UK Renewable Energy Industry Urges Government To Allow Onshore Wind Auctions

Clean Power

Published on October 26th, 2018 | by Joshua S Hill

October 26th, 2018 by

14 major renewable energy companies have penned a joint letter to the UK’s Secretary of State for Business, Energy and Industrial Strategy, Greg Clark, urging him to drop the current restrictions on onshore wind which prevent it from competing in the Government’s power auctions.

Currently, the UK awards power through its Contracts for Difference auction scheme. However, the auctions are currently only being offered to one of two “pots” of renewable energy technologies — the pot which includes “less established technologies” such as offshore wind and onshore wind on remote islands. The other pot, however, includes “established technologies” such as solar and onshore wind, and auctions have not been offered under this pot for some time.

Thus, 14 major renewable energy companies, made up of project developers and supply chain companies, have sought to convince the UK’s Secretary of State for Business, Energy and Industrial Strategy, Greg Clark, to resume pot 1 Contract for Difference auctions between 2019 and 2025. Specifically, the authors of the letter claim that re-opening pot 1 auctions “would provide a payback to consumers of £1.6 billion.”

“In addition to being the cheapest form of new power generation, an analysis from the BVG has found that onshore wind has the potential to deliver 18,000 skilled construction jobs, 8,500 longterm skilled jobs, and stimulate supply chain investment, resulting in 70% UK content in projects, in those areas where there are no objections to its development,” the authors of the letter wrote.

The letter was signed by project developers ScottishPower Renewables, SSE, innogy, Statkraft, and Vattenfall, along with supply chain companies Siemens Gamesa Renewable Energy, Vestas, CS Wind, RJ McLeod, Farrans Construction , AE Yates, REG Power Management, Athena PTS, and RSK.

“Thanks to a rapid fall in costs, new onshore wind power can be secured at a subsidy-free price. However, the considerable upfront investments and lack of investor certainty associated with a merchant approach to onshore wind development means that there is a risk this low-cost, lowcarbon power source, and its potential, will not be sufficiently utilised without contracts to procure new capacity.

“In order not to miss the opportunities for growth in supply chain companies and consumer benefit, it is crucial that a decision on procurement through CfD auctions is made now.”

There is an irony in preventing onshore wind from competing for power in the UK, considering that it is the cheapest way of generating new power. In addition, as a poll in July highlighted, a clear majority of UK residents not only support onshore wind but are actively in favor of putting an end to the Government’s effective ban on onshore wind.

”We trust the Secretary of State will take account of the views of these major UK employers who are offering to build subsidy-free projects as part of the clean energy system of the future,” said Emma Pinchbeck, RenewableUK’s Executive Director. “His department’s opinion polls consistently highlight the overwhelming level of public support for onshore wind. New onshore wind would be a triple win for consumers, the environment and UK businesses.”

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UK RHI proposal would limit installations of biomass boilers


The U.K. government recently opened a public consultation on a proposal that would alter the Renewable Heat Incentive to exclude further support for biomass installations in urban areas on the gas grid. The U.K. Renewable Energy Association has spoken out against the proposal, calling it too restrictive and stressing that policy should be focused on improving standards.

The U.K. Department for Business, Energy & Industrial Strategy opened the consultation on Oct. 16. It closes on Nov. 27.

Information released by the BEIS explains that Defra’s Clean Air Strategy, published in May 2018, proposed that further support under the RHI should not be available for biomass installations in urban areas with access to the gas grid. The consultation published by the BEIS contains details of the proposed restrictions and asked for input on the scope and nature of those changes to RHI eligibility.

Within the 21-page consultation document, the BEIS explains the change would apply to new RHI applications starting when the new regulations come into force, including domestic and non-domestic biomass boiler installations of all sizes, along with biomass combined-heat-and-power installations. The restrictions, however, would not apply to existing RHI biomass boiler installations or to biogas RHI installations. The document cites the production of fine smoke particles and other air pollutants as the reasoning behind the action.

