Energy Policy

Nick Butler: The transition to a lower carbon economy has been long promised but the reality remains elusive. There is no doubt that the costs of renewables – led by solar and onshore wind – are now materially cheaper than they ever have been, having fallen respectively to the point at which the International Energy Agency in its latest short term outlook sees prices falling to between $20 and $50 per megawatt hour. That means they can compete with other fuels, even if some of the costs of providing back up to cover the intermittency of renewable supplies are included. In some markets, neither subsidies nor protected market shares will be necessary. Why then is the pace of change in the sector, especially in the developed world, so slow? Hydrocarbons continue to dominate with oil, gas and coal providing over 80 per cent of energy supply. Most serious long term forecasts suggest that dominance will decline only slowly and that renewables will still be providing little more than 15 per cent of the world’s electricity needs in 20 years’ time.

FT 22nd Jan 2019 read more »

ADAM VAN COEVORDEN argues the aborted deal to build a nuclear power plant exemplifies everything that’s wrong with our approach to energy – and only nationalised renewables are the way forward. Undoubtedly, the loss of jobs is a serious and regrettable thing, but something not explored here is what harm would be caused if the building of these plants were to go ahead. The issues here are a microcosm of this government’s failings: lack of action on protecting our environment; private companies receiving generous taxpayer subsidy; the continuing failure of Britain’s energy market. As with other failed privatisation deals, the taxpayer was to take on the risk and provide subsidy, while the commercial enterprise was to take home any profits. Despite the headlines, the move away from building expensive, subsidised nuclear plants is a positive one. The febrile political atmosphere could soon see the election of a transformative Labour government. One where jobs are not lost because deals are not “generous” enough for the private sector, but one where jobs are created as Labour spearheads an economic revolution focused on tackling climate chaos. Renewable investment is needed, and this investment can be realised in the towns and cities that have been neglected for so long. In contrast to this latest Conservative debacle, Labour plans to create jobs, tackle climate change and invest in our communities, rather than merely propping up the profits of multinational corporations.

Morning Star 21st Jan 2019 read more »

Fylde MP Mark Menzies has said Britain should seriously think about constructing its own nuclear power stations, rather than relying on foreign private sector firms who are failing to deliver. Mr Menzies is concerned as more than 1,000 people in his constituency are employed in nuclear fuel production and could have seen jobs safeguarded by the new schemes.

Blackpool Gazette 21st Jan 2019 read more »

Chris Goodall, who has written a series of books on meeting Britain’s energy needs, believes that renewable energy such as solar and wind power can play a greater role. He says the falling cost of renewable energy sources is one of the reasons that HItachi could not make Wylfa viable. Wind is now the third biggest source of power in the UK, and solar power – such as the council-owned solar farm in Telford – are gradually playing a more important role. The problem with renewable energy is its intermittent nature. Last year’s heatwave saw a major spike in carbon emissions while the wind turbines stood still, and Mr Goodall says finding way to store excess energy at peak periods is key to solving the problem. George Day, head of policy at Birmingham-based research organisation Energy Systems Catapult, says it would be extremely difficult for the UK to meet its clean energy targets without the use of nuclear power. “It’s difficult to see a low-carbon energy system in the future which has no nuclear,” he says. “If you try to rely on just renewables and storage, without carbon capture and storage or nuclear, you are looking at a very challenging transition and one that is more costly than a balanced mix.” Former environment secretary and North Shropshire MP Owen Paterson calls for a rethink of energy policy, moving away from the giant power plants of the past He believes that in the immediate future Britain will need to concentrate its efforts on gas, including the exploitation of Britain’s shale-gas reserves through the controversial process known as ‘fracking’. But he says the long-term solution will need to be based around a large number of smaller nuclear plants serving their immediate communities.

