Green, ethical, energy issues in the news

NedS

https://forums.moneysavingexpert.com/discussion/comment/82009733#Comment_82009733

I did a little more research too. The EGL can apply to nuclear as it includes low carbon generation (not just renewables), but as you state excludes any generator who supplies under a government contract such as CfD etc.

QrizB

I shared this article about Spain's cheap wholesale electricity where gas is no longer the predominant price-setter over on the main Energy forum, but it's interesting enough to post here too:

https://janrosenow.substack.com/p/spain-just-became-one-of-europes?triedRedirect=true

michaels

It is not the cost of gas per se that sets the high marginal price, more the cost of the last unit, we procure this from gas plants that run extremely intermittently hence having high capex costs per kwh as they are spread over not many units compared to continuously running plants. intermittent supply and variable demand make this inevitable until we find better ways to manage this marginal demand such as improved interconnectors, batteries and automatic load shedding. The charts from Australia regarding battery taking over this role were thus extremely encouraging.

This is my TL:DR understanding of the situation:

WE tend to always use gas to cover the awkward variable bit of demand because it is the most flexible.

However this last awkward bit involves turning gas power plants on and off frequently making them inefficient and giving low utilisation so although the gas itself is not that expensive this dispatchable power is, the variable cost is not too high but the fixed cost per unit of output is high. 

This means that marginal unit price is high even when gas prices are relatively low.

The marginal price is paid to all variable price generators: legacy wind, solar and especially nuclear.  It does not apply to new wind, PV and nuclear that is contracted on a fixed price per unit CfD basis.

This means that it is the owners of this legacy generating equipment who are making excess profits.

But, the profitability of these plants is baked into their asset prices.  For example pension funds have purchased legacy wind turbines based on the high value of their output despite minimal costs.  If the government tries to impose lower prices on these producers then the asset prices crash, the pension funds lose out and no one wants to deal with the UK govt in the future in case they do more arbitrary rule changes that confiscate massive of asset value.

Instead the govt are trying to do fixed price deals with the legacy suppliers, these are attractive as they turn highly variable income into certain income so the suppliers might accept a price that is a little bit cheaper than the expected average variable price and almost certainly lower than the current high gulf war driven prices.  This means the govt want to do the deal as they can then point to 'lower electricity prices due to breaking the link to gas' which everyone 'knows' is the reason for our high prices.

The problem is the suppliers know the govt is keen to do these deals so will be looking to get top dollar so the risk is that we lock in long term prices that are close to current high prices for political reasons rather than waiting for them to fall back naturally.

And it may be that the current high prices the gas generators can command for this marginal generation are a temporary feature anyway.  This is because there are alternative technologies such as grid enhancement, battery storage and demand side management (such as throttling up or down AC, heat pump and car charging) to compete with gas for marginal production.

If this happens then we will undo the impact of the high gas marginal costs, probably right after we have locked in high prices for the legacy generation that currently gets over priced as a result of the marginal model.

Martyn1981

News article today on the large and growing UK green economy.

UK’s growing green economy worth more than £100bn a year, research finds

More than a million jobs, higher wages, nearly half a trillion pounds in investment in the pipeline – the UK’s green economy is powering ahead, according to research by the country’s leading business organisation.

The net zero economy, which is worth more than £100bn a year, benefits all of the UK, according to the CBI Economics analysis commissioned by the Energy and Climate Intelligence Unit thinktank, despite critics who want to abolish the UK’s net zero targets.

Jobs in the North Sea, which Blair and rightwing parties have cited as a potential growth area, have been steadily declining alongside the output of the rapidly depleting basin for more than a decide. About 200,000 oil and gas jobs in the North Sea have been lost since 2013, despite government support and a favourable tax regime for most of that time.

['decide' - gotta love the Grauniad 😉 ]

Tuesday’s report is the fourth in a series by the ECIU and CBI Economics, which have previously found that the net zero economy was growing three times faster than the rest of the UK’s economy. The estimates only take account of jobs and companies that deal directly with the push for net zero. The wider green economy, which includes other environmental sectors such as waste, pollution remediation, water and nature, accounts for more than 600,000 direct jobs, according to the Office for National Statistics.

Martyn1981

Government has set the 2040(ish) (2038-2042) 7th Carbon Budget at an 87% reduction on 1990 levels. That's up from 68 per cent by 2030, and 81 per cent by 2035.

Energy security, jobs and investment boost through climate action

Today (Tuesday 2 June) the government has set out its proposed level for the seventh Carbon Budget, which sets a science-led target of ~87% emissions reduction in the period 2038 to 2042 – endorsed by the Environmental Audit Committee and the Climate Change Committee.

QrizB

You'd expect a Substack called ProElectrica to be full of renewables news, and you'd be right.

Here's their analysis of a recent Economist article that seemed to suggest that China's renewables revolution was running out of steam.

https://proelectrica.substack.com/p/a-reality-check-on-the-reality-checks

Too much to quote but, in essence, "this is what a maturing market looks like".

QrizB

Relatively good news from the US regarding wind and solar electricity:

https://arstechnica.com/science/2026/06/trump-admin-abandons-fight-against-wind-energy-as-clean-energy-output-surges

Including this titbit:

For a clean-energy state like Maryland, he said, the challenge was real because “a lot of our problems are very short term. We need new supply right away,” and yet gas plants “are the longest to build.” Gordon argued that economics increasingly favors the clean energy pathway because the cost of building gas plants “has almost doubled in just a couple of years,” while solar and battery costs keep falling.

Gas plants are expensive and renewables keep getting cheaper? Who'd have guessed it?

QrizB

Here's a report from the US investigative journalism non-profit ProPublica looking at how BP influenced a 2004 report that claimed CCS was mature technology and therefore we didn't need to abandon fossil fuels:

https://www.propublica.org/article/wedges-climate-research-bp-fossil-fuel-princeton

22 years later and here we are, CCS still isn't mature and we're finally ditching FF because economies of scale have made wind & solar cheaper than burning stuff.

Martyn1981

Gov has provisionally approved 16 schemes offering long duration energy storage, in this case defined as 8hrs or more. The total comes to 6.7GW/137GWh, with duration varying from 8 to 32hrs. [For reference, Dinorwig PHS is 1.8GW / 9.1GWh (~5hrs)].

Three big PHS schemes (pumped hydro storage) for Scotland, and includes 1 flow batt and 1 compressed air (CAES) scheme. Most are Li-ion, four of them exceeding 16hrs.

So looks like we'll be trying out a good mix of solutions, as this sector is still developing, even if PHS is mature.

First hydropower projects in Great Britain in 40 years given go-ahead

The energy regulator has given the provisional green light for the construction of the first new hydropower projects in more than 40 years, part of plans to reduce Great Britain’s reliance on energy imports.

Ofgem has published a list of 16 long-duration electricity storage projects, facilities that can store and release electricity for periods of eight hours or more, it has provisionally agreed can proceed.

The other 13 projects given the provisional green light use other energy storage technologies including compressed air, lithium-ion batteries and vanadium redox flow batteries.

The 16 projects, which are located across England, Scotland and Wales, are designed to help balance the supply and demand of electricity, which can fluctuate because of the unpredictability of renewable energy sources such as wind and solar power.

Consultation
Window 1: Minded-to decisions – Long Duration
Electricity Storage

silverwhistle

Wish my car battery was a bit emptier: today on Agile prices were low during the day and negative for 3 hours. Tomorrow negative from 09.30 to 16.00 and down to minus 5.38, showing how batteries can help.

My kitchen is first but perhaps I need to review my decision that batteries wouldn't be worthwhile for me, if only to run AC on hot expensive nights!