment-at-london-array-and-battersea-power-station

    http://www.guardian.co.uk/environment/video/2013/jul/04/david-cameron-windfarm-thames-estuary-video

    The UK’s Prime Minister David Cameron speaking outside at the London Array site :-

    “Well let’s be clear this is the biggest offshore wind farm anywhere in the world.
    And what it shows is Britain is a great country to come and invest in. And it’s meant
    jobs for local people. And it means clean, green energy for half a million homes in
    our country. It’s part of what we need to have secure, reliable supplies of electricity
    and to get investment and jobs for our people, so it’s a good day for Britain.”

    David Cameron speaking at the Press Launch indoors :-

    “Well of course, when I chaired the G8, I had to arrange everything, starting with
    the dress code. There was some criticism. Why wasn’t I wearing a tie ? What people
    didn’t realise of course was that President Putin wanted to do the whole thing
    barechested on horseback, and I of course had to negotiate him down to smart casual.
    We haven’t had that problem today.

    Sometimes people wonder, can we in the West, can we do big projects any more ? Can we
    do the big investments ? Isn’t that all happening somewhere else in the East and the
    South of our world ?

    And I think if you look at the United Kingdom right now you can see WE CAN do big
    projects. Not only did we do a superb Olympics last year, but underneath London,
    CrossRail is the biggest construction project anywhere in Europe.

    Not far away from here is Dubai Ports World London Gateway, which is the biggest port
    contruction taking place anywhere in Europe.

    And here you have the biggest offshore wind farm anywhere in the world.

    I think it demonstrates Britain is a great place to invest.

    I don’t want to have too much Schadenfreude, but it’s actually a fact that last year,
    foreign direct investment into Europe as a whole went down by something like 40%, but in
    the UK it went up by 24%.

    We are making this country incredibly attractive to invest in, and and that’s part of what
    this project is about.

    When it comes to green energy, I think we have one of the clearest, most predictable
    investment climates. And we’re going to add to that by completing the Energy Bill this year.

    So, we will have a fantastic market for investors to come and build in.

    So, a great win for Kent, a great win for renewable energy and a great win for Britain.”

  • They Think It’s Not All Over

    Posted on June 11th, 2013 Jo No comments



    [ Image Credit : Lakeview Gusher : TotallyTopTen.com ]

    So, the EIA say that the world has 10 years of shale oil resources which are technically recoverable. Woo hoo. We’ll pass over the question of why the American Department of Energy are guiding global energy policy, and why this glowing pronouncement looks just like the mass propaganda exercise for shale gas assessments that kicked off a few years ago, and move swiftly on to the numbers.

    No, actually, not straight on to the numbers. It shouldn’t take a genius to work out the public relations strategy for promoting increasingly dirtier fossil fuels. First, they got us accustomed to the idea of shale gas, and claimed without much evidence, that it was as “clean” as Natural Gas, and far, far cleaner than coal. Data that challenges this myth continues to be collected. Meanwhile, now we are habituated to accepting without reason the risks of subsurface and ground water reservoir destruction by hydraulic fracturing, we should be pliable enough to accept the next step up – oil shale oil fracking. And then the sales team can move on to warm us up to cruddier unconventionals, like bitumen exhumed from tar sands, and mining unstable sub-sea clathrates.

    Why do the oil and gas companies of the world and their trusted allies in the government energy departments so desperately want us to believe in the saving power of shale oil and gas ? Why is it necessary for them to pursue such an environmentally threatening course of product development ? Can it be that the leaders of the developed world and their industry experts recognise, but don’t want to admit to, Peak Oil, and its twin wraith, Peak Natural Gas, that will shadow it by about 10 to 15 years ?

    A little local context – UK oil production is falling like a stoneover the whole North Sea area. Various efforts have been made to stimulate new investment in exploration and discovery. The overall plan for the UK Continental Shelf has included opening up prospects via licence to smaller players in the hope of getting them to bet the farm, and if they come up trumps, permitted the larger oil and gas companies to snaffle up the small fry.

    But really, the flow of Brent crude oil is getting more expensive to guarantee. And it’s not just the North Sea – the inverse pyramid of the global oil futures market is teeteringly wobbly, even though Natural Gas Liquids (NGL) are now included in petroleum oil production figures. Cue panic stations at the Coalition (Oilition) Government offices – frantic rustling of review papers ahoy.

    To help them believe it’s not all over, riding into view from the stables of Propaganda Central, come the Six Horsemen of Unconventional Fossil Fuels : Tar Sands, Shale Gas, Shale Oil (Oil Shale Oil), Underground Coal Gasification, Coalbed Methane and Methane Hydrates.

    Shiny, happy projections of technically recoverable unconventional (night)mares are always lumped together, like we are able to suddenly open up the ground and it starts pouring out hydrocarbon goodies at industrial scale volumes. But no. All fossil fuel development is gradual – especially at the start of going after a particular resource. In the past, sometimes things started gushing or venting, but those days are gone. And any kind of natural pump out of the lithosphere is entirely absent for unconventional fossil fuels – it all takes energy and equipment to extract.

    And so we can expect trickles, not floods. So, will this prevent field depletion in any region ? No. It’s not going to put off Peak Oil and Peak Natural Gas – it literally cannot be mined fast enough. Even if there are 10 years of current oil production volumes that can be exploited via mining oil shale, it will come in dribs and drabs, maybe over the course of 50 to 100 years. It might prolong the Peak Oil plateau by a year or so – that’s barely a ripple. Unconventional gas might be more useful, but even this cannot delay the inevitable. For example, despite the USA shale gas “miracle”, as the country continues to pour resources and effort into industrialising public lands, American Peak Natural Gas is still likely to be only 5 years, or possibly scraping 10 years, behind Global Peak Natural Gas which will bite at approximately 2030 or 2035-ish. I suspect this is why EIA charts of future gas production never go out beyond 2045 or so :-

    Ask a mathematician to model growth in unconventional fossil fuels compared to the anticipated and actual decline in “traditional” fossil fuels, and ask if unconventionals will compensate. They will not.

    The practice for oil and gas companies is to try to maintain shareholder confidence by making sure they have a minimum of 10 years of what is known as Reserves-to-Production ratio or R/P. By showing they have at least a decade of discovered resources, they can sell their business as a viable investment. Announcing that the world has 10 years of shale oil it can exploit sounds like a healthy R/P, but in actual fact, there is no way this can be recovered in that time window. The very way that this story has been packaged suggests that we are being encouraged to believe that the fossil fuel industry are a healthy economic sector. Yet it is so facile to debunk that perspective.

    People, it’s time to divest your portfolios of oil and gas concerns. If they have to start selling us the wonders of bitumen and kerogen, the closing curtain cannot be far away from dropping.

    They think it’s not all over, but it so clearly must be.

  • Energy Change : Germany’s Energiewende #1

    Posted on March 11th, 2013 Jo No comments

    I recently attended an event entitled “The Energiewende: A close look at Germany’s renewable energy revolution”. This was hosted by PRASEG, the Associate UK Parliamentary Renewable and Sustainable Energy Group, and supported by the German Embassy, and held at the Boothroyd Room of Portcullis House, Westminster, 6th March 2013 between 2pm and 4pm.

    The main speakers were Rainer Baake, State Secretary at the Federal Environment Ministry in Germany between 1998 and 2005, and Andreas Kramer, Director and CEO of the Ecologic Institute in Berlin – a well-regarded think tank. Alan Whitehead MP also gave comments, and Simon Hughes MP also attended and shared some points.

    Tom Heap, the well-known Radio 4 presenter, was on hand to chair.

    What follows is not verbatim, but is transcribed from scribbled notes.

    [Tom Heap] “Germany is a live pilot experiment [in transitioning out of fossil fuels to renewable energy]. That’s not meant to be patronising. [Whilst recording a programme there before Christmas I was] hearing comments from right-of-centre government I wouldn’t hear in the UK. On wind turbines, German and British conservatives are poles apart. There wind power is not seen as an imposition. We heard “our energy, our village”. The technologies are similar, but the politics are different…”

    [Rainer Baake] “In Germany, energy policy holds past and future challenges. In June 2011, we ended a long and very controversial debate on energy policy. We ended up with very ambitious goals. The almost unanimous vote was historical. It was almost impossible to believe. We had always had a very diverse debate since Chernobyl [the catastrophic nuclear power accident in Ukraine in 1986 that necessitated the total evacuation of the city of Pripyat and the surrounding districts]. With the major change in government in 2008, with a Green and Social Democrat [SPD http://www.spiegel.de/international/germany/where-do-they-stand-a-quick-guide-to-germany-s-political-parties-a-651388.html ] majority, we got Phase 1, then the Renewable Energy Act (EEG, Erneuerbare-Energien-Gesetz http://www.bmu.de/en/service/publications/downloads/details/artikel/renewable-energy-sources-act-eeg-2009/) – which was also controversial at that time.”

    “[We] created the Feed-In Tariff [FIT] – an incredible success story. Over roughly ten years, the Renewable Energy share stands at 25% of power generation as of today. And of that 25%, 50% of that is in the hands of private people and farmers. This is why it has received political support. The owners of the windmills, biomass generators […] are not only producers, they are also voters. At the start, there was opposition from Conservatives [German conservative right-of-centre politicians – CDU http://www.spiegel.de/international/germany/where-do-they-stand-a-quick-guide-to-germany-s-political-parties-a-651388.html], but companies in their own constituencies said, “We can earn money with this” […] Renewable Energy receives very wide support. This is very different from nuclear power.”

    “The Conservatives and Liberals [German free market neoliberal politicians – FDP http://www.spiegel.de/international/germany/where-do-they-stand-a-quick-guide-to-germany-s-political-parties-a-651388.html ] promised that after the 2009 elections if the coalition won there would be lifetime extensions [on existing nuclear reactors – allowing them to continue operating after their originally designed safe lives]. But they didn’t have a plan ready. They made [announcements] in December 2010 [extending reactor lives out to 2045 http://www.world-nuclear-news.org/IT-German_plant_life_extension_law_passed-2911107.html ] but this was against the public [opinion]. It only lasted for a few weeks, because Fukushima happened [ http://www.bloomberg.com/news/2011-03-14/germany-suspends-plan-to-extend-life-of-nuclear-power-plants-merkel-says.html ]. Our Government realised what it meant for their own policy. They were able to explain Chernobyl [the meltdown accident at Pripyat in the Ukraine in 1986] as Communist [regime] mismanagement, but the meltdown of three reactors at Fukushima, in a technologically advance country…the Government immediately changed position, and it led to a very big [wide] consensus. In June 2011, the opposition and the Government [decided for] Renewable Energy.”

    “In the original [Energiewende] plan of 2000, phaseout of nuclear was to be by 2022, and in the next decades, the fossil generators would convert to Renewable Energy. When created the FIT in 2000 – all Renewable Energy [technologies] had the same starting line [the same levels of subsidy]. The FIT is not a permanent subsidy – it helps these technologies to be introduced to markets. The winners are clearly wind power and solar power – others maybe [remain] too expensive. Biomass is now reaching a sustainability limit [not enough feedstocks for expansion]. It is not going to be posssible to increase biomass or hydropower much over today. Geothermal energy – never came up. Wind and solar power prices decreased dramatically. We have enough of that. The features – have to deal with […] weather-dependent and solar power is not flexible to demand. Second – also very variable. Very capital-intensive [for investment phase] but marginal costs [of operation] are negligible. One you’ve invested, put all the money you need on the table, there are no costs over the following decades.”

    “These features [of Renewable Energies] mean it is going to be a complete change in energy systems over the next decades. 25% of demand – happened much faster than anticipated in 2000. The first 25% is one story. The next 25% is another story. 25% is easy to integrate. Very robust. The next 25% – as you can imagine – 50% of the system – this is the real challenge of the Energiewende – synchronising production of solar and wind with demand of customers. How to balance demand and supply ? How to minimise the costs [of that] – [reduce] in a free European Union energy market ? There’s the technology – and on the other hand, the market. On the technology side need much more flexible supply. With FIT […] Baseload is not a word that describes supply – it describes demand. With marginal costs of zero, they [utilising power from renewable energies] come first – they are pushing traditional fossil fuels out of baseload. The operating hours of traditional baseload generators are decreasing. [We will need] not only adjustments to demand, but also the variable sources. Ten years ahead we will not have any baseload. We will still need 6,000 hours a year generators. They’re there – that’s gas. [We also need] a market design to enable [this].”

    “Second – we need [new/larger] transmission lines. That’s something that really needs to happen. The bigger [wider] the area you connect, the bigger [better, more even] the balance. Not only talking about Germany – also Denmark, the Netherlands, Scandinavia – the better we’re connected, the better to balance. [The history of] the market in almost all countries – generators [power stations] were built under state regulation on the basis of monopolies. After the deregulation in the 1990s, the [power sector changed to work] on the basis of least operating costs. [The power was supplied] always by those generators of least operation cost – makes sense. All these have marginal costs – that is, fuel. When you introduce lots of Renewable Energy with a marginal cost of zero, the prices on the wholesale market have come down significantly, from 95 to 50 Euro per MWh. This has been caused not only by Renewable Energy – but it has been mainly Renewable Energy – pushing out the more expensive generators.”

    “This creates a problem, as you need backup capacity – when the sun isn’t shining and the wind isn’t blowing. There have been arguments/debates about the capacity market we need – an intelligent system – not very expensive – to make sure to backup when wind and solar are not available. We also need a system to support the Energiewende over the next decades. FIT was good for 15 years, but answers of the past are not necessarily correct for the future. It is always argued very strongly that for Germany this is not to renationalise energy policy. This Energiewende is much less costly if we do it with our neighbours. It’s too controversial at the European Union [EU] – but [we are/having] encouraging discussions with neighbouring countries – to the benefit of everybody – to put into reality the EU energy market. We need flexibility of generators, but also flexibility of demand side. [We have asked the German] States [Länder] – are you able to shift your peak [demand] by six hours – a real part of the solution. [We need to] move away from switch [on] and forget. [To those detractors of the Energiewende] if look at the opposition [views] there is no reasonable balance of money in and out. One day we will be using all our renewable electricity generation – for example, using electricity for transport, but for now [we need to export].”

    …TO BE CONTINUED

  • Natural Gas in the UK

    Posted on February 27th, 2013 Jo No comments

    The contribution of coal-fired power generation to the UK’s domestic electrical energy supply appears to have increased recently, according to the December 2012 “Energy Trends” released by the Department of Energy and Climate Change. This is most likely due to coal plants using up their remaining allotted operational hours until they need to retire.
    It could also be due to a quirk of the international markets – coal availability has increased because of gas glut conditions in the USA leading to higher coal exports. Combatting the use of coal in power generation is a global struggle that still needs to be won, but in the UK, it is planned that low carbon generation will begin to gain ascendance.

    The transition to lower carbon energy in Britain relies on getting the Natural Gas strategy right. With the imminent closure of coal-fired power plant, the probable decommissioning of several nuclear reactors, and the small tranche of overall supply coming from renewable resources, Natural Gas needs to be providing a greater overall percentage of electricity in the grid. But an increasing amount of this will be imported, since indigenous production is dropping, and this is putting the UK’s economy at risk of high prices and gas scarcity.

    Demand for electricity for the most part changes by a few percentage points a year, but the overall trend is to creep upwards (see Chart 4, here). People have made changes to their lighting power consumption, but this has been compensated for by an increase in power used by “gadgets” (see Chart 4, here). There is not much that can be done to suppress power consumption. Since power generation must increasingly coming from renewable resources and Natural Gas combustion, this implies strong competition between the demand for gas for heating and the demand gas for electricity. Electricity generation is key to the economy, so the power sector will win any competition for gas supplies. If competition for Natural Gas is strong, and since we don’t have much national gas storage, we can expect higher seasonal imports and therefore, higher prices.

    It is clear that improving building insulation across the board is critical in avoiding energy insecurity. I shall be checking the winter heat demand figures assiduously from now on, to determine if the Green Deal and related measures are working. If they don’t, the UK is in for heightened energy security risks, higher carbon emissions, and possibly much higher energy prices. The Green Deal simply has to work.

