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expert comment on Amber Rudd’s speech today on UK energy

The secretary of state for energy and climate change has announced that the UK’s coal-fired power stations will be closed by 2025, with more gas-fired stations to be built.

The SMC produced a Briefing Note on low-carbon electricity.

 

Dr Simon Harrison, Chair of the Institution of Engineering and Technology (IET) Energy Policy Panel, said:

“Closure of coal fired stations has long been seen as an important part of transitioning us to low carbon energy, so today’s announcement should not come as a huge surprise to many in the industry. As fears about our tightening capacity margin and escalating energy costs grow, cost-effective and secure energy should rightly stay as a priority alongside tackling climate change.

“The challenge is to achieve a balance of all three of these energy policy goals – to do so it’s crucial that Britain establishes a long-term energy policy that accommodates a broad mix of capacity types including nuclear, gas, CCS, renewables and new forms of capacity like storage, demand side response and smart meters which can help consumers control and reduce their carbon footprint and energy bills at an individual and community level. An adaptable and modern energy infrastructure is critical to achieving this broad mix of capacity. The recently announced National Infrastructure Commission is well placed to help deliver this long term energy policy and modern energy infrastructure. The Government must now build on today’s announcement by ensuring that this this Commission remains focused on these goals in the coming months.”

 

Prof. Michael Grubb, Professor of International Energy and Climate Change at UCL, said:

“There is a real risk appears to be of the government getting panicked into paying for far more gas capacity than the system actually needs – a cost borne by consumers, whilst scaling back on the cheapest option, which would be to strengthen energy efficiency policies”

 

Dr Rob Gross, Director of the Centre for Energy Policy and Technology at Imperial College London, said:

“After a summer of cuts and confusion the government has finally woken up to the reality of the energy industry. It is good to at last see some common sense from the Conservatives.

“Investors in energy need long term clarity or they won’t invest in anything at all. The devil will be in the detail but it is very welcome the government is now setting out plans to 2025. It’s also good that Rudd supports innovation but does not expect it to emerge by magic.

“We now wait to hear more details on support for heat, offshore wind and other key low carbon options.”

 

Prof. Kevin Anderson, Professor of Energy and Climate Change and Deputy Director of the Tyndall Centre for Climate Change Research, School of Mechanical, Aerospace, and Civil  Engineering;  University of Manchester, said:

“Behind its confident bluff and eloquent rhetoric the UK Government’s new energy focus reveals its contempt for contributing to any meaningful deal on 2°C in Paris.

“Through smoke and mirrors Amber Rudd claims her Government’s love affair with gas is aligned with the UK’s domestic commitments on climate change. But this is all an elaborate ruse – one in which too many academics and climate change experts are complicit. The UK’s domestic climate change policies are far removed the Government’s repeated international commitment for the UK to make its fair contribution to “hold the increase in global temperature below 2 degrees Celsius”.

“Whilst some gas may just about squeeze into the UK’s domestic carbon budgets, these budgets are themselves premised on a very high chance of exceeding 2°C. More disturbing still, the Government then assigns a significant and highly inequitable slice of the global carbon budget to the UK. To cap it all off, they then assume that a large scale uptake of highly speculative negative emissions technologies will, in some far off decade, suck our CO2 emissions out of the air.

“Dismantling this expedient catalogue of nonsense leaves the UK with a fair 2°C carbon budget that has absolutely no emission space for a new fleet of high carbon gas-fired power stations – the maths is that simple!”

 

Dr David Clarke, Chief Executive of the Energy Technologies Institute and a Fellow of the Royal Academy of Engineering, says:

“We welcome improved clarity and stability of government policy – these are critical elements in establishing investor confidence in the UK energy sector. However, electricity generation is only part of the problem and without more considered long-term planning of the overall energy system – linking power, heat and transport with much greater involvement of the demand side – the UK will not deliver the most affordable system, even if security and sustainability targets can be met. Phasing out coal for gas will probably help with these issues but even greater emissions cuts will be needed longer term to meet the Climate Change Act targets. This will require nuclear and large scale renewables such as wind and solar but we also believe that carbon capture and storage will be required and there is very little mention of this.

“The Royal Academy of Engineering’s recent report ‘A critical time for UK energy policy’ stresses that energy policy needs to support the actions needed for the next few decades, not just for the next ten years. Actions from the Government over the coming months to sustain their currently planned support for nuclear power and demonstration of carbon capture and storage, low carbon heating and ‘smart’ demand management may prove more cost-effective for the long term than short term decisions on coal versus gas.”

 

Professor Richard Templer, Director of Innovation, Grantham Institute at Imperial College London, said:

“Replacing coal with gas is a good step, but only in helping us to make a transition to a world in which we no longer use fossil fuel for primary energy production.

