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Jillian Ambrose Claims “Wind Power Is Cheap”

March 3, 2018

By Paul Homewood

 

Jillian Ambrose is either totally ignorant about the cost of wind power, or is being extremely devious.

This is what she has written today:

 

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The UK’s electricity market has followed the lead of surging wholesale gas prices this week to reach weekend highs not seen in a decade.

The power market has avoided the severe volatility which ripped through the gas market this week because strong winds helped to supply ample electricity to meet demand.

But as freezing winds begin to wane this weekend National Grid will need to use more gas-fired power plants to fill the gap, meaning the cost of generating electricity will surge.

Jamie Stewart, an energy expert at ICIS, said the price for base load power this weekend has already soared to around £80 per megawatt hour, almost double what one would expect to see for a weekend in March.

National Grid will increase its use of expensive gas-fired power by an extra 7GW to make up for low wind power, which is forecast to drop by two-thirds in the days ahead.

Wind speeds helped to protect the electricity system from huge price hikes on the neighbouring gas market on Thursday, by generating as much as 13GW by some estimates.

However, by the end of Friday this output will fall by almost half to 7GW and slump to lows of 3GW by Saturday, Mr Stewart said.

The power price was already higher than usual at £53/MWh last weekend even before the full force of the storms hit Britain. That was still well above the more typical "mid-40s” price for this time of year, Mr Stewart added.

https://www.telegraph.co.uk/business/2018/03/02/electricity-prices-hit-10-year-high-cheap-wind-power-wanes/

 

I’ll give her the benefit of the doubt over the headline, as I am aware that journalists often don’t have a say over them.

But then she does go on to write to the effect that wind power costs much less than £80/MWh.

As we know, this is utterly untrue.

The bulk of onshore wind output earns a subsidy of £45.58/Mwh, via the Renewable Obligation scheme. This is on top of what they receive for electricity sold. Therefore, even with wholesale prices at last week’s level of £53/Mwh, wind farms will be paid over £98/Mwh.

Offshore wind farms earn even greater subsidies, with RO subsidies typically worth twice as much as onshore.

Because these subsidies never appear in the wholesale costs, but are instead hidden away in green levies added to electricity bills, there is a misleading assumption that gas generation is more costly than wind.

The impression given by the article is that if we had more wind power capacity, the overall cost of electricity generation would fall. In fact, the opposite is true.

Interestingly there are a few comments on the article which have seen through the con, such as:

Gilbert Bellairs 3 Mar 2018 4:52PM

Very misleading headline. Onshore wind farms are paid at least £95/mwh, offshore around £150mwh.  Smaller turbines are paid even more and I hate to think how much we’re paying for the diesel generators being installed to fill in the gaps on windless days.  There is no such thing as cheap wind power for consumers.

43 Comments
  1. Broadlands permalink
    March 3, 2018 6:48 pm

    Where does that leave the solar-panel “farm” industry, especially in the dark of winter?

    • Ben Vorlich permalink
      March 3, 2018 9:06 pm

      At the moment most of the solar farms will be buried under a foot or two of snow….

  2. save energy permalink
    March 3, 2018 6:54 pm

    “strong winds helped to supply ample electricity to meet demand.”

    So to get ample electricity we need winds like we just had…. She’s a Ttupid Swatt.

    see the cost of one night of that type of wind in Holyhead –

    https://www.dailypost.co.uk/news/up-80-boats-destroyed-storm-14360298?utm_source=daily_post_newsletter&utm_medium=email&utm_content=EM_DailyPost_Nletter_News_smallteaser_Image_Story1&utm_campaign=daily_newsletter&ptnr_rid=110631&icid=EM_DailyPost_Nletter

  3. jim permalink
    March 3, 2018 7:12 pm

    Paul, me thinks she doesn’t know the difference between SRMC and LRMC. On the basis that wind is ‘must run’ its true to say that SRMC of wind is more or less zero. Just like nukes. So purely on a SRMC basis gas is higher priced because of course the SRMC of gas plant is the cost of the fuel.
    Of course all of this is just a result of the totally screwed up electricity market that has no relationship with a merit order based on real costs. If the subsidies were not there, the capital cost , and hence the LRMC of wind , would mean no-one would be stupid enough to build them.
    This is an example of how crass the journalism in the world ( not just in the UK) has become. It makes no effort to write about facts, its all ‘agendas’ with no knowledge or brains.