  • New Nuclear : Credibility Strained

    Posted on February 26th, 2013 Jo 1 comment

    As rumours and genuine information leak from central sources about the policy instruments and fiscal measures that will be signed into the United Kingdom’s Energy Bill, the subsidy support likely to be made available to new nuclear power is really straining credibility from my point of view. I am even more on the “incredulous” end of the spectrum of faith in the UK Government’s Energy Policy than I ever was before.

    The national demand for electrical power is pretty constant, with annual variations of only a few percent. It was therefore easy to project that there could be a “power cliff” when supply would be curtailed from coal-fired generation under European legislation :-

    https://www.gov.uk/government/organisations/department-of-energy-climate-change/series/energy-trends

    http://www.bbc.co.uk/news/business-21501878
    http://www.guardian.co.uk/money/2013/feb/19/ofgem-higher-household-energy-bills
    http://www.telegraph.co.uk/finance/newsbysector/energy/9878281/Ofgem-boss-warns-of-higher-energy-prices-in-supply-roller-coaster.html
    http://www.telegraph.co.uk/finance/newsbysector/energy/9878281/Ofgem-boss-warns-of-higher-energy-prices-in-supply-roller-coaster.html
    http://metro.co.uk/2013/02/19/consumers-face-higher-energy-bills-as-the-uk-becomes-more-reliant-on-gas-imports-3503130/
    https://www.gov.uk/government/news/decc-statement-on-alistair-buchanan-s-comments-on-energy-security-and-rising-gas-prices

    The pat answer to how we should “Keep the Lights On” has been to wave the new nuclear fission reactor card. Look ! Shiny new toys. Keep us in power for yonks ! And hidden a little behind this fan of aces and jokers, a get-out-of-jail free card from the Coal monopoly – Carbon Capture and Storage or CCS. Buy into this, and we could have hundreds more years of clean power from coal, by pumping nasty carbon dioxide under the sea bed.

    Now, here’s where the answers are just plain wrong : new nuclear power cannot be brought into the National Grid before the early 2020s at the very earliest. And options for CCS are still in the balance, being weighed and vetted, and very unlikely to clean up much of the black stuff until well past 2025.

    When put through my best onboard guesstimiser, I came up with the above little graph in answer to the question : how soon can the UK build new power generation ? Since our “energy cliff” is likely to be in one of the winters of 2015 or 2016, and we’re not sure other countries we import from will have spare capacity, we have little option but to increase Natural Gas-fired power generation and go hell-for-leather with the wind and solar power deployment.

    So no – it’s of no use promising to pay the new nuclear reactor bearer the sum of 40 or more years of subsidy in the form of guaranteed price for power under the scheme known as Contracts for Difference – they still won’t be delivering anything to cope with the “power drain” of the next few years. If this is written into the Electricity Market Reform, we could justifiably say this would destroy competition, and destroy any market, too, and be “central planning” by any other name – this level of subsidy is not exactly “technology-neutral” !

    http://www.guardian.co.uk/business/2013/feb/19/edf-40-year-contract-nuclear-plant
    http://www.telegraph.co.uk/news/uknews/9879257/Government-drawing-up-ludicrous-40-year-contracts-to-persuade-power-companies-to-go-nuclear.html

    And offering the so-called Capacity Mechanism – a kind of top-up payment to keep old nuclear reactors running, warts and all – when really they should be decommissioned as they are reaching the end of their safe lives, is not a good option, in my book.

    Offering the Capacity Mechanism to those who build new gas-fired power plant does make sense, however. If offshore wind power continues with its current trajectory and hits the big time in the next few years, and people want the cheap wind power instead of the gas, and the gas stations will be feeling they can’t run all the time, then the Capacity Mechanism will be vital to make sure the gas plant does get built to back up the wind power, and stays available to use on cold, still nights in February.

    https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/66039/7103-energy-bill-capacity-market-impact-assessment.pdf
    http://gastopowerjournal.com/regulationapolicy/item/1405-eurelectric-discards-eu-wide-capacity-mechanism-as-premature
    http://www.eaem.co.uk/news/doubts-gas-strategy-will-lead-new-plants

    Oh, people may complain about the idea of new “unabated” gas power plants, and insist they should be fitted with carbon capture, but new gas plants won’t run all the time in future, because renewable electricity generation will be cheaper, so forcing gas plant owners to pay for CCS seems like overkill to me. And, anyway, we will be decarbonising the gas supply, as we develop supplies of Renewable Gas.

    I say forget the nuclear option – build the gas !

  • Gas Strategy “Dangerous Gamble”

    Posted on February 11th, 2013 Jo No comments

    I had a most refreshing evening at Portcullis House in Westminster this evening – apart from the fact that the Macmillan Room was overheated, so you couldn’t possibly deduce that energy conservation is intended to be part of the UK Government’s strategy, making an example with the public sector.

    Tonight was the launch of the Greenpeace and WWF-UK report “A Study into the Economics of Gas and Offshore Wind“, which was commissioned from Cambridge Econometrics.

    Professor Paul Ekins got up to speak and actually had the gall to declare the Government’s “Gas Strategy” to be a “dangerous gamble”. It was at this point that I took heart again – there are still some sane, rational people in the “national energy conversation”, even though Ekins did admit that he wasn’t sure that the “Gas Strategy” was an actual thing. Oh, but it is. All eighty pages of it.

    Today was not the first time Professor Paul Ekins called out the Government on this, apparently, although I didn’t have a recollection of seeing the the mention in New Scientist before today.

    Other highlights of the evening were provided by Laura Sandys MP naming her political opposition Alan Whitehead MP as the leader of a “parliamentary roadshow” on Energy and Climate Change, and questioning the use of the term “energy efficiency”. “It’s energy waste, guys”, she corrected and said we should be using that term instead of the “effete word efficiency”, and encouraged the energy waste prevention industry to get the rest of us engaged with their products.

    A chap from Scottish and Southern Energy (SSE) – I think it might have been Kevin MacLean – got up during questions from the floor, and almost begged for a long-term framework – a plan for renewable energy – a “binding framework” to encourage investment and “get costs down”.

    It was pointed out during the evening, that, logically enough, that policy is important to energy futures, “if you have more certainty, you get more investment”. And there was encouragement to get Government Departments to think about this more. Yes, some subsidies and other forms of support are going to be needed to get the renewable energy revolution kickstarted, but “if [we] get benefits – isn’t that a price worth paying ?” The benefits outlined included potential for some small growth in the economy, around about 0.8% GDP, but good prospects for high value employment in depressed coastal towns where much of the offshore wind industry will host engineers, both for construction and ongoing operations and maintenance.

    Laura Sandys MP was ashamed to say that she may no longer be able to claim she has the two largest offshore wind farms in her constituency – as progress is being made elsewhere.

    Sarah Merrick from Vestas, the wind power engineering firm, emphasised that the economics of wind power stacks up and that it’s important to communicate this – despite the current dismissive media agenda – where she said it is important to defend the industry against certain media claims.

    Lord Alan Haworth brought up the inevitable question of renewable energy intermittency – “days of dead calm and dark nights”. He raised the statistic that weather systems in Europe can cover 1,500 kilometres, so if wind power is down in the UK, it’s going to be down elsewhere in the EU electricity networks – the countries we have interconnectors with. What he didn’t elaborate on was this – just as the UK is beefing (and I don’t mean “up to 100% horsing about”) up its connections with the European electricity networks, so too, Europe as a whole is beginning to reach out with its networks to satellite countries. What that could mean is that even if wind-powered electrons in the UK take a dive, electrons could still appear in the power network from very far afield, and shunt power to the UK.

    The speaker from the Crown Estate said that it was “sensible” to push for a good quantity of wind power – and that the report was a compelling argument. He regretted that it could not be guaranteed that the wind power-ed economy would necessarily have more of its supply chain in the UK – as various bodies have to comply with EU trade rules – but that there was a commitment in one part of the industry to 50% indigenous resourcing and employment (if I noted that down correctly).

    Long-term policy clarity was espoused. Disappointment was expressed in the Coalition Government’s flip-flop about gas – emphasising the development of gas-powered electricity generation at the expense of projecting high levels of renewables (65%, says the report, is perfectly feasible) – and that it gave mixed messages – which weren’t helping investment decisions. Sarah Merrick repeated the E.On line that UK electricity should be “balanced by gas, not based on gas”, although she didn’t explain that they weren’t necessarily talking about wind power being the mainstay of new generation capacity.

    It was generally agreed that David Cameron should lead and adopt the EU 2030 renewable energy targets – to enable billions of new confidence in the UK energy sector.

    Not having a strong lead on renewable energy and energy waste reduction would be an “abdication of responsibility on the part of the policy-creating machine”. And, “even if shale gas does materialise”, it would not provide much stimulus.

  • A Question of Resilience

    Posted on January 28th, 2013 Jo No comments

    Again, the evil and greedy oil, gas and mining companies have proved their wickedness by manipulating public opinion, by directly financing conspiracy theorists who deny climate change science. The irony is tangibly acidic. The paranoid have actually been duped by a genuine conspiracy. They have drunk the Kool Aid; they have believed the lies; they have continued to communicate doubt. They think they are challenging corruption in high places, but what they are really doing is reinforcing apathy in the face of genuine risk.

    The questions posed so unrelentingly by the climate change deniers have sewn a patchwork tapestry of disinformation, which continues to poison genuine dialogue and is undermining political progress. We cannot take these people with us into constructive engagement, and ask them to help us forge a broad consensus. It is as if they exist in a parallel universe. Some of us will continue to attempt to conduct dialogue, but will end up wasting our time. The documentation by the media is faulty, and perpetuates the success of the denier strategy of divide and rule.

    But hold on a minute. There are problems with the stance of climate change denial, but what about the positioning of climate change activists ? Let’s try that first paragraph one more time :-

    [ Again, the “evil” and “greedy” oil, gas and mining companies have proved their “wickedness” by manipulating public opinion, by directly financing conspiracy theorists who deny climate change science. The irony is tangibly acidic. The paranoid have actually been duped by a genuine conspiracy. They have drunk the Kool Aid; they have believed the lies; they have continued to communicate doubt. They think they are challenging corruption in high places, but what they are really doing is reinforcing apathy in the face of genuine risk. ]

    By casting the fossil fuel and mining corporations as wrongly motivated, by using negative emotive labels, the dominant narrative of political activists has failed, once again, to move us all forward. These kinds of revelations about underhand corporate public relations activities are by now unsurprising. The news cannot shock, although it may disgust. Yet, since nothing is offered to counter-balance or correct the inappropriate behaviour of the “fossil fuellers”, they win the game they invented, the game they wrote the rules for. Protesting at a petrol station achieves nothing of any note, not even when there’s a camera-friendly polar bear. We hear the message of pain, but there is no ointment. There is a disconnect between the gruesome discovery and any way out of this mess. The revelation of intent of the carbon dinosaurs, the recounting of the anti-democratic activities, does not result in change.

    Environmental pollution is a “victimless” crime – no matter how much we sympathise or empathise with the plight of poisoned floating fish, dying bees, asthmatic kids, or cancer-laden people. Fines and taxes cannot rectify the scourge of environmental pollution, because there is no ultimate accountability. Regulation cannot be enforced. The misbehaviour just carries on, because there is systemic momentum. There is no legal redress (“due process” in Americanese) for those who are suffering the worsening effects of climate change, and there is no treaty that can be made to curb greenhouse gas emissions that anybody can be bound to by international sanctions.

    And so when we hear the same old story – that the energy industry is propagandising – we cannot respond. We don’t know what we can do. We are paralysed. This narrative is so tired, it snores.

    Truth may have been a victim, but the energy industry are also vulnerable – they are acting in self-defence mode. Let’s take the big vista in : there is stress in the global production of fossil fuel energy, and all routes to an easy fix, even if it’s only a short-term fix, are choked.

    So let’s ask the question – why do the energy companies deceive ? Do they think they are being deceptive ? Why do fossil fuel miners seek to massage public opinion ? This is a question of resilience, of Darwinian survival – seeking advantage by altering policy by tampering with public assent. They believe in their product, they construct their mission – they are protecting their future profits, they’re making a living. They’re humans in human organisations. They’re not “evil”, “greedy” or “lying” – as a rule. There are no demons here, nor can we convincingly summon them.

    Look at the activist game plan – we announce the deliberate actions of the fossil fuel companies to influence the political mandate. But these scandals are only ever voiced, never acted upon. They cannot be acted upon because those who care have no power, no agency, to correct or prevent the outcomes. And those who should care, do not care, because they themselves have rationalised the misdemeanours of the fossil fuellers. They too have drunk from the goblet of doubt. Amongst English-speaking politicians, I detect a good number who consider climate change to be a matter for wait-and-see rather than urgent measures. Besides those who continue to downplay the seriousness of climate change.

    Look also at the difference between the covert nature of the support for climate change deniers, and the open public relations activities of the fossil fuel and mining companies. They speak in the right way for their audiences. That’s smart.

    In time, the end of the fossil fuel age will become apparent, certain vague shapes on the horizon will come out of the blur and into sharp focus. But in the meantime, the carbon dinosaurs are taking action to secure market share, maintain the value of their stock, prop up the value of their shareholders’ assets. The action plan for survival of the oil, gas, coal and mining operations now includes the promotion of extreme energy – so-called unconventional fossil fuels, the once-dismissed lower quality resources such as tight gas, shale gas, shale oil and coalbed methane (coal seam methane). Why are the energy industry trying to gild the rotten lily ? Is the support for unconventional fossil fuels a move for certain countries, such as the United States of America, to develop more indigenous sources of energy – more homegrown energy to make them independent of foreign influence ? This could be the main factor – most of the public relations for shale gas, for example, seems to come from USA.

    The answer could come by responding to another question. Could it be that the production of petroleum oil has in fact peaked – that decline has set in for good ? Could it be that the Saudis are not “turning off the taps” to force market prices, because in actual fact the taps are being turned off for them, by natural well depletion ? The Arab Spring is a marvellous distraction – the economic sanctions and military and democratic upheaval are excellent explanations for the plateau in global oil production.

    It seems possible from what I have looked at that Peak Oil is a reality, that decline in the volumes of produced petroleum is inevitable. The fossil fuel producers, the international corporations who have their shareholders and stock prices to maintain, have been pushing the narrative that the exploitation of unconventional fossil fuels can replace lost conventional production. They have been painting a picture of the horn of plenty – a cornucopia of unconventional fossil fuels far exceeding conventional resources. To please their investors, the fossil fuel companies are lying about the future.

    Sure, brute force and some new technology are opening up “unconventionals” but this will not herald the “golden age” of shale gas or oils from shale. Shale gas fields deplete rapidly, and tar sands production is hugely polluting and likely to be unsustainable in several ways because of that. There might be huge reserves – but who knows how quickly heavy oils can be produced ? And how much energy input is required to create output energy from other low grade fossil strata ? It is simply not possible to be certain that the volumes of unconventional fossil fuel production can match the decline in conventionals.

    The facts of the matter need admitting – there is no expansion of sweet crude oil production possible. There’s no more crude – there’s only crud. And slow crud, at that.

    Peak Oil is a geological fact, not a market artefact. The production levels of crude and condensate may not recover, even if military-backed diplomacy wins the day for the energy industry in the Middle East and North Africa.

    Peak Oil has implications for resilience of the whole global economy – the conversion of social and trade systems to use new forms of energy will take some considerable time – and their integrity is at risk if Peak Oil cannot be navigated smoothly. Peak Oil is dangerous – it seems useful to deny it as long as possible.

    It’s pretty clear that we’ve been handed lots of unreliable sops over the years. The energy industry promised us that biofuels could replace gasoline and diesel – but the realisation of this dream has been blocked at every turn by inconvenient failings. The energy industry has, to my mind, been deploying duds in order to build in a delay while they attempt to research and develop genuine alternatives to conventional fossil fuels – but they are failing. The dominant narrative of success is at risk – will all of this continue to hold together ? Can people continue to believe in the security of energy systems – the stability of trade and economic wealth creation ? Oh yes, people raise concerns – for example about disruption in the Middle East and North Africa, and then propose “solutions” – regime change, military support for opposition forces, non-invasive invasions. But overall, despite these all too evident skirmishes, the impression of resilience is left intact. The problem is being framed as one of “edge issues” – not systemic. It’s not clear how long they can keep up with this game.

