OFGEM Report "Project Discovery" Funding the next 10 years

[KenB]

Published last month, this rather lengthy report paints a worrisome picture ahead for the UK energy consumer

http://www.ofgem.gov.uk/MARKETS/WHLMKTS/DISCOVERY/Documents1/Project_Discovery_FebConDoc_FINAL.pdf

If you just want to know where your bills are going - see the graphic on page 11.

Forget who gets power on May 6th,  the UK energy infrastructure needs a massive £200 billion investment in the next 10 years just to keep the lights on and the gas in the pipelines.  You and I will be footing the bill regardless. That's about £13K per UK household.

Perhaps a good topic of conversation when some expense fiddling parasite knocks on your door and asks for your support in the forthcoming campaign.



Ken

[rhys]

Interestingly though the table at the bottom of page 11 seems to show the "Green Stimulus" option as having the least impact on bills and the best CO2 reductions  Generation Intermitancy though.
 Risk - Generation intermittency
 CO2 - Down 43% by 2020
Bills -  Up 14% by 2020
Investment - £190bn
Glad I just order another £500 worth of Kingspan

[dhaslam]

  You and I will be footing the bill regardless. That's about £13K per UK household.
Ken

Doing nothing will  will cost that  sort of  amount and perhaps a lot more.     But a properly worked out strategy  will have practically  no net cost to the country.  Provided money spent circulates within the economy  increased income  and increased tax  take will balance the extra expenditure.   The only thing perhaps missing is the  technical ability to make it work.      

[KenB]

Rhys,

The Green Stimulus option requires nearly £200 billion of investment - mainly in windfarms.  I just cannot see that happening under the current economic climate. Who is going to put up the money for that sort of risk. Most of the large wind turbines come from Denmark - so that will be not circulating around the UK economy.

Most likely, the power companies will reluctantly build CCGT powerstations in 2014-2016 on the site of their existing coal plants.  Least investment and gets us out of a hole for a while. They will no doubt employ the cheapest overseas contractors and labour they can get their hands on - so that's not really going to benefit the UK labour market either.

However, we will then be very vunerable to fluctuations in the gas price, and the power companies will find ways of passing those fluctuations on to us. In the last 2 years we have swung from 30p/therm to 60p/therm and back to 30p/therm.  I haven't noticed my gas bill getting any cheaper - despite the 6 or 7% cuts that all the utilities are mouthing off about now - as soon as we're out of the cold spell.

Ofgem seems confident that we will have new nuclear plant coming on line between 2016 and 2020.  We better get started on those then - cost they will take 5 years in planning. That will keep the bureaucrats employed for a few years anyway.

Noel has probably got the best handle on the UK construction industry - he knows when they are likely to start digging holes in the ground and filling them with concrete.


Ken

[dhaslam]

So it is possible to build nuclear power stations but not factories to design and build wind turbines.  There is no reason to believe that only the present designs are viable.   In any case a lot of the work actually needed  is local work.  Roads, power lines and groundworks are needed for wind farms  plus maintenance.     

The Severn  Barrage would employ tens of thousands in its construction phase.
www.altenergymag.com/emagazine.php?issue_number=07.08.01&article=barrage

There is also the possibility of other tidal systems and storage facilities.  As well as electricity  generation there is a  big potential in heat  production and retention.     

[desperate]

We can build  this stuff alright, we just need the sums to add up in terms of finance and planning and long term security of supply, get those right and there will be people crawliing out of the woodwork to supply from this country.

Desperate

[KenB]

Dhaslam,

The utilities will follow the path of least expenditure and risk that maximises their shareholder's profits.

That excludes wind and nukes.   The best you'll get by 2016 is a bunch of rapidly thrown up CCGT sheds with no heat production tie-in.

Here in mainland UK you can't build anything without first having years of planning consultation. So don't expect a Severn Tidal Barrage any time soon. I have a book published in the late 1940's discussing proposals for a Severn Barrage.

