(This post was programmed to appear automatically while I was away, but for reasons that I have failed to discover, did not do so. In light of what I have come across in the reading that I have done since my return, there seems to have been few developments since I wrote it, including some press comments that are unlikely to keep Mr Huhne smiling.)
In the aftermath of the general election, Chris Huhne has succeeded Ed Miliband at the helm of the Department of Energy and Climate Change. There can be no doubt that he will be navigating in some extremely stormy waters.
Of all the cabinet posts other than those relating to the public finances, this is probably the one that will come with the highest risks attached. I am not going to rehearse the evidence that, unless the UK gets a viable energy policy together immediately, there is a very real likelihood that we will be suffering a third-world type energy crisis within as little as five years, the intended lifetime of the current parliament. Huhne’s post at the DECC needs to be filled by someone who can think straight, think big and think fast. It is by no means certain that the present incumbent possesses all these qualities.
There is no reason to think that Huhne is a fool. He was educated at Westminster School, like his party leader Nick Clegg, before going on to the Sorbonne and then Oxford where he took a first in PPE. As a student he was active in Labour politics.
He went of to become an economist in the CIty of London, rising to be the managing director of Fitch ratings, an international credit ratings agency, so it would seem that someone thought that he had management abilities; no bad thing for a minister. He has also had a successful career as a journalist, rising to be financial editor of the Independent and the Independent on Sunday.
After unsuccessful attempts to enter parliament in 1983 and 1986 he turned his attention to Europe and became a Liberal Democrat MEP for South East England from 1995 to 2005, when he was elected to Westminster as member of parliament for Eastleigh. Since then, his rise has been meteoric.
Less than a year later, he challenged Sir Menzies Campbell for the leadership of the party, and although he lost, he received 21,628 votes to the winner’s 29, 697. Not a bad score for a new boy who started as a rank outsider. Huhne stood for the leadership again in 2007 when he lost to Nick Clegg by just 511 votes. He has served as his party’s environment spokesman.
The picture one has of Huhne is that of an extremely capable, ambitious and successful man in a hurry to get to the top.
For the British, coalition politics are a new experience. We have entered a political era in which some things are certainly being done very differently, but it is far too early to even begin to consider whether they are being done any better. For all the avowals of unity in the face of apocalyptic fiscal problems that we have heard during the last three weeks, there is little reason to suppose that the new Prime Minister, David Cameron, is playing the game so very differently from his predecessors. The pressures to watch your back if the keys of 10 Downing Street are to stay within your grasp haven’t gone away, and certainly not when there is someone like Chris Huhne about.
The formation of a coalition made it inevitable that some senior cabinet posts would go to Lib Dems, and there were quiet chuckles in Conservative ranks when one of the new prime minister’s first appointments was David Laws as Chief Secretary to the Treasury. ‘No bad thing’, said the Tory wiseacres, ‘to have one of those other people playing hatchet man during a time of austerity. It helps keep our hands clean if there is a surprise election’. Perhaps the thinking was similar where Huhne’s appointment was concerned.
Energy and climate change is likely to provide a very rough passage for whoever is in charge over the next few years, and Huhne is possibly the most unlikely person to be able to cope with this and keep any semblance of integrity.
There are two major problems that will face him. As a committed green, he cannot back-pedal on the reduction of carbon emissions. Yet even if clean energy was not a consideration, he would be facing colossal problems keeping the lights on. Can he possibly deal with the problem when many of the obvious solutions are already ruled out?
Also as a committed green, Huhne is anti-nuclear. He has already had to perform some fancy footwork where this is concerned, and it looks as though there will be a lot more to come.
In a recent newspaper article he is reported as saying that:
I am not an ideological ayatollah against nuclear power per se.
I am simply a sceptical economist about the record of nuclear power on delivering on time and to budget in a way that can make returns for investors.
He now claims that his objection to nuclear is entirely based on cost and the possible need for subsidies; merely the reservations of a shrewd economist. This sounds unconvincing.
I wonder whether he will use his fluent French to talk to his French counterpart, who presides over an electricity grid that is nearly 80% supplied by nuclear, with no fears of the lights going out, and supplies abundant enough to export large amounts of electricity to southern England.
Huhne certainly has a point about not subsidising nuclear generators. But he makes no mention of the vast subsidies to wind power, which are being taken straight out of the public’s pockets in the hope that no one will notice that this inefficient, unreliable, environmentally devastating, and very expensive form of generation can appear to be free of subsidy. Instead he talks about the rising cost of carbon eventually making nuclear, and presumably wind power too, competitive and able to stand on its own two feet. Of the obvious consequence that the consumer will have to pay more for electricity in any case, he says nothing,
Few people who have thought about Britain’s parlous economic plight are now in any doubt that we face years – perhaps even decades – of austerity. Rising costs are likely to be on everyone’s mind, and particularly where something so ubiquitously necessary as electricity is concerned. Celebrating the supposed economically therapeutic effects of rising energy costs is likely to be very short-lived phenomena.