    The facade is cracking. The mask is slipping. BP and Centrica in a bout of hyper-realism have said that the development of shale gas in the UK will not be a “game changer”. It may be that their core reasoning is to drag down the market value of Cuadrilla, maybe in order to purchase it. But anyway, they have defied the American energy industry public relations – hurrah ! Shale gas is not the milk of a honey-worded mother goddess after all – but what’s their alternative story ? That previously under-developed gas in Iran and Iraq will be secured ? And what about petroleum ? Will the public relations bubble about that be punctured too ? Telling people about Peak Oil – how useful is that ? They won’t do it because it has to be kept unbelievable and unbelieved in order to save face and keep global order. Academics talk about Peak Oil, but it is not just a dry, technical question confined to ivory towers. Attention is diverted, but the issue remains. Looking at it doesn’t solve it, so we are encouraged not to look at it.

    So, why do the energy industry purposely set out to manipulate public opinion ? Well, the reason for their open advertising strategy is clear – to convince investors, governments, customers, that all is well in oil and gas – that there is a “gas glut” – that the world is still awash in petroleum and Natural Gas – that the future will be even more providential than the past – that the only way is up. All the projections of the oil and gas industry and the national, regional and international agencies are that energy demand will continue to rise – the underlying impression you are intended to be left with is that, therefore, global energy supply will also continue to rise. Business has never been better, and it can only get more profitable. We will need to turn to unconventional resources, but hey, there’s so much of the stuff, we’ll be swimming in it.

    But what is the purpose of the covert “public relations” of the energy industry ? Why do they seek to put out deception via secretly-funded groups ? When the truth emerges, as it always does in the end, the anger and indignation of the climate change activists is guaranteed. And angry and indignant activists can easily be ignored. So, the purpose in funding climate change deniers is to emotionally manipulate climate change activists – rattle their cages, shake their prison bars. Let them rail – it keeps the greens busy, too occupied with their emotional disturbance. By looking at these infractions in depth are we being distracted from the bigger picture ? Can we make any change in global governance by bringing energy industry deception to light ?

    Even as commentators peddle conspiracy theories about the science and politics of a warming planet, the “leader of the free world” is inaugurated into a second term and announces action on climate change. Although progressives around the world applaud this, I’m not sure what concrete action the President and his elite colleague team of rich, mostly white, middle-aged men can take. I am listening to the heartbeat of the conversation, and my take away is this : by announcing action on climate change, Barack Obama is declaring war on the sovereignty of the oil and gas producing nations of the Middle East and North Africa.

    You see, the Middle East and North Africa are awash in Natural Gas. Untapped Natural Gas. The seismic surveys are complete. The secret services have de-stabilised democracy in a number of countries now, and this “soft power” will assist in constructing a new narrative – that unruliness in the Middle East and North Africa is preventing progress – that the unstable countries are withholding Natural Gas from the world – the fossil fuel that can replace petroleum oil in vehicles when chemically processed, the fossil fuel that has half the carbon emissions of coal when generating electricity. Resources of Natural Gas need “protecting”, securing, “liberating”, to save the world’s economy from collapse.

    Obama stands up and declares “war” on climate change. And all I hear is a klaxon alarm for military assault on Iran.

    But even then, if the world turns to previously untapped Natural Gas, I believe this is only a short-term answer to Peak Oil. Because waiting in the wings, about ten years behind, is Peak Natural Gas. And there is no answer to Peak Natural Gas, unless it includes a genuine revolution in energy production away from what lies beneath. And that threatens the sustenance of the oil and gas industry.

    No wonder, then, that those who fund climate change denial – who stand to profit from access to untapped fossil fuels, secured by military aggresssion in the Middle East and North Africa – also fund opposition to renewable energy. The full details of this are still emerging. Will we continue to express horror and distaste when the strategy becomes more transparent ? Will that achieve anything ? Or will we focus on ways to bring about the only possible future – a fossil-fuel-free energy economy ? This will always take more action than words, but messaging will remain key. The central message is one that will sound strange to most people, but it needs to be said : fossil fuels will not continue to sustain the global economy : all will change.

    Funnily enough, that is exactly the summary of the statements from the World Economic Forum in Davos – only the world’s administration are still not admitting to Peak Fossil Fuels. Instead, they are using climate change as the rationale for purposeful decarbonisation.

    Well, whichever way it comes, let’s welcome it – as long as it comes soon. It’s not just the survival of individual oil and gas companies that is at stake – the whole global economy is at risk from Peak Fossil Fuels – and climate change. I use the word “economy”, because that is the word used by MBAs. What I mean is, the whole of human civilisation and life on Earth is at risk from Peak Fossil Fuels and climate change. Unconventional fossil fuels are the most polluting answer to any question, and expansion of their use will undoubtedly set off “climate bombs“.

    Don’t get me wrong – Natural Gas is a good bridge to the future, but it is only a transition fuel, not a destination. Please, can we not have war against Iran. Please let’s have some peaceful trade instead. And some public admissions of the seriousness of both Peak Fossil Fuels and climate change by all the key players in governance and energy.

  • A Referendum for Energy

    Posted on January 24th, 2013 Jo No comments

    As I dodged the perfunctory little spots of snow yesterday, on my way down to Highbury and Islington underground train station, I passed a man who appeared to have jerky muscle control attempting to punch numbers on the keypad of a cash machine in the wall. He was missing, but he was grinning. A personal joke, perhaps. The only way he could get his money out of the bank to buy a pint of milk and a sliced loaf for his tea was to accurately tap his PIN number. But he wasn’t certain his body would let him. I threw him an enquiring glance, but he seemed too involved in trying to get control of his arms and legs to think of accepting help.

    This, I felt, was a metaphor for the state of energy policy and planning in the United Kingdom – everybody in the industry and public sector has focus, but nobody appears to have much in the way of overall control – or even, sometimes, direction. I attended two meetings today setting out to address very different parts of the energy agenda : the social provision of energy services to the fuel-poor, and the impact that administrative devolution may have on reaching Britain’s Renewable Energy targets.

    At St Luke’s Centre in Central Street in Islington, I heard from the SHINE team on the progress they are making in providing integrated social interventions to improve the quality of life for those who suffer fuel poverty in winter, where they need to spend more than 10% of their income on energy, and are vulnerable to extreme temperatures in both summer heatwaves and winter cold snaps. The Seasonal Health Interventions Network was winning a Community Footprint award from the National Energy Action charity for success in their ability to reach at-risk people through referrals for a basket of social needs, including fuel poverty. It was pointed out that people who struggle to pay energy bills are more likely to suffer a range of poverty problems, and that by linking up the social services and other agencies, one referral could lead to multiple problem-solving.

    In an economy that is suffering signs of contraction, and with austerity measures being imposed, and increasing unemployment, it is clear that social services are being stretched, and yet need is still great, and statutory responsibility for handling poverty is still mostly a publicly-funded matter. By offering a “one-stop shop”, SHINE is able to offer people a range of energy conservation and efficiency services alongside fire safety and benefits checks and other help to make sure those in need are protected at home and get what they are entitled to. With 1 in 5 households meeting the fuel poverty criteria, there is clearly a lot of work to do. Hackney and Islington feel that the SHINE model could be useful to other London Boroughs, particularly as the Local Authority borders are porous.

    We had a presentation on the Cold Weather Plan from Carl Petrokovsky working for the Department of Health, explaining how national action on cold weather planning is being organised, using Met Office weather forecasts to generate appropriate alert levels, in a similar way to heatwave alerts in summer – warnings that I understand could become much more important in future owing to the possible range of outcomes from climate change.

    By way of some explanation – more global warming could mean significant warming for the UK. More UK warming could mean longer and, or, more frequent heated periods in summer weather, perhaps with higher temperatures. More UK warming could also mean more disturbances in an effect known as “blocking” where weather systems lock into place, in any season, potentially pinning the UK under a very hot or very cold mass of air for weeks on end. In addition, more UK warming could mean more precipitation – which would mean more rain in summer and more snow in winter.

    Essentially, extremes in weather are public health issues, and particularly in winter, more people are likely to suffer hospitalisation from the extreme cold, or falls, or poor air quality from boiler fumes – and maybe end up in residential care. Much of this expensive change of life is preventable, as are many of the excess winter deaths due to cold. The risks of increasing severity in adverse conditions due to climate change are appropriately dealt with by addressing the waste of energy at home – targeting social goals can in effect contribute to meeting wider adaptational goals in overall energy consumption.

    If the UK were to be treated as a single system, and the exports and imports of the most significant value analysed, the increasing net import of energy – the yawning gap in the balance of trade – would be seen in its true light – the country is becoming impoverished. Domestic, indigenously produced sources of energy urgently need to be developed. Policy instruments and measured designed to reinvigorate oil and gas exploration in the North Sea and over the whole UKCS – UK Continental Shelf – are not showing signs of improving production significantly. European-level policy on biofuels did not revolutionise European agriculture as regards energy cropping – although it did contribute to decimating Indonesian and Malaysian rainforest. The obvious logical end point of this kind of thought process is that we need vast amounts of new Renewable Energy to retain a functioning economy, given global financial, and therefore, trade capacity, weakness.

    Many groups, both with the remit for public service and private enterprise oppose the deployment of wind and solar power, and even energy conservation measures such as building wall cladding. Commentators with access to major media platforms spread disinformation about the ability of Renewable Energy technologies to add value. In England, in particular, debates rage, and many hurdles are encountered. Yet within the United Kingdom as a whole, there are real indicators of progressive change, particularly in Scotland and Wales.

    I picked up the threads of some of these advances by attending a PRASEG meeting on “Delivering Renewable Energy Under Devolution”, held at the Institution of Mechanical Engineers in Westminster, London; a tour to back up the launch of a new academic report that analyses performance of the devolved administrations and their counterpart in the English Government in Westminster. The conclusions pointed to something that I think could be very useful – if Scotland takes the referendum decision for independence, and continues to show strong leadership and business and community engagement in Renewable Energy deployment, the original UK Renewable Energy targets could be surpassed.

    I ended the afternoon exchanging some perceptions with an academic from Northern Ireland. We shared that Eire and Northern Ireland could become virtually energy-independent – what with the Renewable Electricity it is possible to generate on the West Coast, and the Renewable Gas it is possible to produce from the island’s grass (amongst other things). We also discussed the tendency of England to suck energy out of its neighbour territories. I suggested that England had appropriated Scottish hydrocarbon resources, literally draining the Scottish North Sea dry of fossil fuels in exchange for token payments to the Western Isles, and suchlike. If Scotland leads on Renewable Energy and becomes independent, I suggested, the country could finally make back the wealth it lost to England. We also shared our views about the Republic of Ireland and Northern Ireland being asked to wire all their new Renewable Electricity to England, an announcement that has been waiting to happen for some time. England could also bleed Wales of green power with the same lines being installed to import green juice from across the Irish Sea.

    I doubt that politics will completely nix progress on Renewable Energy deployment – the economics are rapidly becoming clear that clean, green power and gas are essential for the future. However, I would suggest we could expect some turbulence in the political sphere, as the English have to learn the hard way that they have a responsibility to rapidly increase their production of low carbon energy.

    Asking the English if they want to break ties with the European Union, as David Cameron has suggested with this week’s news on a Referendum, is the most unworkable idea, I think. England, and in fact, all the individual countries of the United Kingdom, need close participation in Europe, to join in with the development of new European energy networks, in order to overcome the risks of economic collapse. It may happen that Scotland, and perhaps Wales, even, separate themselves from any increasing English isolation and join the great pan-Europe energy projects in their own right. Their economies may stabilise and improve, while the fortunes of England may tumble, as those with decision-making powers, crony influence and web logs in the Daily Telegraph and Daily Mail, resist the net benefits of the low carbon energy revolution.

    [ Many thanks to Simon and all at the Unity Kitchen at St Luke’s Centre, and the handsomely reviving Unity Latte, and a big hi to all the lunching ladies and gents with whom I shared opinions on the chunkiness of the soup of the day and the correct identification of the vegetables in it. ]

    Other Snapshots of Yesterday #1 : Approached by short woman with a notebook in Parliament Square, pointing out to me a handwritten list that included the line “Big Ben”. I pointed at the clock tower and started to explain. The titchy tourist apologised for non-comprehension by saying, “French”, so then I explained the feature attraction to her in French, which I think quite surprised her. We are all European.

    Other Snapshots of Yesterday #2 : Spoke with an Austrian academic by the fire for coffee at IMechE, One Birdcage Walk, about the odd attitudes as regards gun ownership in the United States, and the American tendency to collective, cohort behaviour. I suggested that this tendency could be useful, as the levels of progressive political thinking, for instance about drone warfare, could put an end to the practice. When aerial bombardment was first conducted, it should have been challenged in law at that point. We are all Europeans.

    Other Snapshots of Yesterday #3 : Met a very creative Belgian from Gent, living in London. We are all European.

    Other Snapshots of Yesterday #4 : We Europeans, we are all so civilised. We think that we need to heat venues for meetings, so that people feel comfortable. Levels of comfort are different for different people, but the lack of informed agreement means that the default setting for temperature always ends up being too high. The St Luke’s Centre meeting room was at roughly 23.5 degrees C when I arrived, and roughly 25 degrees C with all the visitors in the room. I shared with a co-attendee that my personal maximum operating temperature is around 19 degrees C. She thought that was fine for night-time. The IMechE venue on the 2nd floor was roughly 19 – 20 degrees C, but the basement was roughly 24 degrees C. Since one degree Celsius of temperature reduction can knock about 10% of the winter heating bill, why are public meetings about energy not more conscious of adjusting their surroundings ?

  • Fossil Fuel Company Obligation

    Posted on November 6th, 2012 Jo No comments

    I knew I knew her from somewhere, Ms Henrietta Lynch PhD, from the UCL Energy Institute. I had the feeling we’d sheltered together from the rain/police helicopters at a Climate Camp somewhere, but she was fairly convinced we’d crossed paths at the Frontline Club, where, if she was recalling correctly, I probably tried to pick an “difference of opinion” with somebody, which she would have remembered as more than a little awkward.

    Why ? Because when I’m surrounded by smart people displaying self-confidence, I sometimes feel pushed to try to irritate them out of any complacency they may be harbouring. Niceness can give me itchy feet, or rather emotional hives, and I don’t see why others should feel settled when I feel all scratchy.

    So here we were at a Parliamentary event, and I was on my best behaviour, neither challenging nor remonstrative, but all the same, I felt the urge to engage Henrietta in disagreement. It was nothing personal, really. It was all about cognition, perception – worldviews, even. After my usual gauche preamble, I snuck in with a barbed gambit, “The United Nations climate change process has completely failed.” A shadow of anxiety crossed her brow. “Oh, I wouldn’t say that”, said Henrietta Lynch. She went on to recount for me the validity of the UN climate talks, and how much further we are because of the Kyoto Protocol. “Ruined by Article 12″, I said, “…the flexible mechanisms”. She said I shouldn’t underestimate the effort that had gone into getting everybody into the room to talk about a response to climate change. I said, it would be useful if the delegates to the climate talks had power of some kind – executive decision-making status. Henrietta insisted that delegates to the climate talks do indeed have authority.

    I said that the really significant players, the oil and gas production companies, were not at the climate talks, and that there would be no progress until they were. I said that the last time the UN really consulted the oil and gas companies was in the 1990s, and the outcome of that was proposals for carbon trading and Carbon Capture and Storage. Each year, I said, the adminstration of the climate talks did the diplomatic equivalent of passing round a busker’s hat to the national delegations, begging for commitments to carbon emissions reductions. Besides leading to squabbling and game-playing, the country representatives do not even have the practical means of achieving these changes. Instead, I said, the energy production companies should be summoned to the climate talks and given obligations – to decarbonise the energy resources they sell, and to increase their production of renewable and sustainable energy. I said that without that, there will be no progress.

