Renew On Line 37

Extracts from the news section of NATTA's journal Renew,
issue 137, May-Junel 2002

The full 32 (plus) page journal can be obtained on subscription ( details below). The extracts here only represent about 25% of it.

This material can be freely used as long as it is not for commercial purposes and full credit is given to its source.

The views expressed should not be taken to necessarily reflect the views of all NATTA members, EERU or the Open University.

1. Great hopes for the Renewables Obligation

2. Government backs Wave and Tidal Stream power

3. Renewable Growth : UK Renewables Boom

4. Wind Opposition

5. PIU Report Reactions

6. Others UK green energy news

7. European News- offshore wind, REFIT still best

8. N.American News - US emissions rise

9. World News – more Shell scenarios

10. Nuclear News - Nine new UK plants?

11. In the rest of Renew 137

12. Renew / NATTA subscriptions

Great hopes for the Renewables Obligation

The Renewables Obligation is now in force, requiring electricity supply companies to work towards obtaining 3% of their power from renewable sources by 2003 and 10% by Jan 2011.

Earlier this year, Energy Minister Brian Wilson has predicted that 2002 would be "the year of renewables" in which the potential contribution of power generated from clean sources will finally be recognised in the UK. Clearly he has great hope for the Obligation. But he warned that it was pointless to set over-ambitious targets. "I certainly want to see us aiming higher than ten per cent in the years beyond 2010. However, the reality is that we are starting from a low base it will take a lot of commitment, not least by government itself, to reach the 10%".

In particular, the Government would try to ensure that renewables projects are treated fairly by the planning system. ‘This may involve a challenge to the integrity and consistency of some environmentalists. They cannot, on the one hand, say that the future lies with renewables but, on the other, that they will object to just about every specific project that comes forward’. He added "there also has to be a sensible balance between encouraging renewables and recognising that, in the short term at least, this is going to increase the cost of electricity. That is a factor which cannot be ignored if public support is to be maintained."

He stressed that investment in infrastructure will be necessary if the full potential of renewables is to be realised. ‘We have inherited a distribution system which was built for a coal and steel economy. That has to be updated so as to strengthen the National Grid in those parts of the country which have the greatest potential in, for instance, wind and wave power. The current feasibility study, commissioned by the DTI, into a sub-sea cable along the western seaboard of the UK is a major step in that direction’.

Finally, Wilson stressed that renewables can become the basis of a substantial manufacturing sector. ‘It should never be forgotten that we had world leadership in wind power 20 years ago but did next to nothing with it. The Danes took a different view and now have a £4 billion per year manufacturing industry. I am determined that the same thing should not happen with wave power, biomass and other technologies in which we are well placed to lead the world.’

The RO is expected to increase electricity consumers bills by around 5% by 2010, raising up to £780 m p.a.

See: www.dti.gov.uk/renewable/ro_order2002.htm

RO: no banding

The Renewables Obligation applies to all eligible renewables, without the special ‘technology bands’ that existed in the Non Fossil Fuel Obligation,allowing for extra funding for selected newly emerging technologies. As Brian Wilson has made clear at the launch of the RO, competition is seen as a vital part of the RO. 'We are pursuing a market led approach to encourages competition amongst the different technologies. This will keep costs down, making it a good deal for industry aswell as the environment.' But that could well result in the same problem that emerged with the NFFO - good price convergence, but not much installed generating capacity. The Government’s views on ‘banding’ were set out in their Preliminary Consultation on the RO as follows:

‘Some technologies such as large scale hydro are already commercially viable, while others remain at a much earlier stage in their development, and require varying degrees of assistance to advance further to a stage where they could be commercially deployed on a large scale. A ‘banded’ Obligation would address these differences by setting different buy out prices for different technologies, with those in need of the greatest incentive having the highest buy out price. Banding would impose an obligation on suppliers to supply a specified amount of electricity from specified renewable sources.

The Government... is proposing to reject this approach. It takes the view that it would involve Government in choosing which specific technologies should be used to meet the Obligation. This runs counter to the market led approach that has been designed to ensure that suppliers will meet their Obligation by the most economic means. The Government does not want to segment or unduly distort the marketplace, or to send out the message that some renewables are more important to the UK’s targets than others. Instead, it believes that competitive forces should be the drivers that shape the industry that emerges as a result of the introduction of the Obligation. It believes that, to help bridge the gap between initial demonstration and commercial viability, early offshore wind and energy crops projects should instead be supported through capital grants. In addition, a banded Obligation would amount to an unacceptably long term and inflexible commitment by Government to particular technologies. To implement such a policy would require Government making firm and irrevocable decisions as to which technologies should be used to meet the Obligation. This would fail to take future technological and market developments into account, and perhaps lead to resources being directed to areas of least need. The Government's preferred approach is sufficiently flexible to accommodate both changing circumstances and future developments, which are inevitable over the period of the Obligation.’

Isn’t the purpose of government these days to intervene when markets aren’t working well? No, it seems, now that’s up to the companies. For example, Brian Wilson has set up a new ‘Consolidation working group’, co-ordinated by OFGEM, to consider how smaller generators can co-operate together better in order to compete in NETA

Wave and Tidal Stream power get strong support

The Government’s response to the Science and Technology Select Committee’s very positive report on Wave and Tidal Energy (see Renew 133) was equally positive, with a preface by Energy Minister Brian Wilson reporting on progress that had been made since the Committee reported last April, including the announcement of about £1.7m of DTI funding for Wavegens new offshore demonstration project. Although he didn’t mention it, the DTI is also supporting IT Powers demonstration tidal stream project. In addition he said that he expected that the DTI would soon be ‘supporting three wave energy and two tidal stream projects. Hopefully, two of these projects will lead to demonstration plants being constructed and a programme of testing started in Summer 2002’.

In addition to these projects, he noted that the DTI will be ‘continuing to recruit new wave and tidal stream projects via the Sustainable Energy Support Programme call process’. He went on ‘As well as funding projects in the UK, I am pleased to be able to tell you that DTI’s work with Portugal and Denmark has led to the International Energy Agency approving a new Implementing Agreement on Ocean Energy Systems at the October meeting of their Governing Board. DTI’s participation in this new IEA agreement is already opening up new opportunities for the UK to collaborate with other countries because of our leading position in these technologies’.

He concluded ‘I believe that, since the programme was only restarted in 1999, the UK is making good progress with the development of reliable and cost effective wave and tidal current technologies’.

It seems then that wave and tidal power are seriously back in the fold, and the Select Committee were clearly delighted at the part they had played. Dr Ian Gibson, Chairman of the Committee, said "This is an excellent response to our report on Wave and Tidal Energy in the last Parliament. As the Minister acknowledges, our inquiry has focussed attention on the potential energy resources around the UK and the world at large. Since we reported, the Government has granted, or is granting, funding to three wave energy projects and two tidal current schemes - funding worth more than £3.2 million. This is a good start’.

He went on ‘Our Committee recommended that the Government establish a National Offshore Wave and Tidal Test Centre. We are delighted by the progress made in identifying a site at Stromness in Orkney for a Marine Energy Test Centre and look forward to its opening as soon as possible. Our Committee recommended that targeted funding for wave and tidal energy research be increased steadily to create a critical mass of researchers in the field. Since we reported, the Engineering and Physical Sciences Research Council has launched a Sustainable Energy Generation Programme, within which they expect to support a wave and tidal energy ‘centre of excellence’.

However, it wasn’t all sweetness and light. In its report the Committee had commented that, ‘given the UK’s abundant natural wave and tidal resource, it is extremely regrettable and surprising that the development of wave and tidal energy technologies has received so little support from the Government’.

In its detailed response the government countered that ‘the UK already has one of the few operating wave energy plants in the world, the LIMPET 500 electricity generating plant on the island of Islay,’ and pointed to the subsequent funding provisions, for wave and tidal schemes, the total value of which was over £6 m with the DTI contributing more than £3.2m. It bounced off most of the other critical comments similarly - by claiming that it now had a commitment to wave and tidal.

Although the PIU subsequently recommended allocating a further £5m to wave and tidal work, even if it takes all of that on, the DTI will hardly be going overboard with funding. Clearly then the resuscitation of these energy options is still only partial, and the DTI’s commitment is still hedged with caution. Thus, in its detailed comments, the government noted that ‘A priority for the DTI’s support programme on renewables and sustainable energy technologies is to promote the development of emerging technologies to the point where informed decisions can be made about their prospects. This is key to promoting confidence in new ways of meeting the UK’s energy needs and providing the funds for major infrastructure investment’.

So, as far as major full scale projects in concerned, it’s still, ‘wait and see’. That was one point made when the report was debated in Parliament in Jan - see later.

