Richard Black Gets Ever More Desperate
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By Paul Homewood
Richard Black, formerly of the BBC and now paid by the ECIU to push renewable energy, is away with the fairies again, with this article for the supposedly serious CAPX website.
He actually starts by outlining the issues quite well, including the Hinkley situation:
Almost all debate about the future of energy is couched in terms of technologies. What mix of wind, solar, nuclear, and gas generation do we need? How many subsea cables should we have? Which countries should our grid connect to? And so on.
But there is a completely different way of looking at energy provision: by first asking what services we need and then considering what sort of market we’d need in order to procure them.
The most obvious example of a technology-first approach was the commissioning of Hinkley C. This new behemoth of a nuclear power station due to be built on the Somerset coast will, if completed, send £2.5 billion per year into EDF’s coffers, index-linked for 35 years. It was all agreed via a bespoke, opaque contract.
A better approach would have been for the Government to run an open, competitive auction between the three companies that want to build new nuclear power stations. It should really happen as a matter of course under a cost-conscious public procurement policy.
But even better would have been to assess the services that a Hinkley-style power station would deliver, and have a technology-neutral market, or indeed several markets, to procure them.
Assuming it gets built, Hinkley C will do three things. It will pump a certain amount of electricity into the grid during the course of a year (25 terawatt-hours, if you want a number); it will guarantee, barring breakages, to generate when we most need it, during periods of winter evening peak demand; it will generate low-carbon electricity.
However the solutions he proposes simply don’t stack up:
In principle, you could set up a market specifically designed to deliver those three services at the lowest price. If we want the overall amount of electricity to come from the cheapest form of generation, that would inevitably be onshore wind – but the Government has effectively decided to ban it.
It could come from gas-fired power stations – but given that the energy needs to be free of carbon emissions, this would work only if they paid some form of pollution penalty or were built with some carbon capture system.
Or, it could come from tidal lagoons or solar panels, or, in future, small modular nuclear reactors, should they prove economic.
Most of these options would not, however, guarantee the availability of electricity during freezing, windless winter evenings. So, the market would also need to deliver a way of matching supply to demand during those peak hours, at the lowest cost.
At least some of that would come through contracts that reduce demand as opposed to increasing generation – for example, by paying factories to turn off non-essential equipment during peak-time hours.
And this smorgasbord of provision, if delivered through open competition, would almost certainly work out cheaper than Hinkley.
It’s what the next generation of electricity markets should look like. In addition to simply selling power, the electricity market of the near future will sell flexibility – or, if you prefer, agility.
The reason we need flexibility is because a unit of electricity is worth very different amounts at different times – depending on demand. Baseload power stations such as Hinkley are perfectly able to meet demand at peak times; but they also chunter along for the rest of the year pumping out the same amount of power, whether it is really needed or not.
Similarly, wind turbines and solar panels won’t reliably generate power at times when it is required. Simple economics dictates that the share of wind and solar powered energy will inevitably rise much higher than the 14 per cent at which it currently stands.
So, whether we go for nuclear or renewables or a mixture of the two, the growth market will be in services that take a low-value unit of power, generated at a time of low demand, and turn it into a high-value unit, making it available when it is most needed.
This value multiplication can be done in several ways:
– through storage – either in batteries, or the use of hydropower schemes in which water can be pumped up to a higher reservoir when electricity is plentiful and released to generate power when it is scarce.
– through international trading, whereby the UK can sell solar electricity to Norway (for example) during summer, and buy hydro electricity back during winter.
– through demand switching, whereby business customers – and, with the advent of smart meters, domestic consumers too – are rewarded for switching demand away from peak times.
– using modern gas-fired power stations, which can be turned on and off quickly on winter evenings, while lying dormant during summer.
We have seen these sort of arguments before, but let’s look at some of Black’s howlers:
1) If we want the overall amount of electricity to come from the cheapest form of generation, that would inevitably be onshore wind – but the Government has effectively decided to ban it.
This simply is not true, as Black knows full well.
The government has only removed subsidies from onshore wind. Given that Black himself claims that this is the cheapest form of generation, this seems to be a perfectly sensible policy.
If onshore wind really is as cheap as he suggests, it will continue to thrive.
2) Most of these options would not, however, guarantee the availability of electricity during freezing, windless winter evenings.
Well, all of the options except gas, that he insists should pay a pollution penalty even though there CO2 is not a pollutant.
But where does he get this idea that we only need back up power during freezing, windless winter evenings?
He makes a similar claim when he says:
Baseload power stations such as Hinkley are perfectly able to meet demand at peak times; but they also chunter along for the rest of the year pumping out the same amount of power, whether it is really needed or not.
and:
using modern gas-fired power stations, which can be turned on and off quickly on winter evenings, while lying dormant during summer
In reality, in Q2 and Q3 last year, gas/coal/oil and nuclear provided 73% of the UK’s electricity. Wind and solar only generated 15%.
And it is this fundamental lack of understanding about how the UK’s electricity is produced which fatally undermines the rest of his arguments.
He believes, for instance, that battery storage can make up for renewable intermittency, as if they would only be needed on that handful of freezing nights.
He makes the same claim about demand switching.
Neither of these “solutions” would make the slightest difference when wind and solar power are in short supply for days on end.
And I don’t know how he expects batteries to store enough power in summer, when it is not needed, for use in winter when it is.
3) Through international trading, whereby the UK can sell solar electricity to Norway (for example) during summer, and buy hydro electricity back during winter.
Interconnectors may have a role to play in managing surpluses and deficits, but they are not a substitute for a proper energy strategy.
And he is surely aware that, at times of surplus, such as windy days, Norway is already busy buying up electricity from countries like Denmark and Germany at rock bottom prices.
Given that CfDs give wind and solar farms guaranteed prices, who ends up footing the bill for dumping power at below cost?
And who will guarantee that we can buy it back when we need it?
Today’s weather has not been untypical, and currently wind power is generating 3.5GW, about 8% of total demand.
However, in the last 48 hours, this has ranged from 0.6GW to 4.6GW.
With generation still dominated by conventional power plants, this sort of variability can be easily handled.
Multiply wind capacity by ten, and take away coal, gas and nuclear, and the grid would simply collapse.
It is instructive to see the increasing contortions that the likes of Richard Black, but more importantly those actually in charge of our energy policy, are having to make as they begin to appreciate the disastrous direction into which their mindless obsession with decarbonisation is leading us.
For so long they have lived in LaLa Land, believing that wind and solar power would keep the country running. Now they are gradually waking up to the fact that it won’t.
Yet instead of admitting their errors, they ever more desperately cast around for ways to keep their dream alive.
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March 13, 2017 at 08:21AM
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