The UK government has recently published a consultation document on possible reform of the management and regulation of the UK electricity industry.
The UK fell under the EU system of control and regulation, which was progressively tightened and embodied in the 71 page 2019 Regulation. This Regulation wished to achieve two main aims, the integration of a Europe wide system of power provision and rapid progress to decarbonise the electricity used. The two aims were self reinforcing. The Regulation warned that as more power came from interruptible renewable sources there would be more need for interconnectors to allow the import and export of power across national boundaries to compensate for shortfalls in supply. The UK duly obliged even though we were in the process of exiting the EU, continuing its drive to rely more on interconnectors to the continent and very willing to add large extra volumes of wind energy to the system.
In line with other European countries the UK had developed twin market interventions to bring about the net zero progress. More low carbon power was attracted by offering long term contracts at guaranteed prices. In the early days of renewable power and for nuclear these were at premium prices to the then market wholesale price. The investors putting in the new capacity agreed to pay back any money earned over the contract price were energy prices to rocket, whilst requiring a subsidy all the time the contract prices remained above the wholesale price. The grid operator also had to hold capacity auctions, offering money to owners of stand by plants that would work in periods of low wind or little solar to keep their capacity ready to run. As they hoped these plants were not going to run that often they needed to offer sufficient money to make it worthwhile maintaining , staffing and fuelling the plants ready to run. Gas plants ended up running a lot to keep the system going with more than half our electricity coming from gas on a typical light wind day.
The consultation document does not give a clear steer of what would be a better system to guarantee security of supply whilst also providing plenty of competitive pressure to keep prices under control. The original regulatory system set up by the UK in the 1980s before the EU took over was a simple one of generators bidding into the system their price offers. The grid manager always took the next cheapest offer when having to scale up the output, and dropped off the dearest when cutting supply. The system was sufficiently attractive for there to be spare capacity so we never ran out of power even on cold dark windless busy day. Most of the power came from coal and gas, with a useful contribution from nuclear.
The immediate issues are the way some providers of renewable power can receive the elevated gas based price despite having much lower costs, and the lack of margin in our capacity for when the wind does not blow and the sun does not shine. The UK has also to prepare for a reduction in output from nuclear this decade, which is planned to see the closure of all but one of the existing nuclear stations. What are your thoughts on the changes we need?
August 31, 2022
I work on a trading floor in the City. My commuting friends are oil traders. They tell me that the UK, US and EU sanctions of Russian oil are a facade. The âinternationalâ oil price is $100 dollars a barrel whilst the West pays $300 a barrel for âsanctionedâ oil. This âsanctionedâ oil and gas is simply Russia oil and gas that is either bought by countries in the middle east and swapped for their local oil and gas or bought by China and rebranded as Chinese gas. All of whom are making VAST profits whilst the British public SUFFER.
In other words countries around the world are profiteering at vast the expense of the West, whilst the Western Governments virtue signal about sanctioning Russia and hand huge profits to countries like Saudi and China.
This is farce. We have had enough catastrophic virtue signalling. Whether itâs saving the NHS through lock downs causing millions to be untreated, handing out mortgages to disadvantaged âdemographicsâ causing the 2007 Lehman crash, the green agenda trashing our energy independence. The next crash will be caused by woke policies and will be bigger than anything before it. The public are catching on that virtue signalling is the road to ruin.
August 31, 2022
Fantastic post Javelin
September 1, 2022
+1
September 1, 2022
Well done Javalin. Tory lies exposed again.
August 31, 2022
@ Javelin “…handing out mortgages to disadvantaged âdemographicsâ causing the 2007 Lehman crash..” – you might be clearer that it was not the mortage borrowers at fault, rather the sellers of bundled and repacked mortgage risks whose buyers suddenly saw that they could not rely upon the professed credit risk of what was being sold, ending de facto eligibility for such products in the overnight repo market with consequent catastrophic impact upon liquidity and hence solvency.
Otherwise, your commuter friends are spot on. Whisper who dares how come Saudi has been recently increasing its imports of oil!
August 31, 2022
Have heard the same. A maritime pilot for example, “Had a Russian ship with oil come into a Dutch port, we passed the breakwaters, swung around and headed out to sea again, to Germany. Magically the cargo was suddenly labeled as âDutch oilâ, so the Germans were happy to receive it”
August 31, 2022
Indeed the war on CO2 and more to rely on âunreliablesâ has been a disaster as any sensible (honest and independent) engineer or physicist could have told them.
You say âThe immediate issues are the way some providers of renewable power can receive the elevated gas based price despite having much lower costs, and the lack of margin in our capacity for when the wind does not blow and the sun does not shine.â
If anyone deserves a windfall tax (generally a very bad idea Sunak) it is surely the renewables industry who still have the same costs of production but are now getting far more for their intermittent electricity due to higher gas prices and the absurd war and taxes on plant/tree/crop food and the idiotic blowing up of coal fired power stations with piles of coal conveniently storing energy until needed. Wind power is not even that low in carbon vast amounts of fossil fuels are used to build and maintain them with large amounts of concrete other materials and diesel ships. Electric cars actually increase world CO2 in general. Burning wood at Drax produces more CO2 than burning coal per KWH. Time for the Truss government to finally get a grip and abandon the ruinous and pointless net zero insanity in full.
September 4, 2022
Oh and by the way Net Zero isnât just electricity, itâs all the aviation spirit at Heathrow and the thousands of 12 wheel artics through Dover. Why never discussed by the Net Zeroists? Too difficult thatâs why. Lefties are bad at math.
August 31, 2022
Depoliticise the delivery of strategically important services. The primary consideration should be practicality and utility. Ideology and political vested interest should be purged. This requires a moral PM with a human heart not an ideological drone or leader who panders to ego, party convenience, personal or vested interest
As an aside. Is there any possibility of this Tory government halting its facilitating of the totalitarian left and Labour through its attack on online freedoms? It seems odd that a libertarian like Johnson should want to deliver into the hands of the fascist left a weapon to destroy our most important online freedoms. I DON’T GET IT. What’s the Tory game here? Why are you doing the enemies bidding?
August 31, 2022
âWhat are your thoughts on the changes we need?â
Boris was still promoting Net Zero yesterday as he gave his thoughts on leaving office.
Klaus and his pals want Net Zero.
It will take real strength of purpose from a new Prime Minister to make the necessary changes. Leaving the EU does not mean it will be plain sailing.
September 1, 2022
The ex-libertarian, ex-climate realist and ex-small government Conservative Boris has clearly been driven totally mad by Covid, Carrie, St. Greta, Gove, the devil gas religion, the World Economic Forum⊠or some such combination. But neither Truss nor Sunak have rejected the insanity of net zero even now.
Whom the gods would destroy they first make mad.
August 31, 2022
Allison Pearson today:-
âBoris can never be forgiven for sacrificing Britain to his net zero fantasy
We have already contributed billions to this elite pipe dream and now we must suffer the hardship caused as it darkens into a nightmareâ
He was once a relatively sensible libertarian, small government, climate realist. Never take advice from Theatre Studies graduates on things like energy, economics, physics or engineering Boris – would you fly on a plane designed by your wife or get her to design a new suspension bridge? But the fault starts far earlier than Boris/Carrie, even Thatcher fell for the CO2 devil gas religion at one point. Major, Blair, Brown, Cameron/Clegg, Theresa May and Boris all pushed this insanely damaging insanity at vast public expense.
It has been estimated that ÂŁ12 billion is needed to fix all the UK roads and pot holes – sounds like a bargain compared to HS2 or Net Zero. Undo all the road blocking and motorist mugging schemes at the same time.
August 31, 2022
After all the years of EU control and the bald fact that even the mighty EU can not make the wind blow AND I imagine the EU saw wind power as a potential unifier of Europe rather than a viable energy sourceâŠthere are really only a few things we can do.
Get rid of wokery. It used to be very problematic to be a member of the commie party.
Leave the ECHR with immediate effect.
Get mining and fracking and gas producing. ( promise of nuclear is a cop out probably).
Uproot and sell or melt down those monstrous windmills.
August 31, 2022
Good morning.
What an absolutely insane way to do things. From butter mountains to wine lakes, and now this ! Why canât we just run things like they used to be ? You know, they days when things just worked.
Sounds like a typical, Johnson led government. All talk and no action. Thatâll be his true legacy. That and making us all poorer â ie Levelling up / down.
I suggest we dust that one down and use that. No need to reinvent the wheel.
All in all everything this government has and has not done is coming back to bite us. At least CMD Father-in-Law has done well out of the scheme. He has wind turbines on his farm and gets paid irrespective if they provide energy or not.
đ
August 31, 2022
PS
RIP Mikhail
August 31, 2022
No doubt the Federation will blame the Ukraine, the EU will blame Putin, the WHO will blame covid and the Western World will blame climate change
August 31, 2022
Yes Mark
August 31, 2022
We need affordable electricity for households and industry.
Wind and solar cannot be relied on.
The grid must be able to transfer electricity.
