Renewable energy targets: how Goldilocks got eaten by a bear



The bear

The bear

So how are we doing with that all important target of 15% of final energy use to be provided by renewables by 2020? It is a target agreed with our EU partners and I suppose some will say it doesn’t matter if we aren’t going to be in the EU come 2020. But even then there is the small issue of keeping the UK’s energy carbon output on a trajectory that makes a low carbon energy landscape possible by 2030, and we are of course in the EU right now. So for legal reasons and for reasons of keeping the planet in one piece answering the above question does currently matter.

Last Spring the misleadingly titled Renewable Energy Foundation (REF) (which, we should note, does not seem to be in favour of many renewables, and most notably onshore wind) published and widely trailed a claim that Britain was already well on the way to meeting its EU 2020 renewables target. The organisation therefore concluded that all outstanding onshore wind applications were, in reality, surplus to requirements.

Ed Davey, responding to a letter from Mary Creagh MP about those claims, advised that there isn’t actually a surplus hanging around. He pointed out that REF had assumed that everything in the planning pipeline gets built (he suggested that for example 50% of proposed onshore wind gets planning permission, and of that, 70% actually gets completed). However, despite the above, he did imply that the existence of the ‘pipeline’ means that ‘we remain on course to meet our…2020 renewable energy targets cost effectively’.

So who’s right on this? Remember that the 2020 target is an overall agreed EU target for 15% of final energy use to be met by renewables – which implies a far higher proportion of our electricity to be made up of renewables than that in order to meet the overall goal. It is generally accepted that about 35 – 40 % of our electricity by then should be from renewable sources, which, so the REF tells us, equates to about 33 gigawatts of installed power at average renewable capacity values.

Sorry, I was asking who was right…Well clearly Ed Davey is right to pull REF up on its assumptions about how much ‘in the pipeline’ will actually get built. But he is, I am afraid, now increasingly finding himself guilty of exactly the same assumption: that is that are enough renewable projects ‘in the pipeline’ to come good regardless of the various vicissitudes that the technologies are going through.

Ed’s most recent go at projecting the mix of technologies which would generate the installed capacity we need to deliver the 2020 target line was contained in the December 2013 Electricity Market Delivery Plan, which he helpfully pointed Mary Creagh to in his letter. This report (p.40) lists the range of projected capacity of the various renewables that the Department expects to fill the bill – overall from a minimum of 27.2 installed GW to 40 GW at the most optimistic. And there it sits, in the middle, the ‘goldilocks’ figure of about 33.3 GW. Thank god for ‘the pipeline’.

Well, except that is, if you turn to what DECC told the National Audit Office (NAO) this spring about what actually IS in that pipeline, and what its status is. You can check it out here on p.31 of their report ‘Early Contracts for Renewable Electricity’. At first sight this chart looks like case proven for the Renewable Energy Foundation. No less than 44GW of capacity in onshore wind, offshore wind and biomass listed, and that’s without the 4GW or so of large solar already installed or on its way. But the NAO have helpfully divided the overall figures into what is operational, being built, consented to and what awaits planning permission, and of all the plants in development, which have or don’t have an early investment contract agreed.

If we apply this helpful division into the events of the past few months, then the reality starts to look substantially less rosy.

The government has essentially stopped field solar installations because of Levy Control Framework (LCF) worries. So it is likely that the installed total of large solar installations by 2020 will stay around where it is.

But there’s still onshore, offshore and biomass in the pipeline? Well, Mr Pickles has decided to can onshore wind applications by calling them all in and refusing them, so it is probable that consented onshore will get built at about the rate Ed Davey suggests, but not otherwise.

But what about biomass and offshore? For this we have to turn to the LCF, also inter alia, the subject of the NAO’s report. DECC’s latest figures on the LCF, set out in the Annual Energy Statement in September show that the LCF is essentially bust. Projects that do not already have an investment contract (five offshore wind farms and three biomass plants…oh and of course a whacking great big nuclear power plant which doesn’t count as renewable even though it has scooped up shedloads of CfDs) are very unlikely to get anything now before 2020. Even if one is very generous with assumptions about the knock on the impact of the cumulative total of CfDs from other years, in the figures forward to 2020, it is hard to see anything more than one medium-sized, offshore windfarm getting a CfD, and even then, not before about 2018, by which time it will be too late for 2020. And of course the same goes for biomass. So on these figures, probably best to discount anything that does not now have the prospect of getting a CfD before 2020. Unless you believe that suddenly un-CfD supported projects will rise up and get built – highly unlikely.

