Tuesday, June 1, 2010

Getting real on renewables

Much is often made of how China is pushing ahead with nuclear power - that has been used to justify the UK doing the same. China currently gets about 2% of is electricity from nuclear, and it plans to double that to 4% by 2020. Given that China’s energy use is very large, that’s a massive expansion. But what’s rarely noted is that renewables are being expanded very much more rapidly. They produced nearly 8 times more electricity in 2009 than nuclear - 540TWh from of renewables, including large hydro but excluding small projects, as against 70TWh from nuclear. And there are ambitious plans for expansion, which will continue and possibly extend that imbalance. The 11th Five-year Plan of the Development of Renewable Energy stipulated that 15% of primary energy consumption should be supplied from non-fossil energy sources by 2020, with renewables expected to generate 12-13% of the total energy supply, and that may well be raised to a 20% non-fossil target.

So the real story is that China is going renewable, with a little side bet on nuclear. It has already installed 25 Gigawatts (GW) of wind power capacity, on a par with the one-time wind leader Germany, and it expects to have 150 GW of wind capacity in place by 2020. That’s about the same as the EU might expect to get at some point in the future from a massive and full expansion of the offshore wind resource in the North Sea . Large hydro is of course the big source currently in China (the 2009 hydro total was 197GW), but, in addition to wind on and offshore, it is pushing ahead with less environmentally problematic small hydro, with a 2020 target of 75GW. And it’s also now launched a wave power programme- with a proposal being mooted for 10GW of coastal installations.

The EU is often seen as being big on renewables, and the potential is clearly large- several recent studies have suggested that the EU could get 100% of its electricity from renewables by 2050 and maybe even 100% of its total energy. But progress is slow, and the reality is that China may become the global leader- although the USA is also in the race. The US now has 35GW of wind plant in place- hardly surprisingly, since wind is now the cheapest source on the grid in many states. It’s also now given the go ahead to its first offshore wind farm. Obama has said that ‘the country that harnesses the power of the clean, renewable energy will lead the 21st century’. The race is on, with at stake not only the climate, but also huge potential employment and economic gains.

For its part the UK is still floundering about. Labour’s 40GW offshore wind target will still presumably be retained by the new coalition, but if we are still left with just the Renewables Obligation /ROC system to support it, there is no certainty it will be achieved. Before the election, the Lib Dems called for an expanded Feed In Tariff, so did the Tories, who also talked of abandoning the RO. But the coalition agreement simply alludes to ‘the full establishment of feed-in tariff systems in electricity- as well as the maintenance of banded ROCs’. So the RO stays.

The coalition agreement also, notoriously, said that Lib Dem MP’s must abstain when it comes to a vote of nuclear power. It seems they have been all but neutered on this issue. That tragically leaves just the Green Party and the SNP to fight that corner. But at least there is a commitment to ‘increase the target for energy from renewable sources, subject to the advice of the Climate Change Committee’.

That’s a step beyond what Labour was proposing, although most of the other energy policy commitments were similar to those that had already been made by the Labour government- backing CCS, marine energy, biomass AD and a green investment fund.

In other areas there were obviously some environmental gains, notably the abandonment of the third Heathrow runway, but the stitch up on nuclear is a major step backwards. The coalition says that there will be no public subsidies for nuclear. That of course is exactly the same as Labours promise. But the coalition agreement also makes a commitment to the ‘provision of a floor price for carbon, as well as efforts to persuade the EU to move towards full auctioning of ETS permits’. That will mean that electricity prices might rise, making nuclear look more economic – in effect an indirect subsidy paid for by consumers, but with the taxpayer having to step in if the carbon price falls. True this could also help renewables, but, with nuclear being strongly favoured, we are likely see increasing competition for public and private resources, with the expansion of renewables suffering as a result.

For more: www.natta-renew.org

Saturday, May 1, 2010

All change?

The election is upon us. In terms of environmental politics, is there anything to choose between the reds and the blues – and the rest?

