More than half of £50bn wind farm cash to go overseas
Britain is forecast to miss out on more than half of the £50 billion investment in building offshore wind farms in its waters this decade, with the majority of orders for turbines and other equipment expected to go to factories and suppliers overseas.
A commitment to quadruple UK offshore wind capacity by 2030 was one of the key policy proposals outlined by Boris Johnson in his ten-point plan last week to cut emissions and create jobs. However, government figures predict that only about £20 billion of the investment will go to Britain.
Energy companies are expected to need to invest about £50 billion building new wind farms to hit the 2030 target. Although Britain has two blade factories, in Hull and on the Isle of Wight, many blades and most other big turbine parts are made abroad. Only 29 per cent of the capital investment in recent projects has been in the UK.
The government is aiming to boost this figure and has committed to invest £160 million in ports and manufacturing infrastructure, but the business department told The Times that the UK share of capital expenditure was expected to reach only 50 per cent by 2030 and that “the majority of the increase in UK content is likely to occur after 2025”.
The admission comes despite claims in the ten-point plan that it would “enable the delivery of 60 per cent UK content in offshore wind projects”. This higher figure relates to the “lifetime” UK content of projects starting in 2030 and relies on British companies doing most of the operations and maintenance work over subsequent decades.
Ed Miliband, Labour’s shadow business secretary, said that “a green industrial revolution must be about generating jobs in the UK, not just generating offshore wind here”. He accused the government of “not doing nearly enough to invest in the supply chain to make sure that happens”.
Britain has more offshore wind farms than any other country, after giving early projects subsidy contracts guaranteeing them a high price for the electricity they generate, adding billions of pounds to household energy bills.
Costs have since fallen significantly, though, and recent projects have been awarded contracts at record low prices that are expected to save consumers money.
There is still anger that Britain has not secured a greater share of the manufacturing for an industry that it helped to create.
Sue Ferns, of the Prospect union, said: “Every megawatt of new offshore wind capacity in Danish waters directly supports five jobs in Denmark, compared to just one in the UK.”
In Scotland there has been outrage as Bifab, part-owned by the Scottish government, lost out on making foundations for SSE’s Seagreen wind farm off Fife, where Bifab has manufacturing yards. SSE opted for companies in China, South Korea and the United Arab Emirates, citing lower costs. About 40 per cent of Seagreen’s blades will be made on the Isle of Wight, with other key elements produced abroad.
SSE has selected GE turbines to build the world’s biggest offshore wind farm at Dogger Bank and the government is in talks with the American company to secure manufacturing sites in Britain.
The Times
Stop penalising companies for investing in green tech, CBI urges government
Companies pouring cash into solar panels and eco-friendly heat pumps for their properties should not be hit with hiked business rates and should instead get exemptions from bills to encourage green investment, a leading industry group has said.
The CBI said a reformed business rates system could accelerate progress on a “green industrial revolution”, something which Prime Minister Boris Johnson last week said would be a priority for the Government, outlining a ten-point plan which included banning new petrol and diesel cars a decade earlier than originally planned.
In a report out this morning, the CBI and property adviser Avison Young said that companies were currently being penalised for making their properties more energy efficient and investing in “green” technology.
The two groups urged the Government to take concrete actions to change this whilst it was reviewing the business rates system, including delaying an increase in companies’ bills for at least a year after they undertook work to decarbonise their properties. There should also be a temporary business rates exemption linked to improvements in energy efficiency, CBI and Avison Young said.
Daily Telegraph
Rishi Sunak to unveil national infrastructure strategy for UK
Rishi Sunak is set to unveil the government’s national infrastructure strategy next week, including long-term investments in the climate and transport sectors and plans to narrow the north-south divide.
The strategy, which the chancellor had been due to be published in March, provides £100bn to improve connectivity in transport systems and work toward the government’s goal of net-zero emissions by 2050. It includes a down payment on flagship programmes including fibre broadband, flood defences and transport schemes, according to the Treasury.
Sunak will announce the plans on Wednesday along with his spending review, which will provide tens of billions of pounds for infrastructure investment, including £1.6bn to tackle potholes.
The strategy is also designed to push back against accusations of a discrepancy in funding for the north and south of England. The Treasury confirmed Sunak would be changing the department’s green book, a set of regulations that determines the value of government schemes and which is said to favour London and the south-east of England.
Sunak will also introduce a new national infrastructure bank, which will have its headquarters somewhere in the north of England. The bank will be launched next year to replace the work of the European Investment Bank after the UK leaves the EU.
The Guardian
Ministers block Boris Johnson-inspired bid to export Scots water to England
Ministers have blocked plans to export Scottish water to England to deal with shortages in a scheme once championed by Boris Johnson.
Sir James Bevan, chief executive at the Environment Agency covering England, said last year that Scotland could provide the answer to England’s H2O woes, with the southern half of the UK predicted to run out of fresh water in less than 30 years.