    • wert permalink
      March 4, 2018 10:37 am

      The wind industry in practice tells untruths about the price of wind power generation and misleads politicians and the public about the issue. Why conventional power companies are helpless when faced with unfair competition? I guess one reason could be they’re all feverishly investigating if they could profit from volatile market prices.

      Wind is not cheap, it is worthless, but it forces investments on both the grid and conventional backup power. We are now looking into the possibilities to empty Joe’s pockets…

  4. avro607 permalink
    March 3, 2018 7:13 pm

    The lady also forgot to mention that cheap reliable clean coal outstripped wind output by almost 2GW over the last 10 days as an average.

    • March 4, 2018 4:53 pm

      What the heck is “CLEAN COAL”? While coal may be cheap by in itself, its side effects on the health and environment represent huge and hidden subsidies to the coal miners….

      • March 4, 2018 5:00 pm

        I would argue it’s not the coal miners that a re being subsidised in that case, but the consumers of coal.

        Which begs the question – do you want to put up the cost of energy?

      • March 4, 2018 5:16 pm

        Yes Paul, the consumers of coal, those who suffer the consequences, are subsidized. Yet, it is the coal miners that get subsidized because they get away sort of speak with murder.
        I would rather put up for the extra cost of energy up front, particularly for solar and wind, since they literally do not represent a health hazard.

      • March 4, 2018 6:03 pm

        I would rather put up for the extra cost of energy up front, particularly for solar and wind, since they literally do not represent a health hazard.

        Good luck with that Ben, in the middle of winter, when there is virtually no solar power and the wind is not blowing!

      • J Martin permalink
        March 4, 2018 9:34 pm

        Paying for more solar and wind us the same as paying for more fossil fuels, because both solar and wind only just generate enough energy over the course of their lifespans to pay back the energy used in their manufacture, installation and maintenance.

        If you really want clean energy you should support nuclear, in particular 4th generation nuclear and Thorium.

  5. March 3, 2018 7:42 pm

    When (not if) domestic energy prices hit the wind turbines, I just hope the energy suppliers get their act together and make plain the reasons why. So far these stealth taxes have remained hidden. About time they were robustly explained in plain language and across the twitter/facebook media.
    Currently the official media in the likes of Jill Ambrose et al are just NOT doing their job.

    These energy policies are little more than poverty creation.
    Those beefing about capitalism should look at at this and ponder on what socialism and its bureaucracy can and is doing.

    • Jack Broughton permalink
      March 3, 2018 8:40 pm

      While I do agree about the stealth taxes, don’t get the socialism bit: so far as I’m aware the Tories have been in power for years and years. Sadly none of the parties realise what they are doing to the power industry and British Industry, they are all crusading for a cause that they do not comprehend.

      • March 3, 2018 9:34 pm

        The current lot of left wing Tories inherited the socialist energy policies and have carried on with them with very little change.

      • Paddy permalink
        March 4, 2018 7:24 am

        The pollies are ignorami – they just say what the civil servants tell them. Drain the swamp.

      • A C Osborn permalink
        March 4, 2018 11:20 am

        Oh yes they do know what they are doing.
        It is all part of Agenda 21 and later versions.
        They do not care about the public one iota except when they are threatened at the polling stations.