While of course there are many other key policy issues, their positions on renewables are significant. Both Labour and Tories profess strong support. As a litmus test of green orientation, a survey, carried out by ComRes for RenewableUK, the wind and marine energy trade body, found that only 7 per cent of the Tory candidates agreed strongly with the statement “expansion of onshore wind [farms] is essential if the UK is to deliver on its renewable energy targets”. The statement was strongly supported by 44 per cent of Labour candidates and 71 per cent of Liberal Democrat candidates. A total of 54 per cent of Conservative hopefuls, but no Labour candidates, disagreed with the statement. Among Liberal Democrats, 14 per cent disagreed.

Labour has a quite strong programme of renewable energy support- nowhere near enough of course and based still on competitive market principles via the lamentable Renewables Obligation/ROC trading system. Nevertheless it has managed to attract promises of inward investment from companies like Siemens, GE, and Mitsubishi, which should create several thousand new jobs soon in what could be an expanding offshore wind energy industry.

But Labour also has an increasing commitment to nuclear power, which somehow it says is going to expand without direct subsidies. There was talk of adjusting the carbon market to make nuclear economics look better, but maintaining a ‘floor price’ for carbon could require taxpayer back up- a subsidy. In practice though they don’t actually seem to mind too much about subsidies as long as they are very indirect- they offered an £80m loan to help a Sheffield steel company to link into the nuclear supply chain, and £20m for a ‘Nuclear Centre of Excellence’ along with ‘up to £15m’ for a ‘Nuclear Advanced Manufacturing Research Centre’.

In the run up to the election, the Conservatives published a new energy policy statement- ‘Rebuilding Security’ which similarly backed renewables and nuclear. It’s not clear just how much they actually will support renewables- many Tories are part of the anti wind lobby. However they do seem keen on marine renewables. Britain ‘ruling the waves’ may figure somewhere here, even if in reality it will mainly be Scotland, and the SNP is big on that!

Like Labour, the Tories say they will not provide any direct cash for nuclear. Even so, they want nuclear to expand rapidly- and like Labour saw a floor price for carbon as one way ahead. Or perhaps a revision of Labours Climate Change Levy on large energy users - converting it to a new energy supplier tax. Depending on how it was done that might put electricity prices up by 18%.

In the pre-election ‘wash up’ Labour just managed to squeeze through another levy- to support Carbon Capture and Storage projects. That could also put electricity bills up. So will its new Feed In Tariff system for small renewable projects – DECC admits it will cost consumers £3.1 billion to 2020 for a 2% increase in renewables. Bills will rise even more if the Tories carry out their plan to replace Labours expensive Renewables Obligation with an expanded Feed In Tariff system for all new renewables. A FiT may well be the best way forward (it will be cheaper than the RO), but the commitment to it, and the other Levys, seems to indicate that stealth taxes are still all the rage on both sides of the old political divide! Not much to choose between them then overall.

However there are supposedly going to be new allegedly more open and efficient political processes shaping our energy and environmental future. Labour has introduced the Infrastructure Planning Commission to over large projects. But that seems far from being a move towards more democratic approach, leaving an open goal for the Tories, who launched a planning green paper ‘Open Source Planning’ with proposals for getting neighbourhoods involved in planning decisions in order to encourage sustainable development via a system with a basic national framework of planning priorities and policies, within which local people and local government can produce ‘their own distinctive local policies’. IPC as such would be abolished, though it seems something similar would be retained for some large projects- a Major Infrastructure Unit.

So, single issues like Heathrow apart (and that has to be put alongside the Tories liaison with climate change deniers in Europe), there doesn’t seem much to choose between them in the end in this area either.