Given that all the opinion polls I have seen recently show an accelerating rise in scepticism about climate change, Chris Huhne’s first venture into public office looks doomed. Only a globally binding agreement on carbon emission reduction at Cancún in the autumn could make relying on green energy even begin to look credible, and if what one sees on the net is even half true, this is not a lifebelt anyone should rely on.
From a purely political point of view, Chris Huhne’s position is a very interesting one. His past activities in European politics must make him aware that present energy policy in the UK is dictated not by Westminster, but by emissions targets imposed from Brussels. The combination of climate scepticism and Euro-scepticism on the Tory back benches is likely to make any discussion of energy policy highly volatile, and this cannot have escaped David Cameron when he made the appointment. Presumably it was agreed with Nick Clegg, and one can hardly blame him for not intervening to protect an ambitious rival who has already tried to get his job twice, and only just failed to do so quite recently.
This all looks like high-risk politics of the most ruthless kind, with the future of the UK economy at stake. No industrialised nation can survive without an abundant, reliable and cheap supply of electricity. No country that is in the midst of a potentially catastrophic debt crisis can contemplate a vast hike in the cost of energy that will jeopardise its competitiveness.
As things stand at the moment, our energy policy is on a collision course with reality, and reality doesn’t usually chicken out.
_________________
If anyone is wondering about the title of this post, my spelling skills are very poor in English and non-existent in German.
One has to hope that Forgemasters don’t lose the funding (and hence the work) if Huhne follows up on his threat not to subsidise nuclear. Quite how he squares that with tariff subsidies for home-generated power is a mystery, though. Perhaps Mrs Huhne could shed some light on his reliability..? :-)
James, actually as far as I know they have lost the funding and won’t be getting the £80 million now for the 15,000 tonne press; sorry, I could have been a little clearer in #25.
Ford and Nissan will still get their funding for low carbon/electric vehicles (£360 million loan guarantee and £20.7 million grant, respectively) and Mitsubishi will get £30 million for offshore wind power research. More here.
It looks like Chris Huhne is banking on all those future Leaf drivers being able to power their vehicles with electricity generated predominantly by wind power. Counting his chickens, you might say!
Thanks, Alex. Successive governments seem to have been wonderfully adept at pulling financial plugs at precisely the worst moment. I still wince at the fate of TSR2 (cancelled in favour of the vastly more expensive American F111) and Tracked Hovercraft (cancelled in favour of the Advanced Passenger Train, which was rather good and hence also cancelled).
As for the ‘low carbon’ electric cars, they do seem to forget about the CO2 produced during manufacture, don’t they? One of our local sports centres has just installed 66 solar panels, which will not only take 25-30 years to amortize, but have already produced several years’ worth of CO2, assuming they save the maximum amount of power being produced conventionally.
Assume that what is needed to get to the top of the LibDims is a modicum of sanity as well as the ethical flexibility to publicly defer to every fascist special interest (from the eco-fascists to the Nazis that made them the most enthusiastic supporters of war crimes, genocide & human dissection in former Yugoslavia). That would give Huhne & co considerable reason, now that they are in power & want to stay, to reverse everything they said on the way up. Certainly they have the flexibility to support nuclear if they think the alternative is to be held to account for blackouts.
There is some sign that LD leades are privately & semi-publicly are distancing themselves from decades of denouncing nuclear as the work of the devil. Some time ago I asked Huhne by email why he wanted to put our future in windmills rather than nuclear & got back a paper saying that the future was in CCS. Not that carbon storage is “economical” or even CO2 free compared to nuclear but it shows that they had recognised that their primary excuse for not going nuclear was false.
Neil Craig
Sometimes (frequently!) ideology trumps common sense, or there is just a sheer reluctance to back down. I fear that is the position with Chris Huhne.
We have the very real problem of the length of time it takes from a firm OK to a nuclear plant actually producing electricity-around 10-15 years or so.
Bearing in mind we arguably need around ten nuclear plants, and there is a looming energy gap from around 3 years down the road (partly dependent on how quickly industry recovers) and it is difficult to see how anything but the most enthusiastic endorsement of nuclear will do anything to help us.
I can’t see Huhne doing such a massive about face, so assuming he stays there it could be another five years before firm orders in quantity are placed.
tonyb
Interesting debate in Parliament yesterday re energy policy and nuclear power – plenty to read and digest; here’s the Hansard link.
