Bill Jamieson: Wind of change hitting renewables

Published on Thursday 24 November 2011 12:15

Reports of failed green projects must put the SNP’s energy plans under the economic microscope

HOPE is a precious quality in economics. We must invoke it sparingly. But we are now in need of very large quantities. I refer to the Scottish Government’s obsession with renewable energy, on a scale that could well present us with the energy equivalent of the Edinburgh trams.

Earlier this week Scotland’s massive gamble on renewables took a fresh twist with plans to build the world’s largest offshore wind farm in the Outer Moray Firth. This, we were told, is to comprise “up to” 300 turbines and will deliver “up to” 1,400 jobs during construction and “up to” 280 jobs through operation and maintenance.

When complete, it will, apparently, be capable of generating enough power for a more than a million homes by 2020. As to costs, it will take £50 million to undertake initial preparatory work, with the project overall price-tagged at £4.5 billion. Big figures, astonishing sums – and a stride forward towards that self imposed target of generating the equivalent of 100 per cent of the country’s electricity demand from renewables by 2020. A mighty wind is blowing for renewables. But is it really?

From America comes troubling news for the renewables lobby. Reports are legion of bankruptcies, green jobs that failed to materialise and a notable cooling of the rhetoric on global warming as the country now finds itself on the brink of a breathtaking boom – in fossil fuels.

From Europe come warnings of failed renewables projects, disappointing results and voter disillusion. And from nearer home comes troubling evidence of how the push in renewables is destroying jobs and confronting millions of households with huge rises in energy bills. But cost is the great unmentionable in the renewables rush. And that, of course, was the line that never was in that Moray Firth press release.

How ironic that just ahead of another inter-governmental global warming summit in Durban that the temperature has cooled so quickly in America. For there has been a transformation in prospects for fossil fuels and growing disillusion with the results of massive federal government spending on renewables projects.

America’s energy prospects have been lifted by huge exploitable recoveries of shale gas with none of the “earthquake alarms” raised by the green lobby; improvements in drilling technology that have opened up previously inaccessible “tight oil”; expanses of “tar sands” in neighbouring Alberta and continuing exploration upgrades from oil drilling off the coast of Brazil. For an economy caught in a deep permafrost of debt, energy sources costing considerably less than wind power could hardly have come at a better time.

Coincident with this has been growing embarrassment over renewable project failures generously funded by Washington. Controversy rages over the bankruptcy last month of Solyndra, a solar panel maker to which Washington had extended $535m in guarantees. Three weeks earlier, Beacon Power Corporation, a Massachusetts energy storage systems company which had received $43m in government guarantees filed for bankruptcy owing $47m. Dozens of grants and hand-outs to create green jobs have failed to meet expectations.

Meanwhile New York State, a keen advocate of green energy, has pulled out of an offshore wind farm project due its high cost and General Electric is reconsidering offshore wind energy development plans in Europe.

Still reverberating around the energy policy network is a study by Professor Gabriel Calzada of Juan Carlos University in Madrid which concluded that the Spanish/EU style green jobs agenda promoted until recently in the US in fact destroys jobs. For every green job created by the Spanish government, Calzada found that 2.2 jobs were destroyed elsewhere in the economy because resources were directed politically and not rationally. Each “green” job came at a cost of $774,000 to Spanish taxpayers. Asked recently US journalist Ed Lasky of American Thinker about the origins of Spain’s green energy programme, he said that it was the desire of Spanish political elites to be “world leaders” that drove the programme. A touch of the Edifice Complex, perhaps?

What gave all this momentum was a vicious circle by which banks, to protect their original loans, kept promoting green energy programmes, drawing in more government money. Electricity prices have doubled since 2004 and a blighted economy is now teetering on the edge of recession. In Holland, the EU renewable energy target has been abandoned, saving the country billions of euros in subsidies.

Here in the UK searching questions are being asked about the cost of the commitment to renewables. According to a study by KPMG leaked earlier this month, government plans to cut pollution by a third by 2020 will cost £108bn to implement. Shifting this towards nuclear and gas-fired power stations could reduce this by £34bn, equivalent to £550 for every person in the country. It put the cost of an offshore wind farm powering 800,000 homes at £2.4bn. An equivalent gas powered station would cost £400m – one sixth of the amount.

