Extracts from the Jan-Feb 2003 edition of Renew
These extracts only represent about 25% of it

5. EAC takes on PIU- and Wilson

The House of Commons Environment Audit Committee (EAC) can always be relied on to make critical assessments of government policy, and its review last year of the Performance and Innovation Units Energy policy report was no exception.

As noted in Renew 140, the EAC argued that the UK was way behind most of the rest of Europe on renewable energy development and would not even meet its very low targets for 2010. Given this view, the transcripts of the committee hearings make fascinating reading, especially when they cross examined the Energy Minister and the PIU project team on 24th April. It certainly gave them all a hard time.

For example, the Committee clearly felt, as one member put it, that the PIU had been ‘relatively timid in relation to the targets that you are recommending’ and the Committee were in no mood for what they seemed to see as a rather evasive and even bland approach, especially the idea of leaving all options open. Colin Challen MP said that this might ‘slow down our progress towards the targets’. He added ‘In Germany we saw how they have aspirations of something like 50% from renewables by 2050. That is quite a long way off. They have also decided to shut down their nuclear industry, whereas here we are keeping open all the options. By saying that we shall keep open all the options are we slowing down our desire to go for one option and make a big meal of it?’

Nick Hartley from the PIU team responded ‘The nice thing about renewables is that there is not just one option. There is a whole range of options. That is what marks out renewables technology from others and gives them flexibility. We certainly consider that it is important to develop a range of renewables that are particularly applicable to the UK circumstance. Having said that, I started by talking about the uncertainties that are involved in energy policy making and one of the remarkable things, looking back over the energy policy scene 50 years ago, is that the world was very different and technologies change rapidly. The technological options change. It is difficult to anticipate now precisely what options will be available in 20 years’ time, let alone in 50 years’ time. It is central to our report to say that at the moment it would not be sensible to put all our eggs in one basket. We need policy making that maintains the necessary degree of flexibility.’

However the Committee were unimpressed. They had evidently been chastened by their experiences on a visit to Germany when, as one member noted ‘the Germans spoke of Britain’s position extremely enviously, both in terms of the different energy sources that we have available and in regard to the much greater capacity that we have to produce renewable power. It is greater than any large European country by some way. When comparisons of our capacity to produce renewables are made with what most European countries can produce, and when we make comparisons between our targets and theirs, there is a case to argue that we are being particularly parsimonious in the targets that we set. If countries with far less capacity can set more ambitious targets, what is wrong with us?’

Dr Catherine Mitchell from the PIU team disagreed, claiming that ‘If you look at the targets that are in place around Europe, other than in Denmark, we are pretty much in line with them. Our 10% target relates to an increase of what is known as new renewables, as compared with the conventional, large hydro power and biomass. With our 10% we are pretty much in the middle of the European countries.’

Asked why they had backed off the 30% renewables target for 2020, which was mentioned in the earlier PIU Scoping report as a possibility, Nick Hartley responded that the issue was costs. ‘A 30% target looked to us to entail a greater cost than we considered was justified. It would be nice if experience shows that we were wrong and that the costs come down even faster than we envisage’, adding that ‘even the 20% target is likely to cause some pain’.

However Joan Walley MP was not convinced that the PIU had adopted the right approach- choices had to be made. ‘If on the one hand you say that there are uncertainties, and therefore we cannot put all our eggs in one basket, we have to be able to start now, to have the roadmap to meet the targets in order to get to where we want to be. It seems to me that at some stage there has to be an understanding and a recognition that decisions have to be made to close down some options. If you do not close down those options you will be preventing the option that you want to develop from being taken on board by policy makers. Surely, the role of your report and the guidance that you are giving to Government is to set at what stage and at what time some of those options should be closed off. You cannot have all the options all the time. At some stage decisions have to be made. I do not believe we have understood where you see nuclear power fitting into that. As long as you keep open that option on the issue of externalities, the less likely it is that you will have the framework within which all the renewables that you are talking about will be developed. What is your position on that?’

Gordon MacKerron from the PIU team replied ‘In the report one of the things that we said was that for current nuclear technology there is no case for public support. Because there is no Government policy that precludes nuclear development on the ground, we said- it is true that the industry can put forward proposals for the existing types of nuclear technology. Because we said that there is no case for the public support of that technology, and because the economics of that technology are currently not favourable, in the current commercial conditions, I do not think that we would expect significant proposals to come forward. It is important to remember that nuclear power, in a way like renewables, is not just a single technology. There are possibilities- no more than that yet- that the new generation of nuclear power- more modular in design, more decentralised and with very low waste characteristics and with better passive safety characteristics- may be developed to a point of commercial development. If that were to be the case, and if there were real difficulties in meeting emission targets by other means, it would be useful to have those technologies available for deployment at some future time. For that reason we propose that the Government should give some support to that kind of development. To try to answer you specifically about making a decision on when and what to close, we did not have any explicit discussion about when that moment may be in relation to nuclear power, other than to say that it is not yet the time.’

Nick Hartley added ‘One point I would make is that we emphasise that there should be a further fundamental review of energy policy some time later in the decade. We put the date at 2007, but it may be then or somewhere around then. By that time some of the uncertainties about which I have spoken are likely to be resolved.’

The Committee evidently didn’t like this pronostication, and, as we report later in reviews, they were also critical of the alleged lack of engineering input to the PIU study. Harold Best commented ‘We expected some clear direction from you but there is an absence of hard engineering views all the way through.’ See the Reviews section in Renew 141 for more.