Energy, Skills and Jobs

‘The Committee’s report makes a sound case for investigating the contribution wave and tidal energy could make to the UK’s energy supplies and help to mitigate the effects of climate change caused by burning fossil fuels. As the report identified, the UK has an excellent skills base, which can be used to address the significant challenges of developing and deploying technologies to harness renewable energy from the oceans. Many of these skills have already been utilised to successfully exploit Britain’s offshore oil and gas reserves and, as this becomes a mature industry, these skills will become available to aid the development and deployment of offshore renewable energy industries and provide employment opportunities now and in the future’ ferom the governments response to the Select Committees report

Test Centre

In its reply to the Select Committee the government reported that a recent study, commissioned by Scottish Highlands and Islands Enterprise (HIE) had considered potential locations for a Marine Energy Test Centre. The study was undertaken by a member of the UK Marine Foresight Panel and by METOC, a firm of maritime engineers. The study assessed five potential sites, and concluded that the preferred site was Stromness on Orkney, in terms of the available resource (wave power and tidal currents), a shorter distance offshore to exploit these resources, the availability of onshore facilities (offices, storage and berthing), suitable connection to power lines and sheltered water for construction. The second phase of the project, a full-scale site survey and environmental impact assessment, will proceed shortly, funded by HIE and the Scottish Executive.

Eco- Impacts

In its reply, the Government noted that, ‘whilst providing a clean, reliable source of energy, the installation of any artificial device into the environment will affect it in some ways. The real environmental impact of wave and tidal energy has to be determined to the satisfaction of all stakeholders if the technologies are to succeed’. However any local impact should be ‘balanced against the global effect of reliance on fossil fuel sources of energy; for every 1% increase in market share by a renewable technology, there is a 2% reduction in CO2 emissions’. The Government added that it was ‘prepared to support the technology developers by sponsoring generic research into this very important area at an appropriate time in the development cycle’.

Parliament Debates Wave & Tidal Power

In January there was a House of Commons adjournment debate on wave and tidal power, which took as its starting point last years very positive report by Science and Technology Select Committee. There was much enthusiasm for wave and tidal power set against criticism of how badly they had been treated in the past. Thus Dr. Desmond Turner (Brighton, Kemptown) asked : ‘What position would we have been in if instead of terminating wave power research and development in 1982 we had invested more in it? If we had continued and invested more in it, we might now have as proud an industry in wave power as the Danes have in wind power’.

To which Brian Wilson, the Energy Minister replied: ‘I agree with everything that my hon. Friend said about the short-sightedness of the decision that was taken then. It is also worth recording that the same thing happened with wind power. We had a technological lead in wind power and threw it away’.

Wilson staked his claim as a long term supporter of wave power, by noting that, when, 20 years ago, he was editor of the West Highland Free press, he had run an article by David Ross on that subject ( Ross is currently calling for the `wave programme to be nationalised which may not be quite so easy for Wilson to swallow!).

Nostalgia apart, the emphasis of the Commons debate was on the future, with Desmond Turner, who was on the Select Committee, clearly being one of star turns. Thus Turner noted that ‘in 1999, the DTI’s energy technology support unit estimated that the energy that was easily and practically accessible was 50 TWh per year from offshore wave power and 36 TWh per year from tidal power- and that from only the 10 most promising sites. Even on extremely conservative estimates, more than a quarter of the UK’s total energy consumption of 330 TWh per year is available and exploitable. In fact, I am inclined to err towards the Greenpeace estimate and predict that there is sufficient exploitable energy resource to supply our total energy consumption requirements’.

He added ‘Another important aspect of energy provision is a regular baseline supply. The prime argument of the nuclear lobby is that nothing can supplant nuclear reactors in supplying steady, predictable baseline load. We received evidence from energy generators that they could see few problems for electricity companies in integrating both wave and tidal energy supplies into the grid owing to the reliability and predictability of their output. That certainly applies to tidal power because, apart from the short interval of slack water between tides, there is available power for 24 hours at every site. Not only that, there will eventually be constant supplies due to tidal variations- as long as sites are scattered along the coast. Tidal power is uniquely capable of supplying the baseline load that the nuclear industry claims as its prerogative.’

He was equally positive about solar PV, but he had some critical things to say about biomass, asking why was it receiving more support than wave and tide power? ‘Its economics are uncertain. I am not aware of any reliable, published figures on the economics of electricity generation by biomass. Unresolved issues of environmental impact and potential pollution exist, and any application in generating plants of a large scale would raise a storm of planning issues. The same can be said for waste incineration. At the moment, municipal waste incineration is also counted as part of renewables, which I find highly questionable. Both options are described as CO2 neutral and that is rather simplistic because they involve rapid CO2 emission- far more rapid than the speed at which CO2 is taken out of the atmosphere to produce the materials that are being burnt.’

He concluded ‘The preliminary document from the PIU refers to the need for new energy crop technologies to be developed, which underlines the fact that biomass technology lags behind wave and tidal paths and, even when developed, it cannot guarantee non- CO2 emitting energy prediction in the way that wave and tide can’.

However, Brian Wilson was evidently not keen on taking sides technologically. ‘We should not be picking winners at this stage. We must let them all flourish to their optimum, and then decide which has the greatest potential for use in the United Kingdom. The market will decide to some extent, but we will have a much more realistic view in a few years time, of which systems can provide significant and economic sources of power’.

But he did announce that the DTI was contributing ‘more than £1 m of the total cost of the almost £1.5 m Stingray project, which is aimed at demonstrating a novel concept for extracting energy from tidal currents. The Stingray device prototype generates electricity from the oscillatory movement of hydro-planes driven by flowing tidal currents. The project is being developed by the Engineering Business, a Wallsend company, which plans to test its device in Shetland. It is the third demonstration project in the wave and tidal stream area to be supported by Government during the past six months’. (See below).

He also reminded the Commons that the DTI was putting £1.7 m into the development of Wavegens offshore wave device - which is likely to be tested at the new centre in Orkney. But he added ‘It is remiss not to build on what exists already because that gives it commercial and operational credibility. I do not want to lose the momentum for shoreline and near-shore systems, and I want to encourage the refinement of that technology. I am therefore pleased to announce that one of the UK’s major electricity companies, Scottish and Southern Energy plc, is working with Wavegen to develop a proposal for a cluster of shore-based stations in the Western isles. The intention is that they will be technically innovative and act both as demonstration plants and commercial generators to supply Scottish and Southern. Wavegen is currently undertaking surveys in the Western isles to establish suitable sites for these developments and is working on outline project proposals. It hopes and intends that a key feature of the plans will be the use of the former Arnish fabrication yard for manufacturing’.

He also noted that the Engineering and Physical Sciences Research Council has a £6m research and development programme on renewables, focused on fundamental science and engineering issues, with just over £1m committed to wave and tidal energy. In addition , he said he would be looking carefully at what the Chief Scientists new report on RD&D had to say on wave and tidal power (it backed them).

Finally, on planning he said that that ‘it is necessary to have a planning process that matches the country's needs, particularly when major infrastructure projects are involved. We simply cannot wait five years for decisions to be made. We need a more flexible system that respects people’s right to contest proposals but does not lead to unreasonable delays.’

Not a bad session overall - it even includes praise from Robert Key MP, the Conservatives energy spokesman, for the wave chapter in the OU Renewable Energy book. You can access the complete transcript of the debate at:

http://www.publications.parliament.uk/pa/cm200102/cmhansrd/cm020110/halltext/20110h01.htm#20110h01_head0

DTI Boosts Wave and Tidal Power

As Energy Minister Brian Wilson announced during the House of Commons debate on Wave and Tidal power (see earlier), the DTI is to provide £1.1 m to support the development of a full size "Stingray" tidal stream device, which generates electricity from the oscillatory movement of hydroplanes driven by flowing tidal current. A farm of such devices would convert tidal movement into electricity on a commercial scale. The development of the Stingray device, by Engineering Business Ltd, will take place in Wallsend, Tyneside, while the proposed location for its operation is Shetland. The machine will be located on the seabed reducing the need to protect it from stormy weather.

Wilson said: "Tidal energy has great potential but little has happened until now. The challenge has always been harnessing this energy economically in rough conditions. This project is technologically impressive and maybe a solution to the challenge. I am determined that we should take a lead in the development of this new technology. All too often, clever British ideas have not manifested into the manufacture and finally, the distribution, of the final product. I am determined to not let this happen again. That is why, on top of the Government’s initial money to research the feasibility of the concept, I have today allocated this grant to see the project through to completion."

The hydroplane device was invented and patented in 1997 and won a DTI SMART award in 1998, which provided 75% of the funds for a £51,000 R& D project to assess the feasibility of the concept. Wilson commented "This is a particularly wonderful opportunity for the North East as this new technology offers the opportunity to build a large new industry in the region. Potential for manufacturing is an important part of the case in favour of developing our renewables industry."

