Bishop Hill How immoral?
Oct 20, 2011 Economics Energy: solar Energy: wind The government is apparently going to consider cuts in subsidies to solar panel installations. Apparently wind power is going to be targeted too.
Intense discussions are taking place about precisely how far to cut the small-scale solar “feed-in tariff” (FiT) which pays households and companies for energy produced.
Some officials in the Department of Energy and Climate Change are calling for a reduction in the subsidy by three-quarters, according to industry sources.
That would mean a fall from the current level of up to 43p per kilowatt hour generated, to as little as 9p per kWh – a move which the industry claims would be devastating. If the government follows past precedent, any change would not affect homeowners with existing solar panels.
So the lucky few wealthy people will continue to be subsidised by the poor. It's just a matter of how much immorality the government decides to retain in the system.
Reader Comments (67)
Meanwhile windfarms to get even more cash.
http://www.independent.co.uk/environment/climate-change/offshore-wind-farms-to-get-more-cash-2373399.html
jazznick
The Independent's headline is misleading.
Quote, "Offshore wind farms are set to receive more subsidies than previously planned in the next few years under proposals from the Government today. Under the plans, smaller-scale wave and tidal stream projects, which harness the flow of the tide, would receive many times more support than other types of renewable energy in a bid to encourage those technologies. While the amount of support to offshore wind will decline over the next five years, it will be cut less than had been planned, under the proposals put out for consultation today"
Land based renewable schemes are now losing out to off shore schemes.
Quote from Independent, "Energy Minister Charles Hendry said recent rises in the price of wholesale gas, blamed for the latest energy bill rises by the big six power companies, "totally dwarfs" the cost of the renewables obligation. "
We now know that is not the case.
This little image from British Gas shows how the "government Obligation to help the environment" (better known as renewable subsidies) has already increased electricity bills by 14%
One of my neighbours has literally, this week, had installed eight (approx 8x4) PV panels on his roof. The fact that his roof faces EAST seems not to trouble him. I figure the size of the installation must be around £10k and produce around 4kW - but I shall need to confirm this with him when it's finally completed.
I also figure, as he's a pensioner that he has been prevailed upon by one of these companies who install the kit for a nominal fee and then take the FiT - but as Willis would say, YMMV.
I'd appreciate any feedback from the blog (if that's OK with you Bish) that might support my argument that my neighbour is wasting his time and money - especially as the FiT is bound to be cut in the near future.
The forthcoming cut in the solar FIT will not affect those who are already in receipt - for them it will remain at 43p per unit index linked for the full 25 years. Those who are going to be hit worst are the hundreds of small companies who have been set up to install domestic solar and gone to the expense of attaining MCS accreditation etc.
Good to see tidal and wave finally getting the support it needs, even if it is ten years later than it should have been.
The thing that people tend to forget when considering installing PV cells is, suppose the installation fails after 5 years (water seals that leak + dodgy electrical connections) and there are no spares or service because the fly-by-night