Wind is free - so who will pay for it?

Telegraph.co.uk ^ | 20/07/2003 | Mary Fagan

[Willie Green]

For education and discussion only. Not for commercial use.

It was very encouraging to hear Patricia Hewitt say last week that the UK could hugely cut its carbon dioxide emissions by building a whole new batch of nuclear power stations.

Amazingly, the oh-so-green trade and industry secretary even admitted in public that "nuclear generation is - after all - carbon free".

This was exciting stuff indeed from a Government that wishes nuclear power had never been invented. But by the time the initial shock and euphoria had worn off, I realised that Hewitt was only teasing.

The nuclear line was a throwaway quip. What she really wanted to talk about (yep, you guessed it) was renewable energy and, specifically, proposals for massive offshore wind farms to provide enough power for about one in six UK homes by 2010.

To be fair, the good(ish) news is that these offshore farms will not be quite such a blot on the landscape as their onshore counterparts. And even those us of who crave a proper balanced energy policy admit that they should also make wind power more economical than it currently is (which isn't difficult) if the developments are on a large enough scale.

But the question that no-one has quite answered is who on earth is going to pay to get them to that stage. The background blurb that came with last week's renewable bonanza wittered vaguely about "capital grants" and "favourable economic climates".

But that must just have been snuck in to confuse us as the DTI tells me categorically that the new wind farms will be "financed by commercial means".

I bet that sent shivers down the spines of more than a few banks who rushed to fund new power stations after the UK energy industry was privatised and then ended up nursing stonking losses. Some are still suffering the consequences.

So to sweeten the dash-for-wind the clever old Government has zapped up the so called Renewables Obligation. Put simply, this means electricity suppliers have to buy a specified (and rising) proportion of their power from renewable generators or pay a penalty to the regulator, Ofgem.

That's the favourable economic climate sorted, then.

Call me a party-pooper, but I just can't help thinking how reminiscent the Obligation is to a previous government's cunning wheeze to promote the building of independent power stations. The economic sweetener then was to allow the new generators to pass through certain costs straight through to household electricity bills.

Sadly for many of the power station projects (and in particular the lending banks who foolishly opened their coffers to help fund them), it was a temporary inducement of little or no help when wholesale power prices crashed.

Should any of them be tempted to dabble in the brave new world of wind power, let's just hope they have noticed in the small print that the Renewables Obligation will be "reviewed" in a few years time.

Just to add to the smoke and mirrors effect, last week's announcement also skated blithely over the issue of who pays to get the power to you and me. Building undersea cables to carry large amounts of power will be astronomically expensive.

And that's not to mention the necessary reinforcement work that will almost certainly have to be done on the national electricity transmission grid. The other tricky little issue that has been magisterially swept aside is that the wind just doesn't blow all the time.

Now I know I keep banging on about this, but that in turn does mean keeping backup always available in the form of ready-to-run coal-fired plant (very expensive, carbon-belching and definitely not for the environmentally inclined).

Anyway, someone asked me the other day why I dislike renewables. I don't. Nor do I think that nuclear, gas or anything else for that matter can single-handedly provide our energy needs.

The point is that the Government seems incapable of thinking about anything other than wind and wave power, and never mind the economics (just like the Labour Party of yore was obsessed with coal).

As far as the environment is concerned, renewables - which the Government says must be one fifth of our total energy by 2020 - will of course help the UK meet stiff targets for cutting carbon dioxide emissions (and there's nothing wrong with that).

But in practice they are likely to do little more than offset the diminishing carbon-free benefits of Britain's dying family of nuclear power plant. So bring on the windmills.

Let's hit the 2020 renewable energy target. But let's not ignore the more challenging question of where the other 80 per cent of Britain's energy is going to come from.

[randog]

Looks like windmills are becoming the new 'light rail system' boondoggle.

[neb52]

Does the British have enough land mass to put up enough Windmills to provide even 20%-30% of their power needs. English Channel is a little choppy to be installing them out there so I wonder. I guess that is the master plan. Move everybody into the cities and put all the windmills in the country.