For the foreseeable future we must use gas,oil and coal extracted within the U.K.
August 31, 2022
The 71 pages of regulations (did anyone actually read them?) that plunged Europe into freezing darkness!
August 31, 2022
Like it or not this country is on a crisis due to government intervention in a system that worked well. They were persuaded by those with vested interests that renewables would fix everything even though many of the experts in that field said it was nonsense and there was already proof of the failures in other countries. What we don’t need is more bloody wind. Why have more of what essentially is causing the problem? We have to accept this problem may go on for years. We should have been having this discussion a long time ago. The government MUST see this as a national emergency. Get fracking and nit just in the north, get something actually ordered and off the ground with RR, open the Cumbria coal mine and start drilling. Make sure the energy produced is sold at a reasonable price before export. Other countries manage it and so can we. The majority of people in this country are sensible enugh to realise we are in the shit and when they start to see their bills rising will want any change that brings a long term solution. Stop wasting money on things that just don’t serve a purpose. Governments have been blinkered and not being able to see the folly of relying on renewables and energy in the control of a hostile nation such as Russia is completly irresponsible.
August 31, 2022
You ask:- What are your thoughts on the changes we need?
A brain transplant for all the many foolish and scientifically ignorant MPs who voted for the climate change act. or nodded through Mayâs appalling ânet zeroâ time bomb perhaps? About 95% of MPs it seems need one. Would help if they at least could understand the difference between energy and power and the units, on demand or intermittent electricity and that hydrogen is only a very inefficient way to store energy – we have no hydrogen mines!
1. CO2 is not a serious problem there is no climate emergency.
2. the solutions pushed (wind, solar, heat pumps, EVs, hydrogen, burning wood at Drax save little or no CO2 anyway when fully accounted for anyway.
3. the UK contribution to CO2 is irrelevant given the policies in China, India, RussiaâŠ
All three are true and just one being true makes net zero totally pointless – hugely expensive & very damaging too.
August 31, 2022
The biggest change needed is that the politicians charged with managing energy actually fully understand the whole production and supply process.
To much of the country’s energy group think is shackled by Net Zero. As within lots of government sectors ministers are advised by so called experts who all have their own pet theory, they end up peeing before their flies are open by not applying proper cause and effect analysis.
Why else would they allow the grandstanding situation of blowing up coal power stations and cover the land and sea beds with turbines and solar generators with no proper infrastructure in place, to accommodate the fear methology of not obeying the sermons from the new powerful religious sect that has taken over their whole existance?
August 31, 2022
We need to keep existing power stations in operation at all costs, and stop using net zero as an excuse to shut everything down.
Before we switch to old technology to something else that doesn’t works better, we need technology to catch up — So an extra effort has to be made to find better ways to produce energy that will not impoverish us.
In this there is a great need to look outside the box and allow innovative minds to pursue this – and not allow politics to prevent a real solution.
August 31, 2022
Bryan Harris
Behave yourself . You know as well as most of us. To think outside the box you need to be in it in the first place.
That’s the real problem. We have about 50 MPs that actually think and engage their brains before opening their mouths. How is it the remainder were so right for plucking when the sect for Saving the World started knocking their doors. A 21st century version of the Emperor’s New Clothes. What the hell will they be remembered for?
September 1, 2022
@turboterrier – indeed
As I see it they will be remembered for the death and destruction unfolding.
August 31, 2022
The simple system you describe for the 1980’s would seem to have been sensible, so what on earth made the Government want to change it all in 2019 to tie ourselves in to the EU when we had already decided to leave.
There is a useful saying that “if it isn’t broke, don’t fix it”
It’s a simple saying because so many times it has proven to be true, yes spend money and time to maintain it, but do not change it until you are sure any new product or system is fit for purpose, and then only introduce it slowly.
The real cost of the headlong dash for net Zero is now starting to show, and should be clear, or getting clearer to anyone who is even half sensible.
Time for the real practical thinkers to take back control from the theorists.
Do we have any or enough practical thinkers in Parliament ?
August 31, 2022
Berkshire Alan
We have a few practical thinkers but they are always banished to the back benches. The lunatics have taken over the asylum.
August 31, 2022
Once again our problems arise from following idiotic EU policy. The system of interconnections is a cumbersome, expensive and ineffective means of avoiding the unreliability of renewable.
August 31, 2022
We generate enough idiotic policies ourselves without adopting those of supranational bodies. These are often captured by activists determined to impose their own agendas which have little popular support.
August 31, 2022
The EU draw up a PanEurope plan for industry sharing, rail sharing, legal sharingâŠ.well everything sharing â including âenergyâ sharing
Just because we went brexit doesnât mean our government is sticking to their plan
September 1, 2022
glen
Except sharing the collective debt of each member nation. All to appease Germany.
August 31, 2022
Sir John, my thoughts on this are the ones you have heard over and over again on this site: end the net zero commitment, and stop sending energy to Europe when we need it ourselves. These are two things that the new PM should state publicly on day 1. The broader issue as highlighted by Richard North recently is that the energy companies are very concerned for security of supply this winter, not just high prices. So in this context we should stop contributing to energy insecurity by our support for a war. The sanctions on Russia have clearly proved ineffective and self-defeating, and a rethink is necessary. If we are going to shut out one of the world’s major energy producers, and we want to keep the lights on, we may well have to use more alternative (green) energy sources. More exploration in the North Sea isn’t going to help this winter or next. This is why Johnson has continued to talk up green energy, because he both wants the war to go on, and accepts the energy supply consequences. I don’t agree with the policy but I can understand the logic.
August 31, 2022
This is an extraordinarily silly posting even by your standards, Mr Redwood. Wholesale energy prices are determined by the energy market, which is a European market. There is no separate UK market, and therefore very limited scope for any independnet policymaking by the UK, and none at all on the price in wholesale markets. It’s the story of Brexit all over again – Britain has left the body which sets the rules, and is now a rule-taker and a price-taker. A huge loss of influence
Reply What nonsense. We do supply most of our own energy and import/export is limited to interconnector capacity.
August 31, 2022
Gary Megson :
If the UK was self sufficient in gas, as it could be if our Government/Civil Servants were not trying to eliminate the use of fossil fuels through curbing North Sea exploration/production and fracking to “save the planet”, then we could have prices similar to those of the US, a fraction of those we are currently paying on the world market.
Europe is paying the world market price for gas, which BTW includes LNG from Russia via China.
September 1, 2022
I think there are some elaborate myths now about what is happening in LNG markets. I monitor shipping movements closely. In the early days of the embargo on Russia, many of their vessels stopped reporting positions via satellite responders intermittently, but the Arctic route to Asia was blocked by ice until well into July. The Chinese do have a substantial share in the Yamal LNG project, and so an entitlement to cargoes. It has been quite normal for these to be resold in Europe if Asian demand doesn’t need the supply, often in exchange for other supply e.g. ex Qatar, saving on shipping. Volumes that do go East are transshipped, often across the dock at Montoir, but also in the Barents Sea. Those transfers help disguise the apparent origin of the gas and also allow ships to be diverted to better paying destinations. There has continued to be a regular flow of Russian LNG ships to Spain, Portugal, France, Belgium, and more intermittently, the Netherlands.
August 31, 2022
This really goes to show that our government has learnt nothing from the lack of supply over demand that we are presently suffering and does not feel security of supply is paramount.
Shocking narrow mindedness, net zero and decarbonisation really is a cult.
August 31, 2022
I accept the initial subsidy for the green sector to encourage/force early investment when unit costs were high so without the subsidy not an investable proposition. However we are regularly told with pride from the industry that generation costs have fallen considerably so why subsidy at all?
I find a one size fits all price, if I am reading you correctly, totally wrong, it should reflect their cost base. I suspect as usual that as long as energy bills bumped along without drama no one cared or even understood the markets complexities driven by the blind stampede to Net Zero and protected by censorship of criticism by No 10 and the liberal elites.
Equally profit margins going up for Green generators are not the political dynamite that they are for fossil fuel providers and will encourage more investment so even quicker to Net Zero, win all round except the consumer
Scroll forward post Ukraine and like Covid, Ministers had not gamed all scenarios or censored the unacceptable ones and left us in the mess we are now in. Market rigging never works, economically doomed to failure so a cost to all of us. Short term politically, politicians love it, shows they are on our side/taking action. Kick the can down the road, memories are short, let the next generation take the heat, as a Minister hope you have moved on to something better before being found out.
And of course look to apportion blame, in your case the Regulator.
So license fracking/other new production at cost plus, look at the increased margin they are getting for their output, itâs called excessive profit and cut the subsidies back. They are now going straight into their bottom line.
Switch subsidy to home owners to make solar voltaic really cheap. I would invest tomorrow if price offset by 50% and that would include the slightly more expensive ones where technology now allows (if you have a hot water tank) to use power generated to also heat that. Separate solar thermal not necessary.
And do it immediately. Your usual practice of endless consultation is not acceptable we need action now.
