Excellent Energy and Climate Change meeting yesterday with a witness panel made up of senior executives in the nuclear power generation sector in the UK. We had Chief Executives of EDF (Hinkley Point C, Bradwell B and Sizewell C), Horizon (Wylfa and Oldbury) and NuGeneration (Moorside) along with Zhu Minhong from China General Nuclear, (EDF funding partner) who had travelled from China especially for the meeting. Fantastic panel.
Reason behind the meeting being arranged was public doubt that the EDF developments will ever go ahead. EDF's Chief Exec, Vincent de Rivas was amazing. No way was he going to say anything unplanned. We wanted to know when EDF intend to make the formal commitment to go ahead. He wasn't telling us. Trying to pin him down was like trying to nail jelly to the wall!! Zhu Minhong must have been impressed by the Frenchman's inscrutability. All we learned was that EDF are 100% committed to the project and that the French Economics Minister has said a final decision will be made by mid May. I think we knew that before the meeting. Mr de Rivas was so brilliantly elusive I had a job not to laugh out loud. Questioners will have to rise very early in the morning to get the better of him!
Despite learning nothing new from the session, I have more confidence that Hinkley Point will get the go-ahead sometime soon. Too much money has been invested for EDF (effectively the French Govt) to walk away. EDF has already invested over 2billion in the Hinkley development which will cost £18 billion in total, an eye watering sum. I also think the budget and timetable being discussed are so generous that it will come in on budget and timetable. But confidence also grows that Wylfa and Moorside will be up and running before Hinkley - producing by mid-2020s. Both are progressing under the radar wand the public interest in Hinkley. I suppose it's the UKs obsession with potential failure, and boredom with likely success!
While I feel increasingly sure the UK will develop a new 'fleet' of large scale nuclear, I also think it unlikely that there will be the talked of 18 Gw of new generation by mid 2020s. I also think that we are now looking to build the last large nuclear power plants in the UK. The future is small nuclear, renewables and hydrogen. That warrents a separate post.
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We have spent billions of pounds on wind farms over the last five years. As a result we have an inadequate and unreliable electricity supply. For the first time ever we have a UK power network that is unable to meet peak demand in a cold winter. Last year National Grid offered business and industry contracts which pay them to stop taking power from the network at critical times. It has relied on these contracts this winter. On cold windless days, when National Grid has insufficient power, large power users turn on their own diesel generators or shut down power hungry operations. Next winter, unless some new gas stations are built immediately, there will be even less grid power available at peak periods. Blackouts are a real possibility, and there is another problem. The only way the Government can meet the 2027 carbon budget legislated for in The Climate Change Act is to have at least some of the planned new 3rd generation nuclear power stations built by that date. If EDF do not deliver Hinkley C that will reflect very badly on France and will impair its relations with China where they are currently building this reactor and where EDF hope to gain more orders. The reactor type Hitachi is planning for Wylfa Newydd has a history of being built on time and on budget and could be operational before 2027 as long the investors get a high price for the power produced. If we were not constrained by the 2027 carbon budget then there would be many other cheaper options, including ‘walk away’ safe small modular reactors that produce hardly any toxic waste. Both China and the US are fast tracking these designs through the demonstration stage and licensing procedures. There are various designs and fuel types, but generally speaking companies in the sector claim these new reactors will be commercially available within 10 to 15 years.
In reply to Mairede Thomas. It appears you have fallen into the trap of believing all our energy will come from one source. It won't! The UK has an energy mix. 20% from all renewables of which half will come from wind power. The UK gov want around 35% from new nuclear.
On cold windless days or for the two months when a nuclear power station has to be shut down for refuelling or maintainence or a fossil fuel power stations & nuclear unexpectedly goes off line without warning (which is a far bigger problem for national grid than windless days) there is or should be enough plant margin to supply demand.
The trouble is since the 2015 election, the conservative government have sent shockwaves around the whole energy sector; no one wants to invest in any form of UK energy because of kneejerk reactions and unexpected changes to policy. What you have to remember is that the same companies wanting to build wind farms are the same companies which we need to build new gas, new nuclear etc. They are saying why should they invest in the UK when there are other market places around the world which have more clear and certain policy for investment.
Factor in the cost to consumers. There is apparent uproar in tabloids about the amount of subsidy given to renewables. under £10bn for 20% of our energy from a mix of renewables.
Hinckley C alone is expected to pocket £100bn for supplying 5% of our energy. HC is not good value for UK energy householders or businesses.
