The Rising Trend of UK Industrial Electricity Prices

via The Global Warming Policy Forum (GWPF)
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The emerging trend in UK electricity prices to industry confirms civil service advice to Mr Blair, which he ignored, that the EU Renewables Directive (2009) would disadvantage the UK relative to other members of the European Union. If the Industrial Strategy is to succeed, the Renewables Directive will have to be repealed, post-Brexit, and immediate steps should be taken to resile from its commitments.

In 2007 the UK government department responsible for energy policy, the Department of Business Enterprise and Regulatory Reform (BERR), prepared a short paper to inform ministers of the likely impacts of the proposed European Union Renewable Energy Directive. This document was leaked to the Guardian, and is still available online from that source.

BERR’s study reported that the EU Commission itself estimated the total annual cost of the Renewable Energy Directive target at 24 billion euros in 2020 (See Table 4). BERR thought this was an underestimate, but also estimated the costs to the UK at some £6–10 billion per year (See Table 3, but note that the table unfortunately gets the figures for a 14% and a 15% target the wrong way round).

In other words, in 2007 the UK government estimated that the UK alone would bear between 25% and 40% of the total EU-wide cost of the Renewables Directive targets, a share disproportionate to its population and the size of its economy.

This obviously unreasonable burden resulted from the fact that the UK, unlike other European states such as Germany and Denmark, had only recently introduced substantial renewables subsidy programmes (the prudent and modest Non-Fossil Fuel Obligation was succeeded by the extremely generous Renewables Obligation in 2002). Consequently, the country started from a low base of renewable energy and had no renewables industry. Instead, it had switched heavily towards natural gas for both heating and electricity, a move which of course rendered both sectors much lower emitters of carbon dioxide than they would otherwise have been and at very low cost. In other words, the proposed Renewables Directive seemed almost purpose-built to punish the UK for choosing the most economic route towards a low emitting energy system, namely natural gas, and to hobble the country in comparison to those EU states which had chosen to adopt renewables.

Nevertheless, in spite of BERR’s warning, Mr Blair, then Prime Minister, committed the United Kingdom to the Directive targets, which became law in 2009, which requires that the UK obtain 15% of its Final Energy Consumption from renewables, across all sectors, electricity, transport and heating. No subsequent government has shown any sign of retreating from this obligation.

However, when the EU Renewables Directive is transubstantiated into British law by the Great Repeal Act, it should be high on Mrs May’s list for repeal since it is not only bad in itself but, exactly as predicted by the civil service in 2007, puts the UK at a considerable disadvantage as compared to the member states of the European Union.

Anyone doubting this need only look at the recently released estimates of industrial electricity prices as compared as compared with major competitors. The following figure, drawn from data published by the department of Business Energy and Industrial Strategy (BEIS), charts electricity prices from 2005 to 2015, with and without taxes, for eight members of the European Union, Denmark, France, Germany, Italy, the Netherlands, Spain, Sweden, and the United Kingdom (red line).

Figure 1: Industrial electricity prices (p/kWh) without taxes (left panel) and with taxes (right panel) for Denmark, France, Germany, Italy, Netherlands, Spain, Sweden and the United Kingdom (red line). Source: Drawn by the author from data published by BEIS.

The UK imposes electricity policy costs through levies prior to taxation, so it is unsurprising that it has the highest prices without taxes, but it is still in joint third position when those taxes are included. Bad though that position is, it is the trend over the last decade that gives the most cause for anxiety. Only the UK in this group (and indeed in the EU 15) has a consistent rising trend in electricity prices. In fact all the other countries have a falling trend. There are doubtless a number of causes behind this fact, but what BERR identified in 2007 as the disproportionate burden placed on the United Kingdom by the Renewables Directive target is a substantial part of the explanation.

Due to the provision of coerced market share and generous subsidies, the UK generated about 82.8 TWh of electrical energy from renewables in 2016, up from about 25 TWh in 2009 [See BEIS, Energy Trends, table 6.1 [http://ift.tt/1BgrKCZ]. This is not far short of the approximately 100 TWh per year (about 1/3 of demand) required of the electricity sector by the National Renewable Energy Action Plan (NREAP) which sets out the means to reach the Directive target. As is well known, this growth has been dearly bought, with subsidies currently amounting to about £5 billion a year, and accounting for a significant fraction of the retail price to all consumers. Indeed, in the last release of the now discontinued Estimated Impacts of Energy and Climate Policies on Prices and Bills the Department of Energy and Climate Change (DECC) calculated that the price of electricity to a medium sized business in 2014 was 39% higher than it would have been in the absence of polices.

