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Author Topic: The true cost of renewables?  (Read 2851 times)

Anne

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The true cost of renewables?
« on: June 15, 2013, 11:48:53 PM »
I’m as keen as the next person on this forum on weaning human beings off fossil fuels soonest. Inevitably there are those who will hitch onto the bandwagon, which they can magic into a gravy train. I like to think this forum is honest and fearless, so here is some dirty linen. (That's enough mixed metaphors for now.)

This sort of story from the UK can bring the whole sustainable energy programme into disrepute. How do we face up to it, how do we tackle the damage it’s already done - if indeed there is damage -  and how do we prevent it in the future?
Quote
A new analysis of government and industry figures shows that wind turbine owners received £1.2billion in the form of a consumer subsidy, paid by a supplement on electricity bills last year. They employed 12,000 people, to produce an effective £100,000 subsidy on each job.
The disclosure is potentially embarrassing for the wind industry, which claims it is an economically dynamic sector that creates jobs. It was described by critics as proof the sector was not economically viable, with one calling it evidence of “soft jobs” that depended on the taxpayer.
The subsidy was disclosed in a new analysis of official figures, which showed that:
*The level of support from subsidies in some cases is so high that jobs are effectively supported to the extent of £1.3million each;
*In Scotland, which has 203 onshore wind farms — more than anywhere else in the UK — just 2,235 people are directly employed to work on them despite an annual subsidy of £344million. That works out at £154,000 per job;
*Even if the maximum number of jobs that have been forecast are created, by 2020 the effective subsidy on them would be £80,000 a year.

Is this evidence of people setting up and milking a system? Or is it simply that we need to be more honest about the cost of renewables? Or is it much more complicated?

Much more food for thought here

ghoti

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Re: The true cost of renewables?
« Reply #1 on: June 16, 2013, 04:02:03 AM »
Manufactured doubt.

ccgwebmaster

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Re: The true cost of renewables?
« Reply #2 on: June 16, 2013, 04:26:21 AM »
I can't read the article since the telegraph went paywall (after reading x articles per month).

I do note:

Quote
just 2,235 people are directly employed to work on them

What does that mean? Directly employed as in they service and maintain them once set up? Or does it include manufacturing, transport, setup, and the jobs created in those areas too? What about indirect jobs, whatever the definition may be? How do the same figures look for coal and oil, with a similarly rigorous definition of directly employed?

I'm noting that because my impression of the telegraph is that it downplays and occasionally even denies climate change (ie this smells like a propaganda piece).

It isn't like the coal and oil industry don't get their subsidies and tax breaks (even if the government rakes it in from the end consumer), and I think we have to expect a certain rottenness in human nature whenever money is involved - for anything (renewable energy shouldn't be assumed to be an industry that operates on some higher moral plane in this respect).

As to costs - fossil fuels are not fairly costed anyway, as the damage they are doing and will do is not factored into the pricing. They are destroying (or have destroyed in that action may now be impossible) our future and the future of countless people today and for the indefinite span of human history.

What is the real price in all that? What is the cheaper option?

It reminds me of the way a cabinet of millionaires (in the UK) is able to spin the media such that the impoverished people are the ones milking the system - the welfare "scroungers" and "undeserving poor" (which seems to be all of them now) and so on. Meanwhile their rich banker buddies continue to rake in the inconceivably large bonuses and distort the system in their favour - socialism for the rich and unfettered capitalism for the poor, whose wealth has and is being transferred upwards year on year.

Anne

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Re: The true cost of renewables?
« Reply #3 on: June 16, 2013, 08:39:18 AM »
It's certainly true that there will be a lot of politics in the Telegraph article. But it's also true that electricity bills have increased in order to subsidise the development of wind-generated energy. Both the present government and the previous have been quite clear about that.   

The Renewable Energy Foundation quoted in the article is a UK charitable think tank that has been accused of being anti-onshore windfarms. The Guardian carried a revealing article about them a couple of years ago. Like Lord Lawson's think tank mentioned in another thread, they have come to the attention of the Charity Commission, though the issue was resolved.

So obviously, due caution is needed in interpreting the claims. But I just don't have enough information to evaluate or rebut them.

Incidentally, I don't have a problem with the Telegraph paywall as I read it so rarely I haven't yet exceeded my free views per month so have never come up against it.