He said England was staring into the “jaws of death”, where the ever-growing population surpasses the falling supply of water.
Climate change meant that people should cut their water use by a third, half of all leaking pipes must be repaired, and huge new reservoirs, treatment plants and transport pipes built if England is to continue quenching its thirst, he said.
In 2014, a bold proposal to tackle water shortages in Britain’s southern counties by building a vast “super canal” between the two countries was being considered by both the UK and Scottish governments.
It came after Mr Johnson championed the idea of Scotland helping England out with water.
The plans, devised by one of the world’s biggest architectural and engineering design firms, envisaged a new £14 billion waterway running from the Scottish Borders down through Newcastle and Leeds, winding its way along the west coast of England and taking in extra water on its way.
Known as the Natural Grid, it would eventually branch off as it reached the Home Counties, with routes running down into Hertfordshire and Hampshire to supply homes, businesses and utilities.
The company behind the canal project, Aecom, suggests an initial starting point of the northern Pennines, with the canal eventually extended north to begin its journey in the Southern Uplands.
The plans were presented to David MacKay, chief scientific advisor to the Department of Energy and Climate Change, and had been under consideration.
At the time the Scottish Government indicated support for the idea of exporting some of Scotland’s water supplies to the south.
But ministers have made now made it clear that any plan is now pie in the sky.
“Whilst Scotland has a relative abundance of fresh water compared to an increasing number of parts of the world that are becoming water stressed due to population growth and climate factors, there are no current plans to export water to England or internationally,” said a Scottish Government spokesman.
“Ministers are aware of the supply challenges in some countries, including in south-east England, and the growing concerns about the need for water utilities in England to take action to ensure continuity of supply in water-stressed areas in the future.
“However, previous analysis suggests the sale or transfer of water from Scotland to England – most likely by bulk shipping raw water or via pipelines – would not be economically viable at this time. However, the Scottish Government will keep the issue under review.
“The Scottish Government is instead committed to making Scotland a ‘Hydro Nation’ where water resources are developed so as to bring the maximum benefit to the Scottish economy. As a Hydro Nation, our approach internationally is to support other countries to get the most from their own water resources by reaching out to the world to share our academic excellence and expertise in water governance and water management technology.”
The Herald
Regional disparities in electric car-charging points revealed
London and the south-east have benefited disproportionately from the installation of new electric car charge points in the last year, amid a push to be ready the UK for the ban on internal combustion engine cars in 2030.
The two regions together received 45% of new charger capacity in the year to October, well in excess of their 27% share of the population, according to a Guardian analysis of Zap Map data which shows charging points across the UK published by the Department for Transport.
Every other region received a lower proportion of new charge points installed during the year to October than their population would suggest.
Public car-charging infrastructure was a key part of Boris Johnson’s plans for a “green industrial revolution” published last week. Johnson’s 10-point plan included £1.3bn of investment in car charging, although only £800m of that was new spending. Further details are expected to be outlined in the chancellor’s one-year spending review this week.
The 2030 ban means that all new car buyers across the UK within a decade will need easy access to charging infrastructure, but the current public charging network is already skewed towards London in particular.
There are 63 public chargers per 100,000 people in the capital, more than double the average of the rest of the UK, according to the data compiled by Zap Map. Northern Ireland had the lowest, with only 16.8 per 100,000 people – although other regions with a lower proportion of urban residents may be able to depend more on charging at home in off-street parking spaces.
Matt Western, the Labour MP who chairs a parliamentary group on electric vehicles, said the government needed to address regional disparities as well as ensuring open access to existing charge points.
“What we need is government incentives to put these charge points in place … to provide the incentive for consumers to follow,” he said.
The total number of publicly accessible chargers last month passed 20,000, but there are still 48 local authority areas with fewer than 10 public charging points per 100,000 residents, demonstrating the scale of the challenge ahead to make the whole country ready for electric cars. The RAC has reported a doubling this year in the number of instances where drivers of electric vehicles have needed assistance after running out of charge, because charge points have been out of service, their home chargers have failed to charge overnight, or drivers have run out of charge before reaching a charge point.
The Guardian
Ineos signs hydrogen fuel cell deal for its off-road vehicle
Ineos and Korean carmaker Hyundai have agreed to work together on hydrogen fuel cells that will eventually power the British chemical company’s new off-road vehicles.
They will collaborate on developing a reliable supply of hydrogen in Europe, as well as using Hyundai’s fuel cells in Ineos’s vehicle, called the Grenadier.
Sir Jim Ratcliffe, the founder of Ineos and one of Britain’s richest people, has invested millions in developing the car, which will come to market in early 2022 with an internal combustion engine.
However, Ineos also plans to produce a version capable of running with zero carbon dioxide emissions to meet tightening environmental standards around the world, and it believes that battery electric power will not give it the rugged capabilities in areas with patchy electricity supply.
The Guardian
Hydrogen powers to the fore but is Johnson’s grand plan just hot air?