  6. MrGrimNasty permalink
    March 3, 2018 8:08 pm

    It’s not just the direct costs of the windmills anyway, it’s all the associated wrong-headed policy costs that allow wind power to even exist – smart meters, wasteful remote grid infrastructure connections, poor value insulation schemes, expensive to implement building regulations, delayed exploitation of fracking which means we don’t have cheaper – and most importantly – secure self-sufficiency in gas, etc.

    • A C Osborn permalink
      March 4, 2018 11:21 am

      +1,000,000

  7. March 3, 2018 8:29 pm

    Some numbers from across the pond. Worked through the ‘correct’ as opposed to ‘corrupt’ EIA (US Energy Information Agency) LCEO (levelized cost of electricity) in a guest post at Judith Curry’s a while back. “True cost of wind”. Used the actual penetration (~10%), backup, and incremental transmission costs for Texas’ ERCOT grid. Final ‘correct’ numbers: CCGT ~$56/MWh, onshore wind ~$146/MWh. >2.5x. Explains why there is no wind anywhere without subsidies, even when the grid not the wind farm bears the intermittancy costs. Onshore UK should be a bit more costly than my US estimate, as UK is about same penetration but with slightly lower capacity factor (26% UK versus 31% US) (so more nameplate MW capacity per MWh and higher intermittency costs in UK).

    • Graeme No.3 permalink
      March 3, 2018 9:43 pm

      Curiously in South Australia where the insanity has reached higher and higher**, the cost of wind is A$100-130 plus A$85 subsidy slapped onto the retail bills stealthily. Around US$144-167. Capacity factor average 30%.

      **in the middle of an election campaign with the 3 biggest parties all advocating increased renewables, with the long term Labor government saying that we need 75% renewables. Most are hoping they lose the election badly.

      • A C Osborn permalink
        March 4, 2018 11:25 am

        The lunatics are running your asylum, just like ours.

  8. theguvnor permalink
    March 3, 2018 9:31 pm

    And again what grates most is the fact is that it’s the poor who are most affected.
    https://wattsupwiththat.com/2018/03/02/the-conversation-poor-getting-slammed-by-uk-climate-levy/

  9. professor permalink
    March 3, 2018 9:35 pm

    We still also import a lot of energy. Coal generation still a major power generator. Watch live demand and generation here! http://www.gridwatch.templar.co.uk/

    • A C Osborn permalink
      March 4, 2018 11:26 am

      Yes, while we sit onat least 250 years worth of the stuff.

  10. markl permalink
    March 3, 2018 9:53 pm

    Nothing but selective information dissemination to put lipstick on a pig. Do they really think people accept the posit that their energy costs are rising because of fossil fuels? Really?

  11. avro607 permalink
    March 3, 2018 10:44 pm

    China laughs,our politicians smirk,and the poor,the old and the cold die in their thousands.
    Our current herd(see groupthink) of politicians sicken me to my core.

  12. It doesn't add up... permalink
    March 4, 2018 12:38 am

    I think she missed the bit about the grid operating 2GW short for several hours on 1st March, with system prices soaring to £990/MWh to bid back supply from France.

    So much for interconnectors helping out: we would do so much better to spend on proper power stations we control – and that means keeping our coal ones until they can be replaced with something as reliable.

  13. March 4, 2018 6:40 am

    Cone on, give Silly Jilly a break. After all she is a media studies graduate and so has been taught to write without any understanding.

  14. Richard Woollaston permalink
    March 4, 2018 7:50 am

    As usual, she is simply regurgitating other people’s opinions.

    It is interesting to note that good old coal has accounted for up to 26% of power generation during the current cold spell as CCGT was cut back presumably due to gas shortages. So it’s really coal to the rescue not wind!

    • March 4, 2018 9:09 am

      True, although the strong winds were helpful at a time of gas shortage (due to closing Rough, the UK’s largest storage facility, last year).

      • Gerry, England permalink
        March 4, 2018 10:29 am

        Very true. Without the wind we would have been close to blackouts. Still, next time with less coal and no new reliable generation we won’t be so lucky.