Here's the rest of the article:
Quote
The promise of future jobs is dependent on the building of large-scale wind farms at sea and the construction of factories in Britain to manufacture the turbines, which are currently almost all built abroad.
Industry figures show that for the 12 months to the end of February, the latest period for which figures are available, slightly more than £1.2billion was paid through the consumer subsidy — known as the Renewables Obligation. It was introduced by Labour to encourage investment and is added to all energy bills, meaning that besides households, industry and employers also pay, adding to the cost of all goods and services. According to the Renewable Energy Foundation, a think tank that has criticised the cost of wind farms, it currently adds about £47 to the average household’s cost of living. They say the total subsidy is likely to rise to £6billion by 2020 if the Government meets its target of providing 15 per cent of energy needs from renewable energy.
The industry’s projection is that by 2020 it will create up to 75,000 jobs — an effective subsidy of £80,000 a year — but failing to reach that figure will raise the effective subsidy. The foundation claims that the subsidy will actually cost jobs because businesses will relocate abroad — or close — to save on energy bills. Households will also have less disposable income because more money will go to pay fuel bills.
Among the examples of extremely high subsidies effectively for job creation is Greater Gabbard, a scheme of 140 turbines 12 miles off the Suffolk coast.
It received £129million in consumer subsidy in the 12 months to the end of February, double the £65million it received for the electricity it produced. It employs 100 people at its headquarters in Lowestoft, receiving, in effect, £1.3million for every member of staff.
Iwan Tukalo, general manager of Greater Gabbard Offshore Wind Limited, which is co-owned by SSE and RWE, said building the farm was a £1.5billion investment in British infrastructure.
He added that “as well as supporting significant local employment during the four-year construction period”, 95 per cent of its permanent employees were local people.
The London Array, Britain’s biggest wind farm, with 175 turbines, employs 90 people at its base in Ramsgate, Kent. The array, which is 12 miles offshore, became fully operational in the spring. The foundation predicts its Renewables Obligation subsidy in its first year of full operation will be £160million — effectively £1.77million per job.
In Scotland, Fergus Ewing, the devolved government’s energy minister, published figures earlier this year showing that 2,235 jobs were “connected directly to onshore wind”. There are 203 wind farms across Scotland, and the scale of Renewables Obligation support means each post is underwritten by £154,000.
Wind farms are controversial not only because of the cost, but also because of claims that the turbines, which can be more than 400ft high, are ruining the countryside. Campaigners have said the planning system remains loaded in favour of developers and that too little of the countryside is protected from their spread.
Earlier this month David Cameron signalled that local people would have more say over wind farms in their areas. Developers would have to offer much greater compensation for building them, and planners will be compelled to take into account their visual impact and the views of locals.
But energy firms will be able to offer incentives, including lower power bills for local people, in return for planning permission, which critics say amount to “bribes”.
Campaigners also warn that turbines do not generate power when the wind is too low or too high, and cannot store it, meaning conventional generation is needed as a backup.
Dr John Constable, director of Renewable Energy Foundation, said: “Subsidies can create some soft jobs in the wind power industry but will destroy real jobs and reduce wages in other sectors, in the UK’s case because the subsidies cause higher electricity prices for industrial and commercial consumers. The extravagant subsidy cost per wind power job is an indication of the scale of that problem.”
He added: “Truly productive energy industries — gas, coal, oil, for example — create jobs indirectly by providing cheap energy that allows other businesses to prosper, but the subsidy-dependent renewables sector is a long way from this goal; it’s still much too expensive.”
There is even doubt within the wind industry that job creation projections can be met. Last week, Renewable UK issued a 64-page report urging the Government to “agree a long-term vision” for offshore wind or see jobs created on the Continent.
An Energy Bill, currently before Parliament, is the subject of wrangling over prices for renewable energy for the next 20 years. The wind industry says that without price and subsidy guarantees, a “green collar” jobs boom will not materialise.
Manufacturers are warning that some planned wind turbine factories are under threat without the price guarantees.
Gamesa, a Spanish company which had promised to open a factory in Leith in Scotland, said a lack of certainty was hampering its plans, while Siemens said it needed pricing guarantees before building a turbine factory in Hull.
Robert Norris, Renewable UK’s spokesman, said: “Parents are wondering where their children will find work in the future; the answer is in the renewable energy sector.
“Our studies show that by 2021, more than 76,000 people will be working in the British wind industry in full-time, well-paid green-collar jobs.
“In the last financial year we attracted private investment of £2.5billion, proving that the wind industry is an engine for growth at a time when other sectors are struggling.”

If you could see the article you would see the dismaying horde of comments piling in with denialist nonsense.

Most of the jobs concerned with the manufacture of windfarms are abroad (UK's only manufacturer shut down some years ago when yet another contract went abroad).

I don't think it's enough say it's denialist nonsense. I'd like to be sure where the inaccuracy and  misrepresentations lie, if there are any. I agree that the proper cost of fossil fuels is never factored into the price. And yes, it would be good if the subsidies to fossil fuel could be made clearer, and if we had a simple carbon tax. If anyone could point me to a good analysis of the position in the UK I'd be very grateful.

