A Pragmatic Energy Policy

By Dr. Robert Peltier, PE
The already razor-thin power supply margins in the UK are likely to become nearly transparent by 2012, according to a new study prepared by Fells Associates: “A Pragmatic Energy Policy for the UK” (PDF). The report notes that the UK’s electricity shortfall will blossom to between 30 GW and 35 GW by 2027, and residents should expect periods when demand exceeds supply in just three years. If you think the UK government is worried, think again.

A One-Dimensional Policy

Predictably, UK Energy Secretary John Hutton strongly disagreed with the report’s findings and pointed out that it “overstates the risk of an energy gap, but [the author] also understates what the government’s already doing to secure our future supplies and increase our energy independence.” Hutton was referring to the UK’s recent public pronouncements about offshore wind, new nuclear, and clean coal technologies, none of which will be available in the quantities needed to delay supply disruptions by 2012.

The UK government’s goal for renewables is 10% by 2010, but installed capacity is likely to be about 6%, up a bit from today’s 4.5%. The recently adopted European Union (EU) renewable energy standard requires that 20% of energy consumption across the EU come from renewables by 2020, although the UK’s commitment is just 15%.

With aging nuclear facilities (only one reactor will remain by 2020) and many coal plants reaching the end of their life cycle, the UK has few options for new baseload generation. It’s hard to believe the government has placed all of its electricity eggs into a single renewable energy basket. The implications of this sort of one-dimensional thinking are staggering and will likely cost the UK economy dearly.

Following American Footsteps

The report’s authors rightly predict that nuclear generation will not play a role in bolstering short-term power supplies. The UK has just this year made an about-face on new nuclear plant construction, but it’s years behind the U.S. in many areas, such as streamlining licensing processes. In the near term, aging baseload generation sources will be backstopped by a  4.5-GW wave of new gas-fired combined-cycle plants.

Does this sound vaguely familiar?

Gas-fired combined-cycle plants are typically intermediate peaking plants in the U.S. because of the high price of natural gas compared to the costs of coal- and nuclear-generated electricity. Expect the cost of electricity to rise sharply in the UK because these new plants will become the country’s de facto baseload power supply as nuclear plants are decommissioned and long-ignored coal plants are mothballed.

Also—this is a very important point—the UK must build 40% of all future generation capacity from renewable technologies in order to meet its EU renewable energy obligations. As the report acknowledges, “these targets are demonstrably unattainable.” But that hasn’t stopped the UK government from announcing its intent to construct some 7,000 offshore wind turbines in the North Sea by 2020 at a total cost of almost $150 billion! The government’s hollow pronouncements often point to how offshore wind promises to provide 100% of the country’s power needs. The Fell report’s authors rightly characterize this as one of many “bizarre pronouncements” made by the government as it continues to cook its renewable energy books.

It Doesn’t Add Up

Some simple math shows how ridiculous that goal is, yet few have publicly raised their voices to call the UK government’s offshore wind policy full of hot air. To install 7,000 offshore wind turbines requires the installation of 10 turbines a day from now through 2020, because there are only about 60 working days a year in the North Sea and the UK has only one single jack-up barge capable of lifting an offshore wind turbine into place.

And then there’s the danger of betting all your money on a relatively untested technology: There are only a couple of dozen offshore wind turbines in service anywhere on the globe in this size range; smaller projects off the southern coast of Great Britain haven’t survived because of government permit delays and financing problems.

Let’s Keep Our Options Open

The UK has overfocused on a single technology to solve all of its energy supply problems, and that is a recipe for economic disaster in the coming years. I remain optimistic that the U.S. will continue to closely monitor the UK’s self-destructive energy policies and will work to keep all our future energy options open.

The other lesson is that we must never neglect our existing coal-fired and nuclear baseload power infrastructure, as the UK has. Those aging plants are paid for and will give the U.S. a significant economic advantage in the world’s marketplace for many years to come.

—Dr. Robert Peltier, PE, Editor-in-Chief

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