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Get a move on, Ed, or sun will set on our wind-power dream
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16 April 2009
Heard much more from Centrica after its grandiose claim to have built the world's largest sea-sited wind farm, 50-odd turbines off Lincolnshire, powering all of 130,000 homes?
Any real hope the UK will hit its 15% target for energy sourced from renewables, with the help of 8000 turbines around the coast of Britain?
The answers are all, of course, no.
Which illustrates the crossroads at which the British wind industry finds itself, looking with increasing levels of frustration and agitation at Energy Secretary Ed Miliband.
The momentum has stalled for wind to bridge the UK's energy gap, or power output shortfall, in the next decade. Witness the new fronts that are opening up, aimed at shaming the Government and its grandly named Department of Energy and Climate Change into action. These range from the fiscal to the industrially ambitious.
First up, there's the British Wind Energy Association, a trade body whose members are also, a little uncomfortably, the UK's main carbon-emitting generators.
The BWEA has presented the Treasury with a seemingly elegant way out of the current fiscal impasse. Building wind farms has been put on hold because of the financial crisis and the wind industry is accusing the Government of being happy to bail out banks, but not resuscitate renewables.
One of the biggest financial factors is the need to connect all these wind farms to the National Grid at a cost of several billion pounds. Clearly this horrifies investors, who already fear the payback from the project will stretch beyond their own lifetimes.
In its Budget submission, the BWEA suggests that the link-up costs are "socialised" (i.e. paid for by the generating industry as a whole rather than by each individual operator).
This would mean the dirty, carbon-emitting electricity generators subsidising the wind industry. Via what would, in effect, be a windfall tax on the highly-profitable energy industry, the Treasury would avoid the need to dip into taxpayers' pockets. (The downside, of course, is that at some stage this cost will be passed on in higher power prices to consumers.)
On the industrial front, worthy organisations such as the Institute for Public Policy Research and the CBI are beginning to trumpet a huge potential advantage of our stated commitment to become the world's premier commercial offshore wind laboratory. It gives us a once-in-a-lifetime chance to become the centre for this industry.
Global production of giant wind turbines, measurable as yet in dozens rather than thousands annually, is concentrated in the hands of Germany's Siemens and Denmark's Vestas. Most of it is bound for the US and China.
But if we need 8000 turbines here, the argument goes, surely Siemens, Vestas and new entrants such as General Electric of the US should be building them in the UK — creating thousands of component manufacturing jobs to add to the thousands of construction jobs building the wind farms.
Furthermore, if we need thousands of miles of cable to connect the wind farms to the mainland, then industrial giants such as ABB should set up in the UK. Which, of course, they all might well do — given the right Whitehall signals and incentives. But again, all this rather puts the spotlight on the need for leadership.
The spotlight is not something of which the obviously ambitious younger Miliband brother has so far seemed afraid. But the talk among wind-industry executives is of a leadership vacuum. They feel the Energy Secretary is more interested in "showboating", with unproven and expensive tidal technologies such as the Severn Bore, than grasping the nettle of policy detail and guiding the energy regulator Ofgem.
The decision-making hiatus has seen London Array stall, Shell pull out as a backer and its other backers, E.On and Dong Energy, desperately cast around for alternative finance. After building its Inner Dowsing/Lynn wind farm, even Centrica has gone quiet (and privately quite cool) on further big investments, despite having a green light for 320 further turbines in The Wash.
If wind is the answer, will Miliband, the industry wants to know, storm ahead with it?
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