The REA said the proposal would limit options for decarbonizing heat. If enacted, the group said the proposal will stop the installation of highly efficient and clean biomass boiler technologies from benefitting those in urban areas. According to the REA, modern biomass boilers are already strictly regulated, ensuring their emissions are tightly controlled, with more than 75 percent of boiler models emitting less than one-third of their legal limits.

"The latest proposed reforms to the RHI risks being a knee-jerk policy reaction to the air quality crisis,” said Neil Harrison, chair of the Wood Heat Association. “The industry has lobbied for many years for actions to ensure the very safest levels of emissions from biomass boilers in all parts of the U.K., not just urban areas. Modern biomass boilers, fitted with high-performance filters, achieve particulate emissions equivalent to that of conventional fossil fuelled boilers, while making significant carbon savings.

“The government should be promoting and enforcing quality standards, rather than applying a blanket ban. Such a ban would cut off one of the key options for the decarbonization of heat in larger public and private sector buildings, and would ignore experience from every other developed country which has seen the successful deployment of biomass heating across their economy,” Harrison continued.

Urban air quality can be best minimized by addressing the much more significant emissions coming from transport and properly enforcing controls provided by Smoke Control Zones and other existing legislation,” he said.

Additional information on the consultation is available on the BEIS website.

Scottish Power to develop ‘sizeable’ UK solar portfolio following fossil fuel divestment

Published: 22 Oct 2018, 17:54


David Pratt's photo

Scottish Power will look to add to its wind assets following the same of CCGTs and hydro generators to Drax.

Scottish Power has confirmed that solar will feature in its future generation plans following the sale of over 2.5GW of gas and hydro assets to Drax, becoming the first 'Big Six' energy company to go fully renewable.

Speaking to the Guardian late last week, chief executive Keith Anderson said the company was looking at solar as “a good opportunity” for investment due to its falling technology costs and its ability to complement the generation output of wind assets throughout the year.

This reasoning was behind Vattenfall’s efforts to co-locate solar with a wind farm in Wales last year as according to senior vice president for the wind business division, Gunnar Groebler: “It matches very well because usually when you have a sunny day you have less wind and vice versa.”

The need to address interseasonal generation profiles was pointed to this summer in the UK, when periods of hot, still weather saw the UK’s wind fleet produce lower than expected output. While some moments saw high output send the grid’s carbon intensity and power prices tumbling, Scottish Power intends to protect against future periods of low wind generation.

Details of the energy giant’s plans remain unclear, having only recently completed the Drax sale and jettisoning its fossil fuel assets. However, the company told Solar Power Portal that it is seeking to add significant levels of generation to its portfolio.

A ScottishPower Renewables spokesperson said: “Solar has seen major cost reductions, and we are actively seeking opportunities for solar in the UK. We are working on our initial plans, but we have ambitions to develop a sizeable portfolio of projects.”

The company has a pipeline of renewable energy projects worth £5.2 billion to be spent over the next four years, adding to its 2.7GW of wind projects either operating or under construction. This will add more than 3GW of new generation, and while 2.9GW is set to be offshore wind – adding to the UK’s leading position globally – Scottish Power is expected to outline its deployment strategy for solar in the coming months.

UK’s plastic waste is a burning issue

In August, exchequer secretary Robert Jenrick said: “Tackling the scandal of plastic pollution is one of our top priorities.” But it’s now confirmed what many have long suspected, that the UK recycling industry is riven with corruption (Report, 19 October) and only now is government dimly aware of the problem. Taxing coffee mugs and plastic straws, and placing a charge on plastic bags are commendable actions, but in the face of ever-increasing plastic production, single-use or not, are minuscule and potentially token. In addition to stamping out the illegal export of waste and reducing single use plastic at source, a radical upheaval of domestic recycling is required. Local authorities pay waste management companies to collect, sort and, hopefully, recycle domestic plastic waste. Yet they only recycle a proportion of it and ship the rest abroad. Much ends in landfill or in the oceans. The council tax we pay for these destructive processes could be better deployed.

