Huff, puff and wind power
Putting politics before the evidence when it comes to wind power is bad for energy users and the British economy. George Osborne's overtures to his "NIMBY" backbenchers may end up winning him few friends.
In February a group of more than 100 backbench Conservative MPs sent a letter to the Prime Minister arguing for deep cuts in the support provided for onshore wind. Many of these MPs represent rural constituencies where wind farms may be built. This kicked off a major political spat over the summer with the Chancellor of the Exchequer, George Osborne, championing their cause and picking a fight with the Secretary of State for Energy and Climate Change, Ed Davey, about the support levels provided. Davey won but only after horse trading that saw the Chancellor advance several steps along his "dash for gas".
It is absolutely right that the views of local people are taken into account about developments in their areas. But in support of their argument the MPs criticised wind power technology claiming that it is inefficient and less reliable than other technologies. These MPs appear to have taken their lead from a number of think-tank reports that have made similar claims. One report has made the somewhat surprising claim that wind power is not an effective way to reduce carbon emissions. We decided to get to the bottom of these claims and assess the evidence.
A fortnight ago IPPR published a report called Beyond the Bluster that addresses two questions: is wind power an effective way to reduce carbon emissions? Is wind power a reliable and secure energy source?
To produce this report we drew on the expertise of a leading renewable energy consultancy, GL Garrad Hassan, which is owned by GL Group, a business with interests in the oil and gas sectors. We thought it appropriate to cooperate with those who have an advanced understanding of the technology. To ensure the validity and objectivity of GL Garrad Hassan's work the report was peer reviewed by Professor Nick Jenkins of the Institute of Energy, Cardiff University. All work on the report was carried out on a pro bono basis.
The conclusions of the report were unambiguous. Wind power is an effective way for reducing carbon emissions. We demonstrate this using a simple model of the UK energy system which examines the impact of an additional ‘marginal' plant. This is backed up with empirical data on measured emission reductions from wind power in the US.
We also found that wind power will be a secure and reliable energy source at the levels of deployment expected in the UK by 2020. We know this because wind power is largely predictable and because it varies at rates similar to existing electricity demand it can easily be integrated into Britain's existing electricity system. We highlight in the report how other countries have already achieved what is planned for the UK by 2020 without experiencing any problems. After 2020 the outlook becomes more challenging but for now there is little to worry about.
By ignoring the facts to appease his party, the Chancellor is not developing policy in the best interests of energy users or the wider economy.
First, inconsistent support from government will increase the riskiness with which businesses regard investment opportunities. This in turn increases their cost of capital and will therefore lead to higher energy bills for businesses and consumers.
Second, an uncertain investment outlook of this kind will make businesses in the supply chain less likely to invest here. As a result components will end up being imported, meaning fewer jobs for Brits. This would be a huge missed opportunity given Britain's comparative advantage in this area.
The UK has the greatest wind resource, both onshore and offshore, in Europe. Onshore wind power is currently the cheapest of the renewable technologies and therefore a lower ambition for this technology will make more expensive forms of low carbon generation a necessity with higher energy bills as a result. In relation to offshore wind, Britain has the opportunity to be a world leader, with the Carbon Trust estimating it could contribute £3-10bn annually to the economy between 2010 and 2050.
Tellingly, on publishing the report several journalists in the north got in touch wanting to know how the economic prospects of their areas could be affected if the prospects of the wind industry are dented by changes to government policy.
Indeed, Alex Salmond, First Minister of Scotland, cited IPPR's work in an address at Holyrood on his legislative programme for the coming year. Meanwhile Chris Heaton Harris MP, the agitator spearheading the backbenchers, chose to ignore the content of the report and instead attacked it on the basis of its authorship.
George Osborne does not appear to care about the economic advantages of wind power and has tried to slash support levels for the technology without evidence to show why this would be cost-effective. This is a clumsy political strategy. While it might please "NIMBY" backbenchers the effect would be to undermine the potential for job creation elsewhere.