If you listen to Andrea Leadsome and Amber Rudd who are bending over backwards to secure this Hinckley deal, they contradict themselves on this issue when they speak of undercutting renewables. They are uncredible and this gives investors even less confidence to invest in UK energy.
The UK gov would be wise to walk away from Hinckley C and start again, instead focus on Wylva scale sites. SMR's on the other hand have been ditched before so is there any reason to go back to something that wasn't viable? As highlighted at the ECC meeting, nuclear costs and fossil fuel costs keep rising year on year, renewable costs continue to fall.
Now I know Glyn prides himself on leading his anti wind energy crusade, but look at the chaos it has caused for UK energy investment.
W Jones.
There is certainly some loss of investor confidence in some sectors. But not as much as is sometimes made out. The Energy and Climate Change Committee published a comprehensive report into Investor Confidence a few weeks ago. Worth a read. There is without doubt some concern as the new Govt has cut subsidies and ended the Carbon Capture and Storage competition, saving one billion pounds - not unusual when a new Govt is elected, and is in part anticipated. It a was widely known amongst developers and investors that the Levy Control Framework was spent. We will have more direction as we go forward through 2016 I would expect.
In reply to W Jones - you seem to forget that we used to have spare capacity in the system to cope with unexpected power station breakdowns. Wind however is by its very nature unreliable and cannot be counted on ever. Consequently it cannot provide the necessary spare capacity. You therefore have to have effectively 100% back-up power stations for any wind in the system. The problem is who is going to invest in these when they are only needed to back-up wind? Answer - no-one, unless of course we pay them lots of money. This is where we are now. (And you didn't read my piece properly - I said there are lots of other cheaper options if we are not constrained by a specific date). Also you should be aware most SMRs being designed and built today are very different to the early versions.
Thank you for replying, Glyn.
I have read the report and was alarmed to read that lack of confidence of investors may push up household bills by £120 a year.
Even more worrying for the UK is that Goverment have spooked investors and left them wondering ‘what will be next?’”
The only point I wish for further clarity on is the LCF. Many companies are being denied the FOI requests on the costs of the LCF. This is also undermining the credibility of the government and not giving investors the confidence which it needs to invest in UK energy.
Mariede, I can sum up your arguments against wind power as outdated. We have aprox 13GW of installed wind power in the UK. National grid have stated that they can balance the grid with a further 50GW of installed wind power before the need for any of these mythical back up power stations you talk of. The thought of a further 50 GW of installed wind is not within our reach but I can laugh at the thought of Glyn having kittens at this very fact!
Wind power is reliable. It works 80% of the time, now if you can name me one power station which works at full capacity 24/7/365 I will award you a gold medal. Perhaps you will also be able to tell me the number of windless days we have here in the UK? Not one anti wind opponent has been able to tell me this answer. National grid are able to accurately forecast wind speeds weeks in advance and are able to balance the grid accordingly.
Wind has been counted on! Here are a few of many examples: Cast your small mind back to the Fukeshema disaster when our shipments of gas imports were diverted to Japan, who were willing to pay more for this global commodity. Our contracted suppliers were more than happy to face fines imposed by the UK for non delivery, pushing up the price of gas globally 30% in the process. Wind was able to be relied on as our reserves of stored gas became depleted.
Remember the RWE Didcot B Power Station fire? 1.4 GW taken off the system and wind power was able to help make up the supply the shortfall.
The good part about both these examples is that UK homegrown power replaced imported gas. Security of supply is essential for our country which is a net importer of energy.
"who is going to invest in these when they are only needed to back-up wind?" is a very weak distraction and a very dated argument. Let's hypothersize that no wind power existed at all, the grid would still need both backup and quick-firing capacity for conventional power stations to ensure security of supply. You need to have that discussion with national grid and perhaps you may then understand how the grid network operates.
Gone are the days when excess electricity from nuclear could be dumped in energy intensive industries. Nuclear cannot be turned on or ramped up/slowed down quickly to cope with variable demand. Nuclear is great for baseload, but even this is changing with advancements globally on energy storage. It is such a shame that the UK are not at the forefront of these advancements with the recent cut off in funding.
I have made my views known on SMR's and I will stick by them.