This exchange was revealing:
Ed Miliband: “Can the Secretary of State explain why it was right to give a grant to Nissan to make electric cars – a proposal we support – but wrong to provide a commercial loan to help a British company, Sheffield Forgemasters, to be at the centre of the nuclear supply chain, particularly in light of the admission by the Minister of State, Department for Business, Innovation and Skills, Mr Prisk, that £110 million would have come back to the Government from that loan and that the Government would have got extra money if the company had made a profit?”
Chris Huhne: “The right hon. Gentleman knows that the loan to Sheffield Forgemasters was not a commercial loan. If it had been, it would have been arranged through the banks and not the Government. It was precisely because of the public subsidy element and the fact that that was not affordable that the Government decided not to proceed with it.”
When it comes to wind farms and EV research we hear a lot about important spending and investment, and when it comes to nuclear power we hear the words “not affordable.”
On the costs of the Climate Change Act, another interesting debate yesterday, this time in the House of Lords (link here.)
Lord Lawson of Blaby (Conservative): “Is my noble friend aware that only a couple of days ago, Mr Bob Wigley, the chairman of the previous Government’s Green Investment Bank Commission, stated that meeting the requirements of the absurd Climate Change Act will cost the United Kingdom £50 billion a year, every year, for the next 40 years. How-above all in this age of austerity-can this possibly be justified?”
Lord Marland (Parliamentary Under Secretary of State, Energy and Climate Change; Conservative): “… I must correct my noble friend; the Green Investment Bank was an initiative set up by our own party and one must not rule out the phenomenal business opportunities that it offers for this country. We must have 2 million heat pumps by 2020. We must have bioenergy, which will create 100,000 jobs at a value of £116 million. Wind alone should create 130,000 jobs at a value of £36 billion. At a time when the country needs investment, these are heartening numbers.”
I suspect the £50 billion (or £2.5 trillion by the method people who say Trident costs £100bn calculate it) is a gross underestimate. The correlation between GNP & electricity use is well established & a cut of 50% of electricity should mean close to a halving of our £1.4 trn GNP. A quick calculation over 50 years makes that £35 trillion, far more if you assumed the economy had actually been going to grow. We are talking about either quadrillions or lunacy.
The interview with Wigley in the Sunday Telegraph that Lord Lawson’s question was based on, which is quite surprising, can be found here:
http://www.telegraph.co.uk/finance/newsbysector/energy/7869935/Bob-Wigley-says-green-funding-can-be-much-better-spent.html
The online version does not include this handy info-panel which appeared in the print version.
Apparently the 9 largest of the 49 quangos have combined annual budgets of £185m plus £2bn in funding.
Perhaps the best that can be said about this, and Lord Marland’s claims about job creation, is that survival beyond the October spending review is doubtful. Although the chancellor has pledged to maintain capital investment, presumably that will still need to be based on more than pious hopes.
The Sheffield Forgemasters story persists; Richard North links to this Guardian article about behind-the-scenes lobbying which could have been a factor in the new government’s cancellation of the loan. Some relevant Parliamentary bickering here and here (a bit of a trawl, but worth a glance maybe).
‘Britain is “very likely” to face an oil shock within the next decade, triggering economic volatility as fraught with “nasty surprises” as the 1970s, the energy secretary has warned.
Chris Huhne told the Financial Times that Britain was in danger of becoming as vulnerable to price spikes as before the discovery of big North Sea oilfields, leaving the economy open to “very severe blows”.’
The rest of this article (dated I think Friday 23rd July) is behind the Financial Times’s paywall, so I don’t know what else was said.
Hopefully this will trigger a debate or two in the Commons, and so I’ll be listening out for it next week in Radio 4’s Yesterday in Parliament.
Quick update – Reuters also has the story, see here (h/t Nick Grealy at nohotair.)
“Investing heavily in energy efficiency and renewable sources of power is the only way to avoid such shocks, the paper cited Huhne as saying.”
Alex Cull,
I wouldn’t have thought it was necessary to wait until later in the decade for the UK’s oil shock. Isn’t it already here?
http://www.thisismoney.co.uk/markets/article.html?in_article_id=487503&in_page_id=3
Alex Cull and Peter
The UK’s oil crunch appears to be here already, as Peter writes.
Tony Hayward of BP may be a bit pessimistic about UK oil reserves (and his own company’s woes), but the latest North Sea discovery (by other oil companies) sounds like a major strike.
http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/7859721/North-Sea-oil-find-cheers-three-UK-explorers.html
The discovery is described as “one of the biggest North Sea oil finds in years”.