Shropshire Star 22nd Jan 2019 read more »

Posted: 22 January 2019

Energy Policy

As the UK strives to meet legally binding carbon targets, businesses must help policymakers create a low-carbon economy that does not exclude working-class people or rural regions, Energy Minister Claire Perry has claimed. Speaking at an Aldersgate Group event in central London on Thursday (17 January), Perry was asked to explain how her involvement with last month’s COP24 conference would help the UK to bolster its decarbonisation ambitions, particularly in light of the Intergovernmental Panel on Climate Change’s (IPCC) landmark report on global warming. In the wake of the report, which laid bare the stark differences between an average global temperature increase of 1.5C and 2C, the UK Government has asked the Committee on Climate Change (CCC) for advice on how best to bolster its carbon reduction targets and create a net-zero economy. Delivering the keynote speech at Thursday’s event, Perry said that policymakers would only follow advice which would not exclude entire regions or social classes from the transition to carbon neutrality.

Edie 18th Jan 2019 read more »

Posted: 21 January 2019

Energy Demand

The fall in UK electricity generation to its lowest level since 1994, as reported on the Carbon Brief website earlier this month, reflects a trend in the energy market that is too often ignored. The decline in consumption is not limited to the UK or to electricity. Over the past decade, both total energy demand and electricity use have fallen across the developed world. Since 2010 demand has declined in 18 of the 30 countries that are members of the International Energy Agency. There are several different reasons for the decline in consumption. Technical advances have improved the efficiency of products ranging from washing machines and fridges to computer servers have been underpinned by regulatory changes such as the introduction of LED lighting. Economies have deindustrialised to differing degrees, while in some countries a proportion of the fall has been caused by low economic growth. Although analysts and policymakers frequently assert that electricity will lead the shift to a low-carbon economy, there is so far only limited evidence of a real change. Electricity has only marginally expanded its share of final energy consumption since 2000 despite the growth of computers, telecommunications and the proliferation of domestic appliances. A small number of electric cars and the rising use of electricity in other parts of the transport sector starting with the railways have not yet made a material difference. By 2017, electricity contributed less than 1 per cent of final energy consumption in the transport sector, according to the IEA. As consumers upgrade equipment to ever more efficient models and as regulations force standards to rise, electricity consumption is likely to drop. A revolution in battery technology would in theory stimulate demand for electricity. But any growth in the use of batteries (and other forms of energy storage) will also serve to eliminate waste and the loss of electric power, which as of now can only be used as soon as it is produced. Smart meters and grids will also improve efficiency rather than increasing demand. Falling demand makes it harder to justify substantial long-term investments in new capacity. Higher cost producers – for instance of new nuclear power – are finding themselves squeezed out.

FT 21st Jan 2019 read more »

Posted: 21 January 2019

Energy Policy – Scotland

The Scottish Government should ramp up investment in environmentally friendly infrastructure projects in order to achieve its climate ambitions, according to opposition MSPs. Experts recommend 72 per cent of public spending on infrastructure should be allocated to low-carbon schemes such as electrification of public transport and renewable power to meet climate change targets and safeguard society. But the latest figures suggest only 32 per cent of government-led investment in the next 12 months will go to schemes considered the least harmful to the planet. Meanwhile, 10 per cent will be paid to high-carbon projects such as oil and gas works and road-building and 58 per cent to neutral developments such as schools, hospitals and prisons. This represents a small rise in low-carbon investment and slight fall in high-carbon compared with the previous year. However, a new report from the Scottish Parliament Information Centre (SPICe) predicts that future investment is likely to increase for carbon-heavy developments and decrease for low-carbon projects. Patrick Harvie, joint leader of the Scottish Greens, insists ministers must “pick up the pace” of transition to a greener society to stave off environmental calamity and protect communities.

Scotsman 19th Jan 2019 read more »

Posted: 20 January 2019

Energy Policy

UK signals shift from nuclear to renewables. Business Secretary says ‘economics of the energy market have changed significantly in recent years’. The government has signalled a big shift away from nuclear energy and towards renewables after Hitachi announced it was scrapping work on a new reactor because of the plummeting costs of offshore wind and solar power. Addressing MPs, the Business Secretary Greg Clarke said that despite “significant and generous” offers of financial support from the government, the Japanese firm believed the £16bn Wylfa nuclear project in north Wales was no longer viable. The New York Times says the government had been “betting heavily on nuclear installations to help meet the country’s electric power needs in the coming decades”. Yet Hinkley is currently eight years behind, billions over budget and will lock the country in to paying £92.50 per megawatt hour compared to £57.50 for offshore wind. The deal between the Coalition and EDF was signed back in 2013 and guaranteed the French energy firm an index-linked price for 35 years from the moment the plant is commissioned in 2025. “Since then much has changed, and the assumptions which underpinned the old policy now look laughably wrong”, says the Financial Times. “While renewable costs continue to drop sharply,” reports The Independent, “those for new nuclear power generation have soared, partly as a result of tighter safety rules brought in after the Fukushima disaster in 2011.”

