THE NEW NFFO
The invitation for submissions under the fourth Non-Fossil Fuel Obligation was published in November 1995, calling for bids for projects totalling between 400-500 MW of renewable energy capacity in England and Wales. In parallel, bids under the second Scottish Renewable Order were invited with the total set at 70-80 MW. Like NFFO-3, NFFO-4 will involve contracts over 15-20 years, as from `early 1997', with the NFFO levy continuing to provide support for `up to 15 years'.
SRO-2, which will start in 1996, will involve 15 years contracts and allow up to 5 years for commissioning.
Announcing the new NFFO, the minister, Richard Page, noted that the aim was still to `work towards 1,500 MW DNC' by the year 2000. Although only 329 MW was so far operational from NFFO's 1-3, NFFO 3 had only just got underway and around a total of 900 MW was expected eventually from NFFO's 1-3, from the SRO-1 and the first Northern Ireland NFFO, and from schemes outside the NFFO/SRO. On this basis a further 600 MW would be required, and `it is likely that this will be met by future orders in England and Wales'.
The prices under the NFFO/SRO will not of course be set until the NFFO/SRO orders are finally fixed, but Page made it clear that further 'convergence' with fossil fuel prices was expected. But just how much convergence?
Speaking on convergence to the Parliamentary Renewable and Sustainable Energy Group (PRASEG) just after the NFFO was announced, Prof. Stephen Littlechild, Director of the Office of Electricity Regulation (OFFER), seemed to suggest that splitting the difference between the NFFO-3 prices and full competitiveness might not be a bad start - implying that, for example, energy crops should attain around 5.6 p/kWh as opposed to the 8p they received under NFFO-3.
Littlechild would not, however, be drawn on more general issues - such as the question (raised by Nicola Steen from the Association of Electricity Producers) of what was the right balance between low prices and 'diversity'. Or the idea (put forward by Catherine Mitchell from Science Policy Research Unit at the University of Sussex), of assessing the value of electricity to users, not just its generation cost. For example, renewables embedded in the power system could often cut costs by delivering power locally where it was needed without distribution losses.
Issues like this, and the whole question of how environmental externalities could be taken on board, are evidently not seen as amenable to resolution by regulators like OFFER: they were the Governments responsibility.
The full text of the ministerial statement on the new NFFO is on the Department
of Trade and Industry Web page
The full story of the sinking of the wave power station OSPREY One makes it plain that the OSPREY's misfortune was caused by a combination of unusual circumstances which are unlikely to occur again.
Allan Thomson, the managing director of Applied Research and Technology, which made OSPREY, explained the problems to me. Of the first, he said insurance issues had to be decided and "I just daren't speculate about the cause until the position is clarified." The fact that the two compartments which were damaged were the two that later cracked could not "necessarily" be linked. Repairs were carried out on the Clyde before she was allowed to go to sea and they had been subject to "warranty survey." But he did add: "Obviously, once you get damage to a structure, anything that happens after that will continue to weaken it."
He was emphatic that there was nothing wrong with the steel ("It was better than the specification we asked for") or the design and he intends to build OSPREY Two to the same design for launching next summer. "We have re-run the figures and we still come up with the same answers."
The OSPREY had dived into place on the seabed, as planned, while the sand was being pumped into the ballast tanks. The Oscillating Water Column worked beautifully with a magnificent blast of air streaming up and down the two "chimneys."
Allan Thomson continued: "During the installation process, we need a weather window because the OSPREY goes from unballasted to fully ballasted. In its unballasted condition, and at the intermediate stage, it is more vulnerable. In its fully ballasted condition it meets the design requirements for life.
"The installation went like clockwork. We had a weather window. But then heavy seas came in and we were unable to work for two days and those two days were very important. It wasn't just three metre waves. Occasionally the odd five-metre one would come in.
"The construction vessels, which are the work boats for cranes, with sand pumps on them and divers, couldn't work, and they are no mean vessels. That delayed the completion of the ballasting."
How unusual was the sea? According to Met. Office records for that coast, the chance of waves of that height in August is 0.4 percent. That means that you could go through 1,000 days of August, spread over 32 years, and you would see such waves only four times. And on those four occasions, OSPREY would survive without difficulty, if it was fully ballasted. The ballast holds it down to the seabed and also provides a solid filling for the tanks.