And all this means that (and you’ll have to trust my maths on this, but I’ll happily send you a working sheet of the calculations), taking everything into account, we miss the magic figure of installed capacity by about 3GW or 10%. Granted, a good effort compared to where we were a little while ago but way short of where we need to be, way short of where Ed Davey seems to believe, despite the best efforts of his own government, that we will be, and miles off REF’s rambling.

Unless, of course, the LCF is recast to iron out its manifest faults, and/or Mr Pickles is taken away in a van and held somewhere until it’s all over, or of course we leave the EU in 2017. After that we won’t need to worry about the renewables target and the implications of not meeting it, but we might worry that we didn’t have much of an energy economy left, renewable or otherwise.



On Wind, Cameron and Machiavelli

Guess who's who

Learning from the greats?

So from 2015 onwards, if the Conservatives run the country, there will be no more onshore wind turbines. Or there might be, if developers of onshore farms, or even single turbines, can raise the funds with no underwriting whatsoever (an almost unique position now to be in if you’ve read my recent posts on gas, nuclear and everything else that is now being underwritten), get past a local planning hearing, get a connection slot etc.   So it’s pretty inconceivable that, given these hurdles, any projects will get off the ground.

Dave’s minder in DECC, Michael Fallon, says rather disingenuously that there are enough onshore wind projects ‘in the pipeline’ to reach targets for deployment up to 2020. What he doesn’t mention is that these are largely sketched-in plans which are still a long way from reality. Many of them have no guarantee of funding and even those that do will undoubtedly have the plug pulled on them in a climate of uncertain underwriting, vanishing onward prospects and collapsing supply chain. So it’s therefore likely that onshore wind generally would rapidly roll up, just as it starts to compete with other forms of energy supply on an effective basis and cements its place as the most cost effective form of large scale renewable energy production. ‘Irrational and illogical’ says Good Energy’s CEO Juliet Davenport.  Good stuff in the blog Juliet, but not quite right; you obviously haven’t been reading your Machiavelli. Dave has, I think. Here’s the old cynic giving advice to his prince on new-fangled notions:


“It ought to be remembered that there is nothing more difficult to take in hand, more perilous to conduct, or more uncertain in its success, than to take the lead in the introduction of a new order of things. Because the innovator has for enemies all those who have done well under the old conditions, and lukewarm defenders in those who may do well under the new.”


And as if by magic, an infographic turns up sourced from DECC surveys, which shows that the vast majority of the British public sort of quite like onshore wind, whilst a little, very shirty group (the little angry red people in the corner of the chart)  splenetically don’t. And since they are the people who write to local papers, form committees and, incidentally in some cases, run the hollowed-out local Conservative associations, Dave has clearly opted to listen to Niccolo, and not to everyone else.

But of course, there is the small matter of him being allegedly onside in the great low carbon energy/climate change debate, as he was keen to tell the Liaison Committee in the House when questioned by them recently:

The point I would make is that I support the carbon budgeting process and the Climate Change Act, which I think is a good framework

was his response to gentle questioning from Select Committee chairs. Which leads the excellent James Murray, in a great blog piece  to make the point that if you a) stand by climate change and, in principle, to low carbon energy targets but b) pull the rug from under the most successful and economic component of those targets, you ought to c) set out what you are going to put in its place. He’s quite right, of course, since it would take rather a lot of ‘something else’ in place of onshore wind to get low carbon energy deployment back on track.

I can’t help feel though, that there isn’t a great deal of appreciation around about just what ‘quite a lot’ comes to and  how extensive ‘something else’ would then have to be, so I’ve tried to do a few, immediate sums.

Out to 2020, DECC’s UK Renewable Energy Roadmap tells us that, taking account of attrition in development, there will be about 9.1 GW of new onshore added to the 6.6GW already operational. National Grid’s Gone Green scenarios for development out to 2030 adds another 2GW to that total post 2020. So let’s assume, for the reasons I’ve set out, that much of this of this presently assumed development doesn’t take place with a new onshore regime and that the additional 2GW of capacity after 2020 certainly doesn’t get built. On a reasonable estimate, that’s about 8GW of otherwise accounted for capacity that’ll be lost. And yes, I know that relative capacity margins mean you can’t make a strict comparison, but even after that, that’s something like four nuclear power reactors or five gas-fired power stations worth.  But of course, if you really do believe in the need for low carbon power as part of your carbon budgeting process, then the replacement capacity would have to be found. Not from gas and …er…not nuclear, because you can’t magic up two new plants in six years, but maybe from …what? Biomass, tidal impoundment? Hmm, all these technologies have underwritings far higher per kWh than onshore does, so presumably you’d need to adjust that Levy Control Framework ceiling considerably. So it’s looking improbable that Dave will do what James outlines in his piece, and try to make it all fit together logically.