The Week 18th Jan 2019 read more »

Independent 17th Jan 2019 read more »

Only renewables can fix the UK’s nuclear energy crisis. “Hinkley Point might be the last nuclear power station ever built in the UK,” says Chris Goodall, an energy expert and author of The Switch. The changing economics of the electricity market made Hitachi’s decision “inevitable,” says Goodall. The falling cost of solar and wind power has made expensive, long-term nuclear projects such as Wylfa a much less attractive option. “The ground is shifting under their feet,” says Jim Watson, director of the UK Energy Research Centre. At the same time, it has become much more expensive, at least in Western Europe, to build and deploy large-scale nuclear power projects. Recent attempts in Finland and France have run late and over budget, and many believe Hinkley Point C will suffer the same fate. There are ongoing efforts to develop cheaper alternatives such as small modular reactors, but these largely remain in the concept stage. “They still need to go through the stages of demonstration, seeing how much they cost, and testing the issue of public acceptance,” says Watson. Renewables are getting cheaper and better – wind is now third behind nuclear in sources of electricity in the UK. Increasingly, solar power is an option, even at higher latitudes, and the UK has “some of the best wind resources in the world,” according to Goodall. “I think renewables can do a lot more than people thought ten years ago,” says Watson. Renewables are also much quicker to deploy. Even if the Anglesey plant had gone ahead, it would have been at least a decade before it actually started generating power – in the same period, a huge number of onshore wind turbines could be installed. What’s needed is seasonal storage – technology that can smooth out the peaks and troughs inherent to renewable energy at a large, longer-term scale. Electricity could be stored as hydrogen, for instance, or as hydrogen converted to methane. “If we’re going to spend a great deal of money developing offshore and onshore wind, it’s inevitable that hundreds of times a year we’ll have a lot more than we need,” says Goodall. “We have to find a means of buffering.” Without investment in storage technology, the Hitachi announcement could prove a blow for efforts to reduce the UK’s carbon footprint. But experts are hopeful that it could scare the distracted government into putting its foot on the gas, and backing research and investment in alternative sources of carbon-free electricity. “It could result in more fossil fuel emissions,” says Goodall. “Or, it could put pressure on the government to go back to wind, and combine that with energy storage.”

Wired 18th Jan 2019 read more »

The government sought to downplay the latest blow to the UK’s low carbon energy plans, with Business Secretary Greg Clark hinting Hitachi’s decision to suspend all work on UK nuclear development was temporary while the government reviews its funding policy for the sector. Speaking in the House of Commons this morning, Clark said the government had offered Hitachi a “generous” package to develop Wylfa Newydd, including proposals for the government to take a one third equity stake in the scheme, commit to providing all the debt financing for construction, and offer a Contract for Difference power contract worth £75/MWh.

Business Green 17th Jan 2019 read more »

The government is not quite ready to drop its obsession with nuclear. Greg Clark knows nuclear cannot compete with the likes of wind and solar – but he is not giving up. here was excellent news within Hitachi’s decision to shelve its plan to build a £16bn nuclear plant at Wylfa in Anglesey. Finally, a government minister may have grasped the basic problem with nuclear power. It is being “out-competed” by alternative technologies, especially wind and solar, the business secretary, Greg Clark, had to concede in the Commons. Exactly. So drop the obsession with nuclear, last century’s answer to our energy needs. As Clark also said, the package offered to Hitachi was generous. The price of the power, at £75 per megawatt hour, was lower than in EDF’s Hinkley Point C contract, but on this occasion the government would have taken a one-third stake and committed to providing all the debt financing for construction. Adjust for the different financial structure and the package looked very Hinkley-like – in other words, hugely expensive for the poor old bill payer. Wind and solar have continued to tumble in price, as the National Infrastructure Commission (NIC), the body charged with injecting some long-term thinking into big national projects, noted last year. Its prescription: “Given the balance of cost and risk, a renewables-based system looks a safer bet at present than constructing multiple new nuclear power plants.” Clark doesn’t seem ready to go that far. He promised to set out a new approach to funding nuclear projects in the summer. We’ll await the details, but most of the supposedly “clever” financing solutions, such as the “regulated asset base” model, sound like ways to shovel construction risks on to consumers and disguise the fact within their bills. They don’t change the fundamental expense of nuclear. A better approach is possible. Ministers should read their own infrastructure adviser’s report.