Dear W Jones – If National Grid could use the 13GW of wind without having emergency contracts they would not have entered into them. National Grid, and previously the CEGB, has modelled the risk for conventional power plant breakdown. Until a few years ago a 5% reserve capacity of GW on the system was considered adequate. Now, as you make clear, we need not only a 5% reserve capacity for conventional plant, but in the case of wind a 100% reserve. So if wind comprises 10% of the usual mix of power on the grid then the conventional plant has to provide a reserve of 15% not 5%. Again as your figures demonstrate 13GW of installed wind should provide close to 30% of our power. However it provides 10-11% over the course of a year and has to be backed-up by conventional plant when there is insufficient wind. There are numerous websites that provide hourly data of the power sources on the grid. See www.gridwatch.templar.co.uk for example. You can deny the evidence about the very real problem of ‘no wind’ if you like. I can’t help you there. The problem for us bill-payers is that the strike price for wind was agreed when oil and gas wholesale prices were almost 3 times what they are today. This means that the LCF is probably massively overspent and we are paying for that. The latest IEA figures (2014) show that there is 141GW of global stored energy capacity over 99% of which is pumped hydroelectric storage. Thermal storage connected to roof-top solar pv can be used on-site for heat and hot water. Lithium-ion battery storage is very expensive but can be used for short-term load and frequency balancing on the grid. Compressed air is another option but the air-tight space required is a challenge for storage at any scale and it would add considerable cost. There is research ongoing into magnetic fields coupled with superconductors, again an expensive option. The larger of the 2 Tesla storage batteries recently brought to market has been discontinued. The smaller model which permits small scale time-shift storage in domestic situations is still being made. Hydrogen storage is a possibility but Intelligent Energy, which develops hydrogen powered fuel cells, has just lost 90% of its value on the LSE. Unfortunately large-scale season-shifting power storage is still no more than the Holy Grail.
Mariede, as I explained to you before, national grid have stated that they can cope with almost five times the amount of installed wind without the need for extra back up. You have interpritated the need for 15% reserve wrongly which highlights you do not know what you are talking about. I shall explain. Conventional power stations are not running at full capacity ie there is aprox 90 GW of nuclear capacity installed in the UK. Today we are running just 7 GW. We have 32 GW of installed gas,which today is running at 9 GW. Todays figures obtained from gridwatch.
There will be many factors why these aren't running at full capacity. Constraint on the grid, the need to conserve nuclear fuel and gas imports, the need to reduce our carbon emissions etc. Yes I do think it is vitally important that we do all we can to reduce carbon emissions.
Again, wind does not need any more back up than conventional power stations do. Hinckley C if we refer back to the original topic will need back up. The fact that there is no confidence within the energy sector to build replacement power stations is alarming.
The fact that we have a mix of energy is vitally important.
We could build ten Hinckley C style reactors in this country and put all our eggs in one basket so to speak but as soon as their is a fault in one reactor, for safety reasons, all other reactors around the world of the same design are closed down for investigation. Where is your plant margin going to come from then? Nuclear is far from perfect.
I shall file you with the other opponents of wind who are unable to tell me the amount of windless days we experience in this country. I am not ignoring the evidence, but no one is able to answer me. As far as I am concerned it is an overstated scare tactic used by opponents who are unable to justify any of their arguments when challenged.
You might be able to justify your argument for rhese over exaggerated windless days if we were ever to become 100% dependant on wind power alone, but we are not and national grid have started that it is not a huge problem! I will believe them over an armchair critic.
Strike price for wind power, interestingly new build wind strike price is already cheaper than hinkley, adds just £9 to the average household bill. Gas prices have increased on average £130 or more. So the less gas we can use the better.
Factor in the fact the LCF for all renewables is under £10bn (these costs passed on to consumers on our bills) renewables account for 20% of our energy. Hinckley C which will also be funded from the same LCF will cost £100,000 for just 5% of our energy which is going to be a bigger problem for bill payers as you point out.
There is lack of clarity around the LCF. DECC refuse to answer FOI requests on this issue.
What are they trying to hide?
Storage, watch this space.
Now if you will forgive me for pointing out the obvious, I have better things to do than repeat myself on several points as I feel you do not fully understand how our energy network operates. You are just a keyboard warrior committed to opposing wind. Well frankly my dear, I want our energy sector to have confidence to invest in this country so the sooner you drop your distraction tactics, the sooner we can get on and build new power stations.
W Jones - The UK has 15 reactors generating around 18% of our electricity in the last year. Almost half of this 8.88GW capacity is to be retired by 2025. The older reactors are now running at significantly less than original or design capacity. I can't be bothered to correct the rest of the figures and inaccurate statements you make.
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