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Brewing storm over Labour's dream of wind power future

Today's long-awaited renewable energy strategy is already being blown away by industry experts, reports Ambrose Evans-Pritchard

As the British Government today prepares to embrace green energy with a vengeance, it is worth remembering that all the world's major powers are toying with the same agenda.


The US is all of a sudden the new Mecca for wind power. Turbines towering over 400ft are sprouting up across Texas and the lower Prairies, and GE is betting that power generated by wind could reach 15pc of all US electricity supply in a decade. Roughly 30pc of America's corn crop this year will be used for bio-fuels. Fat subsidies help.

China is already the world's number-two maker of solar panels. The kit is now routinely fitted on new houses. This month's National Energy Plan shows the country is hellbent on cutting oil imports. The latest batch of 6m students will have to master the new green energy doctrine to get into university.

Washington and Beijing are making cold geo-political calculations. Neither wants to be pushed around by hostile petro-powers, or fall hostage to oil at $200 a barrel. Both are going nuclear, but uranium is scarce. Both have coal, but the technology of carbon capture has not yet been cracked.

This is the global picture as Labour releases its long-awaited Renewable Energy Strategy today, hopefully ending years of drift, muddle, and a string of ostrich policy papers. It is very late in the day to play catch-up.

It aims to raise the green share of Britain's energy to 15pc by 2020, from under 2pc today. This much we knew already. Labour agreed to the target at an EU accord last year.

>From what has been trailed, it boils down to a dash for wind. Fast-track planning authority will allow officials to rush through approval for at least 3,500 wind turbines on hilltops and offshore sandbanks on 11 sites along the coasts. An estimated £100bn will be spent on wind subsidies in one form or another.

The Severn tidal barrage will help, perhaps producing 5pc of the country's electricity. Pity the salmon. The rest will come from coaxing us to fit solar heaters in our homes, and forcing us to insulate.

There will be tax breaks for electric cars, the new hope. Specialists think lithium-ion batteries run off the mains could slash fuel demand for motor engines by half. But this is a long way off. Strip out the frills and the entire strategy comes down to wind. It means lifting wind generation from 4 gigawatts to 25GW, a 525pc leap. The UK's current capacity is 76 GW from all sources.

"This target is not feasible," said Dr John Constable, director of the Renewable Energy Foundation. "We are talking about a phenomenal amount of energy. There are not enough machines or boats available to build it all."

Siemens has sold out of turbines until 2012. The world has only one ship able to place the 200-ton turbines offshore.

"The Government is being insincere. They know they won't be around in 12 years when this fails," added Dr Constable.

Wind enthusiasts say the debate in Britain is stuck in a time-warp, rehearsing the cost arguments of the late 1990s when oil was cheap. The latest 2.5 megawatt giants are vastly more efficient that the old mini-mills. Drawing on aerospace technology, they have rotors that dwarf the wingspan of an Airbus A380 superjumbo.

They have cut costs to $0.08 a kilowatt hour in Texas, easily undercutting gas at today's price. This compares to $0.065 for nuclear and $0.05 for coal ( without carbon capture), according to the US Electric Power Research Institute.

Costs are higher in the UK. Offshore farms are yet more expensive. A report by the Centre for Policy Studies said the experience of Denmark shows that windmills add almost no net electricity because power plants have to be kept running for when the wind fails to blow.

The claims infuriate the British Wind Energy Association. "This is ridiculous. If it were true, why would Denmark now be raising the average wind share of its electricity from 20pc to 27pc in five years?" said the BWEA's director, Chris Tomlinson.

The BWEA said tracking systems are now so sophisticated that they can predict wind supply on an hourly basis, greatly reducing the need for slack. While some back-up capacity is needed, the plants can run at much lower levels - cutting the need for fossil fuels.

"This renewable target is a huge opportunity to use our skills from North Sea oil and gas and create a whole new industry," he said. The Government estimates that the green push will create 160,000 jobs.

Scandinavian, German and Spanish companies manufacture most of the kit for wind farms, although Denmark's Vestas makes blades in the Isle of Wight. Although Britain's Renewable Energy Systems has emerged as global player.

Scottish & Southern Energy, Centrica, E.on's Powergen, and Iberdrola's Scottish Power are all betting on UK wind, despite complaints of rampant cost inflation. Shell has pulled out of the London Array project - supposed to produce a quarter of London's electricity - to pursue richer pickings in the US.

Matthew Farrow, the CBI's energy chief, said Labour's dash for wind is misguided and far too expensive. "This renewables target is just a distraction. We have left it dangerously late to renew our nuclear power stations. As a nation, we really are up against a very serious deadline here," he said.

Mr Farrow said the Government had been "half-hearted" about clean coal. But that would require No 11 Downing Street to bite the bullet on hefty subsidies for carbon capture and storage. It doesn't have the money. The Budget deficit is already in breach of EU rules.

Wulf Bernotat, head of E.on, said Labour seems to have been swept way by a "romantic" belief in the magic of green power, neglecting to deal with the central threat, which is that over half of the UK's power plants will soon be obsolete.

"The UK is in a very bad situation. You cannot replace 60pc of the country's generating capacity by betting on renewables. It will be decades before we reach that point, and until then Britain is going to need coal-fired units. I hope some realism comes through in energy policy," he said.

The risk for Britain is that it gets so enthused - as a late convert - by new forms of eco-friendly energy that it forgets to deal with the meat and potatoes of daily power supply. You can get too much of a good thing.
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