As we noted in Renew 128, Stingray generates electricity from the oscillatory movement of hydroplanes driven by flowing tidal current. This transforms the kinetic energy of moving water into hydraulic power, which turns a generator.

As noted earlier, Wilson also announced plans for a cluster of wave power stations in the Western Isles, to be developed by Wavegen in conjunction with Scottish and Southern plc. This should lead to the creation of manufacturing jobs within the islands. Wilson said: "This is an exciting development which will greatly advance the development of shore-based wave technology. I am delighted that the developers, Wavegen, intend to locate the manufacturing process locally. It is their hope and intention that a key feature of these plans will be the use of the former Arnish fabrication yard for manufacturing. Wavegen are now in touch with the owners of Arnish, the Stornoway Trust. The use of Arnish for this purpose is entirely compatible with the intention of Amec and British Energy to use the yard for manufacturing purposes related to their proposed windfarm on Lewis. My Department is, in principle extremely supportive of this proposal for the further development of shoreline and near-shore-based wave power and I expect that we will be asked by Wavegen to consider their proposals at some point within the next three months.’

Wavegens existing 500kW on-shore device on Islay is the only commercial wave power station in the world. Wilson saw the programme as maintaining momentum on the shoreline and near shore systems and to encourage the refinement of that technology. Meanwhile the DTI was also funding Wavegens new offshore wave device.

Renewable Growth

Renewables aren’t exactly flush with funding, but, equally, they are not doing too badly. In answer to Parliamentary questions on the state of play with renewables on Nov.13 last year, the Energy Minister, Brian Wilson, said that ‘the Government have put in place a robust policy to increase investment in the development of renewable energy’,and repeated the claim that the new Renewables Obligation (RO) should create ‘long-term support for renewables, worth over £1 billion per year, by 2010’.

The first table below, produced in response to a subsequent PQ, shows the funding pattern historically and into the future. It illustrates the gradual increase in total allocations from the various funding sources. As can be seen Government funded R&D at last begins to increase slightly. NFFO support, ultimately paid for by consumers, continues for already contacted projects, but, the DTI say ‘Non Fossil Fuel Levy spend in future years is highly dependent on the impact of the introduction of Renewables obligation and of proposed new NFFO flexibility provisions. We anticipate that the costs of the Fossil Fuel Levy following the introduction of the Renewables Obligation will decline substantially.’

* estimates

+ Direct Government funding for R&D on renewable energy through the DTI’s Sustainable Energy Programme & through the Research Councils via the Science Budget. Source: Hansard, 21 Nov 2001 : Column: 300-01W

Increasingly then, it will be the Renewables Obligation for England and Wales and the Renewables Obligation (Scotland), that will push things on, with, once again, consumers ultimately footing the bill. The DTI notes that the level of funding for the RO and ROS ‘will depend on how much renewable energy capacity comes forward at any time’. The second Table,below , shows the expected rate of growth in capacity that should result from these various funding programmes.

RO: Estimated sales by licensed suppliers

Although most of this would presumably come from new projects, under the RO but as noted above, projects initially supported under the Non-Fossil Fuel Obligation will continue to be supported, with the new ‘locational flexibility’ provisions allowing projects stalled due to local planning problems to shift to new sites-without losing their NFFO support. However, interestingly, Wilson reported that this locational flexibility arrangement would not be available to mixed waste incineration projects.

The Renewables Obligation will be also underpinned by direct Government funding for renewables worth over £260 million between 2001 and 2004- including the £100m recently allocated by the PIU (see Renew 135) This will include an extensive capital grants programme for the early development of offshore wind and energy crops, the initial stage of a major photovoltaics demonstration programme and a boost for R&D.

Wilson also pointed to the regional energy assessments (see our report below) noting that ‘the majority of these studies have been completed and have identified each region’s capacity to generate electricity from renewable sources. Once all the assessments are completed, it is expected that specific regional targets will be adopted across the UK. These targets are expected to attract investment in the resources available in these regions’.

Our Feature discusses how this idea might be extended.

UK Renewables Boom

Perhaps unsurprisingly, with the Climate Change Levy and the Renewables Obligation in force, and funding gradually increasing, commercial interest in renewables in growing. The UK energy and water company United Utilities has announced plans to invest £200m in wind farms, hydroelectric plants, biomass projects, and landfill gas production. This investment is in addition to United’s earlier pledge of £100m- see Renew 134. United chief executive John Roberts pointed out that the UK currently obtained just 2.8% from renewables, requiring a 500% growth to meet the governments 10% target within the next eight years. They are clearly trying to do their bit.

In addition, Scottish Power plans to spend a further £500m on wind farms in Scotland, while Scottish and Southern, another large power supplier, plans to spend £450m on refurbishing hydro schemes and building new wind farms.

However getting local planning permission is still a problem. 60% of recent large wind farm projects have been blocked. George Hardie, president of Zilkha Renewables, a US firm trying to create 35MW of wind farm capacity in the UK, told the Guardian (Dec.4) that while Denmark gets 15 - 20% of its power from wind ‘in Britain they have reached about one-tenth of 1%, and the planning people are crying foul’.

Meanwhile, Powergen plans to raise £1 bn to increase its renewable energy capacity ten-fold over the next eight years. The group generates just 100 megawatts of power from its wind and biomass sites in Scotland and East Anglia but it wants to generate 1GW to meet the Government’s ‘10% by 2010’ renewables target. In addition to its planned off shore wind farm at Gt Yarmouth, it is also looking at a 500MW project on the Thames estuary.

RENEWABLES UK

Hopefully also moving things on a little, the DTI has set up Renewables UK, a new unit aiming to help UK manufacturers get a share of £500 bn global renewable energy market. Energy Minister Brian Wilson commented ‘Renewables UK is about maximising the benefits of the renewable energy industries to the UK in terms of manufacturing, exporting and jobs. We have a huge opportunity. Renewables UK is about ensuring that we grasp it. There is a huge amount going on, backed by this Government, to encourage the increased use of renewable energy. This increased activity will create massive opportunities for investment and employment.’ He added ‘ The new organisation will initially have six staff, located in Aberdeen, drawing from their experience of sponsoring and supporting the oil and gas sector. Government Departments and support agencies with an interest in renewables must work closely together to bring jobs across the UK from Cornwall to Caithness.’

See www2.dti.gov.uk/renewable/main.html

Regional RE Targets

A new report produced by Oxera Environmental and Arup Economics and Planning provides an overview of the potential for renewable energy in all the UK regions. It was commissioned to help the Government plan for its target of obtaining 10% of electricity from renewable sources by 2010. The assessments were co-ordinated by the Government Offices in England and the Devolved Administrations.

According to the DTI, these assessments will eventually lead to the agreement of regional renewable targets, and will play a key role in helping developers and other stakeholders to find new potential sites in each region. The potential for renewable energy for each region was identified in the individual studies, using high and low scenarios. The capacity identified in each region has also been translated to the following percentages of the UK’s 10% target.

Total of Government’s target: 66% 100%

Energy Minister Brian Wilson said: ‘The report shows that the Government’s targets of gaining 10% of its electricity from renewable sources by 2010 is challenging but achievable. The recent Scottish Renewables Study, published after this report was compiled, suggested that Scotland alone had the potential to supply even up to 30% of the UK’s electricity supply from renewables. Also this report did not take account of larger wind farms which are further offshore than the initial 18 sites allocated by Crown Estates. We cannot, however, expect offshore wind and Scotland to deliver our targets. I hope that every region will get involved in developing our renewable energy resources’.

But he added ‘targets are no use on their own if there is no sensible understanding of our renewable potential. Everyone working together, one step at a time, with the right investment, is the right way forward to progress the UK’s green agenda’.

The Regional Renewable Assessments Overview report can be found at: http://www.dti.gov.uk/

Community Renewables

The DTI has launched a £1.6m community renewables initiative to give advice and training to local organisation wishing to set up small scale renewable energy schemes, Supported by amongst others the Countryside Agency, the initiative will set up local support teams in 10 areas covering half of England. The teams will help local people and organisations devise renewable energy schemes suited to their area. The aim is to not only create environment friendly developments but to enable community groups to directly benefit from the income generated. More on this welcome plan in Renew 138. Meanwhile see:www.countryside.gov.uk/communityrenewables

Wind Opposition

The debate over on land wind rumbles on. Opposition to the new wind farm proposed for Cefn Croes in central Wales, and the DTI commitment to press ahead nevertheless, has provided a particularly sharp focus. The opponents are incensed by the DTI’s decision that the project does not need to be called in for a Public Inquiry - it had after all obtained planning permission from the local council. We will be looking at both sides of the argument over this project in Renew 138.

