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Claire Perry’s Offshore Wind Sector Deal

March 7, 2019

By Paul Homewood

 

 

h/t Philip Bratby

 

 

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A deal confirmed between the UK government and the wind industry will ensure 30% of electricity comes from offshore wind by 2030.

The move will help the UK towards an aim of securing almost all its power from low-carbon sources by 2030.

It is the latest in a series of agreements with sectors of the economy that are likely to create jobs.

But environmentalists are wondering where the other 70% of the UK’s clean electricity will come from.

That is because, for several years, government economists have foreseen a three-pronged energy policy by 2030.

Civil servants have projected that 30% of electricity would come from offshore wind, 30% from nuclear and 30% from gas power stations fitted with technology to capture their carbon emissions and bury them.

But here is the reality – it is now confirmed that wind will fulfil its part by 2030.

But plans to expand nuclear are foundering; indeed the UK may end up at worst with just one new nuclear station – at Hinkley – instead of the planned six.

As for gas with carbon capture, there is only a single such power plant planned at commercial scale. And that is stuck in the proposal stage.

The government promises it will meet pledges to keep the lights on and cut emissions.

Its commitment is for offshore wind to produce 30 gigawatts (GW) by 2030, creating thousands of so-called “green collar” jobs in the process. Young people are especially attracted to jobs in the environment sector.

But green groups believe much more is needed – probably half as much again (45GW).

https://www.bbc.co.uk/news/science-environment-47476006

 

Interesting that Harrabin quotes “green groups” and “civil servants”, but can’t be bothered to ask energy experts for their opinions!

 

As it is, the government announcement of its new Offshore Wind Sector Deal is a bit of a damp squib.

The only real commitment from BEIS is to carry on holding CfD auctions:

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In return the industry makes some vague promises:

 

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As the document makes clear, even by 2030 new offshore projects are still likely to need to some subsidy.

The figure of £557m means that CfDs awarded in the period between now and 2030 will eventually add an extra £557m to electricity bills each year, once new projects are built. This is in addition to the cost of contracts already awarded, which I have estimated to be £3.5bn a year.

 

Nowhere in the document is any mention made of what happens when the wind does not blow.

Or for that matter when there is too much wind. With 13GW of onshore wind capacity already built, 30GW of offshore will give us 43GW of wind capacity in total. This will often be more than system demand can absorb, a problem made more acute in summer when 13GW of solar power is added into the equation.

And that is before we even get to considering Hinkley Point and other potentially new nuclear plants, which will not be economically viable if forced to run intermittently.

 

As for the promise of all these green jobs,

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The best hope for bringing major contracts to Scotland for the building of multi-billion pound offshore wind farms has failed to win a vital order, according to unions.

BiFab is believed to have lost out on an order for offshore platforms to yards in Belgium, Spain and the UAE.

The company has two mothballed fabrication yards in Fife.

Unite and the GMB say the failure to place any of the order for 100 steel jackets in Scotland is a "scandal".

The two unions have been close to the bid talks and are writing to the Scottish government to push for what they call "a level playing field" to compete against foreign companies which have state backing.

However, foreign suppliers dominate the market, and British content in arrays built so far has been well below 50%. The sector deal aims to increase that to 60%.

In a joint statement on Wednesday night, GMB Scotland secretary Gary Smith and Unite Scotland secretary Pat Rafferty said: "Ten years ago we were promised a ‘Saudi Arabia of Renewables’ but today we need political intervention to help level the playing field in Scottish offshore renewables manufacturing.

"The truth is that state funded European energy and engineering firms, backed by Far East finance and Middle East sovereign wealth funds, are carving-up thousands of jobs and billions of pounds from our renewables sector, and firms like BiFab are left fighting for scraps off our own table.

"That 100% of the manufacturing of the turbine jackets for Moray East and five platforms for Kincardine will be done in yards outside of Scotland is an absolute scandal. This cannot continue unchallenged."

"To working-class communities in Burntisland and Methil there’s no ‘just transition’ or ‘green jobs revolution’ here, just a future that looks heavily rigged against their hopes for employment and prosperity. That’s the real cost of long-term political failure at all levels of government."

https://www.bbc.co.uk/news/uk-scotland-scotland-business-47478083

 

It’s an appropriate reminder that governments cannot create jobs.