“I am perturbed therefore that I cannot see a clear, strategic roadmap that shows how the government intends to use gas as a bridge to a decarbonised electricity supply.

“Any arguments that we cannot afford to push for a decarbonised electricity supply ignore the reality that if we are to avoid dangerous climate change we can only release a further 900 Gt CO2 into the atmosphere. The costs of exceeding this limit or delaying action to decarbonise are greater than  taking action now.

“What the Government need to recognise is that investment is moving away from fossil-fuel business and seeking out low-carbon alternatives. The global average growth rate for low-carbon technology since 2008 has been 11% and is now worth $5tn. This compares to global average growth of GDP in the same period of 3%. The UK is already lagging behind with a growth rate just slightly over half the global rates. The government’s actions are swimming against the tide and will leave the UK an also ran in the development of the low-carbon economy, the economy which will dominate global development this century.”

 

Malcolm Grimston, Senior Research Fellow, Centre for Environmental Policy at Imperial College London, said:

“The logic here is very difficult to follow and therefore to explain.

“If offshore wind is the cheapest already then clearly it should not be subsidised at all and the Secretary of State’s stance is correct.  If solar is going to be cheap within two years then any subsidies should stop at that point.  And how are the system-level costs to be managed, e.g. the need for a very much larger grid to cope with wind when it is available while still maintain links to a dispatchable system of the current size when it is not, and the requirement for large capacity payments to compensate dispatchable capacity for its loss of market when renewables are operating? These are costs caused by and therefore ultimately attributable to variable renewables. From the point of view of the consumer it doesn’t matter where those costs are allocated, they still end up on their bills.

“The nuclear industry is reaping the whirlwind for a number of claims that simply did not stand up to common sense – should the renewables and their supporters be doing the same?

“The Green Party in its manifesto this year said that onshore wind and solar are ‘mature’ ( page 23) and we have the Green movement submissions to the Commission’s Hinkley State Aid investigation saying there should be no subsidies for mature technologies (see e.g. NFLA to the Energy and Climate Change Select Committee). It then becomes a very difficult argument to make that these subsidies are justified – in effect Rudd has simply picked up the Green Party’s argument and run with it. Nuclear has at least belatedly accepted that it cannot operate in a market free of ‘subsidies’ (whatever definition one cares to give the term), which is the case for renewables as well unless the evergreen storage revolution which is always ten years ago actually materialises. It ultimately simply plays into the climate sceptics’ hands to go forward with such a glaringly self-contradictory argument.”

 

Prof. Paul Ekins, Professor of Resources and Environmental Policy and Director of the UCL Institute for Sustainable Resources, said:

“The government’s energy policy is riddled with contradictions. It claims to want the cheapest low-carbon electricity sources, but then stops supporting onshore wind, solar PV and biomass, which are the cheapest low-carbon electricity sources. It claims to be still committed to the UK’s carbon emission reduction targets, and then talks a subsidising a new fleet of gas-fired power stations that will only be able to be used very intermittently after 2030 if these targets are to be met.

“No-one will mourn the final closure of the UK’s coal-fired power stations, but the reality is that most of them would have closed anyway by 2025, and the most important priority is to get them replaced by real low-carbon energy sources, of which renewables are the cheapest.

“Who will invest in the new gas-fired power stations the government wants to replace coal, after its U-turns on renewables have left so many investors who believed past government policy out of pocket? The government will have to pay dearly for the extra risk these investors will now perceive themselves to be taking, so that its subsidies for gas may need to be higher than those for renewables in the next decade and we will miss our carbon targets.

“Lose-lose, for the consumer and for the climate. What a shambles.”

 

Prof. Jim Watson, Director of the UK Energy Research Centre, said:

“The commitment to phasing out coal is very welcome, both for the UK and as a statement of international leadership. As the Secretary of State emphasised, the UK’s gas security position is relatively strong as a result of new investments in infrastructure over the past few years. Therefore, it is unlikely that the closure of coal will compromise UK energy security, wherever our gas comes from.

“However, there will be limits to the replacement of coal with gas for reducing carbon emissions. The UK is already a long way over its ‘gas bridge’ to a low carbon future. A large role for gas in the medium term will depend on the use of carbon capture and storage technologies that are not yet commercially available. Furthermore, the shift to gas can only be part of a much wider low carbon strategy for meeting the 5th carbon budget that will be delivered next year.

“The Secretary of State’s additional commitment to further support for offshore wind if industry meets its cost reduction targets is therefore also welcome as part of this wider strategy – subsidies should depend on cost reductions being achieved. But there remain big gaps in the strategy – particularly on energy efficiency and heat, where further action is urgently needed.”

 

 

Declared interests

Prof. Watson: I am a member of DECC and Defra’s social science expert panel.

No others received.

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