Britain's New Tory Leadership: Why Are They Forsaking Reliable Nuclear Power for Intermittent Wind Energy?
What was David Cameron thinking? Sure, he had to cut some unpalatable deals with the Liberal Democrats to get into power. Sure, that would mean living with a few uncomfortable appointments to his Cabinet team. But in handing Chris Huhne the Energy and Climate Secretariat, Cameron not only shocked UK energy insiders – but the appointment has almost certainly sown the toxic seeds of disunity for the “brokeback coalition.”
Chris Huhne is on a mission to stop all nuclear development. While he and his anti-nuclear Liberal Democrats signed on to a deal by which they agreed to abstain from any Parliamentary vote to approve nuclear legislation, Huhne knew there would be more than one way to undermine a pro-nuclear policy. For a start, he could announce there was “no money” for state subsidies of the proposed new generation of nuclear power stations. Next, he could gamble Britain’s energy future on the meagre energy return offered by wind power. By the end of July, just two months into office, Huhne had done both.
Lamenting that onshore wind turbines were “incredibly competitive” though not as popular “as you might hope” Huhne claimed a much “greater potential” for offshore turbines. Unfortunately, the hard facts tell a very different story for wind power in Britain. The UK’s current crop of just under 3,000 wind turbines claim to have the capacity to generate 4,580 megawatts and power 2.5 million homes. According to the UK Ofgem’s National Electricity Trading Arrangements (NETA) monitoring team however, electricity generated by Britain’s 2,800 onshore turbines in 2009 was far less than capacity, resulting in wind providing less than 1 percent of the UK’s electricity output. With onshore turbines running into all sorts of local planning issues, Huhne’s wind over nuclear policy comes at a high price: electricity generated from offshore wind turbines costs twice as much as that generated from nuclear plants. Huhne appears to have no grasp – or, more worryingly, no concern – for the crucial difference between installed capacity and output generated, especially when it comes to wind power.
This month, Huhne came up with another wheeze to incentivize ownership of onshore wind projects across the country: allowing local councils to become “mini power stations” through selling “green electricity” to the national grid. At the same time that public concern is forcing government to impose stricter planning controls on owners of onshore wind farms due to increasing noise pollution – with levels approaching 60 decibels – from ever bigger turbines, Huhne suggests that local governments get into the wind (and other renewables) business. Bizarrely, the senior Conservative Party partners in the coalition – a party that believes passionately in small government that stays out of the marketplace – is being pushed into ever greater public ownership of the national renewables industry. If Huhne is allowed to go on expanding the horizons for an expansive subsidy feed-in regime it is estimated that paying for it will mean a doubling of UK electricity prices, prices that are already among the highest in Europe.
At exactly the time the rest of Europe is cutting back on extravagant subsidies and curtailing feed-in tariffs, Britain appears determined to go it alone. UK feed-in tariffs, brought in by its Renewables Obligation Certificates (ROC) program that requires electricity providers to “source an increasing proportion of electricity from renewable sources”, are just beginning to kick-in. For each megawatt of power generated by offshore wind farms, the Renewables Obligation provides two ROC’s, at just under lb50/$80 a shot. As MasterResource’s Matthew Sinclair points out, “That means total subsidies of lb100/$160 from just one policy (on top of the carbon price through the EU Emissions Trading Scheme)”.
Yet, as the UK’s own Department of Energy & Climate Change (DECC) reported in June, power from renewables sources actually fell from 6.7 percent in Q1 2009 to 6.2 percent in Q1 2010. Over the same period, supply from nuclear rose by 7 percent and gas by 25 percent. What is so significant about these figures is that they cover a period where Britain shivered through its coldest winter for 30 years. Just at the time the country needed it the most, electricity from renewable sources failed – and not for the first time. It seems that periods of low wind activity often coincide with Mother Nature’s cold snaps.
The DECC blamed a dry winter and low wind speeds for the fall in renewable-sourced electricity. And right there is a key problem for wind power. Not only is it intermittent but periods of low wind often coincide with particularly cold spells of weather. Even Sir David King, the government’s former chief scientist and a vocal climate alarmist, responding to the above DECC figures, pointed out that the figures starkly revealed the need for new nuclear generators to keep the power on and cut emissions. “We can’t rely too heavily on wind,” insists King, “because it always requires a gas-fired turbine to be able to be switched on to provide alternative energy.”
In August, Invesco Perpetual (IP) demanded that government regulators free up price controls on renewables providing greater returns for private investors or they would block private sector investment in renewables projects. It’s a threat Huhne and his team cannot take lightly. IP is a major stakeholder in the power sector, holding shares in energy companies amounting to about $7 billion.
UK MEP (Member of European Parliament) Roger Helmer says, “As some continental countries have found, increasing reliance on intermittent wind creates ultimately insuperable problems of grid management. Distributed generation creates the need for new investment in the Grid of around $15.5 billion, over and above the cost of wind farms.” Helmer adds, “Huhne’s policies are untenable, and if he continues in this vein, his job will be untenable too.”
While both incoming Conservatives and outgoing Labour politicos have agreed that Britain urgently needs to fast-track up to 10 new nuclear power stations to have any realistic chance of keeping the lights on over the next decade, both major parties are now seeing the country’s energy future dictated by the ideological zealotry of a minority party strongly rejected by the British electorate at the May election.
In August Huhne delivered his first Annual Energy Statement (AES) ahead of a definitive National Energy Policy statement this Autumn. To call the AES a green-print for a renewed renewables revolution would be an understatement. Among the 32 Action points Huhne proposes to “reform the climate change levy” to “provide more certainty and support to the carbon price.” The energy secretary also proposes a “new obligation on energy companies from 2012″ as well as plans to develop carbon storage “demonstration projects” and ideas for “more ambitious renewables projects.” Nuclear operators can look forward to legislation forcing them to pay for waste but also for their own future “decommissioning.” References to oil and gas (coal is nowhere) – the actual drivers of the UK economy – are limited to a “doubling of environmental inspections of offshore oil and gas rigs” and help to exploit the UK’s own more difficult to access oil and gas fields.
Huhne’s publicly-funded investment list puts the UK in global pole position on two counts: he is betting that renewable energy can deliver; and second, he’s assuming that British taxpayers won’t mind – when other European citizens plainly do – picking up the extravagant tab to pay for it all.
If David Cameron is not already feeling the breeze from his energy secretary’s new turbine revolution, he will likely soon begin feeling the serious blowback from the British taxpayer.