Wednesday 27 June 2018

Wave power - new bottom up development?

One of the new designs for wave power is looking to enter the energy market via small scale scale applications - as such it is a different approach to the stand-alone mode often proposed for wave power devices - a strategy that seems to have faltered in recent times.

The new approach is about developing the technology in a bottom up fashion by finding 'local' markets rather than sending power into the grid. That means the technology can start off small, and then grow, which is how innovation usually develops

The technology company is called 'Resen Waves'. The device is designed to be a small device (initially 300W) that could provide power for sensors and other small power applications in the offshore oil and gas market - well, that's one way that the oil industry could give renewable energy a break! But its still needs some partners and demonstrations schemes to get it going.

Per Resen Steenstrup, the founder of the Resen Waves company which is now active in Aberdeen, tells me that it is in the Danish renewable energy tradition of incrementally building up from small beginnings. That's right of course - the wind power industry started in Denmark in its modern form at the end of the 1970s and early 1980s using small machines. The concept behind Resen Waves is that it can build up from small beginnings by finding and developing niche markets.The company behind the technology says that it is 'the first company in the World to provide continuous power and real-time data connectivity to autonomous instruments and machinery in the sea, as a plug and play solution'.

You can read more about Resen Waves at http://www.resenwaves.com/

Friday 22 June 2018

How the Committee on Climate Change gave the Government dud advice


The Climate Change Act has been celebrating its 10th anniversary, but there is surprisingly little to celebrate in the earlier advice of the Committee on Climate Change (CCC). The CCC is the body created to advise the Government on the achievement of the carbon reduction commitments (80 per cent of 1990 levels by 2050). You would expect the advice of the CCC to speed the Government's low carbon programme, but in the crucial aspect of electricity supply policy it has (in the past) actually damaged it!

Looking back on its past, it looks like the Committee gave completely the wrong advice to the Government, advice which, alas, they still seem to be following now. 

In particular, in the 'Renewable Energy Review' issued in 2011 (1) (which I criticised at the time), the CCC, urged the Government to cut back the targets for offshore wind and instead focus on nuclear power. They told the Government not to be put off by the Fukushima disaster that had happened earlier that year. According to the Times Report on May 9th 2011 ''The Committee on Climate Change says heavy reliance on offshore wind could result in unacceptable increases in fuel bills.' (2) David Kennedy, the then Chief Executive of CCC said that 'Nuclear looks like it will be the lowest cost for the next decade or two'. Indeed the Review stated that nuclear power was currently 'the most cost effective of the low carbon technologies' (1). That conclusion, given the cost of onshore wind, was highly challengable at the time, especially as given the existing record of nuclear power plant that had been built in the UK and the roll-out of onshore wind. Whereas the deployment of renewable energy has soared ahead, despite the best efforts of many in the Conservatives to block it, nuclear power plans set out in 2010 have proved to be fantasy. And, of course, offshore wind costs have tumbled rapidly making the CCC's earlier pronouncements looking especially silly.

As the Times report of May 9th 2011 stated ''Before the Fukushima disaster the Government had been planning to build 12 new reactors on seven sites by 2025'.  Of course there is no chance that there will be even one reactor by then, let alone 12. The only deal signed so far, Hinkley C, has been achieved at great cost to the British electricity consumer. The scheme only survives because the French taxpayer already has stumped up several billions to subsidise the deal. No doubt more will be needed further down the line more as cost overruns escalating as they always do (and no doubt British taxpayers ending up with further commitments to finish the job). A deal is being discussed for the Wylfa project with Hitachi that will see British taxpayers 'invest' in the project (as well as paying high premium prices for the power in their electricity bills) that will make them liable for a large chunk of the almost inevitable costs overruns.

Yet onshore wind and solar pv projects that can be delivered at no extra cost to the consumer are being denied  contracts for differences that would deliver the power much, much more cheaply for taxpayers and electricity consumers than nuclear power. The Government seems in no hurry either to prepare for new offshore windfarms which are now much cheaper to deliver than new nuclear power.

The UK has been relatively successful in reducing its carbon emissions. Indeed, according to Carbon Brief (3) the UK has reduced its emissions by 38 per cent compared to 1990. That is due to a reduction in electricity use this century (partly a result of energy efficiency policies), more energy efficient buildings, and a switch away from coal to gas and renewable energy. Renewable energy has grown, as a proportion of electricity supply, from 1 per cent in 1990 to around 30 per cent today. By 2020 this will be close to 35 per cent. Most of this increase has occurred this century having being kickstarted by the last Labour Government, especially under Ed Miliband who set out some ambitious plans for offshore wind which were later cutback in the context of the disastrous advice from the CCC.  