With rapid progress now being made on carbon capture, home and industrial-based pyrolysis (waste to energy), and other plastic-to-fuel processes, there is a strong case to stockpile plastic that is difficult to recycle or contaminated. In compacted or granulated form at 10% of its previous volume, it can be stored for future use as feedstock for negative emission energy production and other innovative uses. We used to have grain mountains and wine lakes. Why not temporary plastic mountains?
Patrick Cosgrove
Chapel Lawn, Shropshire

As your report (Ban on plastic waste imports costs councils in England up to £500,000, 20 October) says, we export more than two-thirds of the plastic waste we create, while countries such as China are banning the import of these wastes because they cannot deal with them any more than we can. So is it not time for a rethink? Many plastics cannot be recycled, and, once mixed, the problem becomes near-impossible, so a more sensible approach would be simply to burn these “unrecyclables”, making sure we recover energy from the borrowed oil they represent.

This can be done well in properly designed furnaces, perhaps even with carbon dioxide removal, while the heat created can be used for generating electricity. Better still, we should stop pretending that we can recycle these mixed materials, and simply collect all household rubbish and burn the lot.
David Reed

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Passion proves a winner for Aberdeenshire farmer

David Smith.

Scotland’s Orkney Islands may see electric plane service by 2021

Eight-seater two-engine propellor plane on a runway.

Enlarge / A Britten Norman Islander plane, similar to the kind used in the Orkney Islands to shuttle people short distances.

Up in the remote northeast of Scotland, residents of the Orkney Islands use small island-hopping aircraft to commute around the archipelago. The longest flight in the area is 15 minutes, traveling 33 miles from the city of Kirkwall to the island of North Ronaldsay. The shortest flight takes an average of 80 seconds to travel 1.7 miles between the islands of Westray and Papa Westray. That flight holds the Guinness World Record as the shortest commercial flight route in the world.

Now, Scottish airline Loganair and aircraft modifier Cranfield Aerospace Solutions are working together in the hopes of turning the Orkney Islands' 10 inter-island routes all-electric, perhaps even establishing the world's first all-electric commercial flight routes.

Electric planes are still something of a pipe-dream for environmentalists and technologists. Jet fuel is extremely energy-dense compared to batteries, and flight requires a lot of energy at little additional weight. Electric flight startups are either developing hybrid battery/jet-fuel planes or banking on the continuous improvement of batteries to make their visions viable years down the road. While the most optimistic see the advent of lithium-air batteries and engine efficiency improvement as a path to commercial electric flight, others have focused on decarbonizing jet-fuel synthesis.

But flights as short as those in the Orkney Islands don't need the same kind of energy efficiency as long-haul flights do. Cranfield told Scotland's Press and Journal that it believed it could simply modify the eight-seater Britten Norman Islander planes that Loganair already uses among the islands instead of designing an electric plane from scratch. Paul Hutton, CEO of Cranfield, said that he believed it would only take £10 million to create and safety test these specialty-use battery aircraft. Cranfield is seeking a grant from the UK government to support the project.

Loganair CEO Jonathan Hinkles told the Press and Journal that a three-year timeline is possible if grant funding is found for the project. That would make 2021 the earliest that all-electric commercial flights could be put into service.

Hutton told the BBC that the added benefit of electrifying the Orkney Islands flights is that there's an abundance of renewable energy, especially wind energy, already on the grid in the area. Charging a battery between flights is easily the greener option compared to burning jet fuel.

Local council likes this plan

Loganair operates the inter-islands flights on behalf of the Orkney Islands Council, which subsidizes transportation between the sparsely populated islands. Orkney Islands Council Leader James Stockan told the BBC that the council supports electrifying its inter-islands flights if they can be proven safe, because it could help save money on expensive jet fuel. "This is a community with a strong track record when it comes to innovation, and I am pleased that this pioneering project looks set to be developed in Orkney," Stockan said.