Finally an honest (ha) look overall at generation, accept nuclear will not take up slack for 15;20 years? So if the wind doesnât blow no amount of new turbines will increase output. So what will the gap be and and ramp back up mothballed capacity to fill it.
August 31, 2022
Over the past 6 years the EU has made it perfectly clear that it is not our friend and it will do everything it can to damage the UK. It would be as foolish to rely on the EU for energy supplies as Russia.
We should therefore remove ourselves entirely from the EU’s regulation and their objective to create an integrated European energy market (ie control of supposedly democratic countries by the Oligarchs of Brussels).
Keep the interconnectors, so we can sell (or buy) energy but we must operate our own energy security policy and exploit our own reserves of coal, oil, gas and shale. We must also expedite small nuclear reactors and (providing they are viable without any taxpayer/consumer subsidies) increase renewables.
And we should ditch the Net Zero lunacy. All it will do is make people colder, poorer and have restricted lives. It will do nothing whatsoever to “change the climate.” It’s about CONTROL …. and nothing else.
August 31, 2022
Keep in mind the libdem nick Cleggâs foolish statement a few years ago that thereâs no point expanding nuclear because âit wonât be on stream until 2021/22â. Imagine if weâd just ignored him on this as we should have done on so much else!
I suggest: get moving again with nuclear, the unit costs will fall once we scale up again. Other countries such as Japan are reversing their stances on nuclear. Germany may even have to do so. The left-green scare stories on safety over the last 80 years have been comprehensively debunked.
In the meantime get moving with shale gas. People living within a certain radius of a shale or nuclear project to get free energy supply for the property. Suddenly we will find people are less concerned about earthquakes and nuclear Armageddon, and will ignore left-green bleatings. By all means carry on with wind (solar really does seem to be a waste of time and space at these latitudes) but letâs be sensible about the level of subsidy.
Try to get back to the competitive market based system so successfully implemented by the Tories after privatisation in the 80s and 90s.
August 31, 2022
Just wakening up to what I’ve been banging on about for at least 4 years.
Windfarm operators should be paid a fixed price for their power and there should be no constraints payment for oversupply.
Only a government made up of arts graduates could make such a mess of such an essential basic commodity.
August 31, 2022
Ian, Don’t you love the BBC’s disingenuous take on wind farms…
40% huh… even when it’s the right sort of wind in the real world how much does wind contribute on a daily basis? 4%?
https://www.bbc.co.uk/news/science-environment-62731923
August 31, 2022
Either negligence, incompetence or perhaps vested interests or even blatant corruption? Too many paid MP “consultants” to the green subsidy farming industries perhaps? Why too did they go ahead with the economic basket case that is HS2, the absurdly long lock down, the often dangerous Covid vaccines for children and the young who were never even at any real risk, Test and Trace, the PPE scams?
It is all really incompetence or is it actually far worse?
The price windfarm operators get needs to vary depending on market demand at the time of supply as electricity is so expensive and wasteful to store. If no demand they should get nothing. The idea that they get more as gas prices increase (thus making more profit when their costs are the same) is surely bonkers. It is just a way to hose tax payers money into the pocket of friends to those in positions of power perhaps?
August 31, 2022
..The UK duly obliged⊠NO, JR. Your party and govt made the decision to stay in EU energy orbit despite the public mandate to leave the EU and take back control. What part did May and Johnson not understand. Moreover what minister was in charge of this Kwertang? If so he should not hold ministerial office again.
Again, trying to pass blame to an inanimate object called UK when it was people in your party and govt who CHOSE to take this policy decision.
Victoria Atkinson MP (and former minister!) on TV this morning. Utterly useless. The following guest pointing out how scary it was that she was so clueless about energy and law and order. She wanted to blame the Ukraine war! Who appointed her as a minister! Wrong party, not capable of being a minister. People make policies not inanimate objects. When is your rotten dishonest party going to accept responsibility for its decisions?
So union bosses on high salaries choosing to live in council houses get govt help for energy bill people in their own home do not. What Tory genius made that policy? Ukraine war?
August 31, 2022
Cameron â Leave the EU and all its InstitutionsâŠ. liar liar pants on fire
August 31, 2022
Why can we not keep current nuclear going? Why is a reactor safe today but not safe tomorrow? Is this based on absolute necessity or some arbitary figure arrived at by bureacraric compromise? Carry out a review of that issue while we start fracking, the UK government owns resources underground, does it not?
Contract a firm to extract at a sensible price with bonuses for early success. The Government sells the gas, which it owns, to UK providers at a sensible price.
In the meantime, repeal or significantly amend the Climate Change Act and remove all restrictive EU based regulation.
Halt decommissioning of coal fired power stations where possible. Develop giant catalytic converters to remove pollutants from coal and gas stations and sell the carbon dioxide to fertilizer manufacturers et al.
Whilevthat is going on the Chancellor can dream up some temporary schemes to help the less well off. I know he or she is not likely to have lived before central heating was common place but it should be remembered that the British people survived and multiplied in unheated houses. It wasnât perfectly pleasant but you wore a vest under your shirt and a wooly jumper over it. Oh, and probably some bed socks at night. If you were lucky, you might have warmed your bed with a hot water bottle.
That should keep everyone busy for a while.
August 31, 2022
Can anyone tell me why, in a world of net zero religion, are we currently generating 72% of our electricity demand with gas fired generators, whilst exporting 26% of our requirements?
The 14.8GW could be reduced to 9GW with CO2 emissions reduced. Am I missing something?
August 31, 2022
Well said Dave and a good question.
August 31, 2022
Maybe we’re just a cog in the EU energy machine
August 31, 2022
We are helping keep the lights on in France which mostly has the most expensive power prices in Europe because it is short of electricity with just 24 of its 56 nuclear power plants in operation. The rest are shut for repairs. What happens in winter when we both need the capacity remains to be seen.
For now we can import the extra LNG needed to run the generators for export. We are starting to see grid capacity constraints for meeting French demand and keeping London and the South supplied, as the wires have to carry both from the more distant generators, instead of just carrying imports from France to help meet London demand as has been happening previously. That is why we ended up paying nearly ÂŁ10,000/MWh to Belgium recently.
In running extra gas power stations are chewing through their carbon allowances faster and forcing purchase of more, pushing up prices for UK consumers. This is another reason why we should suspend carbon tax.
August 31, 2022
We can’t upset the French. No matter how stupid they act on Brexit NIP we must continue to pander to them
I bet if the export was stopped until the channel invasion stopped, it would stop overnight.
August 31, 2022
If we barred French fishermen from our territorial waters until the channel invasion stopped, it would stop overnight
September 1, 2022
You are missing the fact that you canât turn power stations on and off like you can the lights in your house. There has to be a constant base load for the grid. If renewables suddenly generate a lot of power, you canât just shut a few power stations down. So we export the power. The insane issue at the moment is the high price of gas and the fact we import so much when we could easily use our own.
August 31, 2022
If we are completely divorced from the eu why have we not repealed ALL of their laws as they all interfere with the direction we want to see our country to go?
August 31, 2022
Because Boris the Traitor signed a deal with them – the Trade and Cooperation Agreement – that PREVENTS us from being more competitive than them, and forces us to abide by many of their policies. And Liz Truss has given NO indication she will tear this up. Brexit, and Britain, has been betrayed.
August 31, 2022
+1
August 31, 2022
“Crisis? What crisis?”
All of this may be good stuff in the medium to long term but it will do nothing to protect swathes of the UK economy and large sections of its population from the impact of sudden massive rises in their energy costs, above all thanks to heroes like Boris Johnson fomenting war in Ukraine.
I find it a bit strange that at one point Liz Truss made the radical suggestion that the extra UK government debt that built up during the pandemic should be treated as a kind of war debt:
http://johnredwoodsdiary.com/2022/07/21/some-funny-numbers-from-the-treasury-and-obr/#comment-1330438
but now we are being hit with the massive effects of a real war she only wants to fiddle round the edges.
August 31, 2022
Until this country takes a hard long look at itself nothing will change.
We all accept the easiest way to save energy is not to use it.
We have thanks to political decisions decades ago to change basic education on life itself, with the closure of domestic science classrooms many younger people cannot cook what in my younger days was called good nutritional basic meals. Today its all fast foods and they require vast amounts of quick available energy to heat up. Where as in the past women would prepare and cook a meal that in various formats would appear over the
next three days. All this and the electrical household gadgets have been there for everyone to see for years but then consumerism ruled the world. Instead of all the woke stuff being stuffed down our necks 24/7 it is not just energy that needs desperately to be reinvented its the way we all live our lives. Circumstances as is, may mean a lot of us are heading for a steep learning curve on basic cheap survival skills. The tax payer cannot keep bailing out all this mistakes. Typical example Transport of London even more money.
August 31, 2022
Profiteering by the wind/solar providers needs to be stopped immediately. They should be taxed down to a 2% profit margin like the other energy suppliers. After all it was sold to us as a future source of “cheap” power – at the moment we’re paying the same for it as for gas-generated power.