Guardian 17th Jan 2019 read more »

BRIAN WILSON: Why ditching nuclear is bad for climate change, good for Putin. If the UK gets rid of nuclear power, it will become more reliant on fossil fuels from Russia, writes Brian Wilson. Amidst the fine talk about “taking back control”, it was ironic that the most significant announcement for the British economy emerged this week from a Tokyo boardroom. The decision by Hitachi to pull out of the planned Wylfa nuclear power station is not only devastating for the north Wales economy, it also leaves the UK without an energy policy worthy of the name. To some, this will be a cause for rejoicing. They hate nuclear power so much they do not care where the alternatives come from – Russia in the long run – or what they consist of – fossil fuels, mainly. Check out Germany where the anti-nuclear policy driven by the Greens resulted last year in 44 per cent of electricity being generated from coal, compared to seven per cent in the UK. The more nuclear they close, the more coal is burnt. Scotland, naturally, has been in the frontline of 21st century virtue-signalling. Hunterston and Torness are spoken of as if they were regrettable plagues upon our landscape, rather than essential engines of the Scottish economy for half a century. Soon they will be gone. Hunterston B has been providing baseload for 46 years and Torness for over 30. They are monuments to great Scottish engineering and well-paid jobs in communities that depended upon them. What, any more than in North Wales, are they to be replaced with?

Scotsman 19th Jan 2019 read more »

Letter: Catherine Mitchell, Professor of energy policy, University of Exeter: The pulling out of Hitachi from the proposed Wylva nuclear power plant is a good thing for energy policy – not a serious blow as said in the article. Nuclear power is now one of the most expensive form of electricity there is. But beyond the economics, it no longer fits with the digitalising world that we live in. The global energy system is undergoing change similar to that in telecoms and computers over the last few decades. The energy system is becoming smarter and more flexible and it is on the path to being operated in a completely different way than hitherto because of that. Nuclear – with its huge, inflexible output – is the equivalent of a giant boulder in the middle of a motorway. We, the energy customers of Britain, would have ended up paying way over the odds for Wylfa, which would have also undermined the UK’s move to a smart and flexible system – which really is the future. We are already going to do that for Hinkley Point C. Going down the nuclear route has been a wasted decade for UK energy policy. Exiting from the EU and the loss of flexibility we may end up with because of difficulties to do with interconnectors and market arrangements is a far greater threat to security than some phantom nuclear power plant from a previous age.

Guardian 18th Jan 2019 read more »

Posted: 19 January 2019

Nuclear Finance

What affects the profitability of an investment in nuclear energy? What are the risks? Energy researcher and analyst Schalk Cloete presents his latest paper on the matter. He looks at the various effects on nuclear power investment, including the rise of other competing renewable energy sources, and the changing price of energy.

Energy Post 18th Jan 2019 read more »