And the Institution of Civil Engineers in Scotland warned this week of an approaching energy gap: 80 per cent of Scotland’s existing power plants are due to stop generating electricity by the end of the decade. The push into green energy will not keep Scotland’s lights on.

What is keeping the renewables show on the road are massive subsidies that hide the true cost of wind power. The Renewables Obligation Certificate is paid for through household bills. Owners of wind turbines are given an additional £49 for every “megawatt hour” they produce – and twice that for offshore turbines. This burden has an economic cost. Rio Tinto Alcan is closing its aluminium smelter in Lynemouth, Northumberland because, it said, “the smelter is no longer sustainable… its energy costs are increasing significantly due largely to emerging legislation”.

I do not doubt the geo-political case for renewables, nor that there should be renewables in our energy mix. But energy produced at a horrendous cost that drains the budgets of households and depresses spending elsewhere is neither a rational energy gain nor a “stimulus boost”. It is edifice economics, founded on sleight of hand taxation and powered by a gale of hope. We are going to need more than this to have a hope of keeping the lights on.

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113

AuldLochinvar

Friday, December 2, 2011 at 03:24 PM

http:\\skepticva.org

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112

AuldLochinvar

Friday, December 2, 2011 at 03:22 PM

Correction: It's http:skepticva.orgEnergyIndependence.html

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111

AuldLochinvar

Friday, December 2, 2011 at 03:20 PM

It is time to realise that coal, oil, and petroleum gas (a.k.a. "natural" gas) were in fact the alternatives to the biomass, water, and wind power that drove every civilisation up until the invention of the steam engine. It is inherently unlikely that we can go back to them, with a world population of 7,000 million. The Rime of the Ancient Mariner tells of how the mariner suffered the consequences of windlessness for his ship, as pinishment for slaying one albatross. How many gannets, cormorants, ospreys, and sea eagles will be slain by 300 wind turbines with blades over 60 metres long? Such birds do not fly acrobatically, as gulls do, and they have no instincts for avoiding turbine blades. There IS an alternative energy resource, which was unknown even to Lord Kelvin, and was laid down by the energy of a star far bigger than the one that supplied us with fossil carbon (and fossil oxygen, by the way). Nuclear power comes from the astounding binding energies of the atomic nucleus, millions of times the binding energies of the electrons that supply chemical energy. It is sad that so many anti-nuclear organisations are ignorant of even as much physics and chemistry as I knew at 20 years old. That's when I got a degree in mathematics. I have read the assertion that plutonium is the most toxic substance known to man. It's not by any means even the most radioactive, and compared with ricin and botulinus toxin even radium is puny. Estimates of the cost of power facilities are so subject to various assumptions that we need to be wary. Let us, for example, suppose that a simple law demanded that all coal and methane burning power plants emit no more carcinogens than is required of a nuclear plant. Their cost per kwh would shoot past even these worthless wind turbines.

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110

AuldLochinvar

Friday, December 2, 2011 at 02:20 PM

Jimmy Neutron doesn't go far enough. The fact is, that with breeder technology, which was successfully demonstrated in the USA's IFR project as long ago as the week before Chernobyl, the same tonne of uranium that contains 7 kg of fissile isotope, can be converted to almost a tonne of fissile Pu-239. See my http:skepticva.orgEnergyIndependence.html There's enough "waste" uranium and plutonium in dumps in the USA even to supply the USA's entire profligate energy consumption for 200 years. Oh, yes, the waste from a reactor that consumes it's own plutonium is gone in a few centuries, not hundreds of millennia. As for "creating jobs", isn't it time for the working class to demand a four day week?

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109

Jimmy Neutron

Tuesday, November 29, 2011 at 08:51 AM

Nuclear fuel gets reprocessed after use which recovers up to 97% of the energy.

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108

Jimmy Neutron

Tuesday, November 29, 2011 at 08:03 AM

Nuclear fuel gets reprocessed after use which recovers up to 97% of the energy.

