The Nuclear Decommissioning Authority has today announced its draft budget for 2015/16. The sum will be £3.31bn, of which £2.1bn comes from the public sector. That’s public money being used to subsidise electricity which has already been used.
All elements of our energy system attract subsidy. What I find distasteful is that the users of nuclear electricity over the last 60 years have handed the cost of dealing with the waste to the citizens of today. Our leaders of yesteryear created a large unfunded moral hazard for future generations. The waste issue remains one of the biggest problems faced by the nuclear industry in their programme for new-build in the 21st century.
The decommissioning figures don’t include any aspect of subsidy for electricity production, or the credit guarantees which have been offered to nuclear projects in the UK. In the future, nuclear will benefit from a very generous subsidy of its own for electricity production, via a 35-year, index-linked Contract for Difference agreement, which will see UK taxpayers making generous contributions to state-owned French and Chinese utilities.
Renewable energy isn’t a panacea to our energy needs – at least not yet. Although renewables have highly predictable output, we’re not able to store significant amounts of electricity on a daily or seasonal basis. That limits the ability of renewables to become the dominant part of our electricity economy, and points to the need for a far greater effort to incentivise R&D in energy storage technologies, and to commercialise those that currently exist.
Expertise in the energy storage and smart energy sectors would serve the UK well in the future, providing us with the opportunity to export goods and services over future decades. And yes, maybe some of those customers might be French and Chinese!
Our energy future, and our hard-earned cash as taxpayers is best served by a massive focus on energy efficiency, increased deployment of existing technologies, and a huge effort in R&D on energy storage and smart energy systems. Let’s run our existing nuclear fleet as hard and as long as it’s safe to do so, and then spend our money where it delivers best for our children and grandchildren; a renewable future.
I do not feel obliged to believe that the same God who has endowed us with senses, reason, and intellect has intended us to forgo their use and by some other means to give us knowledge — Galileo Galilei
I’m a scientist. To be more precise, I’m a physicist. I’ve had a strong interest in energy conservation since being a small boy — I remember asking my dad why he didn’t take the car out of gear when we were going downhill as it seemed as though we would save petrol. That interest in science continued through my schooling into ‘A’ levels, a physics degree, and eventually a Ph.D. And I’ve always thought that science was a good start for policy; not the whole story of course, but policy-making without evidence is almost certainly a recipe for poor decisions.
Those of us who work in the renewable energy sector are confronted by irrational opposition on a daily basis. Those who oppose renewable energy — and onshore wind in particular — do not generally take the trouble to provide evidence. On the contrary, they produce fantastical accounts of the terrible harm which results from wind turbines (Including claims as bizarre as disappearing worms and dead goats), severe (but unquantified) impacts on tourism; or the massive costs which burden the population from supporting the technology (just 1% of your electricity bill); or the fact that wind isn’t wanted (it’s very popular) — and, despite the best efforts of the Advertising Standards Authority, these claims continue. (See, for example, a general search for ‘wind’ in the ASA database
Irrational opposition to onshore wind would not be a problem in and of itself; but the (historical) nature of the debate, characterised by a relentless focus in some sections of the media on opinion, allusion and denunciation, has led to some people with decision-making capacity mistaking the invective for reality.
For those of us who believe in evidence-based policy and decision-making, this is worrying. It’s worrying because decisions are potentially being made contrary to the evidence — to the detriment of communities in rural Wales, and to the people who make up those communities. Let’s explore some of the issues in a bit more depth.
Powys
Powys plays a potentially pivotal role in Wales’ renewable energy ambitions. Blessed with a phenomenal wind resource, and with a low population density, it was one of the main areas of development for onshore wind outlined in the Technical Advice Note on renewable energy published in 2005 known as TAN8.
TAN8 aimed to concentrate developments of onshore wind in Wales in those areas most suited to them, in terms of wind resource and population density. The conclusion recommends the use of Strategic Search Areas to target onshore wind for “efficiency and environmental reasons”.
What they would actually find is a local authority which has objected to a number of large wind farms, such that a public inquiry has been launched into the issue. I’m not blaming anyone for historic decisions here; but I do think it’s worth looking at the example of exemplar local authorities — Neath Port Talbot and Rhondda Cynon Taff — in the way they have engaged with a wind developer (Vattenfall), and the result for the local community of that engagement.
What might have been
In May 2012, permission was granted for the development of the Pen y Cymoedd wind farm, which lies within the Neath Port Talbot and Rhondda Cynon Taff local authorities, following their decision not to object to the scheme. The Pen y Cymoedd windfarm at 228MW is the biggest scheme in Wales.
The fact that local authorities supported the application, meant that the Secretary of State’s decision was more straightforward. It also meant that the decision was made more quickly. Part of the local authority negotiating stance was the requirement to facilitate the involvement of local businesses — and it worked. More than 600 companies signed up with an interest for the development, with 90% coming from Wales, and more than 30% from the local area.
Vattenfall have explicitly stated their commitment to support local businesses; indeed, they require contractors to maximise their use of local companies, something which is written into tender specifications and scrutinised as part of the project development process.
But the local business involvement is only part of the story. Pen y Cymoedd will also have a community benefit fund to match its status as a large energy generator; it will benefit the local community to the tune of £1.8m per annum — index linked — over the lifetime of the project. So on top of the benefit to businesses, the community is going to see investment on a scale which is almost certainly unmatched in the experience of the area surrounding the site. They have already started on a new £350,000 mountain-bike trail, which will be completed before 2014.
The training potential is also starting to be tapped; a group of students from Neath Port Talbot College recently returned from a study tour to the Netherlands to learn about energy generation from the experts. The students teamed up with apprentices from the wind turbine apprenticeship programme, which is being supported by RWE and Vattenfall.
That’s Pen y Cymoedd; but what does that mean for Powys?
The community benefit from these developments would be considerable; I’d go as far as to say transformative. If we use Pen y Cymoedd as the comparator, we can make an assumption on the total annual funds. Using Pen y Cymoedd as an example is helpful because it’s the biggest scheme in Wales, and therefore most closely resembles the impact which might be achieved with a number of large wind developments in Powys.
Pen y Cymoedd generates a community benefit of £1.8m/yr for a size of 228MW. Using the figure of 480MW (assuming all wind farms in the public enquiry gain consent), the equivalent fund for Powys would be (480/228)X1.8m = £3.8 million.
That’s the easy stuff — the ‘clean’ money which can be match-funded and spent on things desired and needed by residents in areas in and around wind farm developments. But what about the business benefits from the developments themselves?
Well, the ‘Economic Opportunities’ report, produced by Cardiff Business School and Regeneris Consulting, suggests that 20% of the economic benefit to Wales from onshore wind development accrues to Mid and South West Wales. Let’s split that 50–50, and agree that mid Wales sees 10% of the total.
The total GVA to Wales from 2012 to 2050 if an ambitious development approach were taken — compared to historic trends of installation — would be £1.4bn.
That’s £140m for mid Wales, that will unlikely see the light of day if Powys continues to deny the opportunity for economic diversification that so many are crying out for.