We can conclude, therefore, that BERR’s 2007 analysis was sound. The EU Renewables Directive (2009) has indeed put industries operating in the United Kingdom at a significant disadvantage as compared to those operating in other EU countries.

In fact, the same dataset from BEIS shows that this disadvantage is evident at a global level. The following figure compares electricity prices with and without taxes in the United Kingdom, Canada, Japan, Poland, Turkey, and the United States:

Figure 2: Figure 1: Industrial electricity prices (p/kWh) without taxes (left panel) and with taxes (right panel) for Canada, Japan, Poland, Turkey, the United States, and the United Kingdom (red line). Source: Drawn by the author from data published by BEIS.

As with Figure 1, while the rankings in 2015 are important it is the trend that deserves close attention. The UK alone has consistently rising prices over the period. Even in Japan, where there are of course very special circumstances, prices are starting to fall, and the rising trend in US prices is both modest in itself and arguably unlikely to continue under the current president’s America First agenda.

Mr Blair made a strategic error by neglecting BERR’s warning about the Renewables Directive. It is not too late to correct that mistake, and the delivery of an “Industrial Strategy” in the context of Brexit provides the framework and the opportunity. However, two years is too long to wait; government would be well advised to take steps to immediately reduce the iniquitous effects of the Renewables Directive.

via The Global Warming Policy Forum (GWPF) http://www.thegwpf.com

April 1, 2017 at 11:04PM

Fully self reliant on solar power for 42 days (out of 210)

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From the only-half-of-the-news-will-do department, this newspaper article titled Family from Limburg uses a home battery for one year already: “our house runs on its own power for weeks”. Not only this newspaper, all the other newspapers jumped on the story.

Basically, a family from Kermt (a small village in the Belgian province Limburg) has solar panels on their roof and got themselves a Tesla powerwall (translated from Dutch):

For 42 days since the beginning of September, a family from Limburg has already been using the energy they generate themselves via the home battery. By storing the energy from the solar panels, it can be used when the owners see fit. “So our house runs on its own power,” says Tom Nijsen (39).

At first glance, it sounds really nice. A Tesla powerwall was installed, storing the energy produced by their solar panels and therefor making it possible to use that solar energy, even when the sun doesn’t shine. Reducing their dependence on the grid and for some periods even being self sufficient. What is not to like?

The reason why initially my attention was drawn to this article was because three statements in the title and summary were demonstrably false. You just had to read the article carefully to notice it.

The first thing I noticed was that if the family had 42 days of self sufficiency since in the beginning of September 2016, then it is mathematically impossible that the battery was in use for “already one year” at the end of March 2017. That one was easy to spot by reading the title and the first sentence.

Also, The claims that their house ran fully on the power produced by their solar panels for weeks (in the title) and the similar claim that it did so for the last 42 days (in the summary) are also not true. Further in the article, a graph was shown with the production/consumption of 1.5 – 2 weeks ago and this puts both claims to rest:

Electricity consumption/production in week March 11 – March 18, 2017 (red=consumption from the grid, yellow=production, green=consumption)

It shows that the installation drew power (albeit very little) from the grid during four out of 6.5 days. If they were really self reliant during a “few weeks” until March 29, then there should not be any consumption from March 15 on.

Those 42 days of self sufficiency were probably not the last 42 days, but in total 42 days somewhere in the period beginning of September until the end of March (probably mostly during autumn and the beginning of spring):

The last few weeks, their house ran fully on its own power for days straight and also on the other days the net was considerably relieved. “Especially now, with a few days of good weather, it is very easy,” said Tom. “The electricity that we generate during the day with the solar panels can be used perfectly during the night and I still have 40-50 percent surplus the next morning.”

In his case, the battery results in 58 percent less activity on the network and more than double direct consumption of self-generated electricity.