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107

deliverus

Tuesday, November 29, 2011 at 12:34 AM

The one thing and the most pressing thing that we must take into account is where are fossil fuel and nuclear fuel prices going to go when we reach the stage as we will in 40 or 50 years time when these fuels are either non existent or are so expensive that only the richest countries can afford them.Oil and gas from whatever source has a life of about 50 years at present consumption levels.Uranium supplies will run out in about 80 years and that is based on today`s consumption. Global warming is almost irrelevant in this discussion as the way we produce energy and still keep our private and public transport running is the real dilemma for us and our politicians not some half baked argument from a politically motivated journalist.

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106

Jimmy Neutron

Monday, November 28, 2011 at 09:40 PM

Looks like the windmill gang have admitted defeat and went to moan about something else.

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105

Geomac

Monday, November 28, 2011 at 12:47 PM

#103 Lies - just lost all interest in further debate having read that you are quoting BWEA as the source of your data on wind generation costs. This must suggest that you consider them to be unbiased - oh dear!!!! Bye - am closing down this window due to lack of serious debate

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104

nabodican

Monday, November 28, 2011 at 12:45 PM

# 103 You mean to say that you actually believe anything that comes out of the BWEA !!!!!!!! Lies & Damn Lies - no genuine stats.

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103

Lies and stats

Monday, November 28, 2011 at 09:31 AM

Geomac Suggest you read up oin the subject of generation costs before quoting figures. http:www.bwea.comrefecon.html Jimmy Mac. All the evidence points to Nuclear being more expensive and though there is a lot of talk about building new generation Nuclear Stations unless you know otherwise I haven't heard of one being started. I doubt if they will ever happen as the tax payer would have to underwrite the construction and the risk and at the moment we are broke.

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102

Geomac

Sunday, November 27, 2011 at 07:33 PM

#100 Lies. I really don't believe that there is someone out there who still believes that wind is FREE. Yes, the "fuel" is free but the recovery of electiricty from wind is far from free - not to mention unreliable and highly intermittent. Onshore wind costs around 9 pence per unit (kWh) to deliver and offshore about twice that - due to the capital cost plus the subsidy (off shore gets twice the subsidy of onshore wind). At the same time wholesale electricity costs around 4.5 pence per unit (kWh).

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101

Jimmy Neutron

Sunday, November 27, 2011 at 07:31 PM

Lied and Stats: your name matches your statements, what's the weather like in cloud cuckoo land? Who said nuclear was cheap? Nuclear is expensive however it produces the power of 3000 windmills with an OEE of over 90%! And if you were to realise anything about nuclear then you would know that it also works toward reducing the worlds largest plutonium stockpile that the UK currently has. Plutonium won't go away and must be dealt with somehow so if we don't build power stations and begin using it the uk will have to build a much much more expensive plant in order to deal with it, such a plant will cost many times that of power station and it will be entirely funded by the tax payer. At least the new power stations are not subsidised like the silly windmills.

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100

Lies and stats

Sunday, November 27, 2011 at 06:20 PM

Two points, 1. Gas generation costs are totally dependent on world proces. We dont produce as much as we consume these days and are reliant on the Russians and those stable middle east countries for our gas supplies. This adds significantly to our balance of payments deficit. Wind as far as I know is still free. 2. Anyone who thinks Nuclear is cheap ignores the facts. Nuclear Stations were withdrawn from electricity privatisation because they were uneconomic. The government then flogged them off by taking all the decommissioning costs onto the tax payers backs. Even that didnt work and they went bust and got handed over to the French (EDF) for a song. You want to look back into the furore there was in the forties and fifties about Hydro generation and how it would be uneconomic etc. and then you might realise in 20 or 30 years time our children will look back on these negative comments on wind generation as being equally stupid.

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99

Geomac

Sunday, November 27, 2011 at 10:29 AM

#98 - spot on Jimmy Neutron Do you get the feeling that the resisitence to nuclear power generation if based on dogma and ignorance rather than on a considered and informed basis?

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