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Untangling the knots of wind policy

Not even Alexander the Great would find it easy to untangle the complicated strands that make up UK government energy policy. The Macedonian leader legendarily solved the intractable problem of loosening the complicated Gordian Knot tying an ox-cart to a post (in order to claim a vacant throne) by getting out his sword and cutting through it. If faced with the current tangle over how various renewable energies are supported, we think he’d probably give up in disgust and try to think of another use for his sword. In which case, the assembled masses of the Department of Energy and Climate Change would be best advised to find something sturdy to hide behind.

The story we’re being fed this morning is that the government is cutting support for onshore wind and solar energy and increasing funding for offshore wind. This, we’re told, is because onshore wind and solar technology is mature, whereas — as we’ve seen with the recent withdrawal of RWE Innogy from its Atlantic Array project in the Bristol Channel — offshore wind still faces considerable technical challenges.

Burbo Bank Wind Farm Now Fully Operational

Offshore wind: more support? Same support? Good question.

Unpacking this claim is quite a challenge. Yes, there are certainly big changes coming up in how renewable energies are supported: but these changes were happening anyway, because the mechanism is switching from Renewable Obligation Certificates (ROCs), where (to simplify somewhat) energy generators claim an extra top-up payment per megawatt-hour on top of the market rate, to a strike price, where suppliers are guaranteed a minimum amount for the energy they generate.

The ‘changes’ mentioned today are in the strike prices, which have been reduced or increased relative to the draft amounts issued in back in July. And there are changes — but they aren’t very dramatic. Instead of onshore wind producers being paid £100/MWhr, as was proposed in the July draft, they’ll be paid £95/MWhr from 2014; this will reduce to £90/MWhr from 2017, rather than £95/MWhr. The offshore wind strike price starts at £155 in 2014, goes down to £150/MWhr in 2016, and then to £140/MWhr in 2017. That’s unchanged from July. Repeat, unchanged. Where this claim that support for offshore wind is increasing is anyone’s guess. Large solar goes from £120/MWhr to £110/MWhr.

Confused? Don’t worry, you’re in company.

Does this represent a reduction in the overall price for onshore wind and solar? Seeing as we’re going from a system where gradually-declining ROC payments top up the fluctuating market price to one where the government mandates an overall price, it’s very difficult to say. On the one hand, apples; on the other, oranges. Add into this that the switch from ROC to strike price is gradual — producers can opt for one or the other up to 2017, when strike prices become compulsory — and it just gets more tangled.

It is instructive to compare these strike prices with those for nuclear, however. The agreement for Hinkley Point C sets the price at £92.50/MWhr from 2018, so all we can say with certainty is that when the station is operating, nuclear will be slightly more expensive than onshore wind, and somewhat cheaper than offshore. Incidentally, the strike price for wave and tidal is £305/MWhr, reflecting the difficulty of placing complex machinery in an extremely hostile environment and getting electricity from them in a medium which is itself conductive, while also keeping up maintenance. Yes, it is harder than splitting the atom.

It’s also not entirely true to state that this is government support, as the money is raised through electricity bills. It’s a moot point, as billpayers are also taxpayers, so the support is coming from the same pockets (yours and mine) and it’ll take a while for the effects of this new form of payment to be apparent. But there is quite definitely a huge amount of spin coming along with this announcement; cynics would say that this is more of an attempt to appease rural opponents of wind farms than anything else.

Meanwhile, and in somewhat of a surprise, the government has released its latest National Infrastructure Plan, with £375billion of investment in road, rail, energy, communications and water projects over the next five years, of which the insurance industry has guaranteed to supply £25billion. This appears to be welcome news: it represents definite progress on urgent projects, including the Wylfa nuclear power station, although some may not welcome the proposed sell-off of the UK’s 40 per cent stake in Eurostar — another asset which could be argued is strategic, potentially passing into overseas ownership. But at least it sets out what civil engineers will be tackling in coming years, and gives us some insight into what the country will look like when it’s done. It’ll be interesting to see where the rest of that £375billion comes from.

Readers' comments (12)

  • Excellent move. Long term investment in what Britain does best: innovation.

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  • There is only one word required for the confusion, contradictions and inequalities regarding the British energy policies, and that word is... Political.
    Every choice, every decision and every part of every policy is driven by the need for political influence. Forget environmental considerations, forget economical benefits, forget efficiency of supply, forget reliability of supply, the only driving force behind all facets of this question is politics, and the only way intelligent policy will ever be reached is through a change in the political system.

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  • Isn’t 95% of what we see in parliament “gesture politics”, these ignorant (& arrogant) people have to be seen to do something, anything….however inappropriate.
    Running a country is too important a job to be left to ignorant politicians whose egos & personal advancement come before everything else.
    Think what political meddling has done to –
    The NHS,
    Our energy,
    & most despicably- the education system.

    On top of all that they are in line for an 11% pay increase & still want to keep their expenses. !!!

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  • I feel compelled to agree with John - on “gesture politics”
    They no longer speak for the majority they are more like puppets for the "Banksters" and the Elite.

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  • I am glad I am not trying to manage production planning for UK wind turbine manufacturing. I can foresee a challenge in the courts, just as happened when the reduced tariffs for the domestic FIT rates were introduced a couple of years ago.