34 Comments
  1. Phoenix44 permalink
    March 7, 2019 12:04 pm

    Why on Earth are they making commitments about how much is UK sourced and women in the workforce? The costs are bad enough without deliberately asking the industry to increase costs for no gain whatosever.

    When did our politics adopt this bizarre anti-economics, protectionist bent?

  2. Ian Miller permalink
    March 7, 2019 12:14 pm

    Sooo…..much has been said, yet this particular insane scandal runs on and on and on and on and on.
    Does not the definition of insanity run something like, “The continuing pursuit of a calamitous set of actions, expecting a different outcome” become relevant here?
    Alternatively, if you “find yourself in a hole. STOP DIGGING !!” The current UK Energy Policy is surely set to dump us right in it !.
    Finally, when our Energy Policy finally turns ‘bottom up’ our generous Chinese creditors will demand their money back from the UK treasury, and ultimately the taxpayer, financed by a dwindling and unprofitable industrial tax base ?

  3. March 7, 2019 12:24 pm

    One scandal here is that the BBC treats this as an environmental issue, rather than what it really is, a business one. Does anybody know the name of a BBC business journalist? No, nor so I, pretty much sums up the BBC and its worship of magic money trees, typified by a total failure to mention the cost of the Green Dream.

    Also no honesty by the unions about losing business to other EU (single market) countries, something that Brexit could, in principle, improve, but probably won’t.

    • March 7, 2019 12:51 pm

      As Paul has said, the only quotes are from “green groups” and “civil servants”, but rather than they can’t be bothered to ask energy experts for their opinions, I would suggest that they darent’t ask energy experts as they can’t have the truth getting out there.

    • March 7, 2019 1:45 pm

      Extensive coverage on the BBC lunchtime news, again with no input from an energy expert.

      • March 7, 2019 2:03 pm

        Philip as I said in the last thread
        \\ BBC Radio Humberside reporters are really banging a drum for Wind Industry PR //
        \\ Radio Humberside have selected the Telegraph article for operation BBCbangingOn coverage started last night in every news bulletin still going at 10:30am
        Lots of hyperbolic language “green jobs” “more ELECTRICITY from wind than fossil fuels for the first time ever”//

  4. Sean permalink
    March 7, 2019 12:24 pm

    Wow, reduced employment and higher energy costs. They’ll blame Brexit for the economic stagnation created.

  5. MrGrimNasty permalink
    March 7, 2019 1:23 pm

    Yes, now seems it is mostly a re-announcement:-

    https://www.thegwpf.com/uk-offshore-wind-sector-deal/

    • March 7, 2019 2:03 pm

      Indeed – ‘no new subsidies for renewables until the aggregate annual total of subsidies begins to fall, probably in the mid to later 2020s.’

    • March 7, 2019 4:13 pm

      From that GWPF link
      30GW wind power capacity “This is, thankfully, not a dirigiste target, but a sketch of the potential that might be achieved
      on the condition that cost reductions are deep and sustained (which is unlikely),
      and if there is a UK manufacturing base which is vanishingly unlikely.”

      ” this Deal … is certainly little more than Public Relations,
      .. and in all probability the wind industry will be reasonably satisfied that this PR secures its market standing and gives the impression of ministerial support.
      The press and media coverage is ideal.
      But actually companies with a heavy dependence on offshore wind development will be worried that despite prolonged lobbying and negotiations they haven’t secured a reversal of the Treasury’s determination to limit renewables levies on consumers.”

      ( I “improved” their grammar)

  6. March 7, 2019 1:35 pm

    Reblogged this on ajmarciniak.

  7. Gerry, E permalink
    March 7, 2019 1:43 pm

    ‘It’s an appropriate reminder that governments cannot create jobs.’

    And also that their idiotic policies can certainly destroy them.

  8. March 7, 2019 2:15 pm

    I am going to disagree with Paul for once
    “It’s an appropriate reminder that governments cannot create jobs.”
    that should be : “It’s an appropriate reminder that governments cannot create SUSTAINABLE jobs.”

    Cos the he BBC Humberside staff are immediately going to point at the Siemens Gamesa factory in Hull and the Orsted Wind Farm base in Grimsby*
    .. and say “These are real jobs government support & subsidy has created”
    The point being is that if gov throws money at something they can create jobs
    .. It is SUSTAINABLE-jobs that they can’t create.
    Take away the subsidies and laws privileging wind and such operations will close
    cos they shouldn’t actually exist cos they were not economically sustainable in the first place.
    Whereas jobs created in fracking, just depend on the market.