This could fit the graph better. There were indeed 2 out of those 6.5 days that no power was drawn from the grid (I would like to see the data during winter).

I count 210 days from the beginning of September 2016 until March 29, 2017 (publication date of the article). The owners could fully rely on the production of their own solar panels during 42 days (20%) in that period. Turning it around: that is 168 days (80%) that they had to draw more or less power from the grid…

This is clearly not an off-grid situation. If they really want to be off-grid, they will have to install at least a second powerwall, making it more difficult to break even.

Which leads to the question: at what cost comes this achievement? The cost of the powerwall was not mentioned in this article, but in other newspapers I read that it came at a cost of about €7,000 euro.

The powerwall is only part of the installation. There is the also cost of the solar panels. The picture of their house shows 12 solar panels. At the website solar panel facts, I learned that such a configuration currently costs around €6,100 euro.

The total cost for new solar panels and the powerwall is therefor €11,100 euro. At first sight, this seems a hefty price to compensate only via a reduced electricity invoice.

But hey, don’t worry. According to the above table, one will “save” €625 per year. Sure, when one avoids drawing 2,500 kWh from the grid (that would have come to a price of around €0.25/kWh), this equals to a profit of €625 per year in the process.

As with almost all alternative energy communication, this is only half of the story. That family is by no means off-grid. Their installation is connected to the grid and will draw from the grid as well as put energy on it. Therefor owners of solar panels are honored with a special tax: the prosumer tax (for using the grid in two directions).

In Kermt this prosumer tax for such an installation is currently around €250 per year (and increasing, there was already an increase of 15% from 2016 to 2017). This is a recurrent cost that the owner of the solar panels will have pay each year, so this €625 profit will come down to around €375 per year.

Also, owners of such a system did an investment to get to this €375 profit per year. The life span of solar panels is considered 25 years, but its inverter needs to be replaced (cost of €1,000 – €1,500, let’s take €1,250). The lifespan of the powerwall is considered 15 years. Both lifespans seems rather optimistic to me. I wonder how much electricity will still be produced by the panels at 20+ years and how good the condition of that (lithium-ion) battery is at 10+ years.

Even with those optimistic figures, the yearly profit will roughly come to 625 – (6,100/25) – (1250/12.5) – (7,000/15) – 250 = around -435 (minus €435). So the owner will have to top up €435 per year for the privilege of having this installation. But probably will earn Social Points for their effort to save the planet.

With only solar panels and a backwards running meter, the owner would have some profit, but not so much with a powerwall. But there are other things that will lower the profit.

This €625 profit per year is for an installation with a meter that is running backwards when the installation is putting excess production on the grid. At a later time the solar panel owner can draw electricity from the grid, meaning a 100% return of what was delivered. But in this case the meter isn’t running backwards. Production is fed into the powerwall and appliances draw their power from that powerwall. Batteries aren’t 100% efficient, so this owner’s profit will be less than €625 (2,500 kWh production minus the efficiency factor of the powerwall minus other losses). To get the same amount of electricity, the battery has to be fed with relative more energy. The capacity of the battery will also lower every year.

Even more, their insurance contract will probably rise because of the solar panels on the roof. Also there is a potential impact of the orientation of the building or shadows on the roof from for example trees and so on. These all have an impact on the profit.

For some reason, this side is completely ignored in all articles on this “success story”. Only the positive things are shown, the negative things excluded. This is the sad standard in alternative energy reporting.

People interested in such system will only get half of the information and therefor it will seem like a good idea to follow. People can only take informed decisions when they know both sides of the story.

This is how the article ends:

“The battery must get a central place in the legal framework in order to make it attractive for the owners,” said Christophe Degrez of Eneco. “After all, They relieve the electricity grid, reducing the need for investment. If we want to make Flanders more sustainable, then this device must get used.”

Sure, it is a no-brainer that a power company wants to promote such a scheme. If lots of solar panels owners would install a powerwall, then the power companies could have less problems balancing the grid, especially when it is sunny and there is not much consumption. Therefor reducing the need for investments … because it would be the solar panel owners that will pay for it.