But, regardless of this newest strike, the UK “oil crunch” appears to be tied more to the amount of money being spent on drilling rather than on potential un-tapped reserves (as Hayward also alluded).
http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/5779908/UK-facing-energy-crunch-as-North-Sea-oil-and-gas-cash-dries-up.html
With its Gulf woes, BP will probably not spend too much on locating new reserves, so it will be up to others (and to a government policy that, among other things, encourages new exploration in order to minimize the impact of a “UK oil crunch”).
This brings us back to the title of this thread.
Max
Peter M and Max, I think I can recall news items giving North Sea Oil a reduced figure of about 35% capacity of its 1999 peak by 2020 (?), but yes, it depends on investment, which may or may not be forthcoming.
Here’s a bit more re Chris Huhne on energy this weekend, from the BBC and Telegraph.
Max,
Whenever I do the calculations on what is claimed from these so-called major strikes, it turns out that the new reserves make hardly any difference to the scale of the problem. I haven’t done the sums on this one from the North Sea but it won’t be any different. However, you can do them yourself and let me know.
I was going to say that the World needs ‘a new Saudi Arabia’ every five years. This reference reckons every two years so there you go.
Time to move away from fossil fuels big time, isn’t it?
Sorry- forgot to paste in:
http://www.theoildrum.com/node/6169
Peter M: Time to move away from fossil fuels big time, isn’t it?
There’s unconventional gas, though, which would seem to be very abundant, and might well serve as a “bridge fuel” (if coal is not an option) perhaps, while the next generation of nukes are developed (plus the next generation of renewables, come to that – the combination of nanotechnology and solar looks promising). I’m wondering what your take is on that?
Alex,
Gas turbines are a good option for electricity generation with reported efficiencies of 50% or more. Of course the higher the efficiency the lower the emissions. They also have good flexibility and can be started and shut down quickly.
Yes, gas is a fossil fuel, and will peak and deplete like oil, but is probably still a good interim solution in the next 20 years or so.
Those with open minds would be as well to reserve judgement on whether oil and gas are fossil fuels. Their formation is not as obvious as that of Coal, and we keep finding more and more. More evidence accrues every year that maybe a process within the earth is producing it.
This though is a separate argument from the discussion on how best to user hydrocarbon fuels. Given that we have excellent nuclear technology we should not burn hydrocarbons to produce electricity, and a move away can only be a good thing. China’s NOx and HC and particulate pollution from its coal stations is living proof that what they are doing is damaging their environment in a real and measurable way.
I’m not sure that Gas turbines to produce electric power are an efficient use of Gas. Only if it is a combined heat and power plant located near to a population centre and or industry could a gas turbine be termed efficient.
Compare this. Two houses one has gas central heating and water and uses electricity only for lighting and domestic appliances. The other uses electricity for all heating and appliances. And both of these homes are serviced by Gas Turbine electricity. It doesn’t take much of a brain to work out that the all-electric house is going to cost a lot more due to efficiency loses, not just in production but also in transmission.
OK so I assume modern boiler etc etc but gas turbines are internal combustion engines and as such not best suited for grid level power production. Where they win is their ability to accept and reduce load almost instantly, and in this way they can improve overall efficacy of a system, as opposed to something like wind power that is completely uncontrollable. So they have a place within our current systems but I believe that this is only a temporary need.
PeterM
You wrote:
For a moment, let’s forget all the hype and hysteria about AGW and look at energy sources.
Let’s also ignore exceptions, like Switzerland, where hydroelectric power is readily available, and concentrate on the UK situation.
A report in The Guardian states, “Britain has enough coal reserves to last up to 300 years”
http://www.guardian.co.uk/commentisfree/2009/apr/28/ukcoal-coal
Using fluidized bed combustion, coal can achieve between 91-95% carbon utilization efficiency and over 99.8% CO combustion efficiency.
http://www.thaiscience.info/Article%20for%20ThaiScience/Article/3/Ts-3%20coal%20combustion%20studies%20in%20a%20fluidised%20bed.pdf
According to a 2004 report by the Department of Trade and Industry, the UK consumes around 60 million metric tons of coal annually, and:
http://www.eia.doe.gov/cabs/United_Kingdom/Full.html
The flue gas from coal combustion contains pollutants such as particulate matter, carbon monoxide, nitrogen oxides, sulfur oxides and mercury.
A number of technologies are in available to reduce or eliminate air pollution from coal-fired power stations for a range of pollutants.
Particulate matter can be removed by 99.5% using various processes; many of these processes also remove mercury by up to 95%.
CO can be held to around 200 ppm in the flue gas, and presents no problem at that level.