Though replacing the jet fuel burned by small island-hopping planes in a remote part of the world may seem like a drop in the bucket in efforts to reduce emissions, starting small is often a path to thinking big. If the shortest flights in the world can be flown successfully, gradually longer and longer commercial electric flights may someday be attempted.

Europe’s clean transport revolution continues

There is now a clear EU majority, led by the Nordic countries, for tougher targets on car emissions, writes Sanjeev Kumar. The big questions now relates to charging points for electric vehicles and whether they can charge fast enough, he writes.

Sanjeev Kumar is Director for Energy and Environment at Burson Cohn & Wolfe (BCW), a consultancy.

The European Union is slowly but surely driving towards cleaner cars. EU governments, MEPs and the European Commission have begun compromise talks on carbon dioxide emissions targets for new vehicles, and their eventual decision could radically reshape the car market.

This represents a huge transformation for Europe. Even if the EU has been a driving force for global climate change policies, it has until now shied away from measures that might have a major impact on its carmakers.

But the political power lines have shifted in recent years, not only within the European Parliament but also inside the Council of Ministers.

Indeed, the current gap between MEPs and governments is relatively slim. EU environment ministers agreed in Luxembourg on October 9 to cut CO2 emissions by 35% for cars and 30% for vans by 2030. That was just days after MEPs voted at their October 3 session in Strasbourg to cut vehicle CO2emissions by 40% by 2030.

'Disappointed' EU capitals agree on 35% car CO2 cuts

EU environment ministers took until nearly midnight on Tuesday (9 October) to agree on a common position for car and van CO2 emission cuts for 2030 but several member states were left “disappointed” with the final agreement.

The current trilogue negotiations between MEPs, the Council and the Commission may be influenced by recent warning by the UN’s Intergovernmental Panel on Climate Change that the world is “running out time” on global warming. But MEPs already have a strong hand. Earlier this year, they successfully pushed the Commission and Council to raise the EU’s 2030 renewable energy and energy savings targets.

Even if the Council is more cautious, its target is still much higher than initially sought by Germany, Europe’s carmaking champion. Although the German government has warned about targets hurting exports and threaten jobs, Chancellor Angela Merkel’s SPD junior coalition partners are now siding with those seeking bigger CO2 cuts.

There is now a clear EU majority, led by the Nordic countries, for tougher targets. France, home to Renault, Citroen and Peugeot, has said it wants a 40% cut. And, as the local elections in Bavaria and Belgium showed on October 14, there is momentum behind green parties.

New direction

While officials hammer out the legal details, the EU’s direction is clear: climate change, local pollution and falling clean technology costs are driving deep changes in alternative systems. Intense competition across the value chain of clean vehicles from Japan, China, South Korea and US adds further pressure.

Emissions from transport are a priority because this is the only sector where the level is much higher than in 1990. Alternative fuels are used by less than 4% of cars currently on the road. Diesel, once promoted as the climate-friendly fuel, is now collapsing as a market. Indeed, most major carmakers are now investing heavily in alternative technologies, with China now leading the way in cheap electric vehicles (EVs)

There is also local pressure on both carmakers and consumers, with city authorities around Europe now enacting bans on dirty cars. Just days before the Parliament vote, on September 30, the Brussels capital region began imposing fines of up to €350 on drivers with diesel Euro 0 and Euro 1 vehicles. And at national level, governments are pledging to end the sale of new petrol and diesel cars over the next few years: this month, Denmark said it would ban them by 2030, following pledges by France and the UK to do so by 2040.

Is Europe ready?

The big questions for the market are about capacity and infrastructure: are there enough charging points? There are currently just 100,000 charging points in the EU, but the Commission wants 2 million by 2025, a 20-fold increase. Can they charge fast enough? Some carmakers are already answering this: Toyota is working on an electric car battery with a much longer driving range and a much shorter charging time. And can electricity networks rise to challenge? The Connecting Europe Facility (CEF), which supports trans-European networks and infrastructures is actively addressing this issue, identifying missing links and bottlenecks to resolve.