August 31, 2022
Ignore the greenists. Get fracking, use coal and regulate the UK market properly here so it is treated as a strategic resource rather than a global commodity.
———-
Social housing rent rises to be capped. Oh great. On top of assistance with energy bills. So what is the point of training to be, say, a doctor in terms of economics if a 45k salary (before deductions for student debt) results in you being stuck in a cold room while your unemployed cousin with the obligatory ADHD kid gets a two bed house ?
We have the situation where wages are chasing benefits.
Also – a think tank reports that the police have lost their way and effectively legalised many crimes – that includes illegal immigration, cannabis smoking, shop lifting and burglary. WHAT Tories ??? Where ????
August 31, 2022
Add to that not acting when told a family running two cars has one untaxed with a bald tyre and another car untaxed and with no MOT. I have reported them twice now as they are driving both cars but nothing has been done. Can we all avoid tax and MOT’S please?
September 1, 2022
Both should invalidate their car insurance, maybe they don’t have that either?
the Police might be more interested when presented that you are recording this warning to them prior to a possible accident involving cars with no minimum insurance.
August 31, 2022
Limited the standing charge poll tax to a nominal sum make the first few units very cheap for everyone enough for lighting, fridge, computer and essentials then charge more for the rest. Electricity from coal can be generated even at current prices for about about 12p KWH without tax. In the states it is usually even lower than this. Just ditch net zero and use gas and coal as needed. Kill this mad May/Greta/Boris/Carrie/BBC religion. Listen to sensible people like Professor Ivar Giaever – Nobel Laureate in Physics; “Global Warming is Pseudoscience”
Poorer people can easily cut their usage but then can do nothing about rip off standing charges. Gas kettles and cooking is usually rather cheaper than electric to run. The main things that use sig. electricity are heaters, hot water, tumble driers and heating the hot water for showers or in washing machines so wash clothes colder, & shower more quickly.
August 31, 2022
Also if trying to save use LED lighting. Freezer and fridges cost less to run in colder garages rather than in warm kitchens. Much cheaper to insulate the person rather than the whole house. Microwaves far cheaper to run than conventional ovens. Pressure cookers cheaper as quicker too if you have to save as much as you can.
August 31, 2022
Install a 4kw solar panels and then for most of the year you will have enough free electricity to power the big ticket items like washing machines and dishwashers. Our system is on Gordon Brown’s ludicrously generous original feed-in tariff and we make a profit of about ÂŁ2,000 a year while being free to use all the power we generate. Only in the worst four winter months do we not generate enough power for at least the washing machine. ( We have a gas Aga for winter cooking and heating the kitchen ).
Just don’t waste money on a battery backup system. The payback period for them is around 15 years and the batteries will need replacing before then !
Many people still don’t realise that electricity is four times the price per kW than gas !
September 1, 2022
Indeed but you do not get much electricity or short winter (often cloudy) days and nothing at night. Nothing much when panels covered in snow either. Correct on storage economics.
August 31, 2022
For me, the goal must be energy security at affordable prices. As it happens, doing that surely puts us on a carbon reducing path.
Arenât the obvious steps to reopen every gas power station and every storage facility whilst getting as much of our own gas as possible.
Meanwhile, fund SMRs and battery storage research etc and crack on with building of larger nuclear power stations. The government should level with the public, explaining that to store enough power to rely only renewables would require building pumped hydro over an area the size of wales (itâs not that but the area is vast).
By way of a framework for energy pricing, Dieter Helmâs emphasis on firm power. Your own emphasis on getting the accounting right: measuring carbon output based on what we consume not on what we supply is vital. Otherwise the system is aiming at the wrong outputs, leading to the perverse desire to cut our energy generation and replace it with more carbon intensive imports.
August 31, 2022
What do I think??
My first thought is that my central heating (like those of many others) is gas fired – not electrically powered.
My second thought is that if we had not rushed to implement net-zero like a bunch of headless chickens, we would let markets decide the optimal way to power the national grid and not be offering huge incentives to renewable suppliers, which get quietly dumped on our fuel bills without anyone asking.
My third thought is that I’ve not heard anyone (with one particular exception – Farage) rasing any real concerns about net-zero and the complete lack of planning with regard any kind of sensible transition to renewables AND their back-up systems, be that pumped-hydro, short term battery or hydrogen production.
My last thought is that until our political classes finally wake up and start to really address the problems this has caused (not just for us but much of the western world) then we don’t have a hope in hell of sorting it out. All against a background of China and India continuing to increase their CO2 emmissions.
I’m not a polling expert but I’m pretty sure that the eco-nutters currently tunneling under the road outside that oil depot are vastly outnumbered by the rest of us, who have generally gone along with this green nonsense quiety but are now probably going to get seriously browned off if our “Leaders” don’t start getting a grip very, very soon!
Reply I have been raising issues over national resilience and the need for enough available power for our needs for many years.
August 31, 2022
My gas central heating will be 50% more expensive already – and a lot worse to come they say!
August 31, 2022
Isnât it ironic that this government only a couple of years ago kept telling everyone just to shop around for a cheaper deal, cheaper energy, a cheaper providerâŠ.theyâre all quiet now
August 31, 2022
All electricity contributions to the Grid should be assigned a capacity factor target. Those that fail to meet that target should have their payments reduced.
Presumably there are extant contracts which should not be tampered with — after all, the UK government has a reputation for probity to maintain. Those benefitting from those contracts should be subject to a windfall tax which will be completely legal.
JF
Ten years ago I heckled a UKIP conference with a loud intervention of ‘tax the windfarms!’ This drew applause. Ten years later and here we are.
August 31, 2022
It may well have been the same UKIP meeting in Edinburgh that I attended and did a Q&A session with the man himself, Farage. He was right then as he is now.
August 31, 2022
Julian, good suggestion.
August 31, 2022
“Tax the windfarms” – hardly any would exist at all but for subsidies and huge market rigging! Just cull these and get real & fair competition. Make the wind farms pay for their intermittency too. Not the consumers. Make sure we have plenty of emergency piles of coal and stop ministers from blowing the power stations up. Have they even given that Cumbrian coal mine the go ahead yet?
August 31, 2022
Wind farms do pay for their intermittency. It’s called the System Integration Cost ( SIC ). Covers increased balancing cost, cost of additional backup capacity and the cost of reinforcing network infrastructure.
August 31, 2022
That all gets added to our bills. It is not paid by wind farms, and indeed recent OFGEM decisions now place the burdens directly on consumers. The previous system went around the houses, charging wind farms but giving them a compensating uplift in their CFD price.
August 31, 2022
“That all gets added to our bills”. Yes; which bit of Tory neoliberal capitalism do you not understand?
September 1, 2022
You said “windfarms pay for their intermittency” acorn.
That was total nonsense.
And you knew it when you wrote it.
August 31, 2022
acorn :
I googled âSystem Integration Costâ and could not find anything. I would be very grateful please for a link, thanks.
I would be very surprised if wind farms are paying for their backup costs. According to the BEIS UK Energy in Brief 2022 (for 2021) the 24 or 27GW of installed wind capacity produced an average of just 8GW of power. So gas was supplying the remaining 16/19 GW of power and all the balancing power.
With regard to âreinforcing network infrastructureâ the National Grid has just announced a ÂŁ54 billion package just to bring electricity from North Sea wind farms to where the power is required.
None of these costs are in the CfD âcontractsâ price paid to wind farms. In fact these âcontractsâ do not require the wind farms to be built and even the electricity can be sold at market price if it is above the CfD price.
September 1, 2022
Have a read of Joshua Burke at Policy Exchange “A second wind: the economics of offshore become increasingly competitive”
https://policyexchange.org.uk/a-second-wind/
August 31, 2022
The essence of Sir Dieter Helm’s recommendation is that renewables should team up with reliable generators to offer a package that matches the demand profile, forcing them to procure their own backup. Essential to lowering costs is removing minimum quotas for renewables and guarantees that the most expensive always get to sell whatever they produce. That might upset those running the most heavily subsidised technologies – wave, tidal, floating wind, and soon, hydrogen.
We also need to look at lowering grid costs by looking at the whole system impacts of technology choices, and avoid making mistakes with bad choices of nuclear technology. Another EPR at Sizewell is a bad choice, made for bad political reasons, probably including trying to discredit nuclear power..
August 31, 2022
If you will allow John. A great piece by Alison Pearce in the Telegraph today.
https://www.telegraph.co.uk/columnists/2022/08/30/boris-johnson-can-never-forgiven-sacrificing-britain-net-zero/
August 31, 2022
Good read. And thanks.
Whilst indeed it is easy for some of us to demand the return of King Coal, we forget that there too is a human cost to it. Now we have offshored, like so much, the environmental damage mining for coal and other minerals does. But it is out of site and out of public mind.
August 31, 2022
The Irish government is proposing a “windfall tax” on the profits of energy “suppliers”:
https://www.irishtimes.com/politics/2022/08/30/taoiseach-signals-windfall-tax-for-energy-suppliers-to-run-with-public-savings-campaign/
But which energy “suppliers” would fall within the tax jurisdiction of the Irish Republic?