    Oil and gas companies always point to energy demand as their get-out-of-jail-free card – they insist that while the world demands fossil fuel energy, they, the energy resource companies, are being responsible in producing it. Their economists say that consumer behaviour can be modified by pricing carbon dioxide emissions, and yet the vast majority of the energy they supply is full of embedded carbon – there is no greener choice. They know that it is impossible to set an economically significant carbon price in any form, that there are too many forces against it, and that any behavioural “signal” from carbon pricing is likely to be swallowed up by volatility in the prices of fossil fuels, and tax revenue demands. Most crucially, the oil and gas companies know that fossil fuels will remain essential for transport vehicles for some time, as it will be a long, hard struggle to replace all the drive engines in the world, and high volumes of transport are essential because of the globalised nature of trade.

    Oil and gas companies have made token handwaving gestures towards sustainability. BP has spent roughly 5% of its annual budget on renewable energy, although it’s dropped its solar power division, and has now dropped its cellulosic ethanol facility. BP says that it will “instead will focus on research and development“. Research and development into what, precisely ? Improved oil and gas drilling for harsh environmental conditions like the Arctic Ocean or sub-sea high depth, high pressure fields ? How many renewable energy pipedreams are exhausted ? BP are willing to take competitors to court over biobutanol, but even advanced techniques to produce this biofuel are not yet commercialised.

    So, the oil and gas majors do not appear to be serious about renewable energy, but are they also in denial about fossil fuels ? All business school graduates, anybody who has studied for an MBA or attended an economics course, they all come out with the mantra that technology will deliver, that innovation in technology will race ahead of the problems. Yet, as the rolling disasters of the multiple Fukushima Dai-ichi nuclear reactor accident and the continuing oil spill in the Gulf of Mexico from the blowout of the Horizon Deepwater drilling rig show, technological advancement ain’t what it used to be. Put not your faith in technology, for engineering may fail.

    For the oil and gas companies to be going after the development of unconventional fossil fuel resources is an unspoken, tacit admission of failure – not only of holding a bold vision of change, but also a demonstration of the failure of being able to increase production from discoveries of more conventional petroleum and Natural Gas. It is true that oil and gas exploration has improved, and that technology to drill for oil and gas has improved, but it could be said that the halting pace of technological advancement means that the growth in fossil fuel exploitation is not strong enough to meet projected demand. Technology does not always make things more efficient – the basic fossil fuel resources are getting much poorer, and perhaps scarcer.

    There is some evidence that global petroleum crude oil production rates have peaked, despite BP adding significant South American heavy oil fields to their annual Statistical Review of World Energy within the last few years. Some of the jitteriness in total production is down to geopolitical factors, like the chokehold that the United States has imposed on Iran via economic sanctions, and some of it is related to consumption patterns, but there is an element of resource failure, as indicated in this IMF report from last month :-

    “Over the past decade the world economy has experienced a persistent increase in oil prices. While part of this may have been due to continued rapid demand growth in emerging markets, stagnant supply also played a major role. Figure 1 shows the sequence of downward shifts in the trend growth rate of world oil production since the late 1960s. The latest trend break occurred in late 2005, when the average growth rate of 1.8 percent per annum of the 1981-2005 period could no longer be sustained, and production entered a fluctuating plateau that it has maintained ever since.”

    There is an increasing amount of evidence and projection of Peak Oil from diverse sources, so perhaps our attention should be drawn to it. If this type of analysis is to be trusted, regardless of whether the oil and gas companies pursue unconventional oil, change is inevitable. Bringing the oil and gas companies onto the world stage at the United Nations climate talks and demanding a reduction in fossil fuel production would be an straightford thing to make commitments to – as it is happening already. A huge facesaver in many respects – except that it does not answer the energy security question – how the world is going to be able to adapt to falling fossil fuel supplies. You see, besides Peak Oil, there are other peaks to contend with – it will not simply be a matter of exchanging one energy resource with another.

    Can the oil and gas companies hold on by selling us Natural Gas to replace failing oil ? Only if Natural Gas itself is not peaking. As the oil and gas companies drill deeper, more Natural Gas is likely to be found than petroleum oil, but because they are so often associated, Peak Oil is likely to be followed quite sharply by Peak Natural Gas. But does anybody in the oil and gas companies really know ? And if they did, would they be able to let their shareholders and world’s media know about it without their businesses crumbling ?

    What I want to know is : with all the skills of dialogue, collaboration, and facilitation that the human race has developed, why can Civil Society not engage the oil and gas companies in productive communication on these problems ?

  • Futureproof Renewable Sustainable Energy #3

    Posted on November 3rd, 2012 Jo No comments

    PRASEG Annual Conference 2012
    http://www.praseg.org.uk/save-the-date-praseg-annual-conference/
    “After EMR: What future for renewable and sustainable energy?”
    31st October 2012
    One Birdcage Walk, Westminster
    Twitter hashtag : #PRASEG12

    Addendum to Part 1 and Part 2

    Dr Mayer Hillman of the Policy Studies Institute has contributed a summary of the questions that he raised at the PRASEG Annual Conference on Wednesday 31st October 2012, together with more background detail, and I am pleased to add this to the record of the day, and wish him a happy 82nd year !


    PRASEG Conference 31 October 2012

    Questions raised by Dr. Mayer Hillman (Policy Studies Institute) in the following sessions

    The Future of Renewable and Sustainable Energy: Panel Session

    I can only assume from the statements of each of the panellists of this session that their point of departure is that consumers have an inalienable right to engage in as much energy-intensive activity as they wish. Thereafter, it is the Government’s responsibility to aim to meet as much of the consequent demand as possible, subject only to doing so in the most cost-effective and least environmentally-damaging ways possible.

    However as Laura Sandys pointed out in her introduction, “policy must reflect the realities of the world we live in”. The most fundamental of these realities is that the planet’s atmosphere only has a finite capacity to safely absorb further greenhouse gas emissions. Surely, that must be the point of departure for policy if we are to ensure a long-term future for life on earth. That future can only be assured by the adoption of zero-carbon lifestyles as soon as conceivably possible. Simply aiming to increase the contribution of the renewables and of the efficiency with which fossil fuels are used is clearly bound to prove inadequate as the process of climate change is already irreversible.

    Demand side policy: The missing element?: Panel Session

    Given that the process of climate change cannot now be reversed, at best only slowed down by our actions, continued development of means of matching the predicted huge increase in energy demand whilst minimising its contribution to climate change is seen to be the logical way forward. However, any burning of fossil fuels adds to the already excessive concentration of CO2 in the atmosphere.

    The only solution now is the one advocated by the Global Commons Institute since 1996. The extent of GCI’s success, both national and international, is very apparent by looking at the Institute’s website http://www.gci.org.uk. Contraction and Convergence is the framework, that is the contraction of greenhouse gases to a safe level and their convergence to equal per capita shares across the world’s population.

    Our chair for this session has been a supporter for several years. Why cannot the panellists see this to be the way ahead rather than taking small steps which, in aggregate, cannot conceivably prevent catastrophe in the longer term?

    Keynote address by the Right Hon. Edward Davey, Secretary of State, DECC

    The Secretary-of-State has just confirmed the fears that I expressed in the first session of this conference, namely that he sees it to be the Government’s responsibility, if not duty, to ensure that, if at all possible, the burgeoning growth in energy demand predicted for the future is met. To that end, he has just outlined stages of a strategy intended to enable comparisons to be made on “a level playing field” between different types of electricity generation as energy is increasingly likely to be supplied in the form of electricity. To do so, in his view, it is essential that a market price for the release of a tonne of CO2 emissions into the atmosphere is determined.

    I have two great reservations about such a process. First, if the price is to cover all the costs incurred then, for instance, the real costs of large scale migration of vast populations fleeing the regions that will be rendered uninhabitable by climate change caused by the increase in the concentration of CO2 in the atmosphere (with more than 100 years continuous impacts) would have to be included. I fail to see how that could be realistically established, let alone its moral implications being acceptable.

    Second, we know that we have already passed the stage that would have allowed us to reverse the process of global climate change – just consider the melting of the Arctic ice cap. That market price for the tonne of CO2 emissions, insofar as it could be determined, would have to rise exponentially owing to the planet’s non-negotiable capacity to safely absorb further emissions. Yet the market requires a fixed price to enable decisions affecting the future to be made.


  • Futureproof Renewable Sustainable Energy #2

    Posted on November 1st, 2012 Jo No comments

    PRASEG Annual Conference 2012
    http://www.praseg.org.uk/save-the-date-praseg-annual-conference/
    “After EMR: What future for renewable and sustainable energy?”
    31st October 2012
    One Birdcage Walk, Westminster
    Twitter hashtag : #PRASEG12

    Continued from Part 1. Followed by Part 3.

    PLEASE NOTE : The record is NOT verbatim and should not be treated as such. Check against delivery, I think they say in the trade. If I have scribbled incomprehensively or missed something, I have interpolated according to the spirit of the context. I am open to correction or challenge on my record of the event.

    [Start of second session : “Demand side policy: The missing element ?]

    [Caroline Lucas MP]

    Demand side is often the poor cousin – it’s a shame to leave it to the end of the meeting.

    [Andrew Warren, Association for the Conservation of Energy (ACE)]

    Let’s run through the patronised world of energy efficiency. The Committee on Climate Change always emphasises two things are going to have to happen to de-carbonise the economy. First, new generation – but also, what do we do with consumption ? How do we deliver the society we want while consuming less ? Germany has a broadly similar aim – competitive energy, energy security. DECC projects a doubling, or even a tripling of electricity consumption. Germany tries to achieve exactly the same objectives, but consuming 25% to 40% less energy overall. What have we been doing in the UK ? Passing EU Directives, in particular, the recent Energy Efficiency Directive. This is interesting – we have never had targets on energy efficiency before. Energy efficiency is moderately politically uncontroversial – apart from some of the things put forward in connect with the work of the Department for Communities and Local Government (CLG) over the Building Regulations. It is key that new build should follow the new standards, and it is also key that when improving existing buildings, that the new standards be used. The Guardian last Saturday carried a front page explaining that CLG would look *again* at Building Regulations [ http://www.guardian.co.uk/politics/2012/oct/26/government-building-standards-review-regulation http://www.guardian.co.uk/business/2012/oct/31/dangers-bonfire-building-regulations ]. The original Government consultation concluded in March 2011 – but there has been no conclusions or report since then. Unfortunately, we need those conclusions by October 2012 in order to maintain progress on the agreed time schedule. What do we see from CLG ? A “conservatory tax”. There are problems in DECC on issues like Fuel Poverty. There are 5 million people in the UK in fuel poverty, and the only Government-funded programme to address this will be terminated in March 2013. Even though the funding for the programme was cut by two thirds last year, it didn’t manage to spend all its money. Perhaps there will be measures in the EMR to impact energy efficiency ? We need to modify the Capacity Mechanism [of the EMR] so that we can incorporate demand side into that. Parallel to the work on the Energy Bill, there is the Energy Bill Revolution, outside Parliament, which argues that if we are start increasing the cost of energy through policy and measures such as the EMR and the EU Emissions Trading Scheme (EU ETS) modifications, then those funds ought to come back to consumers – this happens in Germany. There is some good news – this year we have at last got a strategic body which will deal with the deployment of energy efficiency [the Energy Efficiency Deployment Office (EEDO)]. We do have the Green Deal and the smart meter rollout, but the key thing we’ve never had before is some entity in Government that speaks strategically on demand side.

    [Peter Boyd, Expert Chair, Energy Efficiency Deployment Office (EEDO)/Carbon War Room]

    I work one day per week for EEDO. My “day job” is with the Carbon War Room where we’re looking at the left hand side of the McKinsey MACC cost curves globally. [The McKinsey & Company Greenhouse Gas Abatement Cost Curves show on the left hand side where carbon savings are cost-negative and so produce payback : http://www.mckinsey.com/client_service/sustainability/latest_thinking/~/media/mckinsey/dotcom/client_service/sustainability/cost%20curve%20pdfs/impactfinancialcrisiscarboneconomicsghgcostcurvev21.ashx ] We work on marine shipping […] This is right in the wheelhouse of what we are talking about today. A strategy on energy efficiency has to be linked to carbon targets. For example, the world economy currently produces 768 grammes of Carbon for each dollar of GDP. To get to sustainable levels of emissions [the two degrees Celsius UNFCCC target], that figure has to drop to 6 gC/$GDP. This is a complete pivot for the world economy. If we don’t address energy efficiency, where there are savings, are jobs, are growth. The role of the EEDO is explicitly aiming to fill in the joins in DECC and other departments. The key place where the economy and the environment can work together. There is a suite of announcements to come – to tackle market failure by market failure, new policies and measures are needed. We work with many departments and stakeholders. We held Summer briefings. If anyone wants to take part in the process, they’re welcome to speak with me. There is a recognition that demand response (demand side response (DSR) and energy demand response (EDR)) is underweight in the current Energy Bill. The team in DECC will look at how EDR can be put into EMR – which it is not covered by yet. We are coming out with a draft report on strategy in November 2012. Why is capital not flowing to get white vans out on the roads, rolling out insulation ? We are committed to working with practitioners. With the EMR it will be helpful to get behind it and not just throw rocks at it – it won’t help. I’m passionate about energy efficiency. The UK has a fantastic opportunity to be a world leader – a country with poor weather and leaky buildings.

    [Roisin Quinn, National Grid]

    On the Capacity Mechanism, our role in the EMR is to be the delivery body, not the counterparty [to the various Capacity Mechanism and Contracts for Difference (CfD) contracting and strike price]. For the CfD, we will assess eligibility of projects. We will be running auctions for Demand Side Response (DSR) [aggregators of DSR such as Kiwi Power http://www.kiwipowered.com/ will be capable of taking part in these auctions]. We will take responsibility for energy security outcomes, and monitor costs and progress. We won’t be setting government policy. We will have access to sensitive information under the EMR, but we will not use that other than for EMR policy-based contracts. What does the Capacity Obligation (under contracts for the Capacity Mechanism) mean for EMR ? The idea of the Capacity Mechanism is to ensure that generators supply electricity when needed, or DSR can reduce demand “when needed” – for example on a cold Winter’s night. We need to redefine what “when needed” means to make sure the consumer is protected. There is such a potential for DSR to be really valuable. The National Grid is working with DECC to access DSR ahead of the Energy Bill. We are looking at consumer issues and continuing discussions with DSR providers – who would supply balancing to the grid as well as overall demand reduction. We host the National Grid forums nation-wide. We lead on developing the pipeline of projects needed for energy security – what products can be packaged, and what the lead time is for energy storage compared to DSR. We are looking at measurement and verification (M&V) criteria, so that we can all have confidence in DSR packages, and that M&V does not present a barrier to entry in the DSR market, and future-proofing. We’re not there yet. We’re still on the journey. This is a transitional scheme and we are pleased with our engagement with DSRs [DSR providers and aggregators] so far.

    [Judith Ward, Director, Sustainability First (ex-National Grid)]

    Sustainability First is a small environmental think tank running three year multi-project. We are looking for the scope for DR (demand reduction) and DR (demand response). We need to understand the economic values for customers and industry players. We have a strong practical focus – some of us are in the Low Carbon Forum/Fund and Ofgem and so on. All our papers are published as we go [http://www.sustainabilityfirst.org.uk/]. We aim to produce a “best picture” on how we use electricity in the country today. We’ve done a survey of large industrial customers and done household data research. Without a clear grasp of how consumers really use electricity, we are working with ill-informed risk. In understanding electricity usage the key is in re-engineering the consumer. Our fifth report is out next week. DSR is value today for sale into the UK balancing and “peak” market [peak load is a daily occurence, when a much higher demand for electricity lasts for somewhere between 30 minutes and a couple of hours, on a fairly regular daily basis. For the realtime example :
    http://www.nationalgrid.com/uk/Electricity/Data/Realtime/Demand/Demand60.htm http://www.nationalgrid.com/uk/Electricity/Data/Realtime/Demand/demand24.htm http://www.nationalgrid.com/uk/Electricity/Data/Realtime/Demand/Demand8.htm ] For the large customers on half-hourly distribution network, use the triad scheme to avoid charges [ http://www.flexitricity.com/core-services/triad-management ] Do we need yet more DSR – or is it premature at this point ? We need to understand schemes, how the services will supply flexible and peak avoidance. For the Capacity Mechanism, we need to introduce price information – however basic – so that customers know what they can earn by taking part [in DSR aggregator contracts]. Sources of flexible, suitable load are somewhat limited in the GB electricity system – but there is a surprising amount of peak electricity heating in commercial and some residential applications. But is there potential to shift it to overnight charging ? For retailers there is little incentive to promote DSR at scale. For the vast majority of the 29 million customers, the smart meter rollout is far away, but the settlement system adjustment is close at hand. The question is how to unlock smarter markets. System flexibility has to increase by the 2020s, so will need a more controllable load – and the system costs will go up. The search is on for new sources of flexibility in electricity load. At present there are incentives for electricity demand reduction – lower bills. But from the perspective of the electricity system, not all electricity demand reduction is useful. The time of day and season related. “Time of use” tariffs should promote electricity demand response, assigning value. The Green Deal and the Energy Company Obligation (ECO) should work in a more concerted way to deliver more demand response. Let’s be clear about the priorities on what to do first. Electricity has specific end uses – targetting those could make a difference today. Light efficiency schemes are not very glamorous…

    [Questions]

    [Tim Probert, New Power]

    A question for National Grid. The existing balancing mechanisms – will they be part of the Capacity Mechanism ? Or will there be extra money available to balance grid load [under the new regime] ? The cash out settlement system charges will need reviewing – will more revenue be available for those with flexibility to help in balancing load ?