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April 1, 2017 at 10:51PM

The biggest global experiment disproving CO2 as the main cause of late 20th century warming

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Great news! The UK, Chinese, India and US government and have all consented to allow this hugely important experiment to proceed! Having examined temperature records and the global distribution of warming I am now convinced that early-style pollution associated globally … Continue reading →

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April 1, 2017 at 10:45PM

Waves on sun give NASA new insight into space weather forecasting 

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One thing the Sun has in common with the planets is rotation. ‘Rossby waves, also known as planetary waves, are a natural phenomenon in the atmosphere and oceans of planets that largely owe their properties to rotation of the planet.’ – Wikipedia. New evidence shows these type of waves also exist on the Sun.

Our sun is a chaotic place, simmering with magnetic energy and constantly spewing out particles. Sometimes the sun releases solar flares and coronal mass ejections — huge eruptions of charged particles — which contribute to space weather and can interfere with satellites and telecommunications on Earth.

While it has long been hard to predict such events, new research has uncovered a mechanism that may help forecasting these explosions, reports ScienceDaily. The research finds a phenomenon similar to a common weather system seen on our own planet. Weather on Earth reacts to the influence of jet streams, which blow air in narrow currents around the globe. These atmospheric currents are a type of Rossby wave, movements driven by the planet’s rotation.

Using comprehensive imaging of the entire sun with data from the NASA heliophysics Solar Terrestrial Relations Observatory — STEREO — and Solar Dynamics Observatory — SDO — scientists have now found proof of Rossby waves on the sun.

The results, published in a new article in Nature Astronomy may allow for long-term space weather forecasting, thus helping better protect satellites and manned missions vulnerable to high-energy particles released from solar activity.

“It’s not a huge surprise that these things exist on the sun. The cool part is what they do,” said lead author Scott McIntosh, director of the High Altitude Observatory at the National Center for Atmospheric Research in Boulder, Colorado. “Just like the jet stream and the gulf stream on Earth, these guys on the sun drive weather — space weather.”

Currently, we can forecast short-term effects after a solar flare erupts, but not the appearance of the flare itself. Understanding the solar Rossby waves and the interior process that drive them, may allow for predictions of when the solar flares might occur — an invaluable tool for future interplanetary manned missions which will fly through regions unprotected from the damaging energetic particles flares can release.

The scientists tracked coronal brightpoints — small, luminous features that can be observed on the sun, directly tied to magnetic activity beneath the surface — using data from 2010 to 2013 with NASA’s heliophysics fleet of space observatories.

“The main thing is we were able to observe Rossby waves because of STEREO A and STEREO B, in conjunction with SDO, which allowed us to get a full picture of the entire sun,” said co-author William Cramer, a graduate student at Yale University in New Haven, Connecticut. The STEREO mission used two near-identical observatories in orbit ahead and behind Earth, STEREO A and STEREO B, to get a complete 360-degree view of the sun.

“These missions allowed the researchers to see the entire sun for over three years, something that would not be possible without the STEREO mission,” said Terry Kuchera, STEREO project scientist at NASA’s Goddard Space Flight Center in Greenbelt, Maryland.

In October 2014, after eight years in orbit, STEREO B lost contact with ground operations, but the multi-point view STEREO offers remains invaluable. “Having more than one vantage point to look at the sun has a lot of uses, and even with just STEREO A and SDO we can understand how events, like coronal mass ejections, move through the solar system better than we can with just one eye on the sun.”

The results clearly show trains of brightpoints slowly circling the sun travelling westwards, revealing the magnetized Rossby waves flowing beneath the surface. The researchers also found the brightpoints shed light on the solar cycle — the sun’s 22-year activity cycle, driven by the constant movement of magnetic material inside the sun. The brightpoints may serve as a clue, linking how the solar cycle leads to increased numbers of solar flares every 11 years.

“These waves couple activity happening on instantaneous timescales with things that are happening on decadal and longer timescales,” McIntosh said. “What this points to, is that something that might at first glance appear random, like flares and coronal mass ejections, are probably governed at some level by the processes that are driving the wave.”

When terrestrial satellites were first used to observe the jet stream on Earth, it allowed huge advances in predictive weather forecasting. These results show such forecasting advances may also be possible with observations of the entire sun simultaneously.

Source: Waves on sun give NASA new insight into space weather forecasting — ScienceDaily

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April 1, 2017 at 10:21PM