Not the Australian company I mentioned yesterday:
https://euobserver.com/tickers/155903
“… a six-fold increase in profit at Woodside, Australia’s largest producer of liquified natural gas … ”
Somebody may say that I don’t properly understand these matters, and they would be right, but it seems to me that the additional money which now flowing out from net energy consumers like Ireland, and the UK, to the net energy producers around the world is not disappearing, it is just changing hands, and in many cases recipients will want to put it somewhere safe; and recycling it into the extra UK government bonds which will be needed to finance large scale state subsidies for UK energy consumers would serve their purpose as well as ours.
August 31, 2022
I think it would be useful if someone with some knowledge of energy sat down with the government and did a Jackanory session with the public on TV. They should explain that they got it wrong with the climate change act and net zero and tell people why it is vital we change tact. Let’s have some honesty and then perhaps more people night accept the obvious which is that we need reliable cheap energy.
August 31, 2022
As for storage, put the ARIA program to good use (has that achieved anything yet?!); invent a mechanical storage device (for cars).
Main design parameters:
1. Constructed from readily available or recycled materials.
2. High storage capacity and high power to weight ratio.
3. Rapid charging (minutes not hours)
4. Use a recombination of existing technology
5. SPEED!
Subsidise ownership or leasehold and provide subsidised charging through a smart grid. Power can be drawn back from vehicles when not in use by a smart management system. Sufficient uptake would in theory provide significant storage capacity.
As with anything else in our newly reclaimed sovereign and independent nation, use investment derived from a partnership between private companies and a newly created Norwegian-style sovereign wealth and investment fund. Retain intellectual property as a national asset and use British companies at every stage of supply and manufacture; level playing field be damned. Ensure that British companies benefitting from national investment cannot sell out to the highest foreign bidder.
Oh yes, and so long as I’m dreaming, I’ll have a Sunseeker…
August 31, 2022
“What are your thoughts on the changes we need?” Remove all anti-fracking regulations and repeal the Climate Change Act.
August 31, 2022
Wind and solar benefit land owners at the expense of the consumer. They are unreliable and always will be. We should target our near future energy needs from oil, coal, gas, and nuclear. Tidal is a constant source of energy and being an island surrounded by the sea investment into harnessing this powerful resource should be better explored. Perhaps run a competition to allow the fantastic inventors we have in this country to compete for a prize to come up with a viable solution. Like in 1714 when the British Parliament offered financial rewards of up to ÂŁ20,000 (equivalent to ÂŁ3.35 million in 2022) under the Longitude Act and John Harrison invented the marine chronometer.
August 31, 2022
Unfortunately tidal energy is not quite the constant source you assume. Output is enormously variable, not only with each tide and gaps of no power at all, but also according to the phase of the moon which dominates how big individual tides are. Handling that intermittency imposes considerable costs. It turns out that it is not solved by adding different sites around the coast, as the ones with potential have tides that are in phase with each other, amplifying rather than smoothing the problems. Moreover, there really is no new technology to come to the rescue. Turbines are already close to their theoretical maximum efficiency. Most of the cost is in building barrages, which is ancient technology: the Romans built harbour walls at Ostia.
Trying to use some of the basin to provide storage can smooth between tides, but not sensibly across the lunar cycle. However, it reduces the output by 70%, more than quadrupling the cost because you have to build more barrage to do it.
August 31, 2022
My first comment is still in moderation. As it contains nothing rude or objectionable I will assume that it is a purely a matter of timing.
All good comments above but the financial measures are largely a sticking plaster for the coming winter. The only effective solution is to increase the supply.
I know that it will take time and that is why action must be started right now.
August 31, 2022
Off topic, sorry Sir John,
Boris is in the news again tub thumping about how things will be better this time next year.
I admire his enthusiasm, it is what got him my vote in 2019, but it won’t wash this time.
The difficulties created by Putin’s invasion of Ukraine are not going to end for a long time.
We need to increase our own supply and maintain control over it.
August 31, 2022
Things will be better this time next year – FOR HIM !!!
August 31, 2022
Boris âJam Tomorrowâ Johnson
September 1, 2022
Is the ‘jam’ actually the queue to access a EV charger point, thereby blocking roads nearby?
August 31, 2022
Excellent Tweet of yours about increasing supply roughly one hour ago, Sir John.
August 31, 2022
The proponent of wind and solar frequently assert that these are now the most efficient means of generation. Let us take them at their word. Restore the original market form of buying the cheapest available energy and we get cheaper energy. If that is indeed wind or solar, great. If they are wrong about their efficiency one has to wonder what else they are wrong about.
It should be born in mind that, even if we are leaders in green energy, no one of importance is following us. Maybe they’ve spotted a problem that we haven’t.
August 31, 2022
Pat :
“It should be born in mind that, even if we are leaders in green energy, no one of importance is following us. Maybe theyâve spotted a problem that we havenât.”
Yes, although the Chinese are suppling 95% of the parts for our wind turbines and 100% of our solar panels, they are building far more coal fired power stations than wind farms…..
August 31, 2022
Welcome to Britain 2022 after 12 years of Tory government, a 3rd world country where NOTHING works, police, NHS, border security, strikes and the flagship of the Navy unable to leave its home base without breaking down!
Do you think that you will be able to impose Net Zero without a breakdown of Law and Order, will there be troops on the streets?
You continue to fiddle while Rome burns, trying to ignore what is going on, I donât ever remember feeling so depressed, meanwhile the 2 candidates for PM who are both equally responsible for the state that weâre in continue with the pantomimeâŠ. Itâs sickening
August 31, 2022
My comment still awaiting moderation despite there only being 6 comments when I left mine
We canât have the truth being revealed can we mr redwood
Donât worry itâs what most people believe
August 31, 2022
So too has mine. Obviously the truth is getting hard to hear.
August 31, 2022
I suspect Sir John might be quite busy at the moment, just as I suspect he may have taken a well earned brief holiday over the weekend, yet still kept the blog going. I know he has previously enjoyed breaks in the Scillies, where internet communication is not always reliable.
August 31, 2022
Mine too Lester. Why do we bother? Nobody in charge actually listens anyway.
August 31, 2022
Give the man a break! Sir John probably spends a lot more hours doing his work, and choosing to do things he would rather not, than any of us. All of us will want our scribbles entered here but he has to almost instantly judge what should be published, and what to delay or withhold. I’ve urged him to leave his party and go Independent, also to reduce this diary/blog to perhaps alternate days – but he keeps the level of work going.
Full marks for effort on our behalf, don’t expect him to agree with your views all the time.
August 31, 2022
In terms of forthcoming depression, we remember the organised powercuts, the 3 day week, the power off evenings with candles and gas cooked food- – and the err…early to bed. ! It wasn’t all bad.
August 31, 2022
Hello Sir John,
You are an intelligent man so why do you keep talking about net-zero. Simple research for health & Safety will tell you that people can work an 8 hour day in an atmosphere of 5000 parts per million CO2, & that the atmosphere would have to have 10% CO2 or 100000 parts per million to kill us.
Currently CO2 is 400 parts per million so it is no danger to humanity at all. Until someone, like you,
points this out the net-zero nonsense will carry on & we will never have a sensible energy policy.
As a side issue if we understood CO2 we could immediately stop building two energy systems & use gas & nuclear with no problem at all.
August 31, 2022
We need to use our independent energy resources of oil, gas and coal. Clearly adequate nuclear power will not be available for some time and, even then, it is not without issues.
Gas is in high demand so coal would seem to be a sensible solution for the medium term. We should open coal mines and build clean, coal fired power stations now.
I note our current Prime Minister is still promoting yet more windmills as the solution to the energy crisis. The concept of no electricity when the wind doesnât blow seems to be lost on him.
There should also be an investigation into the environmental credentials of wind farms. We should have a clear understanding of the impact they have on nature, especially the insect and bird populations, during their working life and the environmental cost of their construction and eventual destruction.
August 31, 2022
OT. The intermingled world of politics and the media is way beyond me but as a naive I will say I’m pleased Liz Truss has decided against a BBC interview. If she tells them frequently that she, not they, is in charge of her time, matters may improve.
Naturally all the BBC, their likethinkers, and friends are getting everso excited – how dare she snub us, she’s scared etc., etc.
August 31, 2022
Liz Truss was perfectly right to refuse the interview. All that would have happened is that Nick Robinson would have been ordered to repeatedly ask ad nauseam what she is going to do about energy bills. She would rightly refuse to give details before she has had an opportunity to agree her policy in cabinet.
She could not win in these circumstances : refuse to answer and the BBC will brand her as having no ideas and unless she lays the policy before the House before publicising it, she would rightly incur the wrath of the speaker on her very first day in office !
August 31, 2022
@ The Prangwizard – +1
The same types became over-excited at her good reply to the Macron friend or foe question. They seem not to appreciate it is unclear even if Macron is a friend to France never mind to anyone else.