Sulfur oxides can be removed to 95% with various flue gas desulfurization processes.
With fluid bed combustion, flue gas will contain between 20 to 40 ppmv NOx (as compared with up to 1,000 ppmv with normal combustion), so no further treatment is required.
So the key in the UK would be to ensure that old, dirty and inefficient coal plants are replaced with new, higher efficiency fluid bed technology plants equipped with latest technology flue gas cleanup systems to remove the pollutants.
It seems, however, that this path has not been followed for political reasons.
We shall see what the new UK government decides the role of “clean domestic coal” will be for covering the future energy needs.
Let’s just hope they come up with something more realistic than “windmills” before “the lights go out”.
Just for comparison, the situation in the USA is somewhat different, since there is no implied commitment to reduce coal combustion and the quantities consumed are much higher. The coal reserves are the highest in the world and are estimated to be sufficient to last several hundred years, even including a growth in consumption levels.
The DOE estimates that 950 million metric tons (Mmt) of coal were consumed in the USA in 2009, and that this will increase by around 25% to around 1090 Mmt by year 2025.
China surpassed the USA in coal consumption around 2000, and it is estimated that it will consume around 3.06 billion tons in 2010. Its reserves are the third highest in the world.
So, with the US “cap and trade” legislation dead and China adding a new coal-fired plant every two weeks, the global carbon emissions will not be affected noticeably regardless of what the UK government decides to do.
I would classify any UK attempts to reduce global CO2 emissions by reducing UK coal consumption as “feel good window dressing”, which will have no impact on global CO2 levels whatsoever, but will move the UK more quickly to the day when “the lights go out”.
Max
TonyN
You will have noticed that I copied your phrase about “the lights going out”. I like it.
Max
Peter Geany
Your #45 got me to thinking.
Natural gas (methane) is being formed today by various natural processes, so is certainly not exclusively a “fossil fuel” (as you wrote). There are similar theories concerning petroleum, but these are less certain.
But, leaving that all aside, electrical power from gas turbines can be quite competitive with nuclear power, provided there is a use for the thermal energy released. Many years ago, I was involved with a situation where gas turbines (operating on Dutch natural gas in Germany) produced electrical power at a significantly lower cost than could be provided by a nearby nuclear power plant. But this was a special case, where there was a need for thermal energy.
As you wrote, the beauty of gas turbines is that they are very flexible, and can be used to produce standby power when the grid is overloaded, or (in the case of less reliable wind turbines) when there is no wind or the wind is too strong (i.e. about 70% of the time).
This was the “sweetener” for T. Boone Pickens in his (since dead) scheme to get government subsidies to plop wind turbines all over the U.S. plains states, thereby releasing (his) natural gas for automotive use, while using the gas-fired stations for standby service. The scheme did not really have anything to do with CO2 emissions (although it was promoted with this in mind), but more with moving the USA away from imported petroleum products for automotive use (and primarily for making a “buck” for TBP).
But, as the saying goes about the “best laid plans of mice and men…” (as Robert Burns and, later, John Steinbeck wrote).
Max
Max and Peter Geany,
Methane is present on other planets, or moons of planets, without the need for biological sources to have produced it. It was present on the Earth before the formation of life too. However as the oxygen content of the atmosphere increased, the free methane in the atmosphere would have oxidised and therefore been removed.
Still, it is possible that some hydrocarbons may have originated from abiogenic sources deep in the Earth’s crust but you’d have to ask if they are of significant quantities. Is there any evidence that commercially exploitable finds have resulted from this ‘knowledge’? As I understand it, all commercially useful oil and gas fields, without exception, are found in sedimentary rocks and this is consistent with the theory that they are indeed fossil fuels.
Oil production in the USA peaked in 1970. They wouldn’t care much about the origin of oil, except that an increased knowledge of the process, if it were indeed true, might help them find it. They’ve looked pretty hard but it obviously hasn’t.
Peter M I would just add to your #49 that oil production in the US may have peaked in 1970, but it was just as much their ability to acquire cheap and easy to produce oil overseas that prompted this action as any lack of available resource. I also believe that it is not beyond the realms of possibility that they would deliberately save their own oil in favour of someone else’s. This policy may now be harder to sustain from an economic stand point in future and we may see the US forced to use its own resources, and this will certainly be what it is forced to do if it persists with its current energy policies.
Max I think the lower capital costs and start up cost help reduce the cost of Gas turbine electrify. And if you can recover the waste heat and use it you are on to a winner. Just read this post and see how simple boiler replacement would have a greater effect that producing more wind turbines that don’t work.
http://www.pickinglosers.com/node/1293