One of the worries had been that the OSPREY would slide backwards instead of absorbing (and converting) the energy of the waves. In the event, even though it was only partly ballasted, it did not move a centimetre.
The mood in Inverness remains confident. Everyone, says Thomson, has stood by the project "superbly, shareholders, supporters, what-have-you." The public, too, has been sympathetic, understanding that a pilot project is bound to suffer setbacks.
They removed sixty tonnes of mechanical and electrical equipment - including four Wells turbines and four generators - before the OSPREY sank and the task now is to build another steel containment vessel. They know that it works".
David Ross
A new ETSU study of the OSPREY suggests that, if the device was combined with a wind turbine, it could in principle generate electricity at 5.1p/kWh assuming an 8% discount rate, or 7.5p at 15% discount rate: 10% less than previous ETSU estimates. And if a zero discount rate was accepted then the cost would come down to 3p-3.5p a unit.
The ETSU study, entitled "An Assessment of the OSPREY", was commissioned by the Department of Trade and Industry. It comes just 19 months after the Energy Minister, Tim Eggar, announced that no further work would be undertaken on wave energy "as this technology has limited potential to contribute commercially to energy supplies in the next few decades". That was taken as a final farewell by the Government to a contentious area of renewable energy research. However, now the Government seems to have done a U-turn - at least in terms of spending money on a new study.
The new study is presented by the DTI as being 'part of its watching brief on developments in wave energy' and was carried out by Tom Thorpe, from ETSU, who previously carried out a survey of the whole field of wave power and published a classic, two-volume study of the subject.
David Ross reports.
'The new Thorpe report consists of an exhaustive study of the OSPREY, operating and maintenance costs, availability, output and the consequence of building a wind turbine to give a combination of wave and wind energy from one unit.
Cost is always the objection raised, even at this early stage of development when wave energy teams are building prototypes and serial production has not even started. The costs of 3p-3-5p are for building and maintaining the device, without a discount rate. Eggar himself has said that the use of the discount rate is "not appropriate" for consideration of energy technology projects on a research basis. But the British treasury insists on calculations being based on an assumed 8% discount rate.
With this rate included, a small-scale scheme of 20 megawatts, consisting of 10 OSPREYs, each of 2 MW, located off (just like OSPREY One), would generate at 6.4p a unit. The cost comes down to 5.1p for a 25 MW scheme, consisting of 10 devices, also located off Dounreay, but incorporating wind turbines which produce the additional 5 MW. For a large-scale scheme of two gigawatts, consisting of 1,000 devices, located off South Uist, without wind turbines, the cost goes back up to 6.4p.
Many wave energy supporters consider that the use of the discount rate is unfair at the present stage and that it would be even in a fully developed technology, because it discriminates against capital-intensive technologies - that is, those that have the major part of their expenditure in the initial period when structures have to be built but then benefit from the arrival of "fuel" which costs nothing. By comparison, "cheap" gas turbines cost little at the construction phase but are likely to become increasingly expensive as the cost of the gas rises. The discounting method is based on the belief that expenditure in the future is less significant than expenditure now.' David Ross
The publication of the new Thorpe report came just before more than 100 of the world's leading wave energy scientists and engineers open a three-day conference in Lisbon, organised by the European Union which is subsiding wave power research in Britain, Portugal and other member-countries.
During the conference, ART, the OSPREY development company, announced that their insurers had agreed to pay compensation for the loss of OSPREY One, so OSPREY Two would now definitely go ahead.
Wind power in Britain can now produce cheaper electricity than either coal or nuclear power stations, delegates to 1995 annual conference of the British Wind Energy Association were told.
And if clusters of wind turbines in the countryside were given full credit for their position at the end of the grid network, thus avoiding system delivery charges, they would even compete with the cheapest gas-fired plant.
These calculations are based on the latest round of contracts for government support under the Non-Fossil Fuel Obligation, when the price of wind energy from 67 agreed projects fell to an average of less than 5p per unit.