August 31, 2022
In the winter in the UK, from October to mid-March, during peak energy use periods, do you know how much (as a %) of the energy in the UK comes from Wind and Solar?
August 31, 2022
err….count on one hand?
August 31, 2022
Suffice it to say the CEGB would never have got itself into this current mess. Generator call-ups were based on the âmerit orderâ of heat rates, not price; where you were on the grid, and how good your kit was at shoving MWs and MVars into the grid in a hurry. Plant overhauls were scheduled nationally to keep sufficient system availability and make the best use of contractors.
Loss of Load Probability is still the basis of operations. A bit technical but have a read of https://watt-logic.com/2022/07/21/capacity-market-notice/ and see how the current system has invented many more ways to go wrong.
Basically, the UK has currently has 16 GW of approved interconnector projects, with another 16 GW in scoping stage. NGESO reckons 29 GW “will provide the maximum benefit for Great Britain consumers”.
August 31, 2022
OFGEM consulted on the plans for more interconnectors. The work done by their consultants actually showed that they would make the UK worse off (but clearly consumers would pay to make interconnector owners rich).
August 31, 2022
Obviously investment is great with solid predictable forecasts. However, with national infrastructure there is the ultimate purpose of building it for the benefit of the people. It is put in ‘trust’ and the operators and investors should be entitled to see a balanced return. If HMRC can tax mortgage interest as income, then all existing renewable contracts can be adjusted along with all future energy generation projects to re balance the beneficial interest more equally to the nation. It has obviously been heavily weighted to profit which has gone largely unrecognised until now. So now it is in full glaring view, let’s change that. On the subject of future energy, battery storage sites are in need of red tape removal to speed up the development and even the grid having to make radical changes to accommodate battery Storage because there is a real shortage of connections. Put a complete ban on these stupid city e scooters which are using up precious battery materials and precious energy supply. We managed fine without them. We have legs to walk, run, pedal, and push.
August 31, 2022
As I understand it, the price paid to all generators is that required by the most expensive generator needed to satisfy instantaneous demand. Currently gas is very expensive so the price rises and all others make huge profits.
Would it be possible to subsidise the price of gas to bring down the cost of gas generation, and hence reduce the price paid for all electricity. The cost to the country of subsidising gas must surely be cheaper than effectively subsidising all other generators. This would obviate the need for controversial measures like retrospective windfall taxes.
August 31, 2022
A much easier and cheaper solution to this problem is to do what I have been suggesting for some time – decouple the price paid for different forms of energy and institute a simple payment formula: production cost + 7% profit margin. And apply this retrospectively, by law, to existing licences. Job done. Costs cut and inflation reduced.
August 31, 2022
Sounds good to me !
But your proposal is far too simple for a Conservative Government to accept and Labour won’t have it either because the energy companies will be allowed to make a profit, even a modest one !
August 31, 2022
It seems that electricity companies (in order to comply with the EUâs desire for a Europe wide smart grid?) are informing customers that their âmeter certificationsâ have run out and thus a smart meter MUST be installed.
Do ministers know this and have they heard of the TERRIBLE problems people have had with smart meters? It isnât just a case of a mistake in billing âŠit is that once a mistake has been made there is no employee capable of sorting it out. If you can even speak to one that is.
Really, to impose this on us when we are already suffering is just beyond the pale.
August 31, 2022
Off topic, JR, think it would be a good idea if you drew the attention of Liz Truss to this:
https://www.rte.ie/news/2022/0831/1319822-protocol-treaty-parliament/
“MEPs demand urgent EU action on NI Protocol”
As well as this:
https://www.politico.eu/article/liz-truss-first-parliamentary-battle-brexit-northern-ireland-protocol/
And pointed out that Lord Lilley was spot on in February when he wrote:
https://conservativehome.com/2022/02/12/peter-lilley-the-protocol-mutual-enforcement-of-the-law-can-ensure-goods-are-eu-uk-compliant-without-border-checks/
“In the event of the UK taking action under Article 16 or resiling from the Protocol, it would be sensible, and show good will, unilaterally to make it an offense to export non-compliant goods to the Republic/EU even if the EU chose not to reciprocate. That would reduce any excuse for ârebalancing measuresâ.”
August 31, 2022
12 years of Tory rule and look where we are… Sir J, please don’t try and push blame onto the EU for all of this current energy debacle. Lets see what we can do to get this sorted:
SUPPLY & POWER GENERATION
On demand power is required for UK base load, which is always needed , time of day, day of year.
Solar can be viewed as part on-demand but also as an intermittant on dark cloudy short winter days.
Therefore I posit nuclear must be foremost in any netzero strategy, thus fastrack the SMRs, something in the press today about speeding up related planning laws…. a glimmer of hope… please get on with it.
Today we are still 50%-60% gas power generation – and therefore this should be from UK gas deposits to avoid the costly disruption as we have now. Ditto sourcing oil/coal. This will require HMG to refocus on today’s crisis and make some tactical U-turn decisions on fossil fuels.
Intermittant wind power can have a role too especially in wintry months when it’s blustery and bad weather typically. Also use it to power electrolysis plans for green hydrogen as fuel and perhaps for grid power generation.
COSTING
To obtain price stability, long term contracts are needed to be negotiated for fuels/energy.
In private industry I have seen ‘open book’ pricing, whereby companies demonstrate their actual/real costs and an agreed FAIR profit margin is added. If HMG controls UK permits/drilling/mining/fracking then it controls supply and thus can deflect buying on ‘spot’ markets for fuels, which I am led to believe has been the EU strategy for 20~ years (whereas Putin wanted long term gas contracts…)
I believe these sort of long term contracts occur for Wind/solar/nuclear already, so some Ofgem skills exist in their 1,000 staffing (incredible) to extend this across to the other bridging fuels…. Fossil energy companies will need mechanisms to ensure they can recover their billions of investments over a decade + until the transition to basically nuclear occurs.
Both levers need to interwork to make it happen.
August 31, 2022
What is the point of a consultation when Kwarteng has already made up his mind? He is one of the very WORST and most STUPID ministers in the government – and rumour has it he will be promoted to Chanvellor under the ridiculous Liz Truss!! The so-called ‘consultation’ begins with Kwarteng clearly stating that “the only long-term, sustainable solution” [note the word “only”!] is to “unlock the full potential of our abundant, cheap renewable resources â particularly wind and solar” [note the word “particularly”!]. In other words, Kwarteng wants to double down on wind and solar – the two most unreliable forms of energy of all! The man is past hope – and as long as he remains in government there is no hope for Britain either.
I note that in his book “Ghosts of Empire” he was highly critical of the British Empire, the greatest contribution to global civilisation ever, and Britain’s gift to humanity. And now he has agreed to go ahead with Sizewell C – an overpriced *French* nuclear plant – rather than order the BRITISH RR SMRs. etc ed
August 31, 2022
Another good post.
August 31, 2022
Dear Sir John, Why is it OK for the Government of France to be the biggest player in the UK power market but not OK for the British Government to be a serious player? I feel that this question is bound to be posed frequently in coming months.
August 31, 2022
Agreed outsider.
And why are essential utilities and areas of strategic importance to UK not protected from foreign control?
August 31, 2022
Dear BOF, the British Government itself (Gordon Brown) sold control of all our nuclear power stations to Electricite de France. And i don’t recall the Conservative Opposition making a big fuss about it.
August 31, 2022
At least the French governments looked ahead, saw the oil and gas problems in the future and built nuclear power to head it off! And ours? Nah! Just close coal mines and pay the unemployed.
August 31, 2022
I’m wondering if the closure of all but one of our existing nuclear power stations in the next few years, before the roll-out of SMRs, will lead to an exodus of nuclear-power engineers from this country. But I’m sure that the Johsnon government has a cunning plan. It does, doesn’t it?
August 31, 2022
Boris tweet 2 May 2022
“Nuclear power stations like the one I visited in Hartlepool today are absolutely crucial to weaning us off fossil fuels, including Russian oil and gas.
Instead of a new one every decade, weâre going to build one every year, powering homes with clean, safe and reliable energy.”
I wonder if Sunak and Truss also back this, will the UK government own them?
August 31, 2022
More to the point, Sir John: How many of your contributors are likely to bring a meaningful and usable answer? Two, three, ten, twenty, fifty?
For my part I would say, (re)develop nuclear power stations. But whether of the 3.2GWe Hinckley C (or equivalent) or 470MWe SMR types, they are likely not to be operational before 2029-2035. RR. has signed a agreement with the ULC-Energy (Netherlands) for future SMRs but all documents on various websites are missing an important information: When will the SMRs start producing electricity?
The only document I found quoting a date is euronuclear.org âRolls Royce SMRs expected to power UKâs National Grid by 2029â (see also nucnet.org âRegulator announces Start of Design Assessment for Rolls Royce reactorâ, 04/04/2022 and âRolls Royce: Company expects to receive regulatory approval for reactor by 2024â, 19/04/2022).
So it should be clear that even the SMRsâ contribution to the energy mix is still some time in the future. Iâd better learn how to knit if I do not want to freeze one of these coming winters.