    [Jenny Holland, Association for the Conservation of Energy (ACE)]

    Is long-term demand reduction in your frame in the Capacity Mechanism ? It is simply not going to happen if the draft Energy Bill stay the same. In the United States, the market is “technology-neutral”, but only 10% comes from demand control. If DSR and energy efficiency are not targetted, they won’t happen. Generators will be able to bid in at a lower cost than DSR and energy efficiency – as they will get money for selling their electricity, *and* for the Capacity Mechanism. We are favouring modification of the Energy Bill with a merit order that favours low carbon and demand reduction, not letting gas wing its way though and swamp the Capacity Mechanism.

    [Roisin Quinn, National Grid]

    Absolutely agree. We should not be locking ourselve into long-term contracts with the implication of demand in future that just won’t be there. To date our focus has been DSR, not long-term permanent cuts in electricity use.

    [Peter Boyd, EEDO/Carbon War Room]

    From the strategy side we are looking at options for permanent demand reduction [energy demand reduction (EDR)]. We can exploit international learnings. We’ve recognised that DSR is just a small part of the EDR landscape. This is a market failure – where poor information is preventing [development].

    [Andrew Warren, ACE]

    Th National Grid are “implementing policy coming through”. There is a complete absence of anything in the draft Energy Bill on the demand side as opposed to addressing load balancing and peak demand issues. We should be trying to do what Germany and some American States are doing – allowing direct comparison. Which is cheaper – investing in new generation or investing in demand side reduction ? The cheapest way in almost all circumstances is to reduce the overall level of demand. It’s important that the National Grid flag up the implications of yesterday’s solution dominating.

    [Roisin Quinn, National Grid]

    We are pleased to be involved with the DSR pilot scheme – demand avoidance is appreciated – especially when dealing daily peak demand.

    [Judith Ward, Sustainability First]

    Demand side and the capacity market – I get the sense that they are jelly-like because it is not clear what the Capacity Market is intended to do – either on supply or demand side. It’s hard to know if the DSR is is going to be locked out or not. Is it going to bring forward the merit cap ? In the capacity market, how much is likely to be backup generation [generation brought on at particular times when renewable energy is a a low], not turn-down [when plant is turned from full power output to standby] ? We need to look at the carbon emissions implications as well.

    [Questionner]

    Maybe we should look at it this way – “peak” equals “cap” and “demand” equals “energy” [to meet peak demand we need to cap it by demand reduction – temporary or long term, but to meet usual demand we need new and balanced generation]. Perhaps we should value these separately. There is clearly a market failure, there has been little supply increase. Could electricity distributors drive or aggregate demand response ? Perhaps they are better placed to do that ? There is more trust ?

    [Mayer Hillman]

    Are you sufficiently well-informed that climate change is now irreversible ? In the light of that, the only logical course of action is the Contraction and Convergence (C&C) global framework solution of equal per capita shares and rationing. In 20 years I haven’t seen any alternative. Does that not put that into perspective ? [The main argument of C&C is that there is no point in pricing or trading carbon unless there is a global cap enforced.]

    [Matthew Parlour, “working for Lord Browne of Madingley”]

    After half a century [of efforts on energy efficiency and energy savings] we have learned the consumers do not respond. An example is the difference in Americans being offered free energy demand measures. If the offer was on a website where they had to click to order something sent directly to them, they would not do it. However, if they were offered the same free product by telephone, most accepted it. How much have you thought through the rationality basics ? How do you see the balance of incentives offered to consumers and mandated changes ?

    [Andrew Warren, ACE]

    Mayer, you remain the voice of my conscience. The ice caps are melting. There is less and less opportunity to stop exploitation of Arctic oil – one of the single most depressing things – climate change is exacerbating, leading to greate availability of what caused it in the first place. In ones darkest moments, I turn around and say, oh my God, what are we going to do ? But there was an 18th Century philosopher who posed the problem of a man who did nothing because he thought he could only do a little. I would like to respond to Lord Browne’s assistant – and interesting question regarding the irrational behaviour of consumers. I am impressed by your boss, he changed BP. He was the first head of an international oil and gas company to say climate change is real. He demanded from all his operational groups 20% more efficiency [making the company more efficient and sustainable into the long term in getting oil to market to be burned to emit carbon dioxide…] – a diktat from the top. The rest of the world needs to follow what your boss proposed. With his new venture Cuadrilla, that “Prince Charming” George Osborne was enthusiastic at an event about the prospects for shale gas. Every other energy minister says that reduction in consumption is required. I hoep your boss not only asks for generous tax breaks, but also asks for support for the other more cost-effective solution – reduction of energy demand.

    [Peter Boyd, EEDO/Carbon War Room]

    You vote in a democracy – not because your individual vote really counts [but because of the accumulated effect]. The single biggest failure of the Non-Governmental Organisations (NGOs) at Copenhagen was to demand a global treaty, a single collective political goal – but the white van still needs to be paid to turn up [in other words : the practical details of creating incentives to get insulation done is more important in the long run compared to aspirations on paper.] It is becoming clear that Mitigation of and Adaptation to climate change needs to be joined by a third actor – Suffering. And we can only choose one of two options. We can either do Mitigation and Suffer [the cost] or we can do Adaptation and Suffer [the climate change chaos]. Climate change singularity is one of the problems our brains are not wired to compute. We’re not structured to solve this. We can we do now ? Energy efficiency. While the policy guys are going for the right hand side of the McKinsey MACC curves, and how we’re going to finance that, we’re going for the left hand side. Most of the technologies that can really make a difference are already 20 years old. And it will be a better world that we’re in – not a hair shirt and sandals world. On rationality – if we make these really efficient buildings of our workplaces and then walk around in tee shirts [with the heating turned up] at home, then we haven’t solved the problem. When energy efficiency measures do go in, we can minimise irrationality. What’s the electricity distributor’s role in delivering energy efficiency ? This is the Government’s iPod moment. The array of policies to solve this will get more complex, just like the technology of the iPod was more complex than previously. But the interface of the iPod was clearer, more attractive, and so was usable and popular. A company needs to come round to your house, do an assessment and say “this is what will work for you”.

    [Caroline Lucas MP]

    I welcome the stress on urgency [in relation to Mayer Hillman’s question]

    [Judith Ward, Sustainability First]

    The issue about possible supply failure. There has been retail failure in the settlement system – complex and opaque – a broken link between how upstream costs are recovered (on a socialised basis) weakens their resolve to offer cheaper tariffs. I think that if we can fix some of the issues in the retail market […] I think it’s too early to decide if we want a DSO-led [distribution system operator in the electricity grid] world or a supplier-led world. If we want to do a community project, if will be very difficult to get incentives.

    [Roisin Quinn, National Grid]

    Somebody needs to lead. Climate change. Can we do anything about it ? We have to try. We need a new electricity demand profile in the UK power market that flattens the evening peak load – then we could marketise this.

    [Rebecca Aspin, powerPerfector]

    Energy reduction should be 30% – 40% of our carbon targets. We are not really being energy efficiency focussed. We are disappointed that voltage (power) control is not in the SAP [the Standard Assessment Procedure for permitted technologies for consideration of Energy Bill subsidies]. It seems that policy cannot cope with electricity – they are more heat-focussed.

    [Consumer Focus]

    Regarding the problem with consumers being rational to accept energy reduction – the bigger problem is the implementation of DSR. There is not much money available to get consumers engaged in DSR. £90 per annum would be available – but not to consumers. Heat storage takes up a lot of space – how are we getting consumers to do this ?

    [Judith Ward, Sustainability First]

    The values in our eenrgy system are not there.

    [Roisin Quinn]

    There are savings, but they don’t add up to much. It comes down to questions such as – my cup of tea – really not worth the money to forego it.

    [Peter Boyd]

    Is £90 enough in a £1,200 energy bill ? It will be worth it to have Tesco turn off their air conditioning for a minute, but… Is there sufficient cash to see what is going on. The power of education – waiting for the kids coming through who know about energy demand ? We need a way to measure changes.

    [Andrew Warren]

    [to powerPerfector] You are not the only technology that is not in the SAP – in fact you have to consider the RDSAP [Reduced Data Standard Assessment Procedure] and a lot more technologies are not in there. On providing incentives : in the last few days, the Green Deal has put in place a 15 month £125 million cashback scheme rewarding you for implementing Green Deal measures – you don’t even need to take the Green Deal finance. This is to kickstart the Green Deal, and that is essential as [the Government’s own figures show] in 2013 there will be a reduction in insulation installation projected, if not.

    [Caroline Lucas MP]

    This does come down to political will. And the politicians will only act when more people want them to act. The population assume the situation is not serious as we say, or otherwise the politicians would have acted on it…

    [Andrew Warren, ACE]

    Ed Davey considers delivering demand side as being his number one priority – I know his commitment to energy efficiency. It has been an interesting day in DECC…

    [Keynote Address]

    [Ed Davey MP, Secretary of State, Department of Energy and Climate Change, and on the Energy and Climate Change Select Committee]

    I would like to offer my thanks to this group for over the years pushing an agenda I believe is incredibly important – something I’ve been involved in for many years […] We have a Bill that we’re bringing to Parliament, a really critical bill for the low carbon agenda. The challenge that faces the country is that demand is set to increase, due to economic and population growth, with the electrification of transport and the electrification of heat. As demand is likely to go up as we de-carbonise, supply is going down. A fifth of all power plants are to close by 2020 – there is a huge need for investment – £100 billion in new low carbon electricity generation by 2020 and the network grids and so on. One of the real opportunities for the UK – which is struggling with growth and needs to get the economy going. Energy is often the largest [sector for growth] available. In the national investment plan, £250 billion is needed for infrastructure investment – nearly half of that in energy, several times more than needed in transport, six times more than for water, and seven times more than needed for Crossrail. We have to double investment in energy to meet that. This is a huge opportunity for growth. It’s important for energy security, keeping the lights on and for industry. It’s a huge opportunity – and we can use it to diversify – Carbon Capture and Storage (CCS) [to capture greenhouse gas emissions from coal burning] and nuclear and renewable energy all playing a part. It will insulate us from fossil fuel price spikes and the impact of [energy] bills, and meet our carbon targets. It is a timely opportunity that we need to grasp. The great thing about energy infrastructure investment is that it is available in all parts of the country – a good way of rebalancing the economy. The argument has always been that infrastructure planning takes too long – 4 to 5 years before the first sod is turned. But much energy investment money is ready. If we look at which part of the economy is growing, even in difficult times – it is the green sector. The whole point of EMR is to allow low carbon investment to happen – switching to a more low carbon [economy]. A key element is Contracts for Difference [Feed-in Tariffs] – a really smart investment instrument. On nuclear power we are negotiating bilaterally. And for Carbon Capture and Storage we have a competition. It is quite statist, quite interventionist. The EMR with CfD is about moving u from where we are through four phases to where markets are leading investment at low cost. In Phase 1, the Feed-in Tariff Contracts for Difference (CfD) prices will be set administratively [just as] had the Renewable Obligation prices set in the July review. The National Grid has already issued evidence for the strike price – to try to bring all technology groups down in cost and level the playing field. Some people think this is quite complicated. We will set a fair price, the strike price for low carbon electricity – a variable premium to top up the market price. Generators will pay back if their prices are higher than the strike price, therefore it is more cost-effective for the customer. I’ve spoken to investors – the CfD is really attractive – it offers a predictable return – smoothing out volatility. We will still get market efficiencies as companies will have to sell into the market. [In the Energy Bill I will have] powers to give project developers the comfort that they need [to arrange financing]. In 2017, Phase 2 will want to move to price discovery – with technology-specific auctions, such as with onshore wind generation. By Phase 3, current technologies will have matured, so we will move to more technology-neutral auctions. We could see all technologies competing on cost – clean affordable energy security. There is a huge amount of detail in this. We will publish in a few weeks’ time. Developers want early certainty – looking for entering into the CfD early. We will be providing commitment at a reasonable pace. Discussions about the counterparty and assuring its workability – this will probably be a company owned by the Government. In addition is the Capacity Market – as more of our electricity comes from renewable energy and less from gas etc, we will need to be sure we have enough to come on [in the case of wide variability in solar and wind power supply]. The National Grid is projecting shortfalls, so we will guarantee a steady payment for capacity – we are particularly keen to see a DSR when at the margins [of operability] at Peak [Demand, daily] organised by aggregators to prevent the prices peaking. We want to design a Capacity Market to ensure DSR plays its part. Liquidity is really important in the wholesale market – meaning for lower prices. I don’t think this is working well – we need a more diverse [energy mix]. Some think we should reintroduce the Pool, but that doesn’t solve the problem of lack of liquidity in the forward market. Ofgem has been working on potential reform – the threat of regulating has moved industry, particularly in the day-ahead market. I’ve made clear we’ll have backstop powers to promote liquidity […] On DSR, there is a real demand that Government drives permanent reduction in energy demand. This is crucial, and we are publishing our energy efficiency strategy soon. The Green Deal is going to be extremely exciting – we will see people having warmer homes, cheaper bills and lower carbon. [DSR will be either in the Bill o complementary to the Bill]. The whole point of the EMR is to move towards a low carbon economy – I think these proposals are very radical – they need backing. This is a real radical step forward.

    [Andrew Warren, ACE]

    You would have to be heroic to believe that you are anticipating increased electricity demand. Why have the Government got it so wrong ? If hand on heart you believe that electrification of transport will replace petrol and diesel in all cars and lorries. 70% of our gas is used to heat, and if that moves to being more electrical, it is heroic to suggest that electricity demand can go down. Our proposals are based on good calculations.

    [Questions]

    [Questionner]

    Do you accept front page news ? That the Energy Minister has actively undermined your policy ?

    [Ed Davey MP]

    I hope you note the Prime Minister quotes. The Prime Minister has supported us, [saying that] although John Hayes made those remarks, it is not Government policy. I have taken personal charge of renewable energy. I am in charge of renewable energy strategy, including of onshore wind.

    [Julian O’Halloran, BBC]

    The implication from [John] Hayes implies that there will be a moratorium on wind power as there is enough in the pipeline already. Are you ruling out a moratorium while you are Secretary of State ?

    [Ed Davey MP]

    We are on track to deliver our aspirations (not targets) by 2020 as part of our renewable energy strategy, we are really getting motoring in renewable energy investment, rather than saying we don’t need any more […] I am conscious of the debate in certain parts of rural England and the Conservative back benches – 100 of them wrote to me on Day 1. It is their democratic right to voice their opinion. I issued a consultation on community energy, that new renewable energy infrastructure is part of their community and brings them benefit too. If we can show that people can benefit from onshore as well as other energy […] The opinions polls show that a significant majority are in favour, even if close to their homes. I got 62% of my Constituency vote. Wind farms are already more popular than I have ever been.

    [Summit Skills]

    The Green Deal Skills Alliance. We are not seeting [companies] committed to training. How can we stimulate demand ?

    [Mayer Hillman]

    You have confirmed my worst fears. Your aim is to match demand as efficiently and effectively as possible with the least environmental damage. Rather than the eonomy, in achieving a level playing field you should seek to attract a proper value to a tonne of Carbon. Years ago a tonne of Carbon was cheaper than now. I don’t see how you can achieve [low carbon] with a fixed price. The equation has got to include the displacement of ecological refugees.