In more recent times, at least, the CCC, has been a bit more positive for renewables, and indeed Lord Deben, the Chair, has recently chided the Government on its lack of incentives for onshore wind. The CCC has a new CEO in the shape of Chris Stark whose previous job was Director of Climate Policy for the Scottish Government. At least we shouldn't get any disastrous advice from him!



(1) Committee on Climate Change (2011) 'Renewable Energy Review', https://www.theccc.org.uk/publication/the-renewable-energy-review/

(2), Webster, B., (2011) 'Set Aside fears and build reactors not wind turbines says climate watchdog', Times, May 9th 

(3) Carbon Brief (2018) 'Analysis: How UK carbon emissions fell to their lowest levels since 1890', https://www.carbonbrief.org/analysis-uk-carbon-emissions-in-2017-fell-to-levels-last-seen-in-1890

Monday 4 June 2018

Wylfa: How the Tories are deliberately forgetting their nuclear lessons

For the sake of artificially massaging down the price paid for electricity from the proposed Wylfa nuclear plant  the Government is about to commit the country to pay for billions of pounds of almost inevitable construction cost overruns. In doing so the Tories will be junking their opposition to doing such a thing. In 2010 The Conservative Party election manifesto stated that: ‘we agree
with the nuclear industry that taxpayer and consumer subsidies should not and
will not be provided – in particular there must be no public underwriting of
construction cost overruns’(1)

There was a very good reason for this manifesto commitment. None of the nuclear power plant currently operating in the UK were constructed according to their original cost estimates. They were built during the time when electricity was nationalised, and so the costs were spread around all consumers and there was limited transparency about the economics of building nuclear plants. The Tories decided that there should be no more wastage of public money on nuclear plant which soaked the public purse. They wanted competition in electricity generation.

According to the Electricity Market Reform law (initially proposed at the end of 2010) nuclear power should only have the same incentives as other low carbon fuels. But it has emerged that if this was done literally, there would not be any nuclear power stations built since various other low carbon options are much cheaper. But now that memories of the past problems with building nuclear power plant have receded from, or been airbrushed from, political memory, this principle has been gradually stripped away to return us to the past. The past of the nuclear blank cheque.

Nick Butler in the Financial Times has made some perceptive comments on this peculiar deal (2). He is one of the few who has done some serious thinking about how it can possibly be the case that the Wylfa project will be sold on a 'cheaper' price than Hinkley C (£92.50 per MWh in 2013 prices) despite the fact that the projected cost of building Wylfa is actually higher than Hinklrey C per GW of capacity (see my previous blog post). Prices around £75 per MWh have been kited as the suggested price tag for Wylfa for electricity consumers.

The price of the contract given to EDF to build Hinkley C was seen to be very large. So there was great political pressure to reduce this price. But the nature of nuclear power is that it is very expensive, so all the Government could do was to fake the price by giving 'below the counter' financial incentives. Of course this price can be reduced on paper if the state takes at least part of the risk and invests and lends money at cheap rates. But in real life not only is this mechanism not being made available to other low carbon fuels, but the taxpayer will end up paying a much higher price than advertised through a different route - when the time comes for the project investors (including the Government) to pay for the almost inevitable cost overruns.

The remarkable thing is that despite this effort at price fakery, the price agreed will still be a lot higher than that available for installing large amounts of onshore wind offshore wind and solar power.

The nuclear industry appears to have lobbied successfully for this return to the past, a past where nuclear power was financed by opaque means, and its expensive nature hidden by the fact that the state effectively offered the developers a blank cheque. Of course the British body politic will find out to its disgust that there will be billions of pounds paid out when the fund initially vested in the development is exhausted - thus revealing the grotesque fakery of the allegedly 'cheaper' price of the Wylfa project compared to Hinkley C. That won't happen for quite a few years since, no doubt, despite the usual wildly optimistic projections of delivery dates, the plant will not be constructed for a number of years yet. It will be long enough to ensure that the architects of this sorry deal are out of office and unavailable for comment from their retirement mansions.

(1) Conservative Party, 2010. Rebuilding security – conservative energy policy in an uncertain
world, page 18

(2) Nick Butler, 'Stake in nuclear plant would be dramatic change of policy for UK' Financial Times, 4/06/2018 https://www.ft.com/content/7ba55ce6-63f3-11e8-90c2-9563a0613e56