August 31, 2022
We have excellent Charity shops in every town who sell ‘woolies, scarves, coats’ at give away prices. The bundles of wool require would be dearer!
August 31, 2022
MT, thanks for the advice but knitting would also prevent me spending too much time on the web and could possiblt save electricity đ
September 1, 2022
you might need accountants gloves ie without finger ends, to stop your hands getting too cold.
August 31, 2022
Every day we have more evidence of how weak, useless and pathetic this government and its ministers are. So we have Priti Patel whining “that police should be focusing on getting the basics of policing right, on traditional policing and making our streets safer”. Who’se been in charge for the last decade?! What have the Tories actually done to FORCE them to arrest protesters, investigate burglaries, etc? Nothing. Why doesn’t the Home Secretary just give ORDERS to the chief constables abouty how to police the streets?
And then we have the report that the ONS has decided that the ÂŁ400 energy rebate will NOT count as a price reduction, and therefore will NOT reduce infaltion by 2% (as it would have done if they had decided to count it differently). This is clearly a stupid decision as it means that the official inflation rate will be higher than that actually experienced by people. The effect of this is that unions will push for unreasonable wage demands based on an inflation rate that is artificially high.
Both these problems arise directly from the fact that the government does NOT want POWER. I find this utterly baffling and contemptible. Instead of wanting to have the power to control every organ of government and run the country properly, the way their voters want them to, ministers insist on delegating power and responsibility to independent, autonomous bodies. WHY???!!! It is madness. It is an abdication of responsibility which is quite incomprehensible to me.
August 31, 2022
Have you thought of running for Parliament? You might just get in somewhere!
August 31, 2022
“Mikhail Gorbachev promoted peace between Russia and the West and allowed a big reduction in nuclear weapons and tensions. He offered a better future for Russia and the wider world.”
He also said some wise words about the EU being the Soviet Union all over again, which have now been removed from the internet, and about Jan 6 in Washington, which were jammed by Youtube.
September 6, 2022
What Gorbachev said about the EU is still available on the internet as part of âthenewamerican.comâ 08/10/2010 âThe âNew European Sovietâ.
As for the other assertion (YouTube jammed) see âwashingtonexaminer.comâ, 11/01/2021 âMikhail Gorbachev says he knows who organized attack on Capitolâ, maybe something closer to what MG was actually thinking âŠ
August 31, 2022
It is important to understand the background to the REMA review. The reason for it is firstly that they need a new system to hide the extensive subsidies needed to run the chosen Saudi Arabia of Wind insecurity strategy. These include the effects of rising curtailment which reduce the marginal benefit of more wind and solar farms, schemes to heavily subsidise hydrogen, batteries and even stand by capacity, as well as pay for the extensive grid upgrades required. The consultation simply doesn’t envisage our present predicament at all. It is of course putting the cart before the horse: the first task should be to work out how to build a reliable low cost system with options for an element of fuel switching so we do not become too dependent on one source. The cartoonish Energy Security Strategy is not it, and is dangerously incomplete in examining its consequences and lack of plans for backup.
I read the consultation questionnaire as supporting National Grid’s preferred solution called Locational Marginal Pricing. A prime effect of that is to highlight grid constraints and therefore justify more grid investment to alleviate them. It also tends to result in high prices for consumers who happen not to live next to a windfarm. It is used for example in Californua, which has about the most expensive electricity in the US. It is another example of National Grid running the show behind the scenes in their own interests. etc ed
August 31, 2022
For historical accuracy it is worth pointing out that the original pool price system provided direct and indirect incentives for capacity. There was a supplementary payment based on giving a very high value to potential ower cuts forced by lack of capacity taking account of the probability of occurrence.
There was initially no payment for capacity under the replacement arrangements. As I explained the other day, the Capacity Market we now have has been used to help ensure coal closure, and is unfit for procuring new dispatchable capacity. The government has of course chosen only to promote intermittent capacity via CFD auctions which in fact do not guarantee that capacity will be built or offered at the strike price if it is built..
August 31, 2022
Scrap all subsidies and tax wind and solar the same as all other power generation.
Todays news. The largest wind farm has started generating. As said on the Beeb news, it will generate enough power for one and a quarter million homes, when the wind blows!! Let me qualify that. When the wind blows at just the right velocity, not too gently, and not too hard, when the turbines have to be shut down.
It beggars belief that the majority of MP’s actually believe in Net Zero/Climate Change and really think this stuff works. The quickest way to energy security is to expedite fracking. Then N Sea oil and gas, mine our own coal and order SMR’s from RR. None of it may come in time to save the Conservative party.
The Climate Change modelling is no better than the Ferguson crackpot modelling for the ‘pandemic’.
August 31, 2022
What the BBC will not have told you is that the wind farm is benefitting from the current very high market prices. It may have referred to the price in 2012 money (without mentioning that it is 2012 money, before indexation) at which it bid in the CFD auction, which is after indexation has been added a floor price backstop if the market hasn’t meanwhile been rigged in its favour, which is exactly the point of the REMA market rejig being discussed in this blog.
August 31, 2022
Yes BOF, your last sentence is the truth. They are all fraudsters! How do we tackle the problem as it seems all MPs have been bought or threatened!
Reply What a wrong and nasty comment
August 31, 2022
In other news – Iâm so glad the BBC have identified the floods in Pakistan as Climate Change, and not as I thought a huge monsoon flood like in 2010, or the failure of farmers to construct run offs and riverine corridors, or failure of its government to build up its river banks or building reservoirs in flood-plains or having an emergency services and communications response along the known affected areasâŠnot because theyâre corrupt and busy building nuclear weapons, increasing their space programme and military budgets
August 31, 2022
+1
When I heard of the flooding I thought, “Should have spent all that money on Nukes of flood defences instead”
And we still send them millions in ‘aid’
August 31, 2022
Pakistan is THE largest recipient of our bloated and excessive Foreign Aid budget. All of which is borrowed money, of course !
August 31, 2022
For a government to be successful the PM must appoint the right people as ministers. The latest rumours as to who Truss is considering to be in her cabinet do not augur well! Apart from the hopeless Kwarteng, whom I have criticised in a separate post today, I read that Jacob Rees Mogg may become Business Secretary. This would be a DISASTER for Britain. JRM would be excellent as a deregulation minister, but he is NOT a patriot – he is a dogmatic, free market, laissez faire extremist and he will let British businesses go to the wall, or be bought up and asset stripped by our foreign enemies. Our industrial base will be destroyed. One reason why I supported Brexit was to be out of the handcuffs imposed on us by the EU’s state aid policies, which did not allow the UK government to help build successful British industries. Boris the Traitor betrayed that opportunity in his UK-EU TCA, but JRM would be even worse, and would not use the limited powers that are left to us.
If you think I am mistaken just look at his record: he opposed import controls on EU exports to us, even though they imposed the full set of controls on our exports to them, meaning that our businesses faced extra costs, and by not retaliating he has given EU businesses a UNFAIR COMPETITIVE ADVANTAGE over UK ones. If this isn’t treason I don’t know what is! This is NOT a problem caused by Brexit, but by the Conservative government’s policies and the way they have implemented Brexit. When I voted for Brexit I knew full well that this would result in extra costs for exporters, but I was IN FAVOUR of this, because if this applied equally to both sides it would lead to import substitution, something which I am very, very strongly in favour of. But instead, the Tory Traitors have adopted a doormat, unilateral surrender to EU exporters. No wonder I am an EX Tory!!!
August 31, 2022
It is all too technical for me to understand but:-
We are out of the EU so we should not be following any of their rules, regulations, laws, or whatever they are called.
The whole carbon neutral idea is a load of codswallop.
I suppose we really should not blatantly BREAK contracts as it would make it difficult to make future contracts that we may need. Perhaps these contracts could be tweaked or amended in some way.
And for heavens sake, Sir John, STOP COVERING POTENTIAL FOOD PRODUCING LAND WITH SOLAR PANELS AND WIND FARMS. (Or houses for that matter.)
August 31, 2022
There wont’ be any quality crops soon. All the fertilizer companies are closing down due to the high cost of energy. The rearing of livestock is being shackled in many countries too. We will be cold and hungry but don’t worry, you can have a blanket and eat an insect burger.
August 31, 2022
Delay the closure of nuclear plants.
Build more modern nuclear – small modular one, not old tech such as Sizewell C.
Subsidise research into better nuclear technologies (many useful ones emerging, just needing a bit of research and/or engineering).
Stop providing subsidies to people NOT to generate (business has risk, accept it or don’t enter the market).
Stop all subsidies/levies at consumers’ expense.
Also research into this supposed climate emergency (giving proper voice to those who say that there is no emergency).
Energy storage research is also essential (even pumping water up a hill to store surplus electrical wind energy as potential energy, despite being “lossy”, is better than paying people not to do anything with it. In fact by paying them on that basis you actively discourage them developing tech to store surplus energy until the grid needs it.
Note: the idea of giant batteries to store energy is ridiculous – hydro-based storage is better, which may mean siting wind farms near hills.