Meanwhile, opposition has also begun to emerge to offshore wind projects. In a recent Parliamentary exchange, Bob Blizzard (Waveney) asked Secretary of State Margaret Beckett, if she would tell ‘the environmental and other groups that come to see her not to oppose offshore wind farms? Although they want renewable energy, many of those groups have blocked wind farms in the countryside. As the windiest country in Europe, it would be a disaster if our huge potential for developing offshore wind power were to be thwarted by the activities of those groups’.

Beckett responded that although ‘many of those groups make a useful contribution to the debate... there can be a worrying tendency to a degree of inconsistency among them when it comes to concrete proposals. Everyone who wishes to see the greater development of a programme for renewables - I think that includes most hon. Members - must recognise that none of these issues is problem free’. (Hansard March 7)

Wind versus Whelks

Energy Minister Brian Wilson got caught in some cross fire from conflicting local interests when he responded to a Parliamentary Question in Jan about the benefits of offshore windfarm projects. He said he would be happy to visit Lowestoft to see the pioneering work of SLP, which, as the local MP, Bob Blizzard, reminded him, is involved in a project to build the largest wind turbine in Europe, and he was also asked to visit King’s Lynn, where, a Norfolk MP, M. Bellingham, noted, there were plans for a further 30 offshore from Cromer. But then came the punch line ‘Did he agree that, however desirable offshore renewable wind energy is, it is vital that fishery interests are considered when locations are decided? Otherwise, irreparable damage could be done to the cockle, whelk, mussel, shrimp and crab fishery off the Norfolk coast’.

Wilson said he recognised the problem and was due to meet the National Federation of Fishermen’s Organisations to discuss it. ‘As in everything, we must strike a balance. Of course other maritime interests must be consulted and considered, but we must not have locking mechanisms, and stalking horses of initiative that appear to be environmentally based but whose objective is actually to block renewables projects.’

Mrs. Joan Humble (Blackpool, North and Fleetwood): weighed in, adding that ‘in my area there are two issues, tourism and fishing’. Wilson replied ‘Of course there must be consultation, and people have a right to expect account to be taken of all possible impacts when applications are considered. What we must not have, however, is institutionalised objection to every project that is proposed. That applies to offshore wind, onshore wind and all other renewables. At some point, a contradiction will arise if we as a Government, and the country generally, pay lip service to renewables without willing the means to deliver the necessary contribution. Obviously each project must be scrutinised, but there must also be a generally positive attitude to the development of the industry.’

Mr. Simon Thomas (Ceredigion) then added his piece, claiming that ‘many people are in despair at the proliferation of onshore wind farms, which do not even produce the amount of energy that offshore wind could produce? We need that to happen in the Celtic sea especially. Ireland is taking advantage of that resource and the Irish Government are investing in the biggest offshore wind farm in the whole of western Europe. Should not that be happening in UK territorial waters?’

Wilson replied ‘I am sure that the hon. Gentleman realises the problem that he wants us to build large offshore wind farms all over the place, but that the opposite view has been expressed by other hon. Members. People must take a balanced view and we must act collectively. If we are to have a serious renewables industry, we must be able to drive forward projects without them being blocked for years, sometimes on unreasonable grounds. At the same time, we must protect the right of scrutiny’.

Patricia Hewitt also got an ear full on the same issue in another session when Kevin Hughes (Doncaster, N) asked ‘What guarantees can the Secretary of State give to the House that huge swathes of the beautiful English countryside will not be blighted by these obnoxious looking windmills- noisy instruments that cannot generate enough electricity even to boil a decent kettle? What guarantees will she give that the English countryside will not be ruined by these obnoxious things? (windturbine =2MW, kettle =1kW but let that pass- ed)

Ms Hewitt replied: ‘I am sorry that my hon. Friend does not like the appearance of modern windmills. I think that they are rather beautiful. Environmentalists cannot have it both ways. If we are committed to the development of renewable energy, and if we want to meet our Kyoto targets - and, indeed, targets beyond that - and deal with the problem of climate change, then yes, we have to meet the targets that we have set. That means ensuring that 10 per cent. of our electricity comes from renewable energy by 2010 - and, frankly, more beyond that. Environmental issues, especially in respect of areas of outstanding natural beauty, are always taken into account when planning decisions are made on the siting of wind farms.’

PIU Report Reactions

The Performance and Innovation Unit’s Energy Review (see Renew 136) predictably attracted hostile comments from the Times (‘An ill wind’ 15 Feb.) and the Telegraph (‘Blair will Blow Billions on wind’ 17 Feb.), but also critical comments from the Sustainable Development Commission and the Environmental Audit Select Committee, complaining that the PIU had ducked the issue presented by the Royal Commission - the need for a 60% cut in emissions by 2050. And the BWEA claimed that wind alone could supply 20% of UK power by 2020.

The nuclear industry meanwhile started optimistic talk about replacing the Advanced Gas-Cooled Reactors with AP100 when the AGRs were shut down from 2010 onwards (see ‘9 new plants’ later). And the governments Chief Scientist, Prof. David King, seemed to break ranks with the official line and back a nuclear expansion. "Dependence on fossil fuels would be unchanged unless there is new nuclear build at least to replace existing nuclear power stations," he said in an interview on BBC Radio 4’s Today programme, although he did add that might only be necesary ‘until renewables come on stream substantially’.

The debate continues (see our report later) with a DTI consultation paper emerging in the run up to the proposed White Paper on Energy, expected in October.

PIU Debate

The Performance and Innovation Units energy review was the subject of a joint meeting of the Parliamentary Sustainable and Renewable Energy Group and the Parliamentary Office of Science and Technology in March, at which a large audience packed into a House of Commons meeting room, heard very positive comments from Brian Wilson, Energy Minister, Robert Keys opposition energy spokesman and Lord Ezra Lib Dem Energy spokesman. They seemed to be trying to outdo each other in heaping praise on the PIU energy team for an ‘excellent bit of work’.

What seemed to make the PIU report attractive to politicians was that it managed to contain the thorny issue of nuclear power in a loose framework which might avoid head on collisions. Thus on one hand it says that new nuclear plants are not needed now, and shouldn’t get state support, but on the other, that the nuclear option should be retained as an insurance, in case renewables, energy efficiency and CHP don’t deliver enough power. So it should be allowed to benefit from the emerging carbon credit system.

However, the consensus was not entirely solid. For example, Keys harped back to the nuclear industry’s call to ‘replace nuclear with nuclear’, which the PIU had explicitly rejected, at least for the moment. Lord Ezra also muddied the waters a little, pointing to the local environmental impacts of on-land wind. Wilson went on the attack on this issue, saying that too many of the projects given NFFO contracts had not happened because of local planning problems. Everyone agreed that we needed renewables, he said, but some of the people who said they supported renewables in principle were actually opposing them in practice. He seemed determined to press ahead- and indeed almost evangelical about the prospects for the renewables industry.

However, the rhetoric took a bit of a dent from people from the industry. Jeremy Leggett from Solar Century complained that investment capital was hard to find in the UK- unlike in Germany where PV solar was romping ahead.

Catherine Mitchell, representing the PIU, focused on the economic issues. Renewables and CHP looked likely to be the best economic low carbon supply options, so we should simply allow them to show what they could do. Pushing this line perhaps a little too far, she added ‘economic regulation needs to be technologically neutral’. That’s fine up to a point- a level playing field would be a good thing. But it will take time for the field to be levelled- and we may need a period of positive discrimination in favour of renewables. The governments new green rhetoric is obviously welcome, as are the capital grants for renewable projects. But the main reason, arguably, why renewables have been stalled so long in the UK is because all the support and subsidies went to nuclear. And it’s still the case that nuclear gets more than renewables- by a factor of more than two in terms of R&D spending, leaving aside the billions in liabilities that the government is to take over. Even assuming we accept the view put by Wilson that nuclear and renewables should have a joint role as non fossil options (a very big assumption) what sort of parity is that?

Wilson seemed bemused by the fact that Denmark had done so well with wind, compared to the UK, but seemed unaware of, arguably, the main reason why- the Danish decision in 1985 to avoid nuclear. However that sort of decision seems to now be out of reach within the new PIU consensus framework. Instead, we are to focus on timetables for the various options, renewables CHP and efficiency now, nuclear again maybe later. Obviously that’s not all bad, but lets hope the imminent DTI consultation paper on the issues raised by the PIU report provides an opportunity to raise the problems of nuclear power, rather than just allowing us to register our degree of approval for the framework set out by the PIU. See Reviews in Renew 137 for more

Opposition from both sides

While environmental groups like Greenpeace, Friends of the Earth and SERA have indicated their opposition to the PIU’s compromise on nuclear, it was, in effect, also challenged, but from the other side, by the Chief Scientific advisor, Prof. King, who is based in the DTI’s the Office of Science and Technology. As noted above, he rather broke ranks by suggesting that "dependence on fossil fuels would be unchanged unless there is new nuclear build at least to replace existing nuclear power stations," (interview on BBC Radio 4’s Today programme).