    [Jessica Lennard, Edelman]

    In a statement you made [today], you said there are no targets or cap on renewable energy. Can the Minister comment on biomass ?

    [Ed Davey MP]

    There is a proposed cap on biomass – it is not completely financially within our envelope. Biomass investment is a bit lumpy, and [support for it] would displace [other energy technologies]. On demand for the Green Deal we’ve made a cashback available to encourage early movers. The Local Authorities are running [training] courses and we will be doing marketing efforts when after 28th January. I’d be surprised if demand was taking off now. We are expecting demand to grow – not whizz bang massive demand in the first month – it’s long-term. Solid wall insulation – it’s a bit of a hard sell. Investment is a 10 to 20 year business, not for a quick buck in the next quarter. Timing is really important, and expectations. We didn’t talk about our carbon reduction. The most ambitious carbon emissions reduction target in the world – [as outlined in our] carbon budgets. I’ve proposed decarbonisation in the Energy Bill. […] [Regarding Mayer Hillman’s points] The fixed price will be for low carbon investment. The rising prices will be on carbon. I’m working tirelessly to reform the EU ETS, to persuade the Poles and others. I’m doing exactly what I think you want – and the price of carbon should go up […] We should have no complacency whatsoever about closing the emissions gap. If sounds technocratic – markets and […] I apologise – this is how it’s done.

    [Questionner]

    The Prime Minister’s comments will be scrutinised in boardrooms around the world. In a speech to the CBI […] indicated a three month process in relation to gas generation investment.

    [Ed Davey MP]

    Called for evidence for the gas strategy to replace coal. There are various barriers to this investment. By the time you have planning gas technology has moved on – this causes delays.

    [Andrew Warren, ACE]

    The Energy Bill is incredibly important to get right. It’s not something that you can re-visit after 20 years – it is essential to get it right.

  • Futureproof Renewable Sustainable Energy #1

    Posted on November 1st, 2012 Jo No comments

    PRASEG Annual Conference 2012
    http://www.praseg.org.uk/save-the-date-praseg-annual-conference/
    “After EMR: What future for renewable and sustainable energy?”
    31st October 2012
    One Birdcage Walk, Westminster
    Twitter hashtag : #PRASEG12

    Followed by Part 2 and Part 3.

    PLEASE NOTE : The record is NOT verbatim and should not be treated as such. Check against delivery, I think they say in the trade. If I have scribbled incomprehensively or missed something, I have interpolated according to the spirit of the context. I am open to correction or challenge on my record of the event.

    [Alan Whitehead MP : chair of PRASEG]

    People are asking about the title of this conference “aren’t you being a bit previous ?” But we do need to talk about the future of renewable and sustainable energy when the Energy Bill comes in with the aim of delivering a low carbon economy. We are at a juncture also where we need investor certainty. There’s been the very successful Round 3 Offshore wind power licencing. The Electricity Market Reform (EMR) is going to be vital in terms of the atmosphere and landscape of that process taking place. Renewable energy is one of the largest areas of investment in the UK. We need to make sure that we meet our targets for the 2020s and onwards. The last thing we need is the shambles of yesterday and this morning – conflicting messages on wind power from two Ministers and a correction by a third Minister, and a further correction at Prime Minister’s Questions. The press treatment will undermine investment certainty in Government policy. With the EMR we *will* be able to talk about the time after the 2020s. Maybe there’s an opportunity that comes out of this political storm. We do need clarity. We need to go ahead and reach our targets and exceed them. Renewable energy will play a part we know it can in the “Energy Revolution”.

    [Laura Sandys MP, PPS to Greg Barker MP, Secretary of State Climate Change, Department of Energy and Climate Change]

    The work of the Energy and Climate Change Parliamentary Select Committee shows how important this subject is. It is not partisan. In many ways energy is a very big challenge. Addressing it is about putting this country’s interests first with a sustainable and reliable energy system. I am pleased that this event has the support of DONG Energy. My Constituency is host to the London Array [wind power project]. If all the MPs had the experience [of the integration of renewable energy projects with the local population] I had with DONG. They have built a strong community coherence and shown dedication. The project is very much part of the local environment. There has been no better experience than in Thanet. I must also put in a caveat, not speaking as a PPS, but as an expert in energy for 20 years. In many ways, the big challenge is not the 24 hours of [press] debate. I think the second biggest challenge, after deficit reduction, is keeping the lights on – building a long-term competitive energy system. We are in a difficult environment, trying to raise £200 billion of investment at a time of financial contraction. Wholesale energy prices are rising. The challenge is to create a low carbon resilient system. There are no easy energy technology options. We have to balance up price and price stability; supply and security of supply; and even the aesthetics. There is nothing that meets all our requirements entirely. Every energy option has some pain. We need to understand this and be big. We need energy renewal. This is a subject for big people. For people with big ideas and courage to deliver long-term strategy. We need a mixed energy economy – we should not have vilification of any technology – no “religious” response to any technology. We need to focus clearly on our legal obligations and targets. We must also reflect aspirations and realities. The 20th Century was a battle of ideas – capitalism versus communism; free market very long-term planning. This century will see a massive struggle for resources – to sustain the population in each country. I’m not sure it will be such a friendly one. Energy resources and renewable energy, even, will become more expensive. So maximising our supply from domestic renewable energy will provide us with more stability and security. Some say we’re going it alone on decarbonisation. Look at China’s planned investment of $473 billion and the EU and progressive States in the US. The smart, the bright and the intelligent are embracing it. Green and renewable energy are not some form of “sandal” economy, a tie-dye tee shirt. We’ve got to wake up to reality. We’ve got to also look at the challenge of renewing our energy system. It’s an opportunity to be aspirational. I don’t want a lowest common denominator energy system – I want something aspiration that looks to the future in behavioural, structural and technological terms. The EMR is the Government’s job – to get right the forward market and the right settlement market for your industry. The Government is there to support you. Companies are key to making big differences. We are constantly looking at the wrong end of the supply chain – as engineering blokes – looking at big energy projects. A modern, interactive, smart system will take a new approach to consumers. We need new technology, not just new generation technology, but throughout the supply chain. Democratisation – distributed, de-centralised energy – and opportunities for real demand reduction. If developing new energy systems, re-engineer it around the consumer. Take for example mobile phones – thousands of tariffs, but the customer still feels in control. We are as energy consumer merely receivers of energy bills. We cannot conceive of how to “consume” energy. The system is old-fashioned. A command-and-control environment. If the customer knew that there were 100 hours of energy “peak” demand – mostly on Tuesdays in February between 5 and 9pm, if I remember rightly, and that between 5 and 7% of all infrastructure and distribution arrangements are focused on those 100 hours, they’d say “Fabulous. Give me fifty quid and I’ll turn all the lights out.” We need to start to respond [to these exceptional cases] because “peak” is not talked about around the dining room table. We need to be transparent in communication – unnecessary capacity [energy provision in the supply system] is due to old-fashioned practices. At the heart of a new energy system we need a new vision for consumers. I’m a bit green – a “Turquoise Tory”. My father introduced the first clean air Act. Macmillan told him it would be the end of industry. In months, the UK was the leading exporter of clean coal technology. Modernity will move beyond current technologies. It is clearly important to have infrastructure that allows more technologies to come on board. Something we don’t talk about it grid. I have a real sense that it has purpose. The vision is that it should be a plug-and-play operation – like the X-box. Generators are the software – accessing the grid, either microgenerators, community generators, macro generation. The big breakthrough will be getting the grid to play a real part of the new energy system – like the body’s blood system. I’m leaving all the policy bits to the Minister. Because energy resources have been so freely available, so cheaply, in distribution, the Cinderella of all policies is demand reduction. We need to get a clear understanding of where we can *not* (where we do not have to) generate. We can choose to deliver a smart set of energy policies. The smarter the policies, the less generation we need to do. A creative part of these policies will be policies to address demand reduction. We need some other mechanisms – not least price transparency. Energy suppliers need to design their products so that consumers can reduce it. We are currently flying blind. The customer does not understand what they are using – where, when and how – the truth about how much energy costs. Smart consumers deliver smart markets.

    [Start of first session “The Future of Renewable and Sustainable Energy”]

    [Ben Sykes, Director, UK Markets, DONG Energy]

    We have 720 MW of offshore wind energy. I’m going to approach this from a purely business angle. How is the landscape looking for a business doing a lot in offshore wind ? We hear a lot of talk about Renewable Energy. It’s time to differentiate within that. There are different sets of challenges – let’s be realistic. So, considering the impact of the EMR on offshore wind in future, DONG sees a lot of good things coming out of the EMR. The “Contracts for Difference” (CfD) we think is a good one. It gives investors certainty (although there are risks that include the counterparty risks…) DONG is active in bringing in investors – pension funds, private equity. These need to see the certainty of revenue. The big question : what the implementation model will say about the energy mix. How the Energy Bill deals with energy mix is critical. The capacity [mechanism] allocation – nothing to do with the Contracts for Difference – as deployment increases it will affect the balance in the Levy Control Framework. [Note : the Capacity Mechanism is proposed to pay large power plant to remain on standby in the case they are needed as backup generation. The Levy Control Framework is effectively a hard cap on HM Treasury spending in each area – the Government will only subsidise a certain amount of electricity generation capacity held in standby each year, for example.] This is a big issue : will we have the conditions for bringing these projects forward – which are years in the planning ? It’s very difficult spending tens of millions of pounds without knowing if we have access to the subsidy – if we end up walking blind for 5 yeas and then hearing “Oh sorry, there’s no capacity [mechanism funding] left for this year” from Whitehall.

    [Nick Molho, World Wildlife Fund (WWF)]

    I thought I would touch on the context of the EMR. The International Energy Agency (IEA) in their World Energy Outlook (WEO) says tht unless we shift our energy systems we will be using all the carbon we *can* use by the 2020s in order to keep within the 2 degree global warming target. Where the EMR sits : there is considerable investment uncertainty – the impact of uncertainty can be made clear by recognising that 2030 is only one investment cycle away. We need a framework in the very near future. Does the EMR do enough to attract large amounts of capital ? Yes, two reasons. If there is a long-term volume signal – a decarbonisation target for example – signals especially to renewable energy. And second, if there is a stable and well-balanced Feed-in-Tariff Contract-for-Difference (FiT CfD) for Renewable Energy. Our report from WWF showed that feed-in tariffs are key – continued policy support will be key. If we want to reduce the cost of finance, we need to avoid the summer offshore wind power support levels chaos. Around 40% of our power was generated by gas in 2011 – the UK has a lot of existing gas. A limited amount of new gas generation will be needed to balance the grid in 2030. The role of unabated gas [without Carbon Capture and Storage (CCS)] will have to be limited increasingly – it should not exceed 10% by 2030 if the UK fully de-carbonises according to the Committee on Climate Change (CCC) budgets. The CCC have pointed out that a large amount of gas [percentage terms] is economically not feasible. The International Energy Agency (IEA) and others still project increases in the gas price. Energy Efficiency is often underestimated. The McKinsey report for DECC said that energy efficiency could reduce consumption by 40%
    [ http://www.eaem.co.uk/news/uk-could-cut-electricity-demand-40-says-mckinsey “Capturing the full electricity efficiency potential of the UK” ] by 2030. We have to put energy efficiency at the core of policy – according to a WWF and Green Alliance report [ http://www.wwf.org.uk/what_we_do/press_centre/?unewsid=6259 “Creating a market for electricity savings: Paying for energy efficiency through the Energy Bill by Rachel Cary and Dustin Benton” ]. We need energy efficiency enabling powers in the Energy Bill. This is critical to the ability to provide long-term investment, to be clear on gas and energy efficiency, and working across borders on EU co-operation.

    [Simon Skillings, Senior Associate, E3G]

    What a fascinating industry this is. The EMR is a delivery mechanism. If we ask what it is here to deliver – the “Pool” – how much commodity – the National Grid has got to deliver it regardless of conditions. The question should be how effective they are at delivering what they’ve got to deliver. The trouble is, the future is uncertain, and it’s difficult to be prescriptive about what we need. The challenge is to risk manage economy/energy/environment – what can the Energy Bill do ? Should it ignore the risk management and leave it all up the National Grid ? Alternatively it can specify with a little more clarity – effectively saying to National Grid “go away and do your work” is not viable. The Energy Bill therefore has to specify what the National Grid has to deliver with the EMR tools. How the trade-offs are made should be outed in a more public arena. The fear is that the Treasury holds money as a weapon, it’s not democratic – balancing against other requirements. The EMR has to contain something about carbon control, something about capacity and the levy, something about security of supply. Is it enough ? No – there are actually two other areas. Everybody wants to talk about “demand side” [Demand Side Management (DSR) and Energy Demand Reduction (EDR)]. It’s obvious but hard. Can we mandate demand side in the Energy Bill ? It needs to have some sort of evidence in the Energy Bill about the role of renewable energy into the long-term. Maybe the existing 2020 targets give enough clarity. Could we leave the broad discussions another year or two before we can be clearer on targets in the EU ? No, clearly in the short number of years to 2020, targets for further out need to be provided for renewable energy. Success will be judged by how the Energy Bill specifies how National Grid delivers.

    [James Murray, Editor, BusinessGreen, chair of meeting]

    Interesting comments there – about the Treasury being anti-democratic – ducking questions of responsibility.

    [Andrew Buglass, Head of Energy, Royal Bank of Scotland/Low Carbon Finance Group]

    I run the RBS Energy Team, and the Steering Committee of the Low Carbon Finance Group – I’ve been living and breathing this for some time. My perspective is from the lender angle. I echo what Ben says. Clearly we have a situation where there is significant weakness in the economy. There is a massive reduction in the amount of capital. Creit ratings are under pressure. Bank liquidity is tight. But banks really like this sector. Generally this sector performs well. We have financed 9 gigawatts of renewable power. We want to lend money to this sector. Lending volumes are a lot lower the last ten yeas. There has been a hiatus caused by the EMR consultation process. Developers are cautious, and it has not been helped by the revision of the Renewables Obligation (RO) banding. Lenders and developers need a regulatory framework or face regulatory risk. We have financed renewable energy and “conventional thermal”. What matters in policy is transparency, predictability and durability. Can you explain the new system to a sceptical foreign investment committee to encourage them to commit equity capital ? Energy investors have choices…We need to deliver clear overall messages. With the complexity of the EMR there will be issues. The public “debate” – a worrying trend is that there is perceived politicisation of the sector. There needs to be a political debate about policy [not a media debate]. It is unfortunate what has happened in the press. Those things make serious investors very, very nervous. They wait until the path is more clear – then they know what they’re going to be getting. With Contracts for Difference (CfD) it’s about the mechanism – the counterparty and the process. There’s a long lead time and the potential for rationing of CfD’s is likely to put investors off. Also, the involvement of the Government in setting the CfD – whether that’s on volume or price. This is more interventionist than generation has been in the past – investors need to make sure they are comfortable. They are watching the Capacity Mechanism with huge interest – in relation to “conventional thermal” and what it implies for generation mix. On liquidity – independents [independent generators] need a route to sell their power. Even under the Renewables Obligation (RO) we are seeing much less volume of Power Purchase Agreements (PPAs) being agree, and with less favourable terms. Gas is potentially a gamechanger, and it will be playing a major role in this sector. Sticking to the 2020 target has reassured people, we can point to something written in tablets of stone – it offers a direction. I personally think that 2030 indicators would be extraordinarily helpful – as undertaking a commitment to pieces of the low carbon sector.

    [Questions from the floor]

    [James Murray, Editor, BusinessGreen]

    Precisely how unhelpful was the intervention from “The Peoples’ Minister” John Hayes ? Is this press blustering, or really damaging ?

    [Nick Molho, World Wildlife Fund (WWF)]

    It was unhelpful in two ways. First this kind of dispute will delay investment coming to the UK. And secondly, from the consumer’s perspective, their perception, that arguing about the costs of investment indicate that since the costs will be high, bills will go up.