But then James probably hasn’t read his Machiavelli either. Niccolo has some good advice on this dilemma as well. He tells his prince:

“It is unnecessary for a prince to have all the good qualities I have enumerated, but it is very necessary to appear to have them. And I shall dare to say this also, that to have them and always to observe them is injurious, and that to appear to have them is useful; to appear merciful, faithful, humane, religious, upright, and to be so, but with a mind so framed that should you require not to be so, you may be able and know how to change to the opposite.”


….which is probably what Dave will now do.


The tide is turning (and so are the turbines)

Committee Room 20 is about as far as you can go along the corridors of the House of Commons without actually ending up on the roof, so I was slightly surprised to see just how many people, including a large number of Parliamentarians, made the trek to discuss wave and tidal power at the PRASEG meeting on Tuesday. I guess though that the great turn out serves as a weathervane for the justified and renewed interest in the technologies that is currently under way after lots of disappointment that promising early prototype work has not really scaled up as had been hoped.

Well no more long periods of disappointment on this front, apparently. Or at least not as far as tidal energy is concerned. Remarkably, the front runner for full scale deployment doesn’t rely on anything new and untested; as Mark Shorrock, CEO of Tidal Lagoon Power Swansea Bay, put it at the meeting, it’s just a matter of ‘a breakwater, a powerhouse some turbines and a coffer dam.’ Those ingredients, all tried and tested, make up a scheme that is now largely funded, presented for planning and regulatory appraisal and is supported by the vast majority of local people. The project is set for installing and generating 320 MWs of capacity by 2018 and all without serious collateral environmental impacts, or blocking searoutes. An honourable mention at the meeting should also go to the Solway Firth tidal stream project which is aiming to land considerable capacity and roll out full scale turbine power from tidal flow by 2015.  I won’t witter on too much about the Swansea Bay scheme because you can find the techie details of it now in various places such as the BBC’s  piece.

What hasn’t been covered though are any of the longer-term considerations about finances and the reality or otherwise of tidal flow ever actually making a real difference to the UK’s power base.  And that’s been the problem with a lot of wave and tidal so far – promising technologies but between them affording a minuscule power input. So what is the prospect now and how does it compare with the bangs for bucks from other prospects? We might note that Swansea Bay is likely to be able to supply virtually zero carbon power for a hundred years or so. After all, that early experiment (effectively a tidal lagoon) at Lyme Regis, the Cobb, is still standing up well after almost 200 years.

Well, Swansea is the first, but already other sites are being actively investigated, including notably a lagoon at Bridgewater, which would provide inter alia a first-class defence against future flooding in the Somerset Levels. And the price for the power, on the basis of scale and cost, looks to come down in a solar panel-type curve in the future. Swansea being a relatively small project sited out of the strongest tidal flows probably needs a CfD of about £168 per kWh over 35 years. This is relatively expensive, but then it’s already being reckoned that the third lagoon could come in at under £85 per kWh. And this makes it, after capacity payments and all other hidden subsidies are taken into account, cost competitive with gas, something no tide geek would have dreamed of being able to claim just a few years ago. Oh and by the way (1) Swansea reckons to deliver an efficiency of about 90% on the ebb tide and 81% on the flow, which in English means that it can be counted as that holy grail of new energy, the carbon free baseload/back up source.  (2) And by the way some quiet work on wave and tidal CfD levels in DECC  means that both the level and the time scale can be accommodated within present arrangements and with no special negotiations (small gold star to Greg Barker here I think.)

So after several lagoons, and perhaps by 2023, we would maybe have 1.5 gigawatts of baseload -type capacity operating at an average CfD of about £90 over 35 years. But hold on! Haven’t we heard these sort of figures before? Well, yes, indeed we have. On a good day, with binoculars, the people building the breakwater at Swansea can gaze across the Bristol Channel and check out the progress of the concrete mixing at the Hinkley C nuclear power station site (which is funded now on a similar basis). But…two small observations:  firstly, I would wager that Swansea Bay will be quietly garnering the tide and feeding it into the grid whilst Hinkley C  will still be looking for the key to turn the plant on. Secondly, looking through those binoculars much later down the line, whilst people will be hard at work dismantling Hinkley C, protecting the waste ponds on site for 160 years and transporting large amounts of other detritus to a very large (and hopefully very safe) but very expensive hole in Cumbria, Swansea Bay will be …well, like the Cobb, just still there, minding its own business and if we still want it to, producing power for all of us.