The Prime Minister has grand plans for hydrogen power. However, he sought to humanise a vision of a future dependent on energy from the lightest, simplest and most abundant chemical.
“You cook your breakfast using hydrogen power,” said Boris Johnson, going on describe a world with cleaner air because “the trucks and trains, ships and planes are running on hydrogen”.
He spoke of how his “10-point plan will turn the UK into the world’s number one centre for green technology and finance” which will see “water turned into energy with up to £500m of investment in hydrogen”.
Targets included generating 5GW (gigawatts) of low-carbon hydrogen production capacity by 2030 for use in industry, power and homes, with the goal of creating the first town heated solely hydrogen by the same date.
Swapping the UK to hydrogen power is a massive challenge which that will require massive investment, however.
Analysts at Evercore calculate a global transition to hydrogen power will cost $400bn (£301bn) over the coming decade and $2 trillion over the following 20 years.
Britain’s investment in the fuel source – even if it does attract the Government’s hoped for £4bn of private sector capital – hardly holds a candle to what is required.
And it’s not as if it hasn’t been tried before. “Hydrogen has a history,” Evercore’s analysis cautioned. “Sceptics are right to be doubtful about a theme that provided false starts of hope and promise in the Seventies, Nineties, and Noughties.
Hydrogen’s ebbs and flows have usually been driven by not being able to compete with low oil and gas prices, rendering moot its ability to serve as an alternative form of energy.”
But this time it seems different. New technology such as viable fuel cells which turn the gas into electricity and global recognition that climate change has to be tackled have created a new impetus around the gas and its applications, as the world turns away from fossil fuels.
Phil Caldwell, chief executive of West Sussex-based fuel cell developer Ceres Power, is hopeful that Britain can have a place in a hydrogen world.
“Government has made a good start,” he says. “These are concrete policies and targets but it mustn’t be the end of ambition. Now it’s up to them to create the right conditions to attract the private investment that’s needed.”
However, he cautions against thinking the UK has staked a flag in hydrogen territory that other countries have yet to recognise.
“Britain did not invent hydrogen power,” the boss of the Aim-listed company says. “South Korea’s investing more than £40bn in hydrogen and fuel cell technology, Germany’s putting £8bn into hydrogen and other big European nations larger amounts than us. If anything we are behind as a nation.”
But Britain has a close to home advantage when it comes to hydrogen – geology.
“Thanks to decommissioning of the North Sea we have the best geology in the world for carbon capture and storage (CCS),” says Eugene McKenna, green hydrogen managing director of FTSE 100 chemicals business Johnson Matthey. “We’re putting back what was taken out and eventually it will turn back into rock.”
These formerly unwanted sites – which other North Sea oil countries have access to – place Britain at the forefront of CCS development (also known as CCUS with ‘utilisation’). Arguably Australia has similar geological advantages, but the sunny climate Down Under makes it ideal for solar-powered green hydrogen, and Norway’s abundant hydro power means it has less of a focus.
Focusing investment close to home is an opportunity missed in the last renewable energy boom, as nations moved into solar, and particularly in cloudy northern Europe, wind power, according to Marco Alverà, chief executive of Italian energy infrastructure business Snam.
He praises the UK as home to “some of the world’s best energy technology companies”, something he attributes to the country being a “beacon on energy policy, with the most informed parliament and people”.
“The UK, Germany, Italy and Spain drove down the price of renewables because of policies and subsidies to encourage utilities to invest, and the UK was at front of them,” he says. “But the £1 trillion that consumers paid from their energy bills over 15 years in subsidies went mainly to Chinese manufacturers of solar and wind equipment because the capacity wasn’t in Europe.
Sunday Telegraph
Energy firms have been fined £389m in the last decade
Energy firms have been forced to fork out £389million in fines and redress payments over the last 10 years, new research has revealed.
British Gas has been charged the most over the past decade, paying out £45.5million, according to analysis of Ofgem data by energy switching site, Flipper.
The Big Six are most at fault with Npower coming in next with a bill of £36million followed by Eon at £34.6million.
When tallied up, energy firms have had to pay back the equivalent of £100,000 a day, every day, for the last 10 years due to non-compliance with regulations.
Mark Gutteridge, managing director of Flipper, said: ‘This figure is shocking and these are not minor issues.
‘Ofgem only investigate where it believes a company has breached their licence conditions, consumer protection law or have acted anti-competitively.’
While the fines are paid to the Treasury, the vast majority of this sum – 75 per cent – have been redress payments.
This means the energy company agreed to take action that benefits customers such as paying into social programmes like the Warm Home Discount.
Problems seem to be escalating as the latest statistics from Ofgem suggest that 2020 could be a record year for fines.
So far, £64.9million has already been dished out this year – the second biggest amount after £71.9million was paid in 2015.
More than 20 different suppliers have been fined since 2010, with British Gas and Eon each having paid out the most at more than £34million each.
Daily Mail