Greenpeace was horrified. "The chief scientist is playing politics - he has strayed outside his scientific remit to try and soften up the public on behalf of the Government which wants to build a dangerous new generation of nuclear power stations".

Instead, Greenpeace recommended that the Government support a target of getting 50% of UK power from renewables by 2020. ‘This would allow us to phase out nuclear power and massively reduce our emissions of greenhouse gases’.

Perhaps predictably, Kings comments were echoed by Jack Cunningham, the Labour former minister. ‘We are simply not going to be able to provide the electricity for an advanced industrial economy without a contribution from nuclear power.’ However, Margaret Beckett, the environment secretary, played down Prof King’s comments, saying it was too early to come to conclusions.

* Subsequently, the PIU report was debated in the House of Commons on March 13. This turned into an exchange of pro and anti nuclear views. We will be covering the debate in Renew138.

Overall the PIU review does seem rather complacent. For example, not only does it conclude that there should be no major problems with allowing imported gas to be the dominant fuel for the UK, it also suggests that energy demand will stabilise, with only transport being a problem and most of that coming from growth in the use of aviation fuel. In general it felt that market mechanisms and especially EU energy market liberalisation could be relied on to maintain security of supply. So there was no need for much in the way of government intervention, just a bit more regulation. All very New Labour.

The special meeting with a panel including key PIU energy team members, organised by the Warwick Business School at the Institute of Mechanical Engineers on 11th March, tried to tackle some of these points- with for example the issue of global oil and gas reserves being raised. But the mood seemed to be that, if the world energy system can survive the Enron collapse, then it could cope with most things. A Friends of the Earth speaker tried to get the problems of nuclear power discussed, but the view seemed to be that, in reality, the city was unlikely to fund any new nuclear plants, so the issue could be left aside.

In general the PIU seem convinced that renewables, CHP and energy efficiency should and will be the technologies of choice, as reflected in the ambitious estimates for potential take up. All that was needed was proper market regulation. The problem is that it is not clear whether this is what OFGEM, the energy regulator, can deliver - with NETA being the current issue.

Other UK Green Energy Sector news NFFO/SRO cut

The Fossil Fuel Levy in England and Wales, which is used to support renewable energy projects contracted under under the Non Fossil Fuel Obligation (NFFO) by allowing supply companies to add a small charge on consumers bills, has been reduce to zero from the previous level of 0.3%.

Ofgem, the Energy Regulator, explained that it anticipates that over the coming months there will be sufficient funds already accrued form previous levy income to make up the difference between payments which the Renewables Scheme guarantees to generators and the amount they will be able to secure in the market. NFFO 1 and 2 projects have already lost their levy support, since they were only contracted up to 1998, and some projects supported under subsequent rounds of the NFFO have yet to get started.

Under transitional arrangements, existing NFFO contracts will continue to be honoured, and the levy may yet have to be re-started to meet the costs, but for new projects the NFFO system is being replaced by the Renewables Obligation which will require supply companies to source 10% of the power from renewables by 2010, and will lead to a surcharge building up in stages to perhaps 4% by 2010.

In parallel, the levy associated with Scottish Renewables Order has also been reduced, but only down from 1.2% to 0.6%, presumably reflecting the rapid take up of SRO-3 wind projects. Like the NFFO, the SRO will soon be replaced, but the proposed new Renewables Obligation Scotland, has a more ambitions target than the RO - a 18% from renewables by 2010.

Green Power Guidelines

OFGEM, the energy regulator, has published proposed guidelines designed to help customers who want to choose an electricity supply that is more environmentally friendly. The numbers have at last begun to grow. According to www.greenprices.com UK subscriptions have risen to over 45,000, still of course dwarfed by the 280,000 in Germany and the 680,000 in the Netherlands. But we hear that London Electricity and Powergen have recently been innundated with subscribers to their schemes

The new draft guidelines set out the criteria that OFGEM expects company tariffs to meet if they are to be described as ‘green’. They have been prompted by the changes in the regulations for renewable energy supply, namely the Climate Change Levy renewables exemption and the Renewables Obligation. The guidelines:

· define key terms of what forms of generation constitute ‘green energy’

· explain the key features consumers should expect from a ‘green’ tariff

· clearly describe which rules, regulations and guidelines apply in this area

Ofgem’s Director of Social and Environmental Affairs, Virginia Graham, said: "Competition in the energy market has made it possible for customers to get all or part of their electricity from suppliers who offer green tariffs. These guidelines aim to give customers the confidence that a green tariff is actually contributing positively to the environment. The guidelines, which are advisory, will also help suppliers to understand the importance of accuracy and transparency in green supply offerings."

The Guidelines are not in fact very explicit on what is or isn’t green energy.

They say "it is not the purpose of the document to set strict definitions for what technologies constitute ‘green’ energy", but a little annoyingly they then say ‘however it is important that there is general consistency in approach’ and add ‘there is a core of technologies which are generally understood to be renewables. These include landfill gas, sewage gas, hydro, wind, energy crops and other biomass, geothermal power, solar, tidal and wave power. Other renewable technologies include co-firing of biomass and energy from incineration of mixed municipal and industrial wastes. These technologies are arguably of less environmental benefit in many peoples perceptions’. In particular, they note that waste incineration is not eligible in the Renewables Obligation or the Renewables Obligation Scotland.

The proposed rules themselves are fairly straight forward, along the lines of ‘legal, truthful and honest trading’ as in the advertising standards, and include a prohibition against the use of ‘energy which is purchased by suppliers as part of their Renewable Obligation’. Any premium charged should be directed either to ‘the additional cost of purchasing renewable energy from non RO/ROS accredited sources or the cost of obtaining ROCs which are not presented as part of the RO’.

OFGEMs "Guidelines on Green Supply Offerings. A Consultation Document" are at www.ofgem.gov.uk or phone on 0116 277 2617

Secure Energy

The Select Committee on Trade and Industry recently produced a report on Energy Security, a subject which had come to the fore after the energy crisis in California. They noted that, at present, the UK enjoys a high level of diversity and security of supply, with electricity generating capacity currently exceeding demand by more than 30%. But, looking to the future, they warned that consumers, who had been lulled into a false sense of security by the recent energy prices cuts, had to be made aware that the cost of maintaining energy supplies in a sustainable fossil free way was going to be expensive, whether it was the 1p/kWh subsidy that the nuclear industry told them they would need to be economically viable or the 3p/kwh RO price cap for renewables.

Even that might not be enough, and the Committee were not confident that the current 10% by 2010 renewable target would be met. In particular they felt that NETA was undermining the development of a diverse range of energy supplies, and felt that the government needed to play more of a role in ensuring longer term security of supply ‘We have not yet heard any evidence that leads us to believe that the market is sufficiently far-sighted to guarantee enough reserve generating capacity without some element of planning by Government or one of its agents’.

We’ll review the report in Renew 137.

Meanwhile, for a lively, if odd, debate on energy, with a strong contrarian element, see: www.spiked-online.com/sections/science/debates/energy/

European Developments

EWEA Conference on Offshore wind

So far Denmark, Sweden, the Netherlands and Britain have installed around 100MW of offshore wind turbines. But more is to come. Ruud de Bruijne, spokesman for COD, Collaboration on Offshore Wind Energy Development, speaking at a three-day EWEA offshore wind energy conference in Brussels, claimed that "Towards 2005 we will see small-scale 100-150MW offshore wind farms in a water depth of less than 20 metres (60 ft). By 2010 we will see units of more than 500 megawatt on water depths of more than 20 metres." However Andrew Garrard, partner in British consulting group Garrad Hassan, warned that "Offshore projects today are not big enough. We have to look into gigawatt projects not megawatt ones."

"There is a shortage of good onshore wind farm sites in Denmark and northern Germany. Onshore growth is deteriorating and offshore wind farms are a natural way out," according to Jos Beurskens, vice president for the European Wind Energy Association. "Spain is really the only European country which has the potential, like the U.S., for onshore wind farms," said Andrew Garrad.

Offshore was therefore the obvious next step in many places. Denmark plans to build offshore wind farms with a total capacity of 750 MW by 2008, Belgium plans to install 325 MW and the UK has granted 18 licenses for a potential 1,000-1,500 MW. Germany is developing a plan for a 1,000 MW offshore farm, and all in all there are plans for around 5,300 MW of offshore wind farm in Europe.

"Studies indicate that 2,500 offshore megawatts will be in operation by 2005, generating an amount of electricity equivalent to the needs of two million European households and creating some 50,000 jobs in the sector," the EWEA said. By 2020, there could be 50,000 MW of offshore wind capacity, with the onshore capacity being around 100,000 MW. COD’s Bruijne said the North Sea and the Baltic have 90% of the offshore potential in Europe. In southern Europe, particularly in the Mediterranean, water is too deep, making offshore projects too expensive.

