John Webley: The economic insanity of the government's renewable energy strategy
John Webley, a retired Morgan Stanley Managing Director, is currently leading a campaign against wind turbines in rural Kent. He has been shocked by what he has learned about the wind industry and alarmed by the failure of many politicians to really understand the full implications.
As politicians begin to return to work from the summer break it is time to raise an issue of fundamental importance for the future well-being of the country.
The Government’s Renewable Energy Strategy document is out for consultation until 26 September. This is the document that proposes that Britain’s renewable energy targets for electricity generation will be largely met by 3,000 offshore wind turbines and a further 4,000 onshore turbines.
The Government is also in the process of establishing the new subsidy support structure to encourage investment in renewable energy, particularly, wind turbines. The Government’s main support mechanism for the generation of renewable electricity consists of Renewable Obligation Certificates (ROCs) which are issued to those who invest in and generate renewable electricity, but the cost of this support is borne directly by the consumer.
At no point has the full cost of the proposed wind strategy been fully and simply explained to the public and at no point has the public been told what alternatives there might be. The wind industry, green lobbyists and the EU have done a brilliant job of leading the Government (and, it has to be said, the Tories) down a path that not only makes absolutely no economic sense but is the height of irresponsibility. The numbers involved are so shocking it is difficult, at first sight, to believe them.
If one uses the Government’s estimates for the electricity that would be generated by the 7,000 turbines, the new wind turbine subsidy structure and the current market price of the ROC’s, the annual level of subsidy that will be paid by the consumer is an incredible £6 billion per annum. The wind industry will lock into these subsidies for 20 years, the expected useful life of the turbines. One can anticipate that further subsidies will have to be made available when turbines have to be replaced. Prior to publication of an article in the Times, these numbers were shown to BERR and not disputed.
The total output of these 7,000 turbines (as estimated by the Government) could alternatively be generated by 7 nuclear power stations, such as the one currently being built by EDF at Flamanville. A nuclear power station can be easily connected to the grid and costs the consumer nothing since the cost is covered by the private sector. The private sector also expects to cover the cost of clean-up on decommissioning (EDF builds up a special fund for this purpose). Furthermore, a nuclear power station has an expected useful life of 60 years!
The Government has been so swamped by all the data generated by the thousands of consultant man-hours they have commissioned, that these simple calculations have not been done. If they had, it would have become immediately apparent that the EU’s obsession with renewable energy, as opposed to CO2 reduction through nuclear, should be pushed back and the bold decisions required to build the necessary nuclear capacity taken without delay.
The public is, instead, being asked to pay at least £120 billion (and probably more than twice this over the 60 years that would be covered by nuclear) for an intermittent source of electricity which would necessitate considerable addition to the infrastructure of the National Grid. It would have to be replaced after 20 years and, as far as the 4,000 onshore turbines are concerned, would do irreparable damage to the countryside, would leave approximately 5 million tons of concrete in the ground, would require around 1.5 million tons of scrap-metal and other components to be disposed of and with no certainty that the wind companies would still be in existence or have the wherewithal to carry out the decommissioning when required.
If this was not bad enough the simple fact is that the 7,000 proposed turbines would require back-up at virtually 100%, in any event, in order to ensure security of supply at times of peak demand. The wind industry, as well as the Government, are totally misleading the public in this respect but there is irrefutable evidence that the UK is subject to relatively frequent extended periods of wind collapse that cover the whole country. This means that the nuclear reactors or equivalent thermal power plants would have to be built anyway so they could kick-in when the turbines stop.
Wind power, as a renewable energy source, is a concept that appears attractive and opponents can be easily demonised. This has been fully exploited by the wind industry which, supported by the green lobby, continues to pump out misleading propaganda to be sure of cashing in on the subsidy bonanza.
The reality, as demonstrated in this article, is that the country is on the verge of being the subject of one of the biggest confidence tricks of all time. The Government has totally failed the country in not understanding either the economics or the operational issues of their proposed renewable energy strategy. By allowing themselves to be taken in by the wind industry and swayed by the greens, the vital decisions necessary to ensure security of electricity supply have not been taken and it is fast becoming too late. Only a small percentage of the money saved by not pursuing a wind strategy would provide plenty of funds for communities willing to accept nuclear reactors and any reserve fund required to guarantee clean-up.
The Tories are not exploiting this Governmental failure and are in grave danger of making the same mistake. As a matter of urgency, a Tory energy policy needs to be adopted that recognises the economic reality outlined above and steers us away from the precipice we are fast approaching.