Increase our gas storage back to sensible levels.
Get fracking and extracting from the North Sea again. Offer local discounts only if necessary.
Encourage development of rain water collection systems.
Investigate viability of local developments of solar and wind projects (concerns over who would run/own them – councils are often utter rubbish – in fact they often can’t even collect the rubbish).
I’m sure there are others – that’s all that springs to mind for now.
August 31, 2022
We now need to worry about the way the EU is flailing about, planning to impose its own dead hand on markets. They have announced an intention to rip up the rules with almost certainly no idea of the consequences. We need to prepare to defend whatever they try to decide should apply to interconnectors in the face of shortages, and for the possibility that their actions will bankrupt generators and suppliers active in the UK.
The EU must get on track by abandoning its net zero programme, and promoting the supply of the fossil fuels it needs from friendly competing sources around the world. An attempt to replace Russia dependence with China dependence in pursuit of renewables would be the height of folly,
I am encouraged that Truss appears to be aware of the dangers of China dependence. She needs to follow through with the consequences for energy policy.
August 31, 2022
Why ask? Many of us have views which contradict the Tory party philosophy which has been given over to insane greenery and wokery.
As a result of such green insanity we have a fuel shortage, no gas production increases, no oil production increases, no coal. We import all three shortages with money we don’t have. Policy there is to keep selling our assets. Opposition to that is ignored. Proposals to ban wood burning remains.
Our views which say get fracking are ignored and ridiculed because the likes of Boris would rather industrialise tbe sea and the land with windmills and solar panels which are largely useless. He just wants more and more and more and more. Will his successor?
August 31, 2022
I do not want us to be reliant on electricity from anyone else.
We should be self-sufficient for all forms of energy as far as possible.
We are already committed to two new nuclear stations provided by EDF but all future ones should be British-built Rolls Royce SMRs
We should extend the working lives of our existing coal and nuclear plants until sufficient new nuclear stations come on line and provide power when the wind and sun are not cooperating.
Only then should coal and later gas generating capacity be withdrawn.
August 31, 2022
The data below is for the 24-hour period 00:00 to 23:59 30 August 2022.
Number of migrants detected in small boats: 0
Number of boats detected: 0
3 days without any illegal crossing âŠI just donât believe it !
August 31, 2022
I’ve just finished laughing
August 31, 2022
@ glen cullen – did you perhaps miss: –
Number of migrants detected in one large boat rented by the Home Secretary: 2,649 (or some other estimated number).
Hopefully the replacement Home Secretary will have some nous and determination.
August 31, 2022
Did a small armada land on the beach at Sandown IOW?
August 31, 2022
Perhaps they are all going through Ireland, but very odd.
August 31, 2022
The changes we need are to immediately cancel the Net Zero Strategy.
We need to urgently return to gas and coal in the short/medium term and nuclear in the longer term using proven nuclear technology (and not EDFâs faulty EPR design) and SMRs. No further fossil fuel power stations should be explosively demolished.
The forced electrification of heating and transport needs to be cancelled before it adds an extra burden to the electricity supply with which it cannot cope and customers should not be forced to buy useless products.
âGreenâ technology can be developed but only implemented once it has been proved to work at scale for supply and electrical products are produced that customers want to buy.
August 31, 2022
What I would like to see is a system that provides for sufficient and secure supply. If that means ignoring or abandoning green or climate or global warming issues pro tem or as needs be forever then so be it for if there really is a human driven climate crisis, the entire UK contribution be what it may will make no material difference to the outcome. If the 1980’s system, simple, effective, understandable, fair and efficient can be replicated to similar good effect, then that would be fine.
August 31, 2022
I see your government has learnt nothing. I read that soon the new PM, cabinet ministers and the police will all be driven around in Audis. It is unbelievable.
August 31, 2022
There should be a law passed that all state spending on vehicles must be on vehicles made in the UK.
August 31, 2022
Wind speeds are dropping globally. Last monthâs Met Office annual State of the Climate report said 2021 saw the second lowest speeds in more than 50 years.
It said: âThe UK annual mean wind speed from 1969 to 2021 shows a downward trend, consistent with that observed globally.â
Oops. Now that is climate change.
August 31, 2022
Berkshire Alan
We have a few practical thinkers but they are always banished to the back benches. The lunatics have taken over the asylum.
August 31, 2022
Ordinary people down here on the ground are slowly but surely seeing the country falling apart and things we took for granted are rapidly disappearing. From energy and electricity bills going skywards to non-existent policing and now juvenile gangs setting upon youngsters whose parents call 999 and 48 hours later police respond with lame excuses.
London, we have a malfunction and major disconnect.
The conservatives are not listening in real time and are out of touch since BJ went on walkabout overseas. Meanwhile HMS POW has lost power, stuck through lack grease propshaft lack of grease. Ye God’s!
August 31, 2022
A small but important change would be to phase out ‘constraint payments’ to wind and solar providers when they switch off their generators because the grid is full. These payments are a perverse incentive. If they did not exist, I think it is likely that renewables providers would invest in storage of power. We are currently nowhere with storage, and as we are building wind capacity at a rate of knots, this will become an issue fairly soon.
August 31, 2022
In the short term, the restrictions on fracking should be altered significantly to take into account the new circumstances we find ourselves in. Earth tremors are not good, but the threat of astronomical gas prices this Winter is a greater danger. Whatever the frackers can get from existing wells (like the two Caudrilla ones in Lancashire) should be welcomed. If necessary, those who live near fracking activity should be the ones who benefit from cheaper gas.
In the medium term, we need many more ‘waste from energy’ – incinerators. These generate power by burning non-recyclable waste, which would otherwise decay and add carbon anyway. We burn 70% of our non-recyclable waste – the rest goes to landfill, or is exported to other countries to burn. We should burn 100%. Germany is close to 100%, Sweden and Holland are both in excess of 100% – importing rubbish from elsewhere to burn. The process of proposing/building/approving such projects needs to be streamlined radically by central Government using emergency powers if necessary.
In the longer term, I’m excited about the prospects of tidal, as it is completely dependable, ‘low tech’, and could last for hundreds of years. I’ve been disappointed that the Swansea Barrage hasn’t gone ahead – I understand that the May Government found the proposal wasn’t good value for the tax payer, but I believe it compares favourably to Hinckley Point C. Under the present circumstances, I think it should be looked at again, or if necessary, the UK Government goes back to the stakeholders with a counter proposal.
August 31, 2022
Lastly, my understanding is that in broad terms, it is the UK Government that is ‘coining it’ from the difference between the gas price and the actual price of energy generation. The Government must not try to conceal this from the public – this is the public’s money and should be given back as a rebate.
August 31, 2022
Exempt any remaining gas and coal plant from Net Zero rules and taxes.
Temporarily increase PA to ÂŁ25,000, re-adjust allowance quarterly via payroll as prices reduce.
Take VAT to zero for all energy supply equipment, installation and energy efficiency work.
Emergency 4 day week plans.
RE-examine contracts which are too cozy, one sided. Tax the resultant windfalls if the contracts are not updated to new circumstances. Ban landowners from gaining rentals in excess of farm land returns etc.
More competition & permits for oil and coal generation especially existing plants.
Better contracts or nationalise them. Ensure that state and private energy suppliers are not charging the UK customers more than other non UK customers?
Ensure British controlled and ran companies control our networks and are prioritised e.g like the French, nationalise certain infrastructure as needed. Improve grid provision, short , intermediate storage, hydro, closed loop, liquid air, Geo thermal. Links to Iceland or Norway. Maybe closed loop hydro between the sea and coast if enough height differential. Borrow a Fjord or create a concrete hole in the sea bed and fill it, empty it with seawater via turbines and draw off a constant power output in reverse.
September 1, 2022
The power supply market needs a full revamp.
1. There is far greater scope for demand side management and we will need to use it more in the future. As renewables take up a greater share of the market, the price of power will become more volatile. The more customers can respond to these price signals the better. For example, lets make it easy to choose to recharge your car when the price of power is low or do it at a higher price if you cant wait. This means much smarter metering and smarter devices – we have a digital world lets live in it. The current models of flat tariffs or overnight economy tariffs are completely inadequate. We should enable customers to push power back onto the grid when prices are high from their cars and other home storage devices.
2. Serious consideration should be given to the idea of having separate green and brown power prices (perhaps an alternative distinction is between intermittent and dependable power). It seems bizarre that the price of green energy should be set by the price of brown energy when we are trying to phase brown energy out. Intervention and markets don’t mix well.
3. We need a system that will deliver security of supply if we have a prolonged period of a mass of still cold air sitting for weeks over the country (its called a hard winter). The plan has to mesh with our plans for net zero. But whether it is LNG, gas storage, hydrogen, carbon capture or something else, we have to pay for it. This needs to be structured into the energy market and should be directed to those that are providing this service. It would not be right for this premium to be available to intermittent generators who happen to be available. The mechanism should give predictability of revenue to providers and assurance of availability to customers.