Extracts from NATTA's journal
Renew, issue 150 July-Aug 2004

12. Wind power costs

A  report from the Royal Academy of Engineering on  ‘The Costs of Generating Electricity’ portrays wind power as very expensive, and nuclear as getting cheaper as new technology emerged.  It claims that electricity from offshore wind farms will cost at least twice as much as that from conventional sources. Our cheapest electricity will, it says, come from gas turbines and nuclear stations, costing just 2.3 p/kWh, compared with 3.7 p/kWh for onshore wind and 5.5 p/kWh for offshore wind. ‘This may sound surprising,’  said Academy Vice President Philip Ruffles, who chaired the study group, ‘especially as we have included the cost of decommissioning in our assessment of the nuclear generation costs... But modern nuclear stations are far simpler and more streamlined than the old generation- the latest are only about half the size of Sizewell B- and far cheaper to build and run.’

In the case of wind energy the report argued that it was  necessary to provide back up capacity for when the wind did not blow. It claimed that it had been ‘rather generous’ with the wind generation figures- assuming only 65% back-up power whereas previously it had called for  more like 75 to 80%.  Even so it said that the cost of back up capacity would adds1.7 p/kWh to the costs.

It concluded ‘Onshore wind generation is the cheapest renewable, but with back up, it costs two and a half times as much as gas or nuclear.’ While it says ‘wind, nuclear and biomass generation all have the benefit of not emitting carbon dioxide’, the costs of capturing CO2 for fossil fuels could add at least 2 p/kWh for coal-fired generators and 1-2 p/kWh for gas generators. ‘Coal looks uneconomic in the future,’ said Ruffles, ‘by the time you capture the carbon dioxide it’s going to cost as much as onshore wind.’

The study didn’t cover transmission costs for individual technologies or storage costs for gas to ensure security of supply since ‘the market currently absorbs these through system operating costs or the cost of gas’. However, it noted that providing energy a long way from the eventual customer will add to its cost. “The renewables sector already benefits from subsidies worth around £485m year through the Renewables Objective,” according to Ruffles. “The Government is also planning to offer further subsidies in the form of reductions in transmission charges- this may run counter to the spirit of the new European Electricity Directive aimed at promoting competitive energy markets.”

The report, which was commissioned from PB Power and overseen by a panel of Academy Fellows, was released to coincide with BBC2’s ‘If..’ programme (see Renew 149), which Ruffles noted raised ‘the possibility that if we don’t get our energy policy correct and affordable we run a real risk of blackouts in the future.

He concluded:‘The value of our report is that it puts a price on the policy decisions we must take to sustain a vibrant economy, avoid the lights going out and meet our emissions targets. The report does not take sides in the energy debate but it does introduce transparency. People need to appreciate the real costs of generating electricity including wind power which may be, as the Renewables Innovation Review said last week, our best hope for renewable technology until 2020.’

BWEA Response

The British Wind Energy Association was quick to respond. It claimed that ‘onshore wind in the UK already generates electricity at prices competitive with new conventional generation technologies, including nuclear, while offshore wind, initially more expensive, is starting to fall, with the general consensus that prices will reduce dramatically by 2020’.

It noted that research conducted by OXERA for the Government’s Renewables Innovation Review,  cites current prices for onshore wind of 3.1 pence per unit (p/kWh), dropping to 2.7 p/kWh by 2010. Current costs for offshore wind are 5.5 p/kWh, predicted to fall to 4.4 p/kWh by 2010 and further falling to 3.7 p/kWh by 2020.

The BWEA was also ‘extremely surprised’ by the high figures quoted by the Royal Academy of Engineering for the cost of back up for wind energy.  It said this contradicted the research done for White Paper on Energy by the PIU ‘which quoted a figure of 0.2 p/kWh for a 20% contribution from intermittent generation more than eight-fold lower than the assumptions made by the Royal Academy of Engineering’.  

The BWEA added this low price for back-up was further confirmed in a forthcoming report from the Carbon Trust, commissioned by the Renewables Advisory Board, which it said concluded that intermittency is not a problem for wind at up to a 10% wind contribution to total grid power.

In relation to nuclear power, BWEA noted that the recent Energy White Paper concluded that “the current economics of nuclear power make it an unattractive option for new generating capacity”. BWEA further noted that the RAE report itself states that “Further scrutiny of the commercial claims for nuclear power would be useful because of the lack of data from existing new build projects.”

BWEA commented that it ‘assumes that the figures quoted for nuclear are based upon reactors that are yet to be built and is not aware of any market experience that proves the costs claimed by the Royal Academy of Engineering. This is in contrast with onshore and offshore wind where real cost data of real existing projects are used to make economic forecasts.’

Wind v MoD

Prof. David Wallace, vice-president of the Royal Society, has written to the minister responsible for defence estates,  about the blocking of wind farm applications within 74km (45 miles) of air defence radars- the Ministry of Defence has it seems opposed 48% of pre-applications last year. He wrote ‘Understandably, the MoD has concerns over the effects that wind farms may have on radar in terms of personnel safety, especially for low flying aircraft, and the potential consequences of compromised radars with regard to national security, it nevertheless concerns me that the restrictions imposed by the MoD are at odds with the rest of Europe, where only Germany imposes a ban, which is set at 5km.’ 

Country Life goes anti-wind

The glossy UK magazine ‘Country Life’ has launched a campaign to urge the government to reconsider it policy of windfarms which it calls a “disaster”.  It says that the recent  ‘Planning Policy Statement 22’ would relax planning criteria to allow turbines to be built “almost anywhere on England’s treasured landscape” and is, according to the magazines editor , a “dreadful mistake which will do irreversible damage to the British countryside”. 

He calculates that in addition to the 1,043 wind turbines in 84 sites in the UK at present, 6,000 will be needed soon to meet government  targets- and more later. That policy would be “an impending environmental disaster with grave threats to both quality of life and tourism in the UK.”

Meanwhile, Powergen has put its  plans for a wind farm in Portland Harbour on hold in order the obtain more information on wind speed in the area, following claims form the Yachting community that the turbines would materially affect wind flow.