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  • If Politicians were honest the above leaked prices should be announced in Parliament. I note that strike price for wave and tidal is £305/MWhr, and that the River Rance in France is generating at <£18/MWhr when operating for a few hours per day. The Rance Barrage is self financing because it's paid for itself in last 40 years and is in profit. Big profits are also available from it's associated tourism.
    A Severn Barrage with 15GWhr or 23GWhr capacity [depending on barrage location] would also obviate need for civil engineering of upstream river and sea defences. The Rance has lasted 40 years with a further 100 years of design life; unlike several Nuclear stations with a 35 year operational life and centuries of clean up costs.
    As a trial, before building the Severn Barrage, why not construct a prototype barrage, as proposed at Fleetwood, on the River Wyre?
    Why hasn't this happened? I agree with previous contributors, it's because Politicians will stop it in planning stages with help of the people seconded to civil service from main energy suppliers.
    Tides are eternal, "Civil" Servants have insufficient engineering education to work out that The Moon going round The Earth will continue to generate tidal power until 'End of The Earth'.

    The existing energy utilities are contracted to their own expensive gas fields. They should be purchasing cheap Fracked Gas from America as Grangemouth Refinery plan to source for their survival.

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  • At GBP95/MWh even the very expensive Hinkley point nuclear station seems to be a bargain compared to the feeble, intermittent and, in most cases unpredictable, supply of energy from the new renewable energy technologies.

    The whole policy is fatally flawed because, as we now know, man-made carbon dioxide does not cause dangerous global warming.

    The whole exercise is a futile attempt to solve a non-existent problem with expensive technologies that make hardly any difference.

    The sad thing is that, to a very large extent, it robs poor electricity consumers to subsidise those rich enough to invest in these heavily subsidised monumental follies.

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  • I agree with Rodney Harrap. Tidal barrages are a no-brainer, but we're 'ruled' by dummies who can't plan a logical long-term strategy for the UK's electricity infrastructure. Their ideology (reinforced by EU state aid rules) allows them to abdicate responsibility for it. (how convenient)

    Personally, I'd opt for the Minehead to Breaksea Point barrage in the Bristol Channel, as it would double as flood protection for the Somerset Levels. The cost of all upstream flood defences would come out of the public purse, so that should be the minimum government contribution to the project.

    More importantly, incorporating energy storage in the barrage construction, by using cylindrical caissons, would deliver dependable, dispatchable. electricity, which would become the cheapest on the market at around the time that the Hinkley C plant is being decommissioned.

    Furthermore, I would advocate that the caisson design first be trialled to upgrade the Swansea Bay Tidal Lagoon and give that an energy storage facility too. That could in turn be integrated with the recently shelved Atlantic Array, so that all these renewables have before-generator energy storage. That design principle is transformational. The benefits far outweigh the costs and make the case for nuclear look pretty shaky in comparison. (long term!)

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  • I've got an idea, I know its a bit radical. Wind power is so marvellous,cheap reliable completely predictable ,why don't the windpower people just get the windfarms built and sell the power into the grid without subsidies. It's so easy for this super reliable power source. No problemo

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  • " . . the difficulty of placing complex machinery in an extremely hostile environment and getting electricity from them in a medium which is itself conductive, while also keeping up maintenance. Yes, it is harder than splitting the atom."

    Aren't you over-stating the difficulties? Anyway, that ceases to be a problem if you remove all the complex electrical stuff from the "hostile environment", which is another bonus of switching to a before-generator energy storage design. It would work for offshore wind as well:-

    For example, the 26 generators here;
    would be variable displacement water pumps instead - feeding accumulators so that two or three generators, housed in the dry and easily accessible - would deliver dispatchable power, only in response to demand. See any problems? (aside from a high capital cost)

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  • One of the problems beyond capital cost is the interference with the mud flats used for enormous numbers of migrating birds. I note in Wikipedia they discuss the "Possible effect of turbidity reductions in Severn Estuary" by a Barrage which could increase the productivity of the Mud flats. This becomes a problem if electrical demand is reduced then the water may not uncover all the mud flats on infrequent days. However, that is an ideal topic to prolong any public enquiry.

    David Smarts suggested barrier from Minehead to Breaksea Point which would generate 15GW or equivalent to 5 Large Nuclear Power stations. Even the traditional Brean Down and Lavernock Point barrage generates 7.2GW or 3 Nuclear Stations.
    The use of Barrages elsewhere on UK coast will avoid building of intermediate storage during tidal changeover. Intermediate storage could ensure an equivalent Pump Storage scheme and ensure mud exposure. If I recall a Dr Price did a fascinating study on the Intermediate Storage.

    The River Rance initially had a problem with an oil seal design for bearings, once rectified they have worked reliably ever since. Changing a Water Turbine Alternator pod is a piece of cake compared to maintenance in a radio-active environment.
    David Smart mentions High Capital cost for a barrage - what's the cost of 5 Nuclear Power Stations each replaced every 35 years. A Barrage can easily last 140 years so that's equivalent to 20 Nuclear Power Stations - Yes, Ladies and Gentlemen, you're correct, Politicians are incapable of planning 140 years ahead. Thank heavens our Victorian forefathers invested in fresh water Dams & Sewage systems, because the conurbations of London, Birmingham, Manchester, etc. would be cholera ridden cesspits if the current politicians and bankers were in charge.

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  • For every MWH of electricity generated, wind turbines use 11.5 times more steel and 9.7 times more concrete than LWR power plants.

    In a world of diminishing resources, shouldn't this be taken into account by environmentalists?:

    Tidal barrages are ecological abominations, compared to the ecological footprint of nuclear power stations.

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