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Foggy thinking on renewables is no way to drive policy

Energy secretary Chris Huhne had some harsh words for renewable objectors last week, but his department’s project-stalling indecision has left Huhne vulnerable to equally harsh criticism.

At the RenewableUK conference in Manchester Huhne launched an attack on critics of the low carbon agenda, calling them “faultfinders”, “curmudgeons”, and an “unholy alliance of climate sceptics and armchair engineers”.

However, supporters of the industry are bothered by the fact that slow progress and a critical public is driven in part by the Department for Energy and Climate Change (Decc).

Last month’s collapse of the first deal to build a large-scale carbon capture and storage (CCS) scheme after four years of negotiation is the latest in a long line of occasions where political rhetoric has fallen short of real progress (News last week).

The £1bn competition originally had three entrants - energy firms Centrica, Eon and ScottishPower, which was the last one left in the race with its plan for Longannet in Scotland - before they all pulled out.

Huhne said Decc had learned plenty from the four-year negotiation, despite the anti-climax. But others were hoping for more than lessons learned.

“This competition has been ongoing for over four years yet we don’t have a piece of hard infrastructure to support it,” says consultant Waterman business development director Joe Morris, who blames Decc’s “bureaucratic methodology” for the project stalling.

However, the main worry for investors is uncertainty over whether the government may reduce subsidies.

Concerns were raised during the Conservative Party conference last month by a change of tone in relation to the government’s commitment to renewable energy.

Chancellor George Osborne said the UK shouldn’t cut its carbon emissions any faster than other European Union member states.

There is also the possibility that rising energy bills along with a struggling economy could prompt the government to reduce new subsidies for renewable energy firms.

As a result, you would be hard pressed to find anyone in the industry who believes the £200bn required - according to regulator Ofgem - to re-wire the UK’s energy grid will be spent by 2020, even if companies and consumers are willing to back the technology.

For now, the government could still argue that it continues to support the sector. Its review into Renewable Obligation Certificate (Roc) re-banding last month resulted in only a small reduction in support.

However, industry believed the announcement was long overdue and again suffered from a slow approach by Decc.

One of the other problems stems from one of Decc’s measures that it was hoped would offer a way forward. The Energy Market Reform White Paper was published for consultation last December but it is described by one industry expert as a “patchwork of interesting ideas”.

Incentives such as feed-in tariffs (Fits) and a carbon floor price are designed to swing the energy marketplace in favour of low carbon and renewable energies over gas.

But WSP Future Energy managing director David Nickols feels that the government may be doing too much too quickly.

“We need policy consistency… In some ways a bad system is better than an uncertain system,” he says.

Nickols adds that the knock on effect of proposing such a wide range of changes is that there will be too few renewables schemes coming online by 2015/16 - the date that Decc said in 2008 would see a big energy gap open up and would therefore need these new schemes to fill the void.

Although the government seeks to reassure investors and collaborate with the industry through working groups, there is still no detail on the levels of market reform subsidies and furthermore these, and the re-banding of Rocs, are subject to review in 2014.

This uncertainty is adding to investors’ concerns and with over 70% of funding from renewable energy projects coming from abroad, it’s clear the UK must find a way to be competitive against its international rivals. The government does speak of this and maintains the UK is still a very attractive place to invest.

But returns are not guaranteed and investors only have to look over to Germany for a more advanced offshore wind programme.

German contractor Strabag is already building its first concrete gravity base plant in Germany - placing it ahead of UK rivals who have no such manufacturing facility.

UK-based engineering firms, Gifford, Arup and Vinci Construction UK have been working over the past few years developing concrete gravity bases but these are only at the prototype stage.

Concrete Centre head of civil engineering Alan Bromage, who helps to promote UK firms in this field, believes there’s still plenty of room to compete but Germany’s quick deployment should be a warning.

There is clearly much to do to ensure Britain’s low carbon future becomes a reality and that UK firms and workers benefit from the potential workload.

Readers' comments (1)

  • Huhne is probably right. Look at it from his position.
    He sees civil engineers wanting it both ways, visible even in this report. Some nameless 'supporters of the industry' are bothered by slow government progress. Conversely, WSP Future Energy managing director David Nickols says the Government is acting too quickly. More worryingly Strabag in Germany is already building its first concrete gravity base plant for offshore turbines, and UK specialists have no such plant.

    Yet we UK engineers have known about UK offshore wind contracts for years.

    One obvious conclusion, drawn by Huhne, is that UK engineers await government initiatives while they could be pressing ahead on their own initiative. When did we civil engineers stop taking the long view?

    I still meet working engineers who do not understand the dangers of climate change and how it threatens us - in a way that makes solving the present economic downturn look like a stroll in the park.

    Let's take stock. At home we have been unable to get public support for the Severn Barrage in any of its forms. We appear to have no work in progress on Dinorvik-type power stations, which would store tidal and wind electricity. Instead some just decry turbines (even in NCE) because the wind isn't constant. Instead we should be designing the solution.

    How many UK firms are involved with Saharan and sub-Saharan governments in solar energy capture? Europe will need this on a vast scale if we are to continue our current standard of living, as demand for oil inevitably outstrips finite supply.
    Perhaps I am an armchair engineer - I am retired and I am now a local Councillor. And I am as frustrated by onshore planning as others. (As a councillor I voted for the Glyndebourne wind turbine in July 2007. It was erected last month).

    But UK engineers should not be wringing their hands about UK planning. They should be be seizing the huge global opportunity for energy construction. Read Prof. David Murray's book 'Renewable energy without the hot air' to get the scope of UK needs, and what Civil Engineers might do. There is no doubting the scale of what is required. Fragging is a retrograde step towards maintaining a high carbon economy. Let's look ahead, not back, and design our way out of climate change.
    Professor Emeritus Peter Gardiner

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