So we are left with rhetoric about democracy, but not much sign of the actual thing –or many real choices. While the Tories talk vacuously of ‘people power’, David Miliband, in an article in SERA’s New Ground, said that the ‘language of social responsibility cannot deliver the substance of national action- it is simply not enough to implore greater responsibility from individuals for problems that need organised collective action’. Fair enough, but, although he accepted that ‘our conception of politics has too often been based on active government and not enough on active citizens’ he pointed to the idea of ‘personal, tradable carbon allowances’ to produce new greener consumer behaviours. So more social control from above…

What about the others? The Lib Dems, coming on strong, says £3.1 billion of public spending will be used to create 100,000 green jobs and help Britain take its first step towards being a zero-carbon nation by 2050, with a target of 40% of UK electricity to come from "clean, non-carbon emitting sources" by 2020, rising to 100% by 2050 . They would ‘will increase the feed-in tariff to provide a 10% return on investment. We have also set out an eco-cashback scheme for the first year of government that will allow people to apply for £400 if they opt for microgeneration’. And they will ‘block any new coal-fiired power stations unless they are accompanied by the highest levelof carbon capture and storage facilities’ and they ‘reject a new generation of nuclear power stations; based on the evidence nuclear is a far more expensive way of reducing carbon emissions than promoting energy conservation and renewable energy’. And they will ‘Abolish the Infrastructure Planning Commission and return decision making including housing targets, to local people. We will create a third-party right of appeal in cases where planning decisions against locally agreed plans’.

The Lib Dems are of course not alone in pushing green policies hard. So, naturally, does the Green Party, which like the Lib Dems - and the SNP- is strongly anti nuclear and aims to obtain around half of the UK's energy from renewable sources by 2020 and ensure that emissions from power generation are zero by 2030. The Greens promised a £44 billion investment programme, which would include £25 billion investment in renewable energy in order to reduce carbon emissions by 2020. "Our investment would mean that one million jobs could be created over the next five years." They presented themselves as ‘Leftwing plus’.

It’s going to be interesting to see how it all turns out. Some hope for a breakthrough from the Lib Dems and even the Greens, and perhaps also some of the other more radical grouping. That might leaven a hung parliament….even if it includes some UKIP and even BNP, both of whom seem to be in denial about climate change and measure to deal with it- except nuclear!

It is possible that something new and wonderful will emerge for the centre left/ centre right parliamentary stalemate that the UK seems to have reached, but extra-parliamentary campaigns seem increasingly more important- with the growing links between radical greens and trade union groups. The Climate Change Campaigns booklet ‘One Million Climate Change jobs now’, was good start, setting out some of the possibilities. There are certainly a lot of new political alliances being formed outside the old political system- at the grass roots. Whether they will bear fruit in terms of effective action remains to be seen.

Saturday, April 3, 2010

Renewable energy and the supergrid

Renewables are moving ahead rapidly around the world – despite the best efforts of those with vested interests in the old energy system. It no longer seems fanciful to talk of getting at least 50% of global energy from renewables source by 2050, or earlier: see http://www.energywatchgroup.org/Renewables.52+M5d637b1e38d.0.html.

The next phase will see some major changes as the developers gets to grips with some of the problems of renewables. One of these is that many of the sources are variable- the sun doesn’t shine all the time and the winds vary. One solution to that is to link up projects over a wide geographical area using long distance power transmission grids. It’s usually windy somewhere in Europe, so wind farms there can help balance shortfalls elsewhere, while hydro plant reservoirs can be used to store excess power from the wind and other renewable sources- pumping water up hill ready to be used for electricity generation when needed some where else on the grid net. The wider spread the geographical distribution, the more effective is the balancing of local variations.

Long distance transmission, using High Voltage Direct Current grids, can avoid the large power losses associated with standard AC grids- you might only get 2% losses over 1000 km instead of 10%. That means the grid could reach as far as North Africa- were there is a huge solar resource. Already there a plans and projects underway for giant Concentrating Solar Power (‘CSP’) mirror arrays, and in the decades ahead CSP solar could well rival wind power as a major source. Projects are already underway or planned in Egypt, Morocco, Algeria, Jordan and elsewhere. See http://www.desertec.org

The renewable resource

For the moment however wind is the dominant renewable and the resource especially offshore, is vast. Perhaps 150 Giga Watts (GW) of generating capacity could be installed in the north sea and linked up to the supergrid. There is already 65 GW of wind capacity on land around the EU, and that too will grow. To put it in perspective the UK has around 75 GW of total generation capacity.