    * Irony Orsted used to have special flights from Denmark every day to bring engineers to work in Grimsby ‘to save CO2’

    • A C Osborn permalink
      March 7, 2019 3:23 pm

      I think it should be “can’t Guarantee the jobs are Sustainable and British”ause most of them aren’t.

  9. March 7, 2019 2:20 pm

    “It’s an appropriate reminder that governments cannot create jobs.”

    But they can, and are, destroying jobs by raising the cost of Energy which is most likely the reason the turbine shells are not being made in the UK.

    • March 7, 2019 2:53 pm

      Good point
      The subsidies do CREATE jobs.
      But since unicorns don’t pay for the subsidies
      the price rises, that do pay for them do ERRADICATE jobs in the electricity customers.

  10. Athelstan. permalink
    March 7, 2019 2:55 pm

    Golly jeepers, quite apart from the quite astronomical eventual decommissioning bill, how green is it and I am willing to bet the house and car on it – ‘decommissioning costs’ it’s not been factored i). It begs, “guaranteed 25 years!” , nope, what is the life span of one of these wonders, whirlygigs in the sea – 7 or 10 years at tops before they’ve been rusted to buggery?

    The UK taxpayer will and relentlessly, continually be on the hook as the foreign investors charge the taxpayer to silently remove and repair these costly boondoggles and for what – abolutely piddling electricity.

    Yet they shut down all debate, I do wonder why or maybe not.

    Surely it is one of the off shore whirlygigs, is the greatest, daftest, ‘solution’ to a non problem ever devised, no wonder they attempt to keep the taxpayer gold rush going and advertizing blizzard of propaganda, “the sky if falling in and man made – you did it!”

    Scam of the world and in all history and Britons all fell into the compound and still swallowing the kool aid and as the death cult peddles it, namely liblavCONgreen.

    Britain, we’ve really got to find a political alternative to the aforementioned and getting out of the Brussels Empire – would be a very good start.

    • A C Osborn permalink
      March 7, 2019 3:20 pm

      Yes the only party that was against it was UKIP, who once they had done their job were deserted by the Public.

    • bobn permalink
      March 7, 2019 5:28 pm

      Agree. Once free of imperial Brussels we need to start on political reform.
      House of Lordy Cronies needs halving in size and then at least 75% elected for 10yr terms by Proportional Representation (elect half every 5yrs at each Commons vote – keep down costs). The balance can be designated for retirees from notable positions (former PM, former Chief of Defence, etc, no religious delegates (they can stand for election), but appointees limited to 5yr term, then they must stand at next election to remain).
      House of Common Traitors need to be elected by PR. The medieval first past post system has been abandoned by pretty much every other country and with success. Last to do so was NZ and has greatly improved NZ politics demolishing their 2 party duopoly.
      Talking myself into starting the ‘Political Reform’ Party. Of course the BBC bias machine would kill it at birth – they couldnt risk losing their perks.

  11. Harry Passfield permalink
    March 7, 2019 3:45 pm

    “Nowhere in the document is any mention made of what happens when the wind does not blow.”
    Which raises the big question – for me, anyway – what is the definition of ‘30% of electricity needs’? Because, at times, wind farms could be supplying little more than 1 or 2%. It also means that alternative generators will need to be able to provide anything from 70 to 100% of the country’s needs – and if they are capable of providing 100% what is the point of the wind farms? What a scam.

    • March 7, 2019 4:27 pm

      May’s Tory government doesn’t care about
      the actual future is SOP
      All they care about is today’s PR to win the next election
      .. plus their own pocket and no doubt their sex lives as well.

    • March 7, 2019 4:27 pm

      May’s Tory government doesn’t care about
      the actual future is SOP
      All they care about is today’s PR to win the next election
      .. plus their own pocket and no doubt their sex lives as well.

    • In the Real World permalink
      March 8, 2019 10:21 am

      Harry says “What is 30% of electricity needs “.
      Well , any wind or solar generation needs 100% conventional backup .
      One , because you cannot run a grid on nonsynchronous generation [wind & solar ] , and two , because the wind & solar is sometimes not working at all .
      http://notrickszone.com/2017/07/05/new-study-concludes-europe-will-always-require-100-back-up-by-conventional-energy/.