    [Ben Sykes, Director, UK Markets, DONG Energy]

    Is lack of clarity helpful ? Probably not. I don’t like having to explain to investors on Wednesday mornings that, despite this, the UK has a stable policy environment, when competing for investment with other north western European countries.

    [Andrew Buglass, Head of Energy, Royal Bank of Scotland/Low Carbon Finance Group]

    From the investment committee point of view, for years, energy has been relatively boring, predictable. They haven’t seen it on the front page, they haven’t really been bothered. There has been a cross-party consensus. Now they get, on a weekly basis, very serious people raising issues, “You’ve seen the papers ? Why on Earth should we continue to support this ?” It raises the potential risk of policy change. And banks don’t like this. And this is also critical – it almost doesn’t matter what the policy message is – everybody just has to have the *same* one. We cannot have a situation where a subsidy was granted that is now no longer affordable. Projects are competing for capital – they need a consistent set of messages.

    [Ben Sykes, Director, UK Markets, DONG Energy]

    It is unhelpful for achieving long-term energy security. It’s lots of froth, but it is a problem for the UK. If we can’t settle down on an energy policy, we’re all in trouble. Although, in 24 hours it may have gone away.

    [Simon Skillings, Senior Associate, E3G]

    This might get some public discussion on energy. Some of these debates might be awkward, but if we don’t have them, we could have the situation in a few years where it is known that half the Cabinet think one thing and the other half of the Cabinet think another, which would be unhelpful. If this [Ministerial difference of policy opinion] does trigger a detailed debate, then it may be a good thing.

    [Jessica Lennard, Edelman]

    Are we going back to the “Pool” ? Will the Government become the buyer of last resort ? What are the Treasury guarantees ? What can we do about independent generators ? One thing is the design of the markets as much as anything. Can you as an independent enter the market ? There are now less opportunties for PPAs (Power Purchase Agreements). It’s unattractive and increasingly unbankable. The changes in the accounting regulations mean that you need to treat PPAs differently.

    [Andrew Buglass, Head of Energy, Royal Bank of Scotland/Low Carbon Finance Group]

    We have been working with large users of power and leading generators who are seeking to come to their own arrangements. We have to think about how to use the existing mechanisms and own corporate policies. We want to have a long term helper for large users. The bulk of people we lend to are independent. They need PPAs to unlock funding – and they are increasingly not able to get that.

    [Simon Skillings, Senior Associate, E3G]

    The issue is the power of the narrative about competition in the wholesale markets. It’s easier to be big than small – it is a driver for consolidation. It’s hard to promote independent generats without unpicking that narrative – for example, reference David Cameron’s remarks.

    [Mike Rolls, Siemens]

    We’re asking for a 2030 target because of the issues of the supply chain. The time horizon for the supply chain is longer – investors need to see a pipeline [emerging future demand based on policy steer] in order to sustain UK jobs in UK companies in the UK. We’ve seen the benefits of a consistent message on a commitment to nuclear power.

    [Nick Molho, World Wildlife Fund (WWF)]

    Should we have 2030 targets to replace 2020 one ? Yes, and work is being done in the EU on that. WWF is coming out with a report that the UK should sign up to a 2030 EU renewable energy target – it is entirely consistent with decarbonisation of the energy system. The UK could become an exporter of energy, as outlined in the Offshore Valuation Report, and could also export renewable energy technology.

    [James Murray, Editor, BusinessGreen]

    …There is the counter-argument that a target doesn’t provide the best price options…

    [Nick Molho, World Wildlife Fund (WWF)]

    The policy approach of taking a technology-neutral carbon price, from the investors point of view, is that this is not a long-term stable signal, and also, the carbon price will have to be set pragmatically [in a political process in a politically acceptable fashion].

    [Ben Sykes, Director, UK Markets, DONG Energy]

    A 2030 horizon really matters to us. We need a supply chain to have legs if it’s going to drive down costs by 2020. We can only deliver ever-lower costs in offshore wind if the industry sees the potential. We won’t get to 2020 and then all sit down – no. We need a signal into the supply chain for 2030.

    [Alan Simpson MP, “architect of the Feed-in Tariff”]

    In Germany the policy discussions are much clearer about the paradigm shift to a cleaner energy system. If DECC didn’t need to find a way to subsidise nuclear power, would we need to have this Energy Bill at all ?

    [Andrew Buglass, Head of Energy, Royal Bank of Scotland/Low Carbon Finance Group]

    We would need something, even if not trying to support new gas and new nuclear. All the issues are about financing, we haven’t discussed *markets*. Despite the complexity of the Renewables Obligation (RO), it *was* bringing forward renewable energy – the RO would have worked as least as well [as introducing the EMR]. The arguments were that the RO was unfit for purpose – but what’s a levy control framework more than an RO ? We could have had more investment velocity if the EMR had *not* been happening. Introducing that level of uncertainty – a hiatus – has been unhelpful in the supply chain. We should have been investing in the UK.

    [James Murray, Editor, BusinessGreen]

    It’s important to note that even with all the uncertainty, we are seeing the most investment in energy in the last 10 years.

    [Simon Skillings, Senior Associate, E3G]

    The Germany comparison is very interesting. The transformation in the energy sector, the Energiewende, is operating at a very deep cultural level. Is the UK Energy Bill re-enshrining history rather than creating a new future ? It’s intelligent to come back to focus on the demand side – a self-reinforcing process.

    [Tim Probert, New Power]

    The levy control framework, and its inevitable cap on capacity. Is it competitive or anti-competitive ? Will developers bid higher or lower into the market ?

    [Simon Skillings, Senior Associate, E3G]

    Dieter Helm makes some good and some bad points. A good point is that we are effectively entering a world of centrally managed contracts – the biggest impact is in the supply chain and the new market arrangements need to [cater for that].

    [Ben Sykes, Director, UK Markets, DONG Energy]

    Will it be possible to game the levy control framework ? How it interacts with the supply chain is critical.

    [Mayer Hillman, Policy Studies Institute, reaching the age of 81 yesterday]

    I fear my worst expectations have been confirmed. All the discussion i based on the assumption that the Government has a responsibility to meet consumer demand, minimising risks, but this is fundamentally wrong. Policy has to determine demand to capacity of the planet to absorb any further greenhouse gas emissions. If we look at that we need to face reality. We are now living on a planet where climate change is irreversible. If you don’t believe me, answer how we can reverse the melting of the ice cap ? How is it we can go on talking about demanding more renewable energy without considering the extent to which it is essential – the environmental constraints are often lost in the debate.

    [Nick Molho, World Wildlife Fund (WWF)]

    Our regular report shows that we consuming at a rate of 1.5 planets. We can’t just focus on the supply side – for example to meet the doubling electricity demand forecast by DECC. How can we put efficiency at the centre of policy ? The key needs are energy efficiency, generation, demand side management.

    [Rachel Carey, Green Alliance]

    The cap on spend for renewable energy and other low carbon energy in the levy control framework – is the capacity market to be included [the proposal to make payments to generators to keep their plants on standby to back up renewable energy] ? Will payments be minimised ?

    [Andrew Buglass, Head of Energy, Royal Bank of Scotland/Low Carbon Finance Group]

    We are certainly looking at the capacity mechanism influence. We need a capacity indicator [in the levy control framework] to bring forward investment. Decisions on thermal plant [including coal] are difficult to make at the moment. I refer to a recent Reuters article that a £90 per MWh strike price [on the Contracts for Difference (CfDs)] will take forward a price of £60 into the market. To bring on 20 GW of nuclear and Carbon Capture and Storage with coal, this price is double the levy control framework allocation for 2030. There are no numbers beyond 2015 – it runs out pretty quickly.

    [James Murray, Editor, BusinessGreen]

    Are you saying that if the Treasury made the levy control framework cap low enough, it would make the whole EMR exercise completely redundant ?

    [Andrew Buglass, Head of Energy, Royal Bank of Scotland/Low Carbon Finance Group]

    Yes.

    [Questionner]

    In the Energy Bill, the Secretary of State is seeking 50 new powers. Do we need to accept the role for the market is so minor that we should go for national control of energy ? Should we stop the pretence that a competitive market can be induced ?

    [Simon Skillings, Senior Associate, E3G]

    To me, there seems to be no narrative that speaks to prices, competition, and consumer benefits. We’re trying not to say it [the call for renationalisation of the energy sector]. We don’t believe new narrative should be national planning for energy. We need a new focus for innovation and customer benefits – shifting the narrative away from the wholesale world to the retail options [at point of sale] world.

    [Ben Sykes, Director, UK Markets, DONG Energy]

    Do I trust the Government or the markets to create a low carbon energy system ? We might need to live with the ambiguity – somewhere in between.

    [Nick Molho, World Wildlife Fund (WWF)]

    The Government needs to be speaking with one voice. In the past we have seen various parties calling for the 2030 target.

    [Andrew Buglass, Head of Energy, Royal Bank of Scotland/Low Carbon Finance Group]

    It’s looking like choppy waters.

    [James Murray, Editor, BusinessGreen]

    We have to recognise that it’s a relatively small number of Conservative MPs whipping up this media storm.

    [End of the first session]

  • The Art of Non-Persuasion

    Posted on October 17th, 2012 Jo No comments

    I could never be in sales and marketing. I have a strong negative reaction to public relations, propaganda and the sticky, inauthentic charm of personal persuasion.

    Lead a horse to water, show them how lovely and sparkling it is, talk them through their appreciation of water, how it could benefit their lives, make them thirsty, stand by and observe as they start to lap it up.

    One of the mnemonics of marketing is AIDA, which stands for Attention, Interest, Desire, Action, leading a “client” through the process, guiding a sale. Seize Attention. Create Interest. Inspire Desire. Precipitate Action. Some mindbenders insert the letter C for Commitment – hoping to be sure that Desire has turned into certain decision before permitting, allowing, enabling, contracting or encouraging the Action stage.

    You won’t get that kind of psychological plasticity nonsense from me. Right is right, and wrong is wrong, and ethics should be applied to every conversion of intent. In fact, the architect of a change of mind should be the mind who is changing – the marketeer or sales person should not proselytise, evangelise, lie, cheat, sneak, creep and massage until they have control.

    I refuse to do “Suggestive Sell”. I only do “Show and Tell”.

    I am quite observant, and so in interpersonal interactions I am very sensitive to rejection, the “no” forming in the mind of the other. I can sense when somebody is turned off by an idea or a proposal, sometimes even before they know it clearly themselves. I am habituated to detecting disinclination, and I am resigned to it. There is no bridge over the chasm of “no”. I know that marketing people are trained to not accept negative reactions they perceive – to keep pursuing the sale. But I don’t want to. I want to admit, permit, allow my correspondent to say “no” and mean “no”, and not be harrassed, deceived or cajoled to change it to a “yes”.

    I have been accused of being on the dark side – in my attempts to show and tell on climate change and renewable energy. Some assume that because I am part of the “communications team”, I am conducting a sales job. I’m not. My discovery becomes your discovery, but it’s not a constructed irreality. For many, it’s true that they believe they need to follow the path of public relations – deploying the “information deficit model” of communication – hierarchically patronising. Me, expert. You, poor unknowing punter. Me, inform you. You, believe, repent, be cleaned and change your ways. In this sense, communications experts have made climate change a religious cult.

    In energy futures, I meet so many who are wild-eyed, desperate to make a sale – those who have genuine knowledge of their subject – and who realise that their pitch is not strong enough in the eyes of others. It’s not just a question of money or funding. The engineers, often in large corporations, trying to make an impression on politicians. The consultants who are trying to influence companies and civil servants. The independent professionals trying to exert the wisdom of pragmatism and negotiated co-operation. The establishment trying to sell technical services. Those organisations and institutions playing with people – playing with belonging, with reputation, marketing outdated narratives. People who are in. People who are hands-off. People who are tipped and ditched. Those with connections who give the disconnected a small rocky platform. The awkwardness of invested power contending with radical outsiders. Denial of changing realities. The dearth of ready alternatives. Are you ready to be captured, used and discarded ? Chase government research and development grants. Steal your way into consultations. Play the game. Sell yourself. Dissociate and sell your soul.

    I have to face the fact that I do need to sell myself. I have to do it in a way which remains open and honest. To sell myself and my conceptual framework, my proposals for ways forward on energy and climate change, I need a product. My person is often not enough of a product to sell – I am neuro-atypical. My Curriculum Vitae CV in resume is not enough of a product to sell me. My performance in interviews and meetings is often not enough of a product. My weblog has never been a vehicle for sales. I didn’t want it to be – or to be seen as that – as I try to avoid deceit in communications.

    Change requires facilitation. You can’t just walk away when the non-persuasional communications dialogue challenge gets speared with distrust and dismissal. Somehow there has to be a way to present direction and decisions in a way that doesn’t have a shadow of evil hovering in the wings.

    “A moment to change it all, is all it takes to start anew.
    To the other side.”


    Why do I need to “sell” myself ? Why do I need to develop a product – a vehicle with which to sell myself ?

    1. In order to be recognised, in order to be welcomed, invited to make a contribution to the development of low carbon energy, the optimisation of the use of energy, and effective climate change policy.

    2. In order to put my internal motivations and drive to some practical use. To employ my human energy in the service of the future of energy engineering and energy systems.



  • Cross-Motivation

    Posted on October 7th, 2012 Jo No comments

    A fully renewable energy future is not only possible, it is inevitable.

    We need to maximise the roll out of wind and solar renewable electricity systems, and at the same time fully develop marine, geothermal and hydropower energy, and of course, energy storage.

    We need strong energy conservation and energy efficiency directives to be enacted in every state, sector and region.

    But we need to get from here to there. It requires the application of personal energy from all – from governments, from industry, from society.

    In arguing for focus on the development of Renewable Gas, which I believe can and will be a bridge from here to a fully renewable energy future, I am making an appeal to those who view themselves as environmentalists, and also an appeal to those who view themselves as part of the energy industry.

    Those who cast themselves as the “good guys”, those who want to protect the environment from the ravages of the energy industry, have for decades set themselves in opposition, politically and socially, to those in the energy production and supply sectors, and this has created a wall of negativity, a block to progress in many areas.

    I would ask you to accept the situation we find ourselves in – even those who live off-grid and who have very low personal energy and material consumption – we are all dependent on the energy industry – we have a massive fossil fuel infrastructure, and companies that wield immense political power, and this cannot be changed overnight by some revolutionary activity, or by pulling public theatrical stunts.

    It definitely cannot be changed by accusation, finger-pointing and blame. We are not going to wake up tomorrow in a zero carbon world. There needs to be a transition – there needs to be a vision and a will. Instead of a depressive, negative, cynical assessment of today that erects and maintains barriers to co-operation, we need optimistic, positive understanding.

    In the past there has been naievety – and some environmentalists have been taken in by public relations greenwash. This is not that. The kind of propaganda used to maintain market share for the energy industry continues to prevent and poison good communications and trust. I no more believe in the magic snuff of the shale gas “game changer” than I believe in the existence of goblins and fairies. The shine on the nuclear “renaissance” wore off ever before it was buffed up. And the hopeless dream of Carbon Capture and Storage (CCS) becoming a global-scale solution for carbon emissions is about as realistic to me as the geoengineering described in Tolkein’s “The Lord of the Rings”.

    Nuclear power and CCS are actually about mining and concrete construction – they’re not energy or climate solutions. I’m not taken in by token gestures of a small slice of wind or solar power or the promise of a segment of biofuels from large oil and gas companies. Public relations and lobbying are the lowest form of faked, usurping power – but simply attacking brands will fail to make real change. I think honesty, realism and pragmatism are the way forward – and there is nothing more practical than pushing for Renewable Gas to back up the accelerated deployment of renewable electricity to its fullest scale.

    My appeal to those in control of energy provision is – to see through the fog to the unstoppable. State support, both political and financial, of new energy technologies and infrastructure has to be a short- to medium-term goal – because of the volatility of the economy, and the demands of your shareholders. The need to build public support for new energy means that we the citizens must all be offered the opportunity to own energy – and so that means building a common purpose between the energy sector and society – and that purpose must be Zero Carbon.

    There is and will continue to be a porous border between the energy industry and governments – energy is a social utility of high political value. However, the privilege and access that this provides should not automatically mean that the energy industry can plunder public coffers for their own profit. What contribution can the energy industry make to society – apart from the provision of energy at cost – in addition to the subsidies ? Energy, being so vital to the economy, will mean that the energy sector will continue to survive, but it has to change its shape.