The EU is supporting a supergid programme initially focused on the North Sea and on offshore wind, but it is likely to grow across Europe. But focusing just on the EU may be suboptimal. The really big on-land wind resources are further east. For example Kazakhstan is estimated to have a wind potential of 210 GW as well as huge hydro and geothermal resources. Turkey similarly. And Turkmenistan also has a large wind resources. In addition, there are also major wind potentials in W. Siberia (350GW) Mauritania (105 GW), and Southern Morocco, (120 GW) . See http://www.iset.uni-kassel.de/abt/w3-w/projekte/ LowCostEuropElSup_revised_for_AKE_2006.pdf

It could be that in the decades ahead supergrid links will be made to link to some of these, as well as the CSP solar projects in the desert areas of North Africa and the Middle East. In which case a whole new energy geopolitics would emerge - no longer determined by oil and gas, which by then in any case will be seriously depleted.

Politics

Clearly the supergrid would take a major effort politically, not least in terms of getting way-leave across national boundaries and negotiating power management and system control arrangements. It would also open up some new geopolitical issues. The EU would still be partly reliant on imported energy, and there is the risk that EU companies would simply grab land for development.

Clearly there would have to be fair trade arrangements to avoid exploitation, and also protection for the EU against being cut off. But with a dedicated grid system linked to the EU, unlike with oil, which can be stored and shipped elsewhere, it is hard to see how there would be much opportunity for supply blackmail or major price speculation. Moreover, the EU would also presumably be trading in excess wind and hydro-power from the north, so it could be a two way, hopefully co-operative, arrangement.

There will of course be a need for negotiation over prices. That has already been an issue in relation to the export of excess power from Danish wind projects and the import, during low wind periods, of hydro power from Sweden and Norway. It is vital to capture the advantage of being able to balance variable renewable supplies across wide areas, and conventional competitive market trading may not reflect this. One way to avoid price conflicts might be to develop an EU-based Cross-Feed Tariff, possibly also providing extra support for a suppliers able to offer stored renewable power.

There is the risk that a supergrid programme, utilizing energy from remote sources, might provide EU countries with an excuse for not dealing with their emission problems and developing their own renewable sources. But the imports would only meet part of the EU's requirement for electricity, the bulk would still come from local/national renewable sources.

There are of course political issues flowing from the fact that one part of the EU’s current enthusiasm for such a system is because it could help enhance competition in a pan-EU energy market. This might undermine some of the regional market control enjoyed by the current main energy players. Some of the large utility companies and some countries do seem less than enthusiastic about the single energy market, and also the supergrid. An additional issue might be that the EC and national governments may well look to the large energy companies for at least some of the funding for such a programme, something that the companies may wish to avoid.

Conclusions

This review has focused so far on projects in and near the EU, but clearly the concepts have wider implications. It is interesting for example to see that the USA has plans for new grid systems to link up with renewables, with talk of an ‘Interstate Transmission Super Highway’. China too is building supergrid links to large but remote hydro projects.
With large inputs from wind, CSP and from other renewables like wave and tidal power linked in, we could see a move to major supergrids around the world, fed and balanced by a range of sources from a range locations. If we are to respond effectively to climate change and improve energy security, this looks like at least part of way ahead- as long as we can avoid exploitation of local populations. If a fair balance can be achieved the prize could be a new geopolitics- no longer would Middle East oil or Russian gas dominate EU energy policy. Instead some of the relatively poor countries on or near the periphery of the EU could benefit.