Perhaps we should have bailed out our energy infrastructure first and let a few banks go to the wall.



Ken

[Ted]

Here in mainland UK you can't build anything without first having years of planning consultation. So don't expect a Severn Tidal Barrage any time soon. I have a book published in the late 1940's discussing proposals for a Severn Barrage.

Which is why the government have set up the Infrastructure Planning Commission. Something that the Conservatives have already said they will scrap as soon as they are in power. 

[noelsquibb]

Noel has probably got the best handle on the UK construction industry - he knows when they are likely to start digging holes in the ground and filling them with concrete.

I stopped listening to grand announcements about infrastructure projects years ago cos they never seem to happen.

Theres a bit of road between Newton Abbot and Torquay that's been designed about 5 times had at least three public inquiries and had funding allocated with a start date more times than I can count.

I worked on an early version of the design as a student engineer in 1972 ........... still waiting for it to happen.
The money spent on talking about it and drawing pictures of it would have built the job twice over.

Severn Barrage ? by the time we realise our needs probably outweigh the needs of greater crested scallops, it will be too late.

I think the  before anything will happen with electric power, which is why I rather hope a significant supply failure will happen sooner rather than later.

Although we did get a gas pipe all the way from Milford Haven to Plymouth, with a pretty new LNG electric generating site on the end of it.  Apparently soon to be generating once they've sorted a few snags 
It will produce 855 Megawatts of power, and use gas that is shipped from all over the world.

So there are schemes going on but will they address the predicted shortfall ?

Of some interest,  the Gov recently took a look at network protection and have told the distributors that they will need to assess the threat from trees growing beside the overhead HV network, so expect a bigger swathe of tree clearance under these lines in future.

Perhaps that's what the Infrastructure Planning Commission is about then.
Phew,  nowt to worry about after all.

[desperate]

Goodo, I bagsy the logs, smoky and I will be along

Desp

[KenB]

Guys,

David Strahan published an article in the Telegraph at the time of the Ofgem report. 

It appears that they (power generators) have taken the easy route and intend to plug the energy gap with gas fired power plants.  However, this leaves us with almost all of our eggs in the one basket. Any disruption to gas supply (not that that's ever happened recently ;-) will severely disrupt our ability to generate power.

The full article, which looks at the UK's increasing gas insecurity, is here

http://www.davidstrahan.com/blog/?p=536#more-536

Figures from New Power, an industry journal, show that 15GW of new gas fired stations are either under construction or have received planning permission, with a further 15GW in the wings. Editor Dominic Maclaine says “there is a new dash for gas in power generation”. That is likely to raise the proportion of electricity generated from gas even further, and increase Britain’s vulnerability in the case of supply disruptions. In that case, without a major increase in storage capacity, future gas supply crises could also leave us in the dark.

If, as "New Power" suggests, that 15GW of CCGT plant have already been approved for planning or under construction - then clearly the industry doesn't give a fig for energy security. It has recently been shown, that it doesn't matter whether the price of gas goes from 30p to 60p, the industry will always find a way of charging its customers more.  Why is it that we see so many happy British Gas adverts on TV these days - claiming that they are keeping the planet green?

Here's a 2006 Government White Paper outlining the necessity to maintain a varied generation mix

http://www.berr.gov.uk/files/file32007.pdf

And lo and behold - the same Government department (BERR) already knew in 2007 about 18GW of CCGT that were in various stages of planning and development.

http://www.berr.gov.uk/files/file41816.pdf

They snuck this one under the radar, whilst every eco-activist in the UK was getting hot and bothered about Kingsnorth - what a great smokescreen that was - no pun intended.  Useless tosser Malcolm Wicks was Energy Minister then - I wonder how much they paid him?