Source: info from EWEA/ PRASEG

Worlds largest Offshore wind farm for Eire

The Irish Government has approved the construction of what they claim will be the worlds largest wind farm, with 200 windturbines on a sand bank off the coast of Co Wicklow - ‘three times the combined size of all the other offshore winds farms in the world’ as the Irish Independent put it. Certainly, at 520 MW, it will be nearly as big as the on land wind farm proposed for the Scottish Isle of Lewis (see Renew 136) and definitely the largest offshore wind farm so far.

The Arklow Banks Farm will be built five miles out to sea and is expected to eventually provide 10% of Ireland’s electricity. The euro 640m plan will involve siting 200 giant turbines on a sandbank 10km off Arklow, Co Wicklow. The sandbank is located due east of the Wicklow town. It spans 27km by 2.5km and runs north to south.

The Irish Independent reported that the successful application for a foreshore license was made by the Eirtricity company headed by former Bord na Mona boss Eddie O’Connor. Work on the ambitious project is expected to start this year and will mean hundreds of jobs during construction. An environmental impact statement has been carried out on the wind farm and the decision to approve a foreshore license for the project, effectively a planning permission at sea, has been announced by Marine Minister Frank Fahey. The State will evidently receive a fee from the operators based on the amount of power generated.

According the the Irish Independent, the ‘wind park’ will be developed on a phased basis. The site was chosen because it is close to the shoreline in shallow water, and close to the national grid. An exclusion zone for shipping will be set up round the turbines, although ships already avoid the Arklow sandbank which is known to be dangerous.

Eirtricity already has two wind farms and another two under construction, and claims to be offering customers its electricity for 10% less than other producers.

The sandbank is 7km from the Arklow coast at its nearest point, and 10km at its furthest. The company says that the turbines will not create any major visual impact because of their location. The Department of the Marine claims the offshore wind farm will have absolutely no environmental downside. Indeed, officials insist that it will foster marine life, because the turbines will attract species in the way deep sea ship wrecks become havens for varieties of fish and other marine creatures. They also feel the exclusion zone will help to protect fish.

Wind grows by 30% Electricity production from wind leapt by 31% last year, making it the fastest growing industry in the field of power generation, according the earth Policy Institute in Washington DC. With the newest turbines on the best sites, wind is now the cheapest method of producing electricity, and huge building programmes have begun worldwide. Global capacity climbed from 17,800 to 23,300 megawatts - sufficient to meet the electricity needs of 23m people, the combined population of Denmark, Finland, Norway and Sweden. Since 1995, global wind-generating capacity has increased nearly fivefold - and the Danes now get 18% of their electricity from wind, although (see later) problems are now emerging with the funding system.

World’s largest solar energy project - Denmark

Valby, in Copenhagen, will be the site of the world’s largest solar energy project involving the installation of solar cells in an urban area the size of 20 football fields. Over the next 25 years, 150,000 m2 of solar cells will be installed mainly on the roofs of residential homes and other buildings in the outer Copenhagen district of Valby. The first 5000m2 should be in place in 4 years.

The Urban Renewal Company along with others such as Copenhagen Energy and Valby District Council are behind the ambitious initiative. Once complete, the solar cells will produce up to 15% of the district’s energy demand, according to the project leader Jakob Klint from URC. ‘This is an immense project as it concerns a large urban area, and also requires a significant financial input,’ Klint told the daily newspaper Jyllands-Posten. However, the project is likely to be a costly affair for Valby's 40,000 residents during the first few years of its implementation, as they will be expected to cover part of the estimated total cost of DKK 15 million. ‘The project can only be carried through if private owners and companies are willing to participate. The idea is that they will cover the costs of purchase and installation of the solar cells’, said Klint.

A typical family will be able to save DKK 3,700 a year once the solar panels are in place. However, the price of will run into the tens of thousands, so it could take up to 10 years before the residents of Valby feel any benefit. Klint, however, is convinced that the project will, in the long run, be economically sustainable for residents.

‘We expect to receive governmental and other forms of financial support, such as EU funding. Additionally, prices of solar panels are halving every 7 years. Therefore we believe that the project will in the long run only require private investments to succeed,’ said Klint. He emphasises, however, that residents should first and foremost see the initiative as an investment in improving Valby's environment.

The solar cells will help to reduce carbon dioxide emissions as well as reduce air pollution. Thomas Brængaard Nielsen, from Copenhagen Energy, agrees with Klint that the residents of Valby must consider this as a long-term investment.‘Electricity prices are unlikely to fall during the next few years. It is the future perspective that should drive the initiative and residents' interest to participate’s. He emphasises that solar cells are part of the future of public energy supply in Denmark. During 2002 the project plans will be aired at a hearing amongst Valby’s residents. But, politicians in Valby’s City Council are evidently already keen on the idea.

Source: Copenhagen Post, 28 November 2001. Lets hope the new political situation in Denmark does not disrupt this project.

REFIT works best

EU member states that achieved above-average growth in one or more area of renewable energy during the 1990s were successful because they introduced the right combination of incentives, concludes a report by the European Environment Agency . The report analyses eight instances in four member states over the period 1993-99 where output of one type of renewable energy grew faster than the EU average and also contributed at least 10% of the EU-wide increase.

The success stories were: solar PV, solar thermal and wind in Germany; solar thermal and biomass for district heating in Austria; PV and wind in Spain; and biomass for district heating in Sweden. A further 15 smaller-scale successes are also discussed, with only the UK, Belgium and Luxembourg failing to be singled out for some type of praise.

The report concludes that key government actions for success are: long established energy policies promoting renewables; financial support for capital costs and renewable generation; good grid access for renewables; taxes penalising fossil fuel use and/or tax breaks for renewables purchase; administrative assistance; priority to R&D; and education, information and training campaigns. Financial support systems had a big impact. The report points out that three countries that guaranteed purchase prices of wind-generated electricity - Germany, Denmark and Spain - contributed 80% of new EU wind energy output during the period. This suggests that feed-in laws work better than the competitive tendering mechanism adopted by Ireland and the UK, a point reinforced by the problems now being experienced in Denmark (see below). Other success factors include local and regional targets for renewable uptake, planning guidance for renewable projects, and revision of building regs to promote PV/solar .

From Environment Daily Report available from: http://reports.eea.eu.int/environmental_issue_report_2001_27/en

Danish wind stalled

Things really seem to be going badly in Denmark. On top of the dramatic cuts in funding for renewables (see Renew 136), Denmarks troubled green certificate system has led to collapse of the Danish wind energy market, according to the World Wind Energy Association.

In 2000, 600MW of new capacity was installed, based on orders made with guaranteed minimum prices. But in 2001, new installations dropped to 18 MW during the first half of the year. WWEA blames the 1999 decision to replace the guaranteed price REFIT styled system by a green certificate trading system, something like the UK’s Renewable Obligation Certificate trading system. WWEA note that more than 80% (1,144 MW) of the 1,388 MW installed around the world in the first half of 2002 were installed in three countries with guaranteed minimum prices: Germany, Italy and Spain. In countries with quota/certificate systems, including Denmark, , the UK, USA and the Netherlands, only 75MW were installed. France and Brazil have decided to introduce minimum price systems which recognize the success of this framework.

The WWEA is encouraging the Danish government to abandon the certificate system, and is trying to discourage other countries from pursuing similar tariff models. It says that "the return of Denmark to the most efficient and effective promotion system for renewable energies would be an important signal for the global dissemination of wind energy". The WWEA is organising a major international wind conference, in Berlin, in July, and, as we noted in Renew 134, along with the German wind association BWE, seems to be in conflict with the European Wind Energy Association, which thinks REFIT type schemes should be replaced by competitive trading schemes.

German subsidies saved

The German parliament recently formally ratified the Kyoto accord - the first EU government to do so. It has also overruled Economics Minister Werner Mueller, who wanted to cut financial support for renewables by 100m marks. Instead subsidies for solar, biogas and geothermal energy will be raised to 400 million marks, from 300m in 2001. The minister had also wanted to cut the government's renewable R&D by 65m marks to 235m marks, but the parliamentary committee decided to cut the budget by less to 274m marks

N. American News

US Emissions rise

The US has announced the largest increase in greenhouse gas emissions in the last five years, with, in 2000, carbon dioxide emissions increasing by 3.1% compared to the previous year. The Energy Department's statistical arm, the Energy Information Administration (EIA) attributes the increase to strong economic growth in 2000, the replacement of some hydro with fossil-fuel generation, and a return to "normal" weather patterns. The annual rise is second only to the 3.4 % increase in 1996, and well below the decade’s average increase of 1.%.