But it is also an opportunity for Europe to capture EV market share. With Chinese, US and Japanese competitors gaining rapidly, it has to adapt. And the demand is there: a recent survey by campaigning NGO Transport & Environment found that 40% of Europeans say they want their next car to be electric or fuel cell-powered. While EVs currently have a market share of just 1.5% in Europe, their numbers are rising fast.

In this context, it’s not hard to see the economic as well as the environmental case for cleaner cars. And it is one that more environmentally-conscious MEPs and member state governments are finally winning in the EU’s corridors of power. It will take time to transform Europe’s car culture, but it is changing.

Fracking in the UK: what is it and why is it controversial?

Fracking restarted in the UK on Monday – the first such operation since 2011. The oil and gas firm Cuadrilla commenced work at a well in Lancashire after seeing off a last-minute legal challenge on Friday.

The aim is to extract shale gas to contribute to the country’s energy supply but environmental campaigners fiercely oppose it.

What is fracking?

It is short for hydraulic fracturing, a means of extracting gas or oil trapped in rocks deep underground. It is one of the technologies the industry has turned to as new sources of easy-to-extract oil become harder to find.

Fluid composed of water and chemicals, with added sand, is fired at high pressure into the rocks. This creates fissures that allow gas and oil to escape and be brought to the surface.

How big will it be?

That is hard to say. Several companies have bought up vast swathes of shale gas acreage, including Cuadrilla, the petrochemicals firm Ineos and IGas, but none are likely to produce gas at commercial volumes for a couple of years at least.

Estimates of how much shale gas the UK has vary, although the British Geological Survey believes there is more than 3.7tn cubic metres of gas in the Bowland shale – a formation that runs across most of north and central England.

There is far less certainty about how much of it could be extracted economically. Most industry figures are cautious about predicting a British shale boom and comparisons with North Sea oil are widely seen as fanciful.

Why is it controversial?

The Cuadrilla fracking site in Preston New Road, Lancashire.

The Cuadrilla fracking site in Preston New Road, Lancashire. Photograph: Danny Lawson/PA

For a start, any form of gas, while cleaner than energy sources such as coal, is still a fossil fuel and burning it is at odds with efforts to reduce carbon output. There are also specific concerns associated with fracking, such as fears it could contaminate the water table. It has been linked with small earthquakes such as those that took place in Lancashire in 2011, triggering a moratorium on the technique and ushering in tighter regulations.

One form of pollution that is often overlooked is the noise and emissions caused by the juggernauts required to bring water to fracking sites for injection into the ground.

Labour has a policy of banning fracking, the Scottish government has a shale gas moratorium and the Welsh government has promised to block any applications.

The industry argues gas is a key part of the UK’s transition from dirtier fuels such as coal to a low-carbon future, providing a bridge while renewable energy sources are increased.

Will it reduce energy bills?

Despite David Cameron’s claim that fracking would bring down gas prices, few expect the industry to grow to a scale where it has any significant impact on pricing.

The amount of gas likely to be produced from any fracking boom is not going to outweigh the effect of global markets for oil and liquefied natural gas, which the UK imports from Qatar and elsewhere.

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However, it could improve security of supply, insulating against the threat that gas imports could be disrupted or rise in cost because of geopolitical events, such as tension with Europe’s major supplier, Russia.

Bank of England calls on banks and insurers to step up climate risk oversight

Prudential Regulation Authority recommends that boards task a senior executive with managing climate risks

The Bank of England (BoE) will today step up calls for financial institutions to better manage climate risks, with the release of formal recommendations detailing how banks and insurers should identify a senior executive for managing climate-related risks.

In what is thought to be the first such move by a central bank anywhere in the world, the BoE's Prudential Regulation Authority (PRA) is reportedly set to publish a draft supervisory statement instructing companies to ensure a senior figure is in place who can report to the board on climate-related risks and opportunities.

The bank is poised to warn that a failure to strengthen climate risk governance arrangements could resultin tougher regulations and the risk of penalties.