Monday, March 1, 2010

Forcing nuclear through

According to the government's national policy statement (NPS) on nuclear power, it is planned to store the irradiated spent nuclear fuel discharged from the 10 proposed new UK plants at the reactor sites for perhaps 160 years. So communities hosting new reactors would get a nuclear waste store too- and for a long time. For several generations after a reactor stopped operating, the site would de facto become a radioactive waste disposal site. In these circumstances it is essential that our nuclear regulators require that these nuclear stores be safe and, for example, to be protected from terrorist attack to at least the same degree of robustness as demanded for the reactors.

So you would think that this issue would be at the top of the agenda for the new Infrastructure Planning Commission (IPC) the government has set up to deal with large projects like nuclear plants - since it is what local people in particular will want to raise. Think again. Here is what the governments NPS says: "The Government is satisfied that effective arrangements will exist to manage and dispose of the waste that will be produced from new nuclear power stations. As a result the IPC need not consider this question." The draft Statement goes on to say that ‘Geological disposal will be preceded by safe and secure interim storage’.

So it’s sorted and the issue should not be raised with or by the IPC. Fortunately it’s only a draft NPS and this recommendation, and much else, has been widely challenged in the consultation responses. So hopefully it will revised. Then again the IPC may not survive- the Tories have pledged to abolish it, although it seems they will retain something similar for some large projects.

The IPC certainly isn’t popular- it’s seen as top-down, autocratic and designed to steam-roller through unpopular plans rapidly. CANE, Communities against Nuclear Expansion, said ‘At a time when public confidence in our political process is at an all time low, government have decided to take to themselves more power to override people's wishes’.

The NPS was also roundly attacked. FOE's executive director, Andy Atkins, said: ‘The government's draft national planning statements on energy are fundamentally flawed. The consultation was insufficient, the alternatives were inadequately explored, and the policies are poorly justified’.

The Nuclear Consultation Group of leading academics submitted evidence to a Select Committee looking at the NPS proposals, concluding that, overall, the nuclear NPS was ‘unfit for the purpose of providing a framework within which the IPC can take fair, balanced and measured decisions on the location of new nuclear power stations’. The NPS appeared to be ‘confusing, tendentious, vague and poorly integrated’ and ‘a highly elaborate exercise to achieve premature legitimation for a predetermined policy, namely, the rapid deployment of new nuclear power stations.’ www.nuclearconsult.com

The Sustainable Energy Partnership (SEP), which I brings together nearly all environmental and fuel poverty NGOs and relevant trade groups, including ACE, AECB, BWEA, CPRE, CHPA, FoE, Green Party, Greenpeace, Micropower Council, NEA, PV-UK, PRASEG, RSPB, REA, SERA, Solar Century, WWF-UK, commented: ‘It defies common sense to approve a massive [nuclear] building programme to achieve the long term objectives of energy policy without a proper assessment of the future long term need for electricity and with a flawed process of assessing the medium term capacity need. This is no way to run a strategy. It means either that the government has taken leave of its senses and behaved completely irrationally; or that there has been, for some time, a hidden agenda: that the government decided a long while ago to build more nuclear power stations, regardless of any evidence of need. Whichever of the above scenarios is correct means that the government's current consultation is a sham and that the policy itself is, to say the least, of questionable legality’.

SEP notes that, there’s no proof to back up the rather weak assertion in the NPS that ‘by 2050 the UK may need to produce more electricity than today’. In fact the 2008 Nuclear White Paper says that, given attention to energy efficiency, by 2050, total electricity demand could ‘remain at roughly today's levels despite the UK's GDP being three times larger than it is today’. What the NPS does, say SEP, is to assert that ‘under central assumptions there will be a need for approximately 60GW of new capacity by 2025’- and then quotes a Redpoint study as the source for this. But Redpoints study simply looked at how ‘a goal of achieving around 28%-29% of electricity from renewables by 2020’ might be achieved, not at how or whether we could generate enough electricity without nuclear to meet demand.