Once electricity from a conventional large power station has reached the end of the grid network, ready to be delivered to homes and businesses, it has cost about 4.5p. Since power from a wind farm usually enters the grid at this point, it should be paid the same price, it's argued. This price should apply even after the NFFO "subsidy" has been removed - likely to happen when the government thinks wind energy can survive in a "free market".
The main stumbling block is that neither the Regional Electricity Companies, who buy electricity from wind farms, nor the electricity regulator OFFER, have yet agreed this principle.
The BWEA conference was given plenty of evidence of the advantages of the 500 wind turbines now operating in 30 or so wind farms around the UK. One wind farm in North Wales, for example, contributed over £200,000 to the local rural economy in its first year of operation.
from Stop Hinkley Expansion Newsletter/August 1995
Japan could generate 20% of its electricity from wind turbines and the wind resource potential of the East China sea area, covering Southern Japan and Korea, Taiwan and parts of China, was comparable with that of Europe's Northern West sea area. These were some of the points made in an interesting paper on the 'Capability of Wind Energy in the East China Sea Area' presented recently by Minoru Nagai to the Pacific Science Congress in Beijing, China.
The wind regime in the East China seas area is not as well mapped as that in Europe, so the results are interim, but the implications are significant. Up to 3000 MW of wind capacity could, it is estimated, be located on the various relevant island sites in the area.
The overview report of the recent UK Technology Foresight exercise (see Renew 96) has backed sustainable energy technolgy as a key priority for the future.
In April 1995,the Governments Office of Science and Technology, which oversaw the Technology Foresight exercise, published 15 volumes covering each key sector, including energy. They were followed by an overview report by the TF project steering group. It prioritises eleven 'key areas' for urgent attention - one of them being environmnetally sustainable technology, including 'alternative, sustainable energy '.
As we noted in Renew 96, fifteen sector panel were set up, and there were some ambiguities in their conclusions. The energy sector panel passed over most of the renewables, focussing just on photovoltaics. But the Agriculture and Environment panel was much more positive: it saw wind wave and tidal as being very relevant to the UK. And the overview report seems to have backed that view. Strangely though it relegates clean process technolgy and the use of life cycle analysis for green product development to a lower priority 'emergent technology' category.
But leaving that aside, what matters now is what happens next? The results of the TF exercise are already influencing R&D allocations, and the Governmment has allocated £40m for a 'Foresight Challenge', as a follow up to the TF exercise. The only problem is that the TF analysis might be used to justify cuts in areas that were not prioritised, such as heavy engineering - and that seems likely to lead to a lot of dissention. The relocation of the Office of Science and Technology in the Department of Trade and Industry has also raised some eyebrows: beforehand it was in the Cabinet Office, and enjoyed more direct ministerial representation.
The TF reports are discussed in detail in RENEW 97.
Networking for Sustainability:
Intrigued or annoyed by the Internet, World Wide Web and all the other wonders of Information Technology? Can the new media help those of us involved with renewable energy and alternatives generally? THE NATTA Conference on Networking for Sustainability on March 30th 1995 will be looking at:
Where we are now A review of the strategic issues facing renewables - and of the networking/campaigning/educational implications.
What's on offer? A quick tour of some of the AT information networks and information technologies that might help, with speakers and/or demonstrations from Student Solar Information Network, EERU/OU etc.
What do we need? Small group workshops on your specific information and networking requirements - electronic or otherwise.
What next? The way ahead. Discussion on how we get what we want. What are the key strategic targets for campaigning? And will IT help action networks grow?
This is a one day conference at Parsifal College (the OU London Regional centre), 527 Finchley Road, London, NW1, Sat. 30th March, 10 a.m. to 5 p.m. Entrance 4 GBP NATTA members and T265 students, otherwise 6 GBP for individuals, or 10 GBP for organisational representatives. It is advisable to book ahead as space is limited. Details from NATTA c/o EERU, Open University, Milton Keynes, MK7 6AA.
This service is free as long as it is not for commercial purposes but please ensure you credit the source of any material you use from RENEW ON-LINE.
EERU Home page
NATTA c/o EERU
Open University
MILTON KEYNES
MK7 6AA
U.K.