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Pull The Other One, Mr McNeal!

June 5, 2016

By Paul Homewood  

 

 

According to Hugh McNeal, chief exec of Renewable UK, onshore wind is now the cheapest form of new generation in Britain.

Perhaps he might care to explain why, at the latest Contracts for Difference auction last year, onshore wind farms were awarded guaranteed, index linked prices of between £83.22 and £86.96/MWh.

 

 

 

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https://lowcarboncontracts.uk/cfds?title=&field_cfd_technology_type=&field_cfd_applicant_name=&field_cfd_target_comm_date_value_1&field_cfd_target_comm_date&field_cfd_unique_id=&field_cfd_agreement_type=All&field_cfd_strikeprice=All&page=1

 

 

Meanwhile, the market price for electricity has been consistently below £50/MWh for nearly the whole period since 2010.

 

Wholesale electricity pricing trends 2010 to 2016

http://www.businesselectricityprices.org.uk/retail-versus-wholesale-prices/

 

 

Carrington Power are currently commissioning their new 880 MW CCGT plant at Trafford and are no doubt confident that they can make money at these prices, despite regulatory pressures.  If they were offered a guaranteed contract to sell all of their output, as is effectively the case with wind farms, they would no doubt be even more profitable.

11 Comments leave one →
  1. June 5, 2016 2:42 pm

    It is shameful how virtually no one in the mainstream media will take on these bare faced liars.

  2. June 5, 2016 5:39 pm

    Stunning that he would lie concerning such an easily checked fact. On an correct LCOE basis, CCGT in the US is about $58/MWh while onshore wind is $146/MWh. The calculations correcting the intentionally false US EIA estimates are in the guest post True Costs of Wind Electricity at Climate Etc.

    • June 5, 2016 6:13 pm

      I did notice before that the EIA figures allow effectively for a carbon tax as part of CCGT, making their comparisons meaningless

      • June 5, 2016 11:25 pm

        Yup. They also fudged relative effective lifetime: set everything to 30 years when wind is maybe 20, CCGT is at least 40, and coal is near 50. Ignored backup for intermittency. We used the Texas Ercot grid for that because it has ~10% wind penetration, known summer peak demand, and known additional intermittency backup costs. Was quite a calculation effort between PlanningEngineer (a senior electric utility executive) and myself. The further we dug, the more dismayed we were at the ‘official’ US government propaganda saying wind was cost competitive. If that were true, it would not need ongoing subsidies. Cannot have it both ways.

  3. June 5, 2016 7:35 pm

    Cheap or not, wind power can’t really be worth much when it only works 20-30% of the time on average.

    Anyone who proposed to build a power station with that kind of output would be laughed out of town.

  4. June 6, 2016 6:11 am

    “NEW style of generation” he means in “onshore wind is now the cheapest form of NEW generation in Britain”
    .ie onshore wind is NOT cheaper than OLD generation and still need subsidies

    • June 6, 2016 6:23 am

      Now there is a UK real world extra thing the “Capacity market auction subsidy”
      : In practice there are problems with opening new gas plants, cos in the old days you just run it almost flat out and now in 2016 the gov gives wind/solar/biofuel priority and ask you to switch off when their output rises.
      So builders are now asking for a subsidy to run on standby “Capacity market: auction”
      So in practice gas plant electricity is costing more than it would ideally.
      However I still don’t think the “Capacity market auction subsidy” takes gas upto anything like the £86.96/MWh.onshore wind gets

      • June 6, 2016 7:18 am

        Ah my 6.11am theory is wrong I just checked his quote and he really tries to say wind is cheaper than gas, cos no one will invest in gas

        Current wholesale electricity prices are too low to spur investment in any new form of power generation, so the Government has already had to make subsidies available to new gas plants.

        If financial support required by onshore wind is less than that required by gas, the industry argues it should no longer be regarded as “subsidy”.

        Firstly last bit is wrong ..if both industries want a subsidy then it’s still a subsidy.
        ..And telling gas-power providers they can only sell when there is low wind amounts to an extra tax.

  5. June 6, 2016 6:34 am

    BTW “UK power prices go negative as renewables boom distorts market
    Power stations start paying …electricity to be taken off their hands”
    FT MAY 21, 2016 by: Pilita Clark

    May 8, when overall power demand was low and there was a glut of electricity, generators paid more than £30 a megawatt hour as prices briefly went negative, according to the energy data company, Enappsys.

    On Boxing Day last year, when demand was also low and renewables supplied a third of the country’s electricity, generators paid £73 per MWh to Elexon

    UK has about 22GWs of renewable capacity*, weekend demand can drop to as low as 17GW
    *( theoretically but I bet max ever output is 10GW)

  6. AndyG55 permalink
    June 6, 2016 9:15 am

    “wind is now the cheapest form of new generation in Britain.”

    Oh goodie..

    Time to REMOVE all subsidies and feed-in mandates.

    ….

    all those present….. block your ears for the piggies squealing.

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