A Place to Stand

This is a recent submission by BNFL to the Scottish Parliament. While some may think it unsurprising that a nuclear company should be saying how neccessary it is to go nuclear the strength of their evidence is distintcly unusual. Despite what the enemies of capitalism may think, experience shows that companies, particularly large companies with a close relationship to government normally go to great lengths not to disturb, at least publicly, the illusions of the politicians they have to butter up & indeed even here they go through some contortions to treat renewables seriously as in the use of the word "challenging" meaning "you are an idiot minister" (most of which I have not bothered with). Some excerpts with my emphasis in bold

· We believe meeting the target of producing 18% of electricity from renewables by 2010 will be challenging and it is extremely unlikely that Scotland could produce 40% of its electricity from renewable sources by 2020.

At present no industrialised country generates electricity with such a high proportion of renewables generation, other than those which can take advantage of large-scale hydropower. It remains to be demonstrated that a reliable national electricity supply system can operate with such a high degree of intermittent and unpredictable generation as would be required to meet the Scottish Executive's 40% target.

Such a high percentage of intermittent renewable generation would require a completely new electricity supply management system if security of supply is to be maintained. Even if such a system were possible it would add further to the high costs of renewable generation. In the absence of any clear option for large-scale electricity storage, any back-up generation for renewables would probably be based on gas-fired generation. This would inevitably lead to increased carbon dioxide emissions and the demand for gas, with its inherent security of supply concerns.

There are widely held concerns about the amount of renewable energy which current infrastructure can accommodate, the cost of back-up capacity, the ability to find investors and planning issues around siting of renewables. There is also the very question of whether enough renewable capacity can actually be manufactured, installed and commissioned on the targeted timescales. Many authoritative and informed bodies - such as the Royal Academy of Engineering1, the Institution of Civil Engineers2, the Oxford Institute for Energy Studies3 and the House of Commons Science and Technology Committee4 - have expressed these concerns.

What are the opportunities and implications for the economy in achieving the targets?

To meet the Scottish Executive's targets means that by 2020 Scotland would produce around 40% of its electricity from a carbon-free source, making a contribution towards minimising Scotland's greenhouse gas emissions. It must be remembered that Scotland already has more than this proportion of carbon-free power through the current mix - mainly from nuclear and hydro-power. Exclusive pursuit of such challenging renewable energy targets without the consideration of other generation options will mean that Scotland will limit the economic effectiveness of its climate change and energy policy. This would impact on Scotland's economy as a whole.

............. Renewable Obligation Certificates are trading at a price considerably above the buy-out price. It seems clear that across the UK many renewable energy projects will need a substantial subsidy for many years. The cost of providing such a subsidy sufficient to support a rapid growth of renewable generation in Scotland would raise energy prices substantially. This would have an immediate and obvious impact on Scotland's industrial competitiveness. It would also make the important task of reducing domestic fuel poverty much more difficult.
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What are the implications if the Executive's targets are not met?

If the targets are not met and no Plan B, such as replacement nuclear build, has been delivered Scotland will face electricity shortages due to lack of capacity. Increased greenhouse gas emissions will also result as fossil fuel power stations will be needed to fill the gap in generation left by the retirement of Scotland's current nuclear capacity. The retirement of older coal-fired generation over the next 15 years will further add to the need for new generation capacity, be that nuclear, coal or gas. This is not simply scaremongering; this is an inevitable consequence. Increasing demand coupled with decreasing supply can lead nowhere else.
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It may be better if the share of generation from renewables were to grow sustainably, rather than be overextended in order to meet an over-optimistic, artificial and unnecessary target.

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In the consultation paper "Scotland's Renewable Energy Potential - Beyond 2010"6 it was recognised that that renewable developments do not tend to create large numbers of jobs. Furthermore, there must be serious doubts as to whether those jobs created from an expansion of renewable generation will be based in local communities hosting renewable energy projects. The skill areas required by the renewables programme will be in manufacturing and in offshore construction. With the rundown in domestic manufacturing industry it is doubtful that we currently possesses the necessary degree, depth or range of skills to meet this manufacturing challenge. Furthermore, given that construction experience and associated facilities for the manufacture of wind turbines already exist elsewhere in Europe, it is unlikely that it would be viable to re-generate such a pool of expertise within the UK. A Scottish Renewables programme is likely therefore to be heavily dependant on a skilled workforce based in Europe or elsewhere.

The impact of closure of existing nuclear power stations should also be considered. Scotland's nuclear power stations provide skilled jobs in their local community. In the absence of a commitment to replacement build it is likely that skilled workforce will have to move away from their local area to find jobs with similar levels of responsibility and reward. It is unlikely that the proposed growth in renewables will compensate for this.
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The UK as a whole will need to import up to 90% of the gas it needs from places such as Russia, Algeria and the Middle East. This situation leaves the UK as a whole, and thus Scotland, vulnerable to supply disruption and price instability - and at the end of a long trans-European gas pipeline. The electricity price is very likely to rise and is highly sensitive to the bulk gas price, which will be outside Scottish or UK control.

Even with 40% of electricity generation from renewables Scotland would still be vulnerable to security of supply weakness if it relied on gas to supply the remaining 60% of its electricity, in particular if the 40% of renewables is backed up with yet more gas.