(Edited to amend details about the REF.)
« Last Edit: June 16, 2013, 09:16:44 AM by Anne »

Neven

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Re: The true cost of renewables?
« Reply #4 on: June 16, 2013, 11:36:22 AM »
Like ccgwebmaster says:

Quote
renewable energy shouldn't be assumed to be an industry that operates on some higher moral plane

We're still having the same system of perpetual growth, and in such a system, whenever a problem arises, such as for instance AGW, there will be people who will try to capitalize on that through things like greenwashing or raking in subsidies. There will also be groups who will do everything to keep in place the model of huge centralized energy production, because that is what keeps the power structures (literally and figuratively) in place.

Now I haven't read the whole article (don't have the time, even on Sunday), but to answer the question, it still isn't known what the true costs of fossil fuels are either. Economists can't calculate that (or don't want to, because no one will then pay them the sums they were promised they would get if they would just obey and finish their boring studies) and so they assume it's zero.

Either way, nothing will work in a system that is based on perpetual growth.
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ccgwebmaster

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Re: The true cost of renewables?
« Reply #5 on: June 16, 2013, 05:04:32 PM »
So obviously, due caution is needed in interpreting the claims. But I just don't have enough information to evaluate or rebut them.

Incidentally, I don't have a problem with the Telegraph paywall as I read it so rarely I haven't yet exceeded my free views per month so have never come up against it.

I'm trying to avoid it now I know it's paywall, nothing more annoying than chasing up a story, and bang - paywall. They've been somewhat insidious in how they've approached it. Them going paywall is good news from the point of view of their position on climate change at least.

If you could see the article you would see the dismaying horde of comments piling in with denialist nonsense.

Most of the jobs concerned with the manufacture of windfarms are abroad (UK's only manufacturer shut down some years ago when yet another contract went abroad).

Maybe so - but an awful lot of oil, coal and gas jobs are also overseas jobs. The UK is after all a net importer on all those fronts.

I don't think it's enough say it's denialist nonsense. I'd like to be sure where the inaccuracy and  misrepresentations lie, if there are any. I agree that the proper cost of fossil fuels is never factored into the price. And yes, it would be good if the subsidies to fossil fuel could be made clearer, and if we had a simple carbon tax. If anyone could point me to a good analysis of the position in the UK I'd be very grateful.

(Edited to amend details about the REF.)

http://ourgreencottage.wordpress.com/2013/01/03/uk-fossil-fuel-subsidies/

I think you need to bear in mind that while the subsidies for renewables may indeed seem larger by any simplistic comparison, especially one that discounts the fact that fossil fuels are not realistically priced - these two industries are in very different stages of their lifecycle. One is and slowly growing - the bulk of the intensive construction past now. The other is in the early stages where large amounts of infrastructure need to be built with decades to go before the payoff is realised.

I think Neven made a very good point with:

Either way, nothing will work in a system that is based on perpetual growth.

I noted to someone once that fusion power wouldn't solve humanities problems - just create a whole new set of different ones. If we're happy to blow the tops of mountains for coal and dump mountains into the sea to build airports now - imagine what we'd do if energy were virtually unlimited?

While it's valid to look at any industry (including renewable energy) and ask the questions you're asking - the main lesson I learned in GCSE history serves me well - evaluate sources for bias.

In the UK the telegraph is sometimes referred to as the 'torygraph' to reflect the right wing persuasions it has.

One final thought. I'm sure none of the sources of data you will find will include this - but does the funding of military operations/levels and political schenanigans carried out for the sole purpose of obtaining or retaining access to fossil fuels count as a subsidy? It's certainly a hidden cost!

SATire

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Re: The true cost of renewables?
« Reply #6 on: June 16, 2013, 08:02:13 PM »
I read a number that Germanies poeple have paid 68 billion € for paving the way for solar so far - and they will pay more because contracts are 15 years and volume is rising faster than subvention declines.
But it will spare us a lot of imports of oil in the future. So we have to pay a lot now and will gain a lot in future. By this we pay a small piece back to our children to compensate a bit the disaster we are going to prepare for them. I think that is fair and should be done by other societies, too. Scandinavia allready nearly completed that task.

On the long run we have to learn from the ants: No problem to grow if we bring everything back to the place it came from. If we recycle everything and only use renewable energies - there is some space to grow for something. And if the things we need could become smaller, we can get more of that to satisfy more poeple. So - think small, think circles and take care that you bring everything back and do not take anything from your childrens future anymore ;-)

Laurent

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Re: The true cost of renewables?
« Reply #7 on: June 16, 2013, 09:20:08 PM »
Anne,

Have you already listen that guy ?

Ozzie Zehner his got a different view than main stream, very interesting !