The EIA’s report showed that transport-related carbon dioxide emissions increased, as did emissions from the residential, commercial and power-generating sectors. Industry-related CO2 emissions remained flat, possibly due to low growth in energy-intensive industries and efficiency improvements.

U.S. energy demand is expected to increase by one third over the next two decades, as businesses and consumers use even more oil and electricity to fuel a growing US economy, according to the the EIA.

Growth in commercial buildings and personal travel, combined with slower increases in fuel efficiency for cars and trucks, is expected to account for the large increase in energy demand by 2020. According to the EIA’s annual report, total U.S. demand for all types of energy is projected to jump from 99 quadrillion British Thermal Units (the delightfully antique unit still used in the USA ) in 2000 to 131 quadrillion Btu in 2020. The latter is higher than what the EIA projected for 2020 in its annual report last year. Domestic crude oil production is projected to decline slightly by 2020 to 5.6 million barrels per day (bpd). As a result, foreign imports are expected to account for 62% of U.S. oil supplies by 2020, up from 53% in 2000, the EIA said. However, that rise is lower than the 64 % -share for oil imports by 2020 that EIA forecast in its report last year. The difference is due to higher expected domestic production from new oil fields in Alaska’s National Petroleum Reserve - opened up, against strong environmental opposition, by Bush, with, sadly, support from some key US TradeUnions, keen to underpin employment.

It doesn’t have to be this way

Development of policies on renewable energy and energy efficiency could create 1.3 million new jobs in the United States by 2020, according to the World Wildlife Fund. A total of 750,000 new jobs would be created over the next nine years, according to ‘Clean Energy: Jobs for America’s Future’. See www.worldwildlife.org

Gross domestic product would increase by $23 bn by 2010 and increase to $43.9 bn (net) by 2020.

‘This study shows that a responsible approach to energy policy can help us meet the challenge of climate change while still benefitting the economy and creating new jobs,’ says WWF. ‘A serious and sustained national effort to improve the energy efficiency of our cars, trucks and buildings will offer us a better future with sustainable economic growth and allow us to conserve irreplaceable wilderness refuges for future generations.’

A related benefit would be an additional $220 increase in annual wage and salary earnings per household by 2010, increasing to $400 per household by 2020. In addition, adoption of the WWF energy recommendations would allow the US to reduce its carbon emissions by 8.5% by 2010 (compared with a projected increase of 20%) and by 28% by 2020 (compared with a 36% rise). 20% of electricity generation in 2020 would come from wind, solar, biomass and geothermal, while oil consumption would decline by 8% by 2020, rather than increase by 315, saving money and reducing vulnerability to oil price shocks. Overall dependence on fossil fuels would decline 15% by 2020 rather than increasing by 40%, and homes and businesses would accumulate savings of $600 bn in that period.

WWF conclude "The study shows that these policies also create more jobs and offer greater economic benefits than can be generated by drilling in the Arctic National Wildlife Refuge despite the unsubstantiated claims of drilling proponents."

* The US Energy Administration, predicts that renewables will increase by 1.3% per year until 2020, but insiders fear that the collapse last year of large USbased energy trader Enron, and the possible end of the special US tax credit,may slow the expansion of windpower, the leading option in the USA.

US wants more Alcohol

A four-fold increase in renewable fuel use in the USA by 2016 would add $6.6 bn to the U.S. farm economy and 300,000 new jobs, while modestly raising consumer food prices, according to a study by by three pro-ethanol groups, the Renewable Fuels Association, the National Corn Growers Association, and the National Biodiesel Board.

Ethanol is strongly backed by the agricultural lobby in the USA and the new study was released the same day Senate Democrats unveiled an energy bill that called for a significant increase in renewable fuels. The farming lobby clearly hopes that the study will bolster congressional support to require all motor fuel to contain more ethanol, biodiesel and other renewable fuels, using surplus U.S. grain. However, as we reported in the Renew 135, although, US car makers are being encouraged to introduce ‘dual use’ vehicles, which can run on 85% ethanol, due to the lack of retail outlets for this fuel, in practice few cars are actually using it. But car makers still receive credits for building dual-use cars, allowing them to lower the average gas mileage of the rest of their fleets. So the end result is actually increased emissions overall from increased petrol use.

* Ethanol is becoming all the rage. Australia has launched an ambitious ethanol programme as have China. The only trouble is that it is expensive.

US Green Power could grow by 50%

An extension of the U.S. tax credit for wind turbines and biomass generation facilities would increase green power output by 50%by 2020, according to a government analysis. The ‘Annual Energy Outlook 2002’ from the Energy Information Administration predicts that renewables will generate 15 gigawatts by 2020, based on the assumption that the current production tax credit for turbines and closed-loop biomass sources, worth 1.7c/kWh, will expire on Dec. 31 2001, as currently mandated. But if the tax credit was extended, then an extra 7GW could be installed by 2020. Even so, the report says that "Renewable technologies are projected to grow slowly because of the relatively low costs of fossil-fired generation and because competitive electricity markets favor less capital-intensive natural gas technologies over coal and baseload renewables."

Meanwhile, a Gallup Poll showed strong support for Renewables in the U.S. - with 91% of respondents favouring investments in "new sources of energy, such as solar, wind, and fuel cells", according to polls conducted in May and November last year. Support for nuclear power dropped from 48 % in May to 42 % in November. Gallup speculated that this drop "may well be linked to the events of September 11, which pointed out the potential vulnerability of nuclear power facilities to terrorist attacks".

Wave hits USA

Plans are underway to build a 1-MW offshore demonstration wave project near Neah Bay in Washington State. The project developer is start-up company AquaEnergy Group, Ltd. The local Clallam public utility district has committed to purchasing the power from the Makah Nation (a North American Indian tribe), which will own and operate the development when completed. "Once this permitting and development precedent has been set, we believe offshore wave power has the potential to satisfy 5% to 10% of total US power demand within 20 years," said Alla Weinstein, AquaEnergy CEO.

As currently designed, the project will rely on floating buoys moored about 60 feet apart in water 150 to 200 feet deep several miles offshore. Attached to a long underwater pump, the buoys move up and down from wave energy, which in turn creates a pumping action, producing pressurized seawater that is directed into a turbine driving a conventional electric generator. Power will be moved ashore with an underground cable. While this technology has been tested in Sweden, the US project is the first utility-scale application.

According to AquaEnergy, the technology is already cost-competitive. The project is expected to generate power at about 6 cents/kWh. If expanded to 100 MW, the cost could be as low as 4 to 5 cents/kWh, similar to hydropower, say project sponsors. "We are entering the market with the same cost characteristics that it has taken wind power 25 years to attain. And our cost-effectiveness will only improve with experience."

..and Canada

Farther north, BC Hydro intends to develop up to 4 MW of ocean wave power as part of a broader plan to install 20 MW of renewable energy generation on Vancouver Island, British Columbia. Currently, only about 20% of the electricity used on the island is produced locally. BC Hydro intends to install about 10 MW of wind, 6-8 MW of micro hydro energy and up to 4 MW of ocean wave energy on the island. The company received 10 proposals in response to its request for proposals for wave power from developers based in Norway, Denmark, the United Kingdom, the United States, Portugal and Australia. Four were short-listed and two are currently in final negotiations with the utility to participate in a joint venture. BC Hydro declined to name the two winning companies but did say the company will develop two plants: a near-shore project and an offshore project. "This is not an R&D exercise for us," said Brenda Goehring, spokesperson for BC Hydro. "If this turns out to be a viable resource, the potential is huge for North America."

Source: www.energyinsight.com

World News

1km Oz Solar Tower

EnviroMission Ltd is planning to build a giant 1km tall solar tower in Australia at a projected cost of Aus $670m. The reinforced concrete tower would generate 200 MW of electricity from a series of internal turbines driven by the 15metre/sec convection currents created inside the tower, as a result of solar heating of air in a large collector area at its base. Solar power tower technology has been tested in Manzanares, Spain, as the result of collaboration between the Spanish government and Schlaich Bergermann. The 50 kW plant operated for seven years until 1989, and

EnviroMission claims that it validated the technology and providing data for design modifications to achieve greater commercial and economic benefits associated with increased scale of economy. The solar tower can work into the night, with innovative heat storing materials under acres of collectors, continuing to heat air.

However, the chairman of the National Trust in Victoria State has called for the project to be halted until the government develops a master plan for the state’s energy industry. EnviroMission Ltd says Australia must proceed if the country is serious about solar energy. It recently formalized an agreement with the German engineering firm, Schlaich Bergermann, to consult on the solar tower. EnviroMission is looking at a number of sites in Australia where there is high solarisation, open spaces and access to the grid.

