Memorandum by Ecotricity—Further
information following the Committee's visit to Bristol Port Wind
Park, on 23 May 2008
1. ONSHORE WIND—POTENTIAL
CONTRIBUTION TO
TARGETS
Ecotricity's view is that onshore wind could
provide at least 10% of the UK's electricity.
Current UK consumption is 350,000 GWh per annum,
10% would be 35,000 GWh.
A typical onshore wind turbine will produce
around 3 GWhs per MW installed and typical turbine sizes are rapidly
approaching the 3 MW installed level. Using these figures we would
need, in total, about 4,000 wind turbines to provide 10%.
Allowing for the 1+% that wind already provides
in the UK, we would need an additional 3,600 turbines to bring
the total contribution of wind up to the 10% level. Although within
the likely timeframe of this happening (up to 10 years) typical
turbine sizes will increase. 3,600 new turbines therefore represents
the higher end of the probable outcome in that respect.
2. BARRIERS TO
ONSHORE WIND
Without question, the biggest single barrier
to onshore wind energy is the planning system. Wind energy finds
itself in a planning system not designed for it and not fit for
purpose.
Wind energy is the only major generating source
which requires planning approval from District Councils. The Government
takes the planning decisions for all other forms of generation,
and for good reason. District Councils are (and have amply demonstrated
themselves) not capable of balancing national strategic interests
with those at the parish level.
Under current circumstances, and often against
planning officers recommendations, two thirds of all planning
applications for wind projects are turned down and two thirds
of all subsequent appeals are upheld. That's a lot of bad decisions
being overturned eventually, but at great cost in time and money
to the developer and council alike.
All other major forms of generation are consented
through the Section 36 process. This process was conceived before
wind energy (and renewable energy) became possible on a commercial
scale, and it is designed to take all but the very small conventional
generators out of the hands of local councils and into the hands
of the government. The cut off threshold, below which a project
is in the hands of the local council, is 50 MW. For conventional
generation that is indeed a very small project—very few
gas and no coal or nuclear power stations exist at this size and
nor will they. However 50 MW is a very large wind farm.
The Section 36 process could easily be adapted
with a different threshold for onshore wind to reflect its different
size characteristics.
Ecotricity believes that wind projects of up
to 3 turbines or 2 MW total installed capacity could be dealt
with by district councils. County councils could readily manage
wind applications of up to 20 MW, since they are already used
to dealing with strategic issues, such as waste. Applications
above 20 MW should go straight to the new streamlined section
36 process that is intended to commence operation next year.
Whilst there are a small number of very large
(in excess of 100MW) wind projects in the UK, these are the exception.
These large sites (predominantly north of the border) are all
but fully utilised and future emphasis will naturally fall on
the smaller sites and those in England. Factors such as nearby
housing, designated land (eg SSSIs, AoNBs, etc), proximity to
grid, available wind resource, access to site and landowners'
willingness to host wind projects, all act to restrict the size
of potential wind sites. This is true universally but more apparent
in limiting site size in England.
The bulk of England's potential sites are below
50 MW, and considerably so. It will not be utilised in a timely
fashion if it remains in the current planning process. It is imperative
that the anomaly of wind energy being the only generation technology
to be consented by District Councils is brought to a timely end.
3. OFFSHORE WIND
Against the backdrop of onshore planning problems,
offshore wind has often been touted as the answer to the UK's
renewable energy issues. Offshore wind however costs around twice
as much per installed MW as onshore wind. The principal additional
cost is incurred installing the turbines and transporting the
power back to shore.
A key claim for offshore wind (other than easy
planning) is the high potential load factor, often cited to be
30% higher than onshore projects (40% for offshore v 30% for onshore).
But offshore projects have yet to deliver on that promise.
Round One offshore projects have been subject
to annual reporting and a recent government report shows that
none of these projects delivered anything close to the 40% load
factor promise and most performed no better than a good onshore
project (at 30%)—in some cases a good deal worse than onshore.
There are a number of reasons for this, perhaps
the greatest and most obvious is indicated by the availability
factors of these machines—which are very low by onshore
standards (in the low 80 percents rather than the high 90s). Putting
aside the question of whether offshore machines are as reliable
(in such a tough environment) as onshore ones, it is clear that
what may be a simple maintenance task onshore can take dramatically
different proportions offshore—with the need to operate
within weather windows and with available barges and other equipment.
Ecotricity has no doubt that more productive
winds exist offshore but we believe that this possible upside
has been outweighed considerably by the realities of operating
machinery in the offshore environment—and perhaps this has
been overlooked to date by offshore's various ardent proponents,
not least of which is the government.
