Ambrose’s Holy Grail
By Paul Homewood
Our old friend, Ambrose Evans-Pritchard, is away with the fairies again:
The world’s next energy revolution is probably no more than five or ten years away. Cutting-edge research into cheap and clean forms of electricity storage is moving so fast that we may never again need to build 20th Century power plants in this country, let alone a nuclear white elephant such as Hinkley Point.
The US Energy Department is funding 75 projects developing electricity storage, mobilizing teams of scientists at Harvard, MIT, Stanford, and the elite Lawrence Livermore and Oak Ridge labs in a bid for what it calls the ‘Holy Grail’ of energy policy.
You can track what they are doing at the Advanced Research Projects Agency-Energy (ARPA-E). There are plans for hydrogen bromide, or zinc-air batteries, or storage in molten glass, or next-generation flywheels, many claiming "drastic improvements" that can slash storage costs by 80pc to 90pc and reach the magical figure of $100 per kilowatt hour in relatively short order.
“Storage is a huge deal,” says Ernest Moniz, the US Energy Secretary and himself a nuclear physicist. He is now confident that the US grid and power system will be completely "decarbonised" by the middle of the century.
The technology is poised to overcome the curse of ‘intermittency’ that has long bedevilled wind and solar. Surges of excess power will be stored for use later at times when the sun sets, and consumption peaks in the early evening.
This transforms the calculus of energy policy. The question for the British government as it designs a strategy fit for the 21st Century – and wrestles with an exorbitant commitment to Hinkley Point – is no longer whether this form of back-up power will ever be commercially viable, but whether the inflection point arrives in the early-2020s or in the late 2020s…..
I do not wish to single out this particular technology. I cite it as an example of how fast the picture is evolving as the world’s scientific superpower mobilizes in earnest, and investors start to chase the immense prize. Consultants Mckinsey estimate that the energy storage market will grow a hundredfold to $90bn a year by 2025.
Once storage costs approach $100 per kilowatt hour, there ceases to be much point in building costly ‘baseload’ power plants such as Hinkley Point. Nuclear reactors cannot be switched on and off as need demands – unlike gas plants. They are useless as a back-up for the decentralized grid of the future, when wind, solar, hydro, and other renewables will dominate the power supply.
I will be writing about the economics of offshore wind in coming days but bear in mind that renewables generated 18pc of UK power last year, and this is expected to double by the late 2020s as wind and solar capacity reach 50 gigawatts (GW). Once the power can be stored for overnight use, there will be extended periods in the summer when no base-load is needed whatsoever.
Perhaps the Hinkley project still made sense in 2013 before the collapse in global energy prices and before the latest leap forward in renewable technology. It is madness today.
The latest report by the National Audit Office shows that the estimated subsidy for these two reactors has already jumped from £6bn to near £30bn. Hinkley Point locks Britain into a strike price of £92.50 per megawatt hour – adjusted for inflation, already £97 – and that is guaranteed for 35 years.
That is double the current market price of electricity. The NAO’s figures show that solar will be nearer £60 per megawatt hour by 2025. Dong Energy has already agreed to an offshore wind contract in Holland at less than £75.
Theresa May has inherited a poisonous dossier, left with the invidious choice of either offending China or persisting with a venture that no longer makes any economic sense. She may have to offend China – as tactfully as possible, let us hope - for the scale of the folly has become crushingly obvious.
Every big decision on energy strategy by the British government or any other government must henceforth be based on the working premise that cheap energy storage will soon be a reality.
This country can achieve total self-sufficiency in power at viable cost from our own sun, wind, and waters within a generation. Once we shift to electric vehicles as well, we will no longer need to import much oil either. Rejoice.
AEP seems to be forgetting that storage does not actually produce any power (This may be totally obvious, but appears to need re-stating). Coal, gas and nuclear generation do not need any storage. Although he states that renewables generated 18pc of UK power last year, he does not tell us that some of this is accounted for by either hydro or burning forests. Whatever your view of the “greenness” or “ sustainability” of these technologies, neither need storage either.
This leaves wind and solar, which generated 14% of the UK’s electricity last year. All of the power they generated was supplied to the grid, so no amount of batteries will increase this figure.
AEP seems to naively believe that we only need storage to spread the load overnight, when the sun does not shine. He obviously does not realise that solar produces very little power during winter months in the UK. Somehow, therefore, we would need to build enough batteries to store all of the surplus power produced in summer, so as to last us through the winter.
Plainly, even if feasible, the cost would be prohibitive. This leaves us with wind power, which, despite his protestations, is horribly expensive.
AEP makes an elementary mistake when he states, “nuclear reactors cannot be switched on and off as need demands – unlike gas plants. They are useless as a back-up for the decentralized grid of the future, when wind, solar, hydro, and other renewables will dominate the power supply.”
The whole point about nuclear power is that it provides baseload and not back up, for which gas plants are ideal.
He also says, “Every big decision on energy strategy by the British government or any other government must henceforth be based on the working premise that cheap energy storage will soon be a reality”.
This is utter lunacy. No such big decision should be made on the basis of what might happen one day. We can agree that Hinkley is the wrong decision, but any sensible government would continue with the current and most effective means of generation, ie fossil fuels. When, or if, renewables (including the cost of battery storage), become cost competitive, then they will no doubt take their rightful place amongst the energy mix.
The last thing we should be doing is committing to long term, expensive subsidies, for renewable technology, which AEP and others keep insisting will soon come down in price substantially.
In the meantime, AEP might like to reflect just how many more windmills and solar panels might be needed to fulfil his joyous future, once all of our cars, heating and industry are running off of AA batteries.
According to DECC, wind/solar/hydro managed to supply a magnificent 2% of the UK’s energy consumption last year.
No amount of batteries can increase this figure.
It is baffling how otherwise normally intelligent journalists, such as AEP, suddenly lose all their critical facilities when climate change or decarbonisation are mentioned.
No doubt, it is interesting to learn about all of these latest technological developments, and maybe they will be well and truly eclipsed by other developments, such as thorium or mini nuclear, in the near future.
But most of us will remember well how we were promised energy utopia back in the 1950s, when the golden age of “cheap” nuclear power began.
Fools should tread carefully, Ambrose!
Curiously AEP states, “once the power can be stored for overnight use, there will be extended periods in the summer when no base-load is needed whatsoever”.
I know I am tired, after a long drive home. But can anybody explain the relevance of this? The whole point about baseload is that it is there when you need it, all year round. Just because you don’t need it in the middle of July does not mean you don’t need it there in January.
And if you do need it in winter, you have to pay for it all year round.