CCGT running on natural gas is the cheapest option for baseload generation - not only in the cost per unit, but the cost of the plant and the decommissioning costs - so no doubt got the shareholders' votes

http://www.raeng.org.uk/news/publications/list/reports/Cost_Generation_Commentary.pdf

The question is whether E.On wil stick to their guns and build the pair of 800MW super-critical IGCC coal plants at Kingsnorth, or will they be converted to CCGT?  E.On are probably waiting for the recession to end, and keep their powder dry - and see what's happening to gas prices.

This is the second dash for gas - the generators have already decided their preferred energy strategy, and are leading the UK into a precarious position of energy insecurity.  Ofgem are toothless to prevent this, in the same way that the banking regulators were unable to regulate the bankers from initiating the credit crisis.

I think this needs to be debated in public - the Government (whichever one), needs to be told that there is a major energy crisis looming. Perhaps they already know?




Ken

[desperate]

It's hardly rocket science that the Govt are going to commision new gas power stations is it? after all at the slightest mention of Nuclear,Coal,Wind on or offshore,Tidal Barrage,Power transmission lines or whatever, there is a countrywide condemnation of "those fools in power" and a couple of decades of action groups attending meetings ad nauseum, and what? sweet f a

They know more than 90% of us dont give a monkeys where the power comes from as long as the lights dont go out,and if you had to absolutely guarantee security of supply, what would you do?

We all know in theory that we could use a sensible mix of renewable on every roof and field and mountain and shallow seabed in and around the country, with say a bit of Coal and nuclear as backup, but given the logistical difficulties, it aint happening this century.

Seriously I think we all need a dose of reality pills, and fast............sorry

Desperate

[splyn]

At least we can take some comfort from the reasonably secure suppy of gas for the near future from Norway's Ormen Lange gas field through the recently constructed pipeline to the UK:

http://www.statoil.com/en/ouroperations/explorationprod/partneroperatedfields/ormenlange/pages/default.aspx

"The field will be able to cover as much as 20 percent of Britains gas needs, for up to 40 years."
...
"With recoverable gas reserves estimated at 397 billion scm, deliveries are likely to continue for 30 to 40 years."

Thank goodness for that. Funny then how this recent bit of news seems to had a very low profile - or perhaps it was just me that missed the headlines:

http://uk.reuters.com/article/idUKOSN00428820100224

"Norway cuts Ormen Lange size estimate"
...
"The NPD cut gas field Ormen Lange's recoverable reserves estimate by 103 million cubic metres of oil equivalent from an earlier 395 bcm view."

This follows Shell's drilling of two appraisal wells which found that the field isn't as big as they thought. Stills its only 25% smaller than thought so hardly worth raising the issue with the public. Fortunately we don't seem to have a UK energy policy so there's no need to reconsider it in the light of any such changes in the fundamentals.

In any case I'm sure that nice Mr Putin will be able cover the shortfall for us - perhaps they could could cover Siberia tundra with polytunnels to capture all that Methane released from the melting (not so) permafrost?

Oh god. I'm starting to empathise with Marvin (the paranoid android from the Hitchhiker's guide to the Galaxy).

Splyn
 

[KenB]

Desperate,

Did you read that we had several instances of demand exceeding supply giving rise to Gas Balancing Alerts - this winter?

100 major industrial customers were disconnected in order to reduce the gas load.

Now chuck in 15GW more CCGT plants, and our instantaneous gas demand goes up by 30GW.  That's the equivalent of another 5 million houses turning on their central heating.

if you had to absolutely guarantee security of supply, what would you do?

I would diversify the fuel mix, rather than basing it all of natural gas.  That's what I've done here.  More than 50% of my domestic heating is now wood.

The utilities have taken the easy option, that maximises shareholders profits.

Strahan's article points out that we are at the end of a very long supply chain.  There is no reason why the Norwegians should supply us preferentially  rather than any other country.  We buy our gas on short contracts - almost on a day to day basis and this does not give us a preferential deal.

I've been taking plenty reality pills recently.



Ken

[renewablejohn]

Ken

I am with you on using wood. Have been 100% wood for heating and cooking for the last 2 years. Next phase generate 100% of own electric from wood and solar.