More info: http://www.enviromission.com.au/top-menu1.htm

Renewables in China

There are a lot of interesting development in renewable energy in China these days. The estimate for commercially exploitable renewable energy resource in China is over 400GW, including over 90GW of small hydropower, about 250GW of wind, approx 125GW of biomass energy, about 6.7GW of geothermal energy and an abundance of solar insolation. The current contribution is around 19GW, with most of this from small hydro. Wind looks like being the biggest growth area- it is expected to expand from 500MW as at present to 3GW by 2005 and 5GW by 2010. Small hydro is expected to rise to 22GW by 2005 and 25GW by 2010. By 2005, the total renewables would be around 26GW, rising to over 30GW by 2010.

See ‘Renewable Energy Development Strategy and Market Potential in China’ LIU Hongpeng (WREC VI, 2000 pp90-96). Interest has also been shown in attempts to introduce green power tariffs to boost development. See South-North Institute for Sustainable Development: www.snisd.org.cn/enhtm/enindex.htm

Russian Volcano power

Russia has launched a 25MW geothermal power plant in Kamchatka. The plant, which is later to be expanded to 50MW, is located on a slope of the Mutnovskiy volcano. The project cost $166m, of which $99.9m will be covered by credit granted by the European Bank for Reconstruction and Development.

Shell- more scenarios

As we mentioned in Renew 136, and discuss in Renew 137, (see Reviews) Shell have produced two new energy scenarios for the period up to 2050, which revise their earlier pioneering 1995 attempts. But not content with that they have recently come up with two more for the period up to 2020 - which project a dramatic break-up of global trends towards globalisation following the terrorist attacks on Sept. 11, which could prevent multinational energy companies from accessing local markets, and force countries into greater reliance on oil rather than gas as a result.

Shell stresses that it is trying to stimulate thinking, rather than make any prophecies or predictions, in its two scenarios. One, labelled ‘Business Class’, has the international elite - led by the US - continuing to lead most of the world towards more efficient prosperity, but at the cost of greater social inequality and market volatility. The other views the world through a ‘Prism’, and foresees, as the FT put it, ‘the monochromatic world of global integration breaking up into more local cultures, rules and restraints’. Sounds fun. More on scenarios in Renew 139.

Nuclear News

‘Nine new UK Nuclear Plants’

BNFL and British Energy seem to have sunk their differences over reprocessing and are collaborating on the development of the Westinghouse AP 1000 upgrade of the Pressurised Water Reactor. In parallel, BE is looking at a CANDU upgrade. The Guardian (Feb.27) reported that this could be the start of a ‘£9bn’ programme that would lead to 9 new nuclear plants being built in the UK, but economically that seems rather unlikely for the moment - even given the PIU’s recommendation that new nuclear projects should benefit from the newly emerging carbon credit system. Instead it looks more like a kite flying exercise, putting down a marker for a programme they would like to see at some point in the future. Even so its an indication of what might be in store.

Nuclear Subsidies Grow

In Renew 134, we noted that the level of UK R&D support for nuclear, including fusion and ‘support for the former USSR’, was planned to expand, so that by 2003/4 it would reach £52.3m- half the total UK energy R&D budget. We can hardly begrudge support for research on ways to clean up the ex-Soviet nuclear messes, and we definitely need work to find ways to deal with the 500,000 tons of nuclear waste that the UK will produce over the next century. But the R&D budget is only part of the story. In fact, Government funding to the UK nuclear industry has been provided primarily in the form of grant and grant in aid to the United Kingdom Atomic Energy Authority (UKAEA). According to the Minister for Energy, responding to a Parliamentary Question last year, ‘this funding has been primarily to enable the UKAEA to discharge historic nuclear liabilities arising form past civil nuclear research programmes and to decommission those research facilities and restore sites to normal use - with the exception of funding in respect of the UKAEA nuclear fusion research programme at Culham which complements the UK’s participation in the European Union's Framework Programme V’. He reported that, in the period 1999-2000, the DTI (Department of Energy prior to May 1992) provided grant/grant in aid to the UKAEA as shown in the table below.

So what do we get for our money in energy terms? Currently the UK has about 12.4 GW of nuclear plant, supplying around 25% of its electricity. The peak output was in 1998 with 90,590 GWh, or 29% of UK electricity, although the 1997 output of 89,341 GWh was actually 31% of electricity, due to lower output from other sources. The peak capacity was 12.956 GW in 1998/99, but this is now falling as plants are retired.

The latest twist in the funding game has been the governments proposal to hive off the liabilities that have been accrued by BNFL (£35bn, £28bn of which are linked to historic liabilities) and the UKAEA (£7bn) to a new Liabilities Management Authority (LMA). Announcing the proposal, Secretary of State Patricia Hewitt noted that ‘the early years of the industry created substantial liabilities in the form of wastes that needed to be treated and plants that needed to be decommissioned’, which were public sector responsibilities. With the government taking over these liabilities, the way forward for privatisation of BNFL could be a little clearer. An earlier attempt to establish a ‘public private partnership’ arrangement was abandoned, following the debacle over the falsification of the data on the MOX shipments to Japan. And since then the finances of BNFL had begun to look decidedly insecure. Technically, according to the Guardian (14th Dec) it is bankrupt, with a £1.7bn gap between assets and liabilities. The DTI says that it will be at least two years before privatisation will be re-considered, by which time the LMA should have lightened its load, although the LMA proposal has attracted strong opposition and it seems the government has now decided not to push ahead with it rapidly.

Wind beats Nuclear

The EU EXTERNE study of the environmental costs of energy generation suggests that, although nuclear power is better than coal (by a factor of around 10-20) and gas (by a factor of 2-5), nuclear plants had 3-4 times more overall environmental impact than wind, over the complete fuel and life cycles for each technology. That’s hardly surprising given that nuclear fuel fabrication is an energy intensive activity, whereas the winds come without any energy costs.

We noted in Renew 133, the following figures, presented in terms of additional environmental costs, for the so called environmental externalities, including health effects and climate change impacts. The current price for electricity is assumed as 4 US cents/kWh, and the extra external costs are put at 2-15c/kWh for coal, 1-3c for gas, 0.2-0.7c for nuclear, and 0.05-0.25c/kWh for wind, varying with country. In France, for example, most of the energy used for nuclear fuel fabrication will come from nuclear rather than coal, so there would be less emissions. But taking average figures, EXTERNE presents the data shown in the chart. These figures should be added to the direct cost of generation (the EU average is 0.04 euros/kWh, around 2.5p/kWh).

That makes oil and coal look bad, given that their external costs translate to about 3.5p/kWh, but wind looks good, with an external cost of only 0.6p/kWh. Nuclear comes out as 4 time worse than wind. Sounds convincing, but is there enough wind? Well, the European Wind Energy Association predicts that by 2020 offshore wind could provide up to two-thirds of Europe’s electricity .

Waiting Game

Energy Minister Brian Wilson was asked, in a Parliamentary Question on 29 Nov last year, whether the new Consultation of the future plans for nuclear waste disposal meant that there would, in effect, be no decisions on nuclear power until after that exercise was complete - in 2006. He replied ‘In our view, there is no sequential arrangement that nothing will happen in the nuclear industry until the waste report appears. Clearly, it is desirable to get answers on waste in a shorter time frame, working both nationally and internationally, but no one currently is making proposals for nuclear power stations. However, they may at any time and they certainly are not prevented from so doing.’ He concluded ‘If there is to be nuclear new build in this country, the time scale for working up those proposals and having them properly considered long before construction would itself be substantial. If such developments are to happen- that is a commercial judgment for the companies involved - here is no reason to suppose that they would happen sequentially; they could happen in parallel’.

Russian Nuclear Push

Russia plans to build at least four nuclear reactors at home and others in China, Iran, India and ex-Soviet republics as part of an ambitious plan to revive its nuclear industry. "Russia’s nuclear power industry is now coming through what can be called the post-Chernobyl renaissance," Nuclear Power Minister Alexander Rumyantsev. Last year, Russia launched its first plant since the Chernobyl catastrophe, a 1000 MW plant at Rostov, to be followed by three others. Russia has also signed contracts to build plants in China, India and Iran. However, despite plans to accept spent nuclear fuel for reprocessing and storage, Russia has so far failed to break into this market, which is dominated by the UK and France.

In the Rest of Renew 137

In another bumper 36 page issue, the Feature looks critically at energy scenarios including Foresight scenarios used in the PIU Energy Review, while our Reviews section look at Shells new scenarios. The Technology section includes a look at the basic physics of renewable energy and at the IPPR’s views on the possibilities of hydrogen as a new fuel. Our Reviews section also looks at the IPPR’s Micropower report - and at the PIU report..And our extensive Groups section includes coverage of the INREB project, the GLA’s new energy programme and AAT new funding- plus the new grass roots network being set up by Energy 21. .

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Renew-on-line posted on 03/04/02 by s.p.forrest@open.ac.uk