The government is evidently aware that the longer term rationale for nuclear is a little weak (to put it mildly) and has commissioned a review of energy policy issues and options up to 2050- with it seems a ‘2050 Roadmap’ to be published along with the next Budget. Maybe, looking that far ahead, they will have some idea where the waste will go long term!

Monday, February 1, 2010

Climate Conflicts

The outcome of the UN Framework Convention on Climate Change 'COP 15' climate negotiations at Copenhagen in December was pretty thin, with no agreements on emission reduction targets. A very general ‘Copenhagen Accord’ was produced by the US, China, India, Brazil and South Africa, none of whom currently face legally binding emissions reduction targets under the existing Kyoto Protocol. Some developing countries objected to it- including Venezuala. Certainly it has only weak links to the main focus of the UNFCCC negotiations on a post-Kyoto agreement- and UNFCCC members simply ‘noted’ the Accord. Some blamed the US for what is widely seen as a weak outcome - but China was also a target. But apologists for the unilateral ‘Accord’ said that at least it was something to show for all the COP 15 efforts. And that it was something of a triumph for Obama to get China on board. Others however saw the fault line being between those who wanted a continued Kyoto type legal targets approach (including the EU and some developing countries) and those, like the US and China, who wanted the freedom to develop their own national plans within a loose Accord. This conflict won’t go away. It will no doubt resurface at the intermediary meeting in Bonn in June, and at COP 16 in Mexico City in December.

Meanwhile, under the terms of the Accord, UNFCC member countries were asked to submit national plans for emission reductions via mitigation actions by the end of January. Crucially, it seems that a proposed exclusion of nuclear projects from national mitigation plans was removed from the texts. So, the use of nuclear energy could be included in the list of mitigation actions to be sent to the UNFCCC. That too could lead to conflict. But then the January deadline was abandoned, so the whole thing seems to have gone in to (presumably only temporary) free fall.

Conflict have already emerged in relation to France’s attempt to introduce a carbon tax. Announced last year, it was aimed to cover all transport/household fuel use, but not electricity, and has been seen as possible template for other national programmes . It would be phased in gradually, starting at around 17 €/tonne of CO2, adding about 4 cents per litre to the cost of petrol and a 5% rise to the price of household gas. But it would be 'tax neutral'- with the revenue from it being returned via tax concessions. It would apply to all homes and enterprises, but not to the heavy industries and power firms included in the EU-ETS.

The left felt the proposal would be ‘unjust’ and ‘inefficient’- a flat levy on fuel would hit low-income families, especially those in out-of-town areas who have no choice but to use cars, without helping clean alternatives. Segolene Royal said it would be better to ‘tax oil and energy companies based on the profits they make from fossil fuels’ and invest in electric cars.

The draft plan called for a levy of 32 €/tonne of CO2 emitted, rising to 100 €/tonne in 2030. That would add 0.077€ to the cost of one litre of unleaded fuel. Home heating costs would rise by 60-170 € p.a, depending on the type of building and method used. 50% of homes would see bills for transport and heating jump by ~ €300p.a. But to avoid a consumer backlash, the government said the levy would start at €17.

Former Socialist prime minister Michel Rocard, who headed the bipartisan panel that drafted the plans, admitted that ‘there is a real risk of social injustice.’ He added that the key issue facing the government was ‘how do we redistribute the money to people in a way that changes their behaviour, but without harming their overall spending power.’

Although painful, a 17 € tax wouldn't have much impact on consumer behaviour. Pascal Husting, the head of Greenpeace France, said excluding electricity and starting the tax at such a low rate meant ‘it would change absolutely nothing in terms of behaviour’ nor encourage energy saving or renewable energy. Over two thirds of the public were said to oppose the idea.

It was meant to start on 1st January, but has been blocked by a legal dispute.

Carbon taxes have their detractors: carbon emissions are hard to verify and quantify. Energy taxes are usually seen as easier, since energy is a familiar traded commodity which is easier to measure and value: as one quip has it, "if you want to keep a donkey healthy you don't regulate what comes out of it: you regulate what goes in".