      • A C Osborn permalink
        March 4, 2018 11:34 am

        It won’t take less coal generation, just a very cold high pressure system sitting over the UK.
        Wind will then be parctically zero and if the high covers most of Europe as well they will also struggle.
        Except the Germans of course who just went ahead and built extra Lignite burning Generators, totally against their own energiwiende and also in total hypocrasy.

  15. March 4, 2018 8:47 am

    You are aiming the the cost of installing offshore wind power capacity is constant, in fact it is dropping rapidly. Germany and Holland have both had subsidy free bids for offshore…

    https://www.carbonbrief.org/analysis-uk-auction-offshore-wind-cheaper-than-new-gas

    • March 4, 2018 11:18 am

      £57.50/Mwh, which equates to a current price of about £62/Mwh is not “cheaper than gas” (Did you know the £57.50 is at 2012 prices?)

      Neither is there any evidence it will ever be built.

      Meanwhile, we have 4GW of offshore wind capacity contracted and due to start up by 2021, at an average price of £142.85/MWh, which together with existing capacity will be subsidised for 15 yrs.

      The answer of course is very simple. Do away with all subsidies and guaranteed prices, and let wind power compete against other generators.

  16. Bitter@twisted permalink
    March 4, 2018 10:32 am

    Much as I’d like to think that that Jillian is a cupid stunt, I’m thinking her seemingly moronic articles are really a case of “follow the money”.

  17. Athelstan permalink
    March 4, 2018 10:34 am

    peak oil/fossil fuel was, is, arrant doom mongering, in the UK, there would be no self induced, governmentally imposed “energy crisis!” – if coal was still the means to the production of cheap, plentiful electrical energy.

    Whereas, peak idiocy can never attained, though some do try so very hard.

    Until the nebulously farcical notion of green energy is disconnected and real world solutions are reconnected we will (the UK) all be switched off.

  18. John Fuller permalink
    March 4, 2018 10:45 am

    I don’t quite understand the point this confusing article is trying to make. It is also factually weak and referencing sources is optional; no source for the 13 GW wind generation last Thursday, “some estimates” is not a reference! However, a Jamie Stewart, an energy expert, is referenced. I hope he was misquoted because I am not impressed with his supposed expertise in energy matters. The Telegraph appears to be short of an editor at the moment.

  19. March 4, 2018 10:49 am

    Sunday Telegraph
    Jillian Ambrose : fracking is doomed ..quotes Green Party

    + Monty Don has pledged to cut down on the amount of plastic used on BBC Gardeners’ World after admitting the programme uses too much non-recyclable material behind the scenes.
    The first episode of the new series will see Mr Don “embarking on a mission to reduce the use of plastic in his garden”, including looking at alternative containers for seed sowing.
    “I am going to try and drastically cut down on the amount of plastic we use in the garden,” //

    Previous editions
    19th of January – This year’s Design Challenge at the STEM Awards has universal relevance: applicants are being asked to explore ways for the construction industry to take advantage of advanced technology to mitigate the impact of extreme climatic events.

  20. Bloke down the pub permalink
    March 4, 2018 12:51 pm

    As I pointed out in tips, Emily Gosden has been tweeting about further risks to the poor’s ability to pay for energy. https://notalotofpeopleknowthat.wordpress.com/about/#comment-109760

  21. March 9, 2018 5:13 pm

    I totally agree Jack. Perhaps I should not have used that emotional word Socialism.
    When I think on the word I tend to align it with the mindset that believes politicians and their bureaucratic underlings know best and have some kind of moral superiority.
    Inevitably, I suppose, this makes me lean towards the conservative party; but as you rightly say there appears to be little difference between them these days apart from the rampant Momentum Movement which has highjacked the Labour Party.
    The sooner politicians are taken out of energy provision the better. They are mucking about with our bread and butter and haven’t a clue.
    Regards

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