Renew On Line (UK) 29a

Extracts from the Jan-Feb 2001 edition of Renew
These extracts only represent about 25% of it

3. Will DTI plans come unstuck?

Despite the very welcome new funding allocations for offshore wind and energy crops, the attainment of the Governments target of obtaining 10% of UK electricity from renewable sources by around 2010 still seems uncertain. Currently, insiders are talking of, at best, only getting around 6.5% by 2010. That's only just over double the present level, which includes the existing hydro plants. It seems likely that we’ll need other renewables as well to reach the target.

However, one of the key problems for new projects is NETA, the New Electricity Trading Arrangements, now confirmed, given that the Utility Bill has become the Utility Act. NETA includes a ‘balancing’ mechanism, in the new four hourly electricity spot price market, which penalises suppliers who can't deliver contracted power on schedule. That has major implications for renewable energy projects, many of which rely on intermittent sources.

Small companies, who are unable to average out their power delivery ability over a number of projects, are particularly disadvantaged. Another key problem is the continuing difficulty in trying to get planning permission for new projects, especially wind farms. Again, this is a particularly hard task for small companies, who can't afford the many tens of thousands of pounds it often takes to see applications through the often lengthy process of hearings, appeals and, possibly, public inquires. Even given the availability of support from the Non Fossil Fuel Obligation (NFFO) cross subsidy, many projects did not actually go ahead due to problems like this, and, with the NFFO now phased out, the situation is likely to be much worse. The only hopeful signs are that some wind projects are now emerging outside the NFFO/SRO, feeding into, and being stimulated by, the green power market, e.g. Scottish Powers new wind farm (see Renew 128) and the new B9/RES windfarm in N. Ireland (see later).

CHP limits

A renewed emphasis on Combined Heat and Power (CHP) is the other main part of the governments strategy for developing sustainable energy projects as a response to Climate Change, but this too is facing problems. The current Government target is to have 10GW(e) of CHP capacity in place by 2010. However, it looks as if up to a third of the necessary projects might not go ahead.

As with renewables, the main problem is NETA, and the terms of the Climate Change Levy. CHP plants vary the ratio of electricity and heat produced to match the consumer load, with the heat load usually being the dominant factor. So their electricity output is not constant. In which case it is hard for them to match up to the requirements of NETA and the four hourly market.

It is true that the heat supplied by CHP plants will be exempted from the levy, as of course will the power from renewable projects. But any electricity from CHP projects traded on the electricity market is not exempted - which is a real disincentive, especially for the larger plants that would be needed if we are to meet the 10GW target. Evidently the government feared that, if this power was exempted, then companies might build token CHP plants but use them mainly to generate electricity and escape the levy.

Given that all CHP plants now have to meet Quality Assurance standards to get levy exemption, this has no validity, according to Stewart Boyle, speaking on behalf of the CHP Association, at a conference on ‘Tackling Climate Change Sustainably’ organised in Oxford last Sept. by the Nuclear Free Local Authorities organisation (see Groups). He argued that in any case dividing up the outputs form CHP plants in this way was foolish. By reclaiming the otherwise wasted heat, CHP increased overall energy conversion efficiency dramatically, and thus reduced the net level of carbon emissions. So CHP should be completely exempted from the levy. As it is, he argued, carbon savings from CHP could fall by 2.2 million tonnes of carbon below what had been hoped for - and maybe more. Add to that the possibility that renewables might deliver 1.8 mTC less in carbon savings than expected, then there could be at least a 4 mTc shortfall by 2010, compared to what was planned, maybe 5mTc.

Other options

What about the newer technologies? The Nuclear Free Local Authorities conference also heard from Ashok Sinha formerly of the Forum for the Future, who described the state of play with photovoltaic solar. Sadly he noted that, while the USA, Japan and many EU countries were pressing ahead with ambitious projects, the UK only had a tiny £1.5m p.a. programme.

The difference was highlighted by the 1MW PV housing project at Amersfoot in the Netherlands, which was larger than the whole existing UK PV programme put together. However there were some bright spots. BedZed, the Beddington Zero Emissions Development housing project in S. London (see Renew 128) did have 100kW of PV capacity, along with other energy saving features including CHP and an electric car pool system.

This type of development indicates how PV might get out of the doldrums in the UK - not as a electricity supply technology, competing in the open market, but as energy generating building materials, integrated into housing projects. When and if net metering became widespread (and a DTI working party has been looking at that), then any excess power could be sold to the grid - and add to the overall national renewable electricity contribution. But that will take time and, for the moment, PV is still too expensive to make a significant contribution to the electricity market.

Sadly, given the low levels of support being offered by the DTI, wave and tidal projects are also unlikely to be to make much of an impact by 2010. With the DTI’s new funding, Offshore wind should do better and deliver significant amounts of power: we've heard it said that it may be possible to get power in at around 4p/kwh within a few years. And although it will initially be expensive, we might get a reasonable input from energy crops by 2010. However, it still may not be enough. In his ‘Richer and Green’ speech, Blair talked of further policy studies on new options, but if real practical support for PV, wave and tidal is not forthcoming, we could still be faced with a shortfall .

There are those who hope that expanding the use of waste combustion could help. Quite apart from its exclusion from the RO, there is a limit to how many incinerators can be built, given the widespread opposition to this technology, on the grounds of worries about emissions. One contributor at the NFLA conference suggested that maybe we should accept waste combustion as an interim renewable and waste management option, to be phased out later when other, greener, energy and waste management options were available. But this seems a little risky: once built these plants would get locked into the waste management and energy systems.

More positively, Innogy's ‘Regenesys’ energy storage system (see later, and Technology) could make a whole range of intermittent renewable sources more viable in the longer term. PV and biomass powered micro chp could blossom at the domestic scale, and wind, wave and tidal could come into their own at the national scale.