The move is the latest in a string of interventions from central banks to encourage more businesses to enhance their climate risk disclosure and will fuel speculation that reporting in line with the recommendations of the Taskforce of Climate-related Financial Disclosures (TCFDs) could become mandatory.

Only last week 18 central banks, including those of England, Germany, France, Japan and China, issued a statement warning financial risks arising from climate change are "system-wide and potentially irreversible if not addressed".

It also comes in the wake of green law group ClientEarth writing to a number of regulators and listed firms to warn legal action could soon follow if they fail to strengthen their climate risk disclosure practices.

Dr Ben Caldecott, founding Director of the Oxford Sustainable Finance Programme at the University of Oxford, said the recommendations from the PRA were part of a wider trend.

"The Bank of England is making clear that supervisory expectations are changing and that the regulator will now be factoring climate-related risk explicitly into different aspects of banking and insurance supervision," he said in a statement. "This is a logical next step as the Bank of England has repeatedly highlighted the potential risks to firm solvency and financial stability from climate change. Other regulators in the UK, such as the Financial Conduct Authority, as well as regulators internationally, will almost certainly follow suit."

He also stressed that ensuring senior executives take responsibility for managing climate-change risks and face board-level accountability for doing should "undoubtedly spur greater action". "Financial institutions now need to develop credible and robust plans for measuring and managing climate-related risks," he advised. "Among other things, they need to determine what analytical capabilities they require and how they intend to resource them."

Jon Williams, PwC Partner and a member of the TCFD, said significant changes were required across the banking and insurance sectors in response to the new recommendations.

"It's encouraging that some banks and insurers are now taking climate-related financial risks seriously, but there's still lots of progress to be made to ensure resilience through the transition to a lower-carbon economy," he said. "The PRA's own survey shows that whilst 70 per cent of banks see climate change as a financial risk, only 10 per cent of them are managing these risks comprehensively. The TCFD status report, published last month, also shows that the majority of banks are not disclosing on climate governance and find it challenging to integrate climate change into business strategy and risk management."

The intervention comes as a number of banks and financial institutions responded to last week's IPCC report on the urgent need for deep and rapid decarbonisation by warning investment markets would have to transform over the coming decades.

A note from banking giant UBS said investors could support the IPCC report's recommended goal of delivering a net zero emission global economy by 2050 by pursuing attractive renewable energy investment opportunities, supporting the transition to electric cars, and backing green financial instruments.

"By choosing sustainable investing options, investors can contribute to the reduction of carbon emissions, along with other positive goals, without sacrificing economic returns," the note stated. "Green bonds, typically, have the same seniority as conventional bonds, yet their investment proceeds are ring-fenced for green projects, such as carbon reduction. BlackRock finds that a $1m investment in the bonds that form the Bloomberg Barclays MSCI Green Bond index represents over 2,000 tonnes of CO2 avoided, in addition to over 88 million litres of water saved, and other positive contributions."

Separately, credit ratings agency Moody's launched a new quarterly Environmental, Social and Governance (ESG) themed research compilation - dubbed ESG Focus - which will pool together the agency's ESG research and green bond assessments.

And investment management firm Brooks Macdonald last week launched a new Responsible Investment Service, which will offer clients investment strategies that either avoid certain companies or sectors or seek to step up support for firms with strong ESG track records.

Meanwhile, the Natural Capital Finance Alliance (NCFA) published a report last week - entitled Connecting Finance and Natural Capital: A Supplement to the Natural Capital Protocol - which provides advice on how investors can better assess their impact on natural capital.

The latest green investment developments come against a backdrop of further reminders of the huge scale of the reforms that will be required to deliver a genuinely sustainable investment community.

A separate report last week from the US non-profit Consumer Watchdog revealed the top 10 US insurance companies continue to hold $51bn in fossil fuel assets, while eight out of 10 have not altered their investment strategies in any way to address escalating climate risks.

The report came as a new coalition of public-interest groups came together under the banner Insure Our Future to call on US insurance companies to divest from coal and tar sands companies.