4. THE POTENTIAL
OF MICRO
GENERATION
What potential does micro generation have to
contribute to our national energy needs? Ecotricity believes the
answer is in the question—it is Micro.
Whilst micro generation undoubtedly engages
people to think about where their energy comes from, and makes
them use it more wisely, this is perhaps it's only saving grace.
On purely economic analysis it has no rationale—
it is the most expensive way to deliver renewable energy targets
by a very long way and it is probably the most expensive way to
deliver carbon reduction targets—possibly more so than new
nuclear.
Micro Generation technologies available today
fall into just two camps—Solar PV and micro Wind.
A typical PV installation will cost £5k
for 1kW installed and that 1kW will produce about 1MWh per annum.
These are broad but reasonable numbers.
A typical micro Wind turbine of 1kW will cost
£2k to install and will produce virtually nothing. This is
the situation with the first generation of micro wind.
Ecotricity believes that second generation micro
wind turbines will be available for around £3k per kW installed,
and each kW installed will produce roughly 1 MWh per annum—on
a par with 1kW of solar.
We offer these two examples of micro generation
to demonstrate our point regarding costs and cost effectiveness
for any given budget. Existing PV and second generation micro
wind—compared to onshore macro wind;
A large wind turbine of 2 MW will cost around
£1.8 Million to install today, and will produce roughly 5,000
MWh each year.
To match this output with solar PV would require
5,000 kW of solar (on up to 5,000 roofs) at a cost of £25
Million.
To match this output with micro wind (version
2.0)—will require 5,000 1kW machines at £3k each—£15
Million total cost.
In both cases an order of magnitude greater
cost to achieve the same result with micro as with macro. Do we
really have that much money to spare?
Germany is often held up as a great example
of how micro generation can be (aided by FITs). It is often said
that Germany has 13% of it's electricity from wind and solar projects
and the inference given is that micro generation (which means
solar in Germany) plays a significant role in that 12%. But it
does not. Examination of the figures from German Federal bodies
shows that solar (for which read micro generation) contributes
0.3% and large scale projects contribute 11.7%. That is the truth
behind the statistics.
0.3% may be considered by some to be nonetheless
an achievement—but consider that at 30p per unit, had the
money instead been spent on large scale wind energy, rather than
0.3% resulting from that spend - Germany could have had six or
more times the renewables contribution, more like 2% of national
consumption. The multiple would be far greater in the UK where
we have a much better wind resource than in Germany.
Ecotricity believes that micro generation is
an emotional distraction from real energy policy, an easy conversation
for politicians to engage in, it being hard to find someone who
is against it (it's like "motherhood and apple pie")—it
appears an easy answer. Until you examine the numbers.
Our suggestion is that government policy at
the household level should focus on energy saving, where significant
in roads to consumption could be made for economic sums—and
energy policy should focus on macro generation where significant
scales of economy will pay real dividends.
5. DOES THE
UK NEED FEED
IN TARIFFS
TO SUPPORT
MICRO GENERATION?
It is not always appreciated by people when
discussing FITs and micro generation that there is currently no
economic way to meter the power from a micro generator and consequently
the power is "spilled" into the local distribution network
where it reduces losses on the system. No electricity supplier
can have the export from a micro generator "notified"
to their "account" and therefore micro generation has
no actual value to electricity companies individually—they
can't get their hands on it, put simply.
The reason for this is that "settlement
meters"—the only meters that the UK electricity settlement
system allows to be used to notify generator output—cost
many times more per year to operate than the value of the export
from a typical micro station.
It's a popular misconception that FITs would
apply to electricity suppliers, and that this is how it works
elsewhere.
An obligation to provide FITs in the UK would
need to be on the Distributions Network Operators (DNOs)—not
the electricity suppliers themselves.
DNOs charge all suppliers to use the local distribution
system, and one of those charges is for losses—pro rata
according to the volumes each supplier puts through the network.
Thus if a DNO paid for the micro export, the
cost would fall evenly on all suppliers operating in that part
of the network—pro rata to their volume. The costs of FITs
would be shared equally between the beneficiaries—the suppliers
whose losses are reduced by micro spill.
FITs would require an obligation on DNOs, and
a new piece of legislation.
The job of FITs is to pay enough money for micro
generation to stimulate more of it. This can be done through the
RO, by giving more multiple ROCs to micro than the two currently
proposed.
To emulate German levels of around 30p per unit
we would need to give 6 ROCs per unit, maybe more.
If policy is to support (and pay for) micro
generation, irrespective of its economic shortcomings, Ecotricity
believes that FITs are not the best way to do this.
Ecotricity believes this because although FITs
could be made to work in the UK, this would require new legislation
on DNOs—whereas existing RO legislation could do the same
job, more quickly and more easily.
7 July 2008
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