EAC and Wilson

The Environmental Audit Committee was just as aggressive when it came to the session with Brian Wilson, the Energy Minister, but the minister did have the advantage that he could point to a (then) imminent consultation exercise and a White paper yet to come. Thus asked about the creation of a Sustainable Energy Policy Unit, which the PIU has suggested should be operational by October 2002, he could say that ‘it certainly features in the consultation’ and would be a matter for the White paper. But he did also offer his own view, ‘I think anything that pulls all these strands together is positive. I do not think it makes sense to have a number of different avenues for various branches of energy policy to go down without some clear coordinating theme to link them.’

He added ‘If I was offering a personal view in the long term and I make it clear that I am unlikely to be around to be involved in it, I think there is a strong case for an energy department. I think there probably always was a strong case for an energy department and the reasons for getting rid of an energy department were more political than logical at the time that happened. So whether it is brought together as a department or whether it is brought together within one department, I certainly think there is a very strong case in moving towards as much of a synthesis of energy policies and responsibilities as possible.’

The Committee then turned to renewable energy policy, and extracted the admission that ‘we are not going to meet 5 per cent in 2003’, which implied a more rapid expansion later on if the 10% by 2010 target was to be met.

Wilson outlined what he saw as the problems. ‘One is investment: you need to have investment or the commitment to investment in order to even have the theoretical possibility of getting the generation which will meet the targets. The second one is the infrastructure: in other words, you need to have the ability to get the power to where it is needed from the places where it is generated. Thirdly, the projects actually have to happen, and maybe the most sobering statistic in all of this is that two thirds of the projects approved under the predecessor of the Renewables Obligation, the Non-Fossil Fuels Obligation, never actually happened, and the reason mainly was because in hundreds of cases they were successfully blocked at a local level. If we continue to see two thirds of projects fail to come to reality, then we are not going to meet targets, it is as simple as that.’

Asked if he therefore thought that the Government was failing at the present time in getting the message on renewables across in terms of the importance of dealing with these local obstacles to achieve the overarching policy, he commented ‘Whether it is Government which is failing, the statistic I have just quoted suggests that somebody is failing, and I suppose everything ends up with Government. I think that it is true that there has not been coherent success in persuading people that if they are in favour of renewables in principle, then they also have to occasionally be in favour of them in practice. I do not think that effort has really been made, because until now, they have not come forward on a sufficient scale. They have come forward in a spasmodic way, and each one has been seen as an individual project. I think we are really at the start of a process now of confronting society with a more general choice, that either they are going to have a significant contribution from renewables or they are not and if they are going to have that contribution, then they are going to have to show reason in accommodating it.’

Then the pressure built up, as the Committee focused on what they saw as the unfortunate lack of support for wave and tidal power, which might help fill the gap. Asked why he was allocating less money to these projects, Wilson, argued that it was because,‘it is demand led, and at the moment we are still stimulating interest in wave power rather than being overwhelmed with applications from wave power’.

He was backed up by John Doddrell, from the DTI Sustainable Energy programme. ‘There are not the huge projects on wave power coming forward at the moment for support in the way that there are for offshore wind’. Wilson added ‘I do not think there is any of these technologies where people are queuing up with projects and we have underestimated what we need to invest in order to back these projects. Roughly, the programmes which we have are in proportion to where the demand is coming from, and if that changes, then the programmes can be changed. If there is a technology which is clearly emerging with great potential then we will be right in there and backing it.’

The Committee were evidently not happy with this, or with the wind programme- they wanted a larger more aggressive and proactive programme, like Germanys. Wilson however felt that ‘There will be a ceiling on what Germany can do with wind in the same way as Denmark is beginning to find there is a ceiling to what they can do with wind. It is also an extremely expensive way of generating electricity on that scale, and I do believe, as I said in my opening remarks, that you have to take public opinion with you. I think that if we were going at a pace which was going to displace other generation sources and increase the cost of electricity in the way that that kind of programme would suggest, even if it was technically applicable in the short term, it would have other ramifications as well. I think to have 18 offshore projects waiting to be in the starting grid, to be putting in place a strategy in order to identify the other locations where offshore wind is going to be feasible, that that is a proportionate programme and one which will help us to meet our targets.’

But he admitted that ‘we do not have the same industry as Germany or Denmark has because we have not done that up until now. We lost the lead in wind; we are now running very hard in order to catch up’ adding that ‘the absolute certainty, whether it is wind or any other technology, is that unless you have a domestic market, then you will not have manufacturing industry to supply it. That is why we start at this very low point, because we have had a very modest domestic industry until the present time. I tell you this, it is worse than that. What I find really pathetic is that while we are now getting into the business of manufacturing the towers for windmills, there is nobody in the UK making turbines.’ He added ‘I am not particularly interested in recriminating about past history but you just cannot leap from A to Z in one go. You have to build, and that is exactly what we are doing now.’

Joan Walley picked up this theme asking ‘how we can now make good what should have happened a long time ago?’, Wilson replied ‘Painting a bleak picture of where we start from is realistic. I certainly do not want to paint a bleak picture of how things are now developing because it is my daily job and I find it really exciting and encouraging.’

Despite his protestations about his commitment to wave and tidal power, the Committee were however not convinced that he was doing enough. As Mark Francois commented ‘you said you have a particular hunch about wave and tidal, (so) why did you only give it 5 % of the budget?’

For the rest of the discussion see the reviews section of Renew 141- and also Wilsons comments on nuclear power later in this section.