Posted: 19 January 2019

Grid Connections

A no-deal Brexit could cost the UK £2.2bn every year as the network connecting the nation’s electricity supply with its European neighbours would no longer function effectively. Environmental think tank Green Alliance issued the warning as Britain’s future clean power supply looked uncertain following a string of failed nuclear power projects. With Japanese firm Hitachi pulling out of the planned Wylfa plant in Wales, the UK now faces a “nuclear gap” of about 15 per cent in its future electricity supply. Environmental groups say the gap can be plugged with renewable energy, and business se cretary Greg Clark acknowledged the tumbling price of wind power was making it a more desirable option than nuclear. However, concerns still remain around how variable power supplies, such as wind and solar, can provide the grid with reliable power. One way around this problem would be to invest in networks that span multiple countries, meaning when the wind is not blowing in Britain energy can be provided from somewhere else. Such a network would also provide a market for the country’s renewable electricity at times of surplus. In 2017, energy trading across borders brought £700m into UK markets. Despite these benefits, and projects in the pipeline to link the UK up with Belgium and Norway, Britain remains one of the least connected countries in Europe. Green Alliance estimates that doubling current interconnection within the next two years and – in doing so – importing cheaper power from Europe, could save consumers £1bn a year. However, this future is under threat as departing the EU will complicate the exchange of electricity between nations.

Independent 18th Jan 2019 read more »

Posted: 19 January 2019

Energy Policy

The future of the Government’s plans to roll out six new nuclear power stations across Britain is looking increasingly parlous, as the Wylfa project becomes the second power station to be scrapped in just two months. Wylfa’s demise makes the Oldbury project extremely unlikely to proceed, while Toshiba has already backed out of developing its Moorside station. These three power stations would have generated 73 TWh of low carbon power per year, or 15% of current demand. Their absence leaves space for new low-carbon capacity to fill the gap. Filling the ‘nuclear gap’ with alternative low-carbon power sources would keep bills down, maintain secure energy supply and allow the UK to maintain progress towards legally binding climate targets. A representative scenario, in which 80% of the energy output of Moorside, Wylfa and Sizewell C was replaced in equal measure by onshore and offshore wind, with the remaining 20% by solar PV would entail an average price of £50-65/MWh, including the cost of system balancing. This is 13-33% cheaper than the cost of energy from nuclear (not accounting for nuclear system costs). This would see an additional 11.3 GW of onshore wind and 5.7 GW of offshore wind capacity, as well as 20.8 GW of new solar PV capacity. Renewable capacity is already set to increase on current levels, as more – and cheaper – capacity continues to come online.

ECIU (accessed) 17th Jan 2019 read more »

Posted: 18 January 2019

Energy Policy – Scotland

Scottish Parliament backs plans to give Just Transition Commission a statutory footing. The Just Transition Commission will provide recommendations to government on how to achieve zero emissions while protecting jobs. The Scottish Parliament has agreed the new commission established to help move Scotland towards a zero-carbon economy should be independent from government and given a statutory footing, after MSPs backed an amendment from Scottish Labour. The new Just Transition Commission will provide recommendations to government on how to achieve zero emissions while protecting jobs, with MSPs then agreeing to back an amendment from Labour MSP Claudia calling for it to be “well-funded, independent of government and accountable to the Parliament”. But SNP, Labour, Conservative and Liberal Democrat MSPs voted down an amendment from Green MSP Mark Ruskell calling for faster roll-out of renewable energy and accelerated decommissioning of oil and gas projects. Claudia Beamish MSP said: “Workers in Scotland will be relieved by the Scottish Government’s decision to support Scottish Labour’s amendment calling for it to give consideration to a statutory Just Transition Commission. “The just transition principles are fundamental to the international and historic labour movement, and to Scotland’s future. The SNP Government must follow Scottish Labour’s lead in pairing climate change ambition with social and economic equity. “The short-termism of the Scottish Government’s initial design for a 2 year long Just Transition Commission showed a fundamental misunderstanding of the concerns of communities and those working in industries that need to adapt now and into the future.

Holyrood Magazine 16th Jan 2019 read more »

Posted: 18 January 2019

Grid Connections

The North Connect transmission link will see the renewable energy markets of Scotland and Norway trade energy will connect a converter station at Stirling Hill, Boddam to an offshore transmission cable across the North Sea. Developers plans were accepted to lay a 415-mile cable from Peterhead to the Norwegian west coast, due to begin in 2023. The electricity superhighway was “unanimously approved” by almost a full council today, a project insider said. Owned by Vattenfall, Agder Energi, Lyse and E-CO Energi, the interconnector is licensed to carry 1.4 gigawatts (GW) of capacity between the two countries.

Energy Voice 18th Jan 2019 read more »

Posted: 18 January 2019