But at what point should an energy tax be applied? If it is levied on all energy users, it can get very bureaucratic. It’s simpler to focus on just the energy generation companies and let them pass extra costs on to the rest, in their prices. In fact that would also work for a carbon tax since its easier to identify the fuels used /emissions produced by a few companies than by millions of energy consumers. But this ‘upstream’ approach means challenging the power companies head on, and some argue that individual consumer taxes have more of an educative value- making people more aware of their energy consumption.

One thing seems certain, we are going to pay more for energy in future. The only uncertainty is who we will pay, and how much. So far most of the energy companies have made very large profits from energy price rises. There is strong case for using taxes, including possibly a one-off windfall tax, to claw some of that back, for ‘hypotheticated’ re-investment in more efficient green energy technology. The private sector says that’s what it does with its profits, but in reality they often seem chary of taking risks with new technology. Could governments do better? Would a hypothecated tax, clearly devote to clean energy development, be more popular than tinkering with tax neutral systems to try to maintain consumer buying power?

Sources: Times, Guardian, BBC, AFP

Friday, January 1, 2010

Green protectionism?

During the battle over the closure of its wind turbine blade manufacturing plant on the Isle of White, Vestas told the Guardian (7/8/09) that UK turbine manufacturers were at a disadvantage compared with those in countries that insist that their windfarms use locally made components. In China, for example, at least 80% of components used must be made locally. In Spain and Portugal, windfarm developers must show how many jobs they will create by sourcing supplies locally in order to get planning approval for their projects. Vestas said “There is a strong political will in most countries to favour local manufacturers.”

However there are also arguments against ‘local content’ rules. Essentially they are protectionist- which is seen by some as undesirable since it limits open markets. Ontario’s new Feed-In Tariff for PV solar projects, which provides 44.3-80.2 cents/kWh for PV solar depending on size, includes a requirement that grid-connected solar projects must involve a minimum amount of ‘local content’: small rooftop PV must have 40% local content as a combination of labour and equipment, larger systems 50%. And in two years time that will rise to 60 %. The aim is to boost local employment. This has caused a stir in Germany, where PV manufacturers say Canada is breaching its obligations to the World Trade Organization. Germany’s solar-industries association, BSW-Solar, has protested against what it calls Ontario’s ‘local protectionism.’ It says ‘The actions taken in Ontario directly contravene Canada’s international trade commitments and place foreign solar equipment makers at a serious competitive disadvantage’. Ontario officials however say that ‘the domestic content rules have been developed in a way that welcomes investment from outside Ontario, because only a portion of the costs are required to be spent in Ontario’. See: tinyurl.com/ykssy9y

But is protectionism so bad? Are free markets so wonderful? Purely economic protection might be seen a too parochial and partisan- just defending local interest- but if the net impact is to create more projects and reduce more emissions, then globally surely that is to be preferred? It all depends on whether you think that open market competition is progressive and efficient, or whether you believe that it’s simply about profits- strengthening the dominant players and weakening rivals.

The evidence from the renewable energy field seems pretty clear. Competitive systems like the UK Renewable Obligation (RO) have been far less successful at building renewables capacity than fixed price Feed-In Tariffs (FITs): Germany now has round 25 Gigawatts of wind capacity in place, whereas the UK only has achieved just over 4GW so far- with some of that being offshore and supported by capital grants. And perversely the RO has cost consumers more: the UK’s ROC system cost consumers 3.2 pence/kilowatt hour, whereas in 2006 the German Feed-In Tariff only cost consumers 2.6/p/kWh- despite Germany having a much bigger wind capacity in areas with generally much less wind than in the UK, and also supporting the installation of a lot more very expensive PV solar capacity.

There is also the question of renewables such as PV being very much cheaper to produce in developing countries, such as China, due to manufacturing costs being so low. This had undoubtedly led to greater uptake of PV in developed countries as many individual consumers have voted with their wallets and bought the cheapest ‘green’ technology available. But this ‘market’ freedom has environmental and human costs, such as a non-regulated wages, no health and safety culture and possible environmental pollution in the production cycle. The same might be said of some biofuels grown, for Western vehicles to use, in the developing world. That booming market has deepened some local environmental problems.