    You can dance around the facts, but climate change is hitting home, and there is no point in continuing to be in denial about Peak Oil, Peak Coal and Peak Natural Gas. These are genuine risks, not only to the planet, or its people, but also your business plans. We need to be using less energy overall, and less carbon energy within the eventual envelope of energy consumption. So the energy sector needs to move away from maximising sales of energy to optimising sales of energy services and selling low carbon energy systems, power and fuels.

    You would be wrong to dismiss me as an “eco warrior” – I’m an engineer – and I’ve always believed in co-operation, expertise, professionalism, technology and industrial prowess. What impresses me is low carbon energy deployment and zero carbon energy research. Progress is in evidence, and it is showing the way to the future. Realistically speaking, in 20 years’ time, nobody will be able to dismiss the risks and threats of climate change and energy insecurity – the evidence accumulates. We, the zero carbon visionaries, are not going to stop talking about this and acting on it – as time goes by, the reasons for all to engage with these issues will increase, regardless of efforts to distract.

    Nothing is perfect. I no more believe in a green utopia than I do in unicorns. But without reacting to climate change and energy insecurity, the stock market will not carry you, even though the governments must for the mean time, until clean and green energy engineering and service organisations rise up to replace you. Lobbying for pretences will ultimately fail – fail not only governments or peoples, but you. You, the energy industry, must start acting for the long-term or you will be ousted. As your CEOs retire, younger heads will fill leadership shoes – and younger minds know and accept the perils of climate change and energy insecurity.

    This is the evolution, not revolution. It is time to publicly admit that you do know that economically recoverable fossil fuels are limited, and that climate change is as dangerous to your business models as it is to human settlements and the biosphere. Admit it in a way that points to a sustainable future – for you and the climate. The pollution of economically borderline unconventional fuels is wrong and avoidable – what we need are renewable energies, energy conservation and energy efficiency. One without the others is not enough.

    How can your business succeed ? In selling renewable energy, energy conservation and energy efficiency. You have to sell the management of energy. You have to be genuinely “world class” and show us how. No more spills, blowouts and emissions. No more tokenistic sponsorship of arts, culture and sports. The veneer of respectability is wearing thin.

    As an engineer, I understand the problems of system management – all things within the boundary wall need to be considered and dealt with. One thing is certain, however. Everything is within the walls. And that means that all must change.


    http://houstonfeldenkrais.com/tag/cross-motivation/ “…Of course, the money would be great. But adding in the reward/punishment dimension is a sure way to sabotage brilliant performance. Moshe Feldenkrais observed that when one is striving to meet an externally imposed goal, the spine shortens, muscles tense, and the body (and mind) actually works against itself. He called this “cross motivation,” and it occurs when one forsakes one’s internal truth to maintain external equilibrium. There are lots of examples of this: the child stops doing what she’s doing because of the fear of losing parental approval, love, protection. The employee cooks the books to keep his job. The candidate delivers the sound bite, and dies a little inside. Feldenkrais attributed most of our human mental and physical difficulties to the problem of cross motivation. If you watch Michael Phelps swim, you can’t help but notice that he makes it look easy. He is clearly strong and powerful, but all of his strength and power are focused on moving him through the water with the greatest speed and efficiency. There’s no wasted effort, no struggle, no straining. He is free of cross-motivation! Would straining make him faster? Of course not. Unnecessary muscular effort would make him less buoyant, less mobile, less flexible. Will dangling a million dollars at the finish line make him swim faster? Probably just the opposite, unless Michael Phelps has some great inner resources to draw upon. The young Mr. Phelps has already learned how to tune out a lot of the hype. He’ll need to rely on “the cultivation of detachment,” the ability to care without caring…”

  • Enron, Fudging and the Magic Flute

    Posted on September 30th, 2012 Jo No comments

    Allegedly, the United Kingdom is about to break free from the Dark Ages of subsidies, and enter the glorious light of a free and light-touch regulated, competitive electricity market.

    The Electricity Market Reform is being sold to us as the way to create a level playing field between low carbon electricity generation technologies, whether they be established or new, baseload or variable, costly-up-front or cheap-and-quick-to-grid.


    Personally, I do not accept the mythology of the Free Market. I do not accept that a fully competitive, privatised energy sector can be delivered, regardless of the mechanisms proposed. The Electricity Market Reform is less Englightenment and more Obscurantism, in my view – the call of the Magic Flute is going to fall on deaf ears.

    Who will play the pipe ? Who will call the tune ? Who will be the Counterparty ?
    At the National Grid’s Future Energy Scenarios day conference-seminar on Thursday 27th September 2012, I listened carefully to several spokesmen from the companies, quangos and agencies deny that they would have anything to do with determining, underwriting or administering deals for the EMR’s proposed “Contracts for Difference” (CfD) – essentially setting a guaranteed lowest price for selling electricity to the grid, regardless of market movement. Mark Ripley of the EMR team at National Grid was very clear “National Grid will not be the contractual counterparty for the CfD”. I asked Jonathan Brearley of the UK Government Department of Energy and Climate Change (DECC) at a break who would be independent enough to set the “strike price” – the minimum price for which electricity generators could expect to sell electricity ? He suggested that perhaps the UK Government would set up an independent governing body – gesturing at arm’s length. I asked him rhetorically who could reasonably be expected to be seconded to this new quango – how could they be truly independent…I did not get an opportunity to ask how the CfD revenues and payouts would be administered. I didn’t know at that time about the rumours that Ofgem – the current electricity generation quango regulator – could be closed down under a new Labour Government.

    The shadow cast by the nuclear industry
    During the presentation by Jonathan Brearley of DECC, he indicated that back room discussions are going on between large potential electricity generation investors and the UK Government. Even before the ink has hit the paper on the EMR draft, it seems the UK Government is inviting large investors to come and talk to them about deals for guaranteed generation sales prices. As far as my notes indicate, he said “The first nuclear project has already approached us for a contract.” I asked him directly in the break if this kind of pre-legislation arrangement was going to allow the nuclear industry to cream off subsidies. He denied that Contracts for Difference would be allocated for current nuclear power plants. He did not admit that there are strong indications that the so-called Capacity Mechanism of the EMR could be applied, propping up the profits of the nuclear power plants already running, and encouraging them to apply for extension licences for their cracked reactors to keep running after they should have been shut down for safety reasons.

    After the National Grid meeting, I went to an EcoConnect meeting, where Eric Machiels of Infinis said, in reference to the strong influence of EdF (Electricite de France) in proposing new nuclear reactors in the UK, “The EMR was set up to meet two requirements. [First] to justify incredibly high investments. [And] nuclear – if you need to invest £10 billion or more, 10 years away, you need regulatory certainty…[But you have to know, decisions on nuclear development] will rely on decisions made in the Elysee Palace and not in Number 10.”

    Well, it seems clear that the steer is still towards the UK taxpayers and billpayers stumping up to support the ailing French atomic power fleet.

    A bit of a big fudge
    There is no reason to believe that the Curse of Enron will not haunt the UK energy trading halls if the EMR goes ahead with its various microeconomic policies. Everybody will play for profits, and the strength of over-competitive behaviour between the current market actors will not encourage or permit new market entrants.

    At the EcoConnect meeting, Diane Dowdell of Tradelink Solutions warned of the risks of going back to the kind of electricity markets of former decades, “Unless you worked under the Pool, you wouldn’t know how it works. It is a derivative…DECC need to look at Ireland – their Pool system has been utterly destroyed. Please don’t follow in the footsteps of Ireland – get the balancing right.”

    The big issue is the macroeconomic need to incentivise investment in new electricity generation plant and infrastructure – something that will not be achieved by flipping microeconomic market trading conditions to benefit low carbon generators. How can new low carbon generators come onto the grid ? By placing focus on investment decisions. New generation has to clear a higher hurdle than how much it can sell green power for on the half-hourly market. Funds and financing are not going to be directed to choose low carbon investment just because marginal costs (the Carbon Floor Price and the European Union Emissions Trading Scheme) are applied to high carbon players already in the market. The guarantees of profits into the future from the institution of Contracts for Difference (Feed in Tariff) and the Capacity Mechanism will maybe trigger a slice of investment in new nuclear power, but it won’t ensure that new gas-fired power plants are built with Carbon Capture and Storage.

    At the EcoConnect meeting later on, another DECC man reported back on the UK Government’s call for evidence on the EMR. DECC’s Matt Coyne said that amongst the conclusions from the consultation with industry there were concerns about the conditions for Power Purchase Agreements (PPAs) under the EMR. (Securing a PPA is the guarantee that investors need to be able to commit to backing new electricity generation capacity). He said that developers are finding it hard to secure finance for new generation investment and that it was a widely-held view that the EMR would not improve that, although he said that “it is our view that the Contracts for Difference will improve things.” Other people at the meeting were not so sure. Diane Dowdell said, “I desperately hope the EMR works. It’s got to work. [Conditions] seem to be edging out the small- and mid-sized players.” Eric Machiels said, “The Big Six vertically integrated energy suppliers are in the best position to retain their position.”

    In my notes, I scribbled that Michael Ware, a dealmaking matchmaker for renewable energy projects, offered the view that “Government does resemble toddlers driving a steam train – there are lots of buttons to push…[The UK is] just a rainy little island at the edge of Europe. Capital is truly international. It all feels much easier to do business elsewhere. [The EMR looks] almost designed to turn off investors.”

    There were several calls to retain the Renewables Obligation – to oblige energy suppliers to keep signing up new clean power from smaller players if they couldn’t make it themselves.

  • London Skies

    Posted on September 9th, 2012 Jo 1 comment

    Image Credit : epeigne37

    Yesterday evening, I was caught by the intensity of the London Sky – there was little air movement in most of the lower summer-heat space above the city, and virtually no cloud except very high strands and sprurls and bones and smears.

    Most of the cloud was clearly the result of aeroplane contrails – numerable to small children and their educational grandparents on various buses.

    As the sun began to set, or rather, as the Earth rolled to curve away from facing the sun, the sky took on the colour of bright duck egg blue with a hint of pale green, and the sprays of high contrail-cloud took on a glorious orange-fuchsia colour with flashes of gold, bronze and vanadium reds, fading slowly to chromium reds as twilight approached.

    At a certain moment, I understood something – as I watched an aeroplane high up, make its way west to Heathrow, the angle of the sunset showed its contrail as a murky ink, messing up the rest of the clouds as it brushstroked its way along, with its slate and muddy hues. As I watched, other parts of the clouds began to appear brown and grey, and since I knew that most of the cloud was jet engine exhaust that hadn’t moved because of the lack of high winds, I finally realised I was watching dirt, high up in the troposphere – careless, unthinking toxic waste. Read the rest of this entry »

  • Climate Change : Reality Report

    Posted on September 4th, 2012 Jo 1 comment
    You would have thought that people would be pulling together to get something done about Climate Change, but no. For example, whilst the UK Government Treasury and its Chancellor continue to fight a running battle with their Climate Change Department, the Prime Minister has just replaced a knowledgable Energy Minister (albeit with a Public Relations rather than an Engineering background) with somebody who seems to be against wind power – one of the only successfully deploying electricity technologies currently. And hired a relative of a rich and powerful Climate Change denier as Environment Minister.

    Great.

    Read the rest of this entry »

  • Energy Together : I’m just getting warmed up

    Posted on August 27th, 2012 Jo No comments

    The human race – we have to solve energy together. And to do that, we need to harness all our personal, purposeful, positive energies, and let me tell you, personally, I feel electric – and I’m only just getting warmed up.

    So let’s hear less of the nonsense from authoritatively-accredited people who want to put a dampener on green energy, who say that saving energy cannot, simply cannot be done, sigh, sigh, sigh, collective groan. We have so much energy together, we can do this.

    We have the will power, the staying power, the investment power, and we will navigate the obstacles in our path.

    Let’s not waste any more time on expensive trinkets, and iddy-biddy fancies with high unit costs and low compatibility to the future. Yes, I’m talking nuclear power. I’m talking the nobody-really-wants-to-do-it-and-nobody-thinks-it-can-be-cheap-enough-to-work-at-scale Carbon Capture and Storage. And yes, I’m talking carbon markets – tell me again, where are they now ? Oh yes, still in the starting blocks.

    And don’t even start to talk about pricing carbon to me – in this world of rollercoaster, highly volatile energy prices, what on Earth could costing or taxing carbon actually achieve ? And fusion power ? Nah, mate, forget it. It’s been 50 years away for the last 50 years.

    Shale gas, oil from shales, tar sands, coal bed methane collection and underground coal gasification are once-abandoned messy ideas from way back. They’re still messy, and they’re still retro, and they’re not going to get us anywhere. If the United States of America want to completely ruin their lithosphere, well, that’s up to them, but don’t come around here toxifying our aquifers and poisoning our European trees !

    What we need is marine energy, geothermal energy, hydropower, solar power, wind power, and Renewable Gas, because gaseous fuels are so flexible and store-able and can come from many, many processes. And we need the next optimistic generation of leaders to push through the administration ceiling and get green energy policy really rolling, attracting all the green investment will.

    If I were a power plant, I would be cranking out the current and making everything shine very, very brightly just now.

  • What is my agenda ?

    Posted on August 13th, 2012 Jo 1 comment


    Tamino’s Arctic Sea Ice Poll


    For some time I have not felt a keen sense of “mission” – a direction for my climate change and energy activities. However, I am beginning to formulate a plan – or rather – I have one important item on my agenda. I am aware that perception can be fatal – and that people in many “camps” are going to dismiss me because of this.

    Suddenly I don’t fit into anybody’s pigeonhole – so the needle on the dial will probably swing over to “dismiss”. However, I think it’s necessary to pursue this. I think I have to try.

    I am prepared to hold several conflicting ideas in the balance at one time, and let the data add mass to one version of the truth or another.

    I’m prepared to accept the possibility of low climate change sensitivity (the reaction of the Earth biosystem to global warming) – apart from the fact that the evidence is accumulating – pointing heavily towards rapid instabilities emerging on short timescales. I don’t think I ever really left behind the hope – and I’m crossing my fingers here – that some massive negative carbon feedback will arise, heroically, and stem the full vigour of climate chaos. But as time slips by, and the Arctic cryosphere continues to de-materialise before our very eyes, that hope is worn down to the barest of threads.

    And on energy security, I am prepared to accept the reasoning behind the IEA, BP, Shell and other projections of increasing overall energy demand between now and 2035, and the percentage of fossil fuel use that will inevitably require – apart from the fact that some evidence points towards increasing uncertainties in energy provision – if we are relying on more complex and inaccessible resources, within the framework of an increasingly patchy global economy.

    If access to energy becomes threatened for more people globally, and also if climate change becomes highly aggressive in terms of freshwater stress, then I doubt that human population growth can carry on the way it has been – and in addition the global economy may never recover – which means that overall energy demand will not grow in the way that oil and gas companies would like their shareholders to accept.

    My impression is that energy producing companies and countries are not openly admitting the risks. If energy supply chaos sets in, then the political and governance ramifications will be enormous, especially since the energy industry is so embedded in administrations. It is time, in my view, that projections of world energy use to 2035 included error bars based on economic failure due to energy chaos.

    What do I need to do – given these pragmatic positions ? I need to include realists in the crisis talks – pragmatic, flexible thinkers from the energy industry. Just as we are not going to solve climate change without addressing energy provision, we are not going to solve energy insecurity without addressing climate change impacts on energy infrastructure. And so I need to find the energy industry people, meet them and invite them to the discussions on the risks of chaos. I need people to take in the data. I need people to understand the problems with slipping back into “thinking as usual”.

    As to the setting – whether I should be an employee or an independent advisor/adviser, consultant or a researcher, I don’t have any idea what would be best. Collaborators would be useful – as I am but one person with a track record of being rather awkward – despite trying to engage my best behaviour. But then, nobody’s perfect. In a sense it doesn’t matter who does the job, but we have to break the public relations-guided psychology of denial. People are not generally stupid, and many are snapping out of their drip-fed propaganda delusions. I wonder exactly how many other imperfect people are out there who are coming to the same conclusions ? And what will be the game changer ?