      As with Germany & S Australia which have the highest amounts of renewable generation & the highest electricity costs , the only reason for the renewables seems to be to fill the pockets of the troughers .

  12. Harry Passfield permalink
    March 7, 2019 6:04 pm

    Just listened to Perry on PM. She really has drunk the kool-aid. She thinks wind really is so cheap and plentiful!

    • John Palmer permalink
      March 7, 2019 7:28 pm

      Yes, Harry – and so it is – when these morons talk about energy policy (or, rather, lack of same).
      Evan Davies (the interviewer on PM this evening) was like a kind uncle bowling underarm to an incompetent niece.
      Not a single mention of the many hidden costs of wind power – be-it on or off-shore or their appalling output vs capacity performance. And she’s still blathering-on about CCS as the key to CCGT generation.
      I’m off to take my blood pressure pills!

      • Harry Passfield permalink
        March 7, 2019 9:37 pm

        Hope your BP is OK, John. 🙂

  13. Dave Ward permalink
    March 7, 2019 7:05 pm

    “The government’s energy minister was in Lowestoft today to launch to a £250m offshore wind deal that looks set to create several thousand jobs”

    “An estimated 27,000 jobs will be created across the country by 2032 as a result of the deal, 6,000 of which will be in East Anglia”

    Claire Perry said “It’s great to have something that benefits people locally, but we’ll all benefit because we’ll be getting completely clean energy from this”

    Keith Anderson, Scottish Power chief executive, added: “This is an industry that’s creating lots of jobs, allowing companies to invest, and letting us attract youngsters coming out of school into apprenticeships and highly-skilled jobs – all because there’s a long-term future”

    https://www.edp24.co.uk/business/energy/energy-minister-launches-energy-deal-lowestoft-1-5925362

    • March 7, 2019 9:33 pm

      The Eastern Daily Press has form for repeating Green BS PR

  14. Harry Passfield permalink
    March 7, 2019 9:41 pm

    So, what the heck does ‘30% of electricity generation’ mean?? It’s meaningless, as far as I can see. Anybody?

  15. March 7, 2019 9:58 pm

    If the UK never had any wind or solar power I believe
    #1 The UK leccy prices and therefore the prices of everything would CERTAINLY be substantially less than today
    #2 In fact advances in conventional power would mean that 2019 electricity cheaper than in 2008
    #3 The UK electricity systems carbon footprint would PROBABLY be lower than today
    in i) Real terms
    ii ) In terms even when regrowth of biofuel is discounted off
    Why ? All the concrete/steel/cabling for windfarms would never have been made
    And also cos advances in conventional power would mean that 2019 electricity production would be more efficient than in 2008

    if I had a bunch of students here I would give them a project
    – “I want you to look at the UK electricity system from 2008 before the Climate Act and model what would have happened if the Act had never happened and the Power station system would have continued without any subsidies ”

    – More new gas power plants would have been built and would be emitting way less CO2 per MWh than coal, than Drax wood etc.
    – There would have been no big interconnector down from Scotland and far less international interconnectors.

    + Quite probably new nuclear would have been built , providing low CO2 baseload

    • It doesn't add up... permalink
      March 8, 2019 4:01 pm

      What about the LCPD? Without those quotas on coal generation we would still be burning 60 million tonnes a year or more.

  16. It doesn't add up... permalink
    March 8, 2019 4:04 pm

    I don’t see how they can claim that additional CFDs will only cost £577m p.a. unless they cap payouts at that sum. Of course, if they do that it will put a very firm lid on the capacity that is installed. Perhaps they hope to manipulate prices higher so that CFDs even at £155.53/MWh no longer pay out at all?

    • March 8, 2019 4:25 pm

      I gather that the £577m takes the Levy Control Framework to its statutory maximum. To go above it, the govt would have to introduce new legislation

  17. Derek Smith permalink
    March 13, 2019 2:17 pm

    This is the Minister for Energy’s strategy to 2030, gross increase in offshore wind turbines, cut back on CCGT stations and only one more nuclear power station to be approved (not built) by 2025.
    Where is the Energy Policy to cover for the occasions when the wind does not blow?
    Look at the Wind output into the National Grid between 24th Feb and 1st Mar 2019; it was minimal. How will periods like that be covered when Wind has been doubled, Coal phased out, Nuclear not expanded and Gas pushed towards closure. What is the Government Policy?

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