That is not to say competitive markets can’t play some role- for example they can sometimes provide incentives for innovation. But innovation has hardly been stifled under FITs: Germany has developed a lot of novel wind and PV technologies and built major new expanding industries, whereas that can hardy be said if the UK- while we still have a research base (just!), we have no major renewable energy technology manufacturing plants and have to import technology from countries like Germany. Maybe a bit of green protectionism wouldn’t be amiss, although really what would make more sense is a FIT for all renewables, not just the tiny one planned for small scale projects. Then the UK might take a lead and win some exports as well.

Monday, November 30, 2009

More Atoms for peace

It’s good to have Obama and Brown pushing for the phase out of nuclear weapons. At least part of the driver for this is that the US and its allies can be seen to be honouring their part of the Nuclear Non-Proliferation Treaty (NPT), in the hope that other countries will sign up to it - or, since it will soon run out, its yet to be negotiated replacement. But there is more. Then, so the argument goes, the way will be clear for the spread of civil nuclear power around the world. That, it’s argued, helps reduce use of fossil fuels and thus reduces global geopolitical tension over oil and gas, while also helping with global climate change. So it’s all related globally and geopolitically - and NPT will save the planet.

The official view seems to be that the NPT has worked well- otherwise we would have many more weapons states. That’s hard to swallow given that India, Pakistan and Israel, all with nuclear weapons, are outside the NPT. The battles with Iran and N Korea over their adherence to the NPT has hardly been a good demonstration of its effectiveness- unless you like brinkmanship. If we are really to enter a brave new nuclear world with lots more countries going for civil nuclear power, but avoiding weapons production, it’s going to get even more hair raising. Hardly sounds like ‘atoms for peace’. With the added increased threat of diversion of technology and materials to terrorist groups, it sounds more like receipt for more global tension and confrontation.

A commitment instead to renewables could avoid all these problems. Egypt, Jordan and Algeria are amongst the countries who have indicated interest in going nuclear recently- yet all these are much better placed to develop their huge solar potential, e.g. via Concentrated Solar Power plants in desert areas. Following the success of pioneering projects in Spain, over 5GW of new CSP projects are already underway or planned in, amongst other paces, Algeria, Jordon, Morocco, Egypt and the UAE. Longer term the ‘Med Solar’ plan envisages up to 20GW of CSP in North Africa.

Meanwhile, GNEP, the ambitious Global Nuclear Energy Partnership programme backed by George W Bush, now seems to be in disarray. The aim was to provide sealed nuclear plants to developing countries, with the spent fuel being returned to the USA for reprocessing, to extract the plutonium that had been produced. This would then be used to fuel a new fleet of US breeder reactors. The theory was that this approach would be less prone to illegal diversion of weapons material- although it would involve installing plants around the world and shipping radioactive material regularly across the globe. GNEP had attracted support from 25 countries,

However, earlier this year Obama halted work on reprocessing techniques that were a key USA contribution to this programme, and the future of GNEP is now unclear. Instead the USA has signed up to IRENA, the new International Renewable Energy Research Agency, which is to be based in Abu Dhabi in the UAE. The UAE of course also has civil nuclear ambitions. So the rivalry between these two very different energy options continues.

There had been some concern that IRENA might also back nuclear. But there is already a powerful International Atomic Energy Agency based in Austria, which promotes nuclear around the world. And in August Helene Pelosse, IRENA’s new director general, commented ‘IRENA will not support nuclear energy programmes because it’s a long complicated process, it produces waste and is relatively risky. Renewable energy is a better alternative and a faster, less expensive alternative, especially with countries blessed with so much sun for solar plants’. Let’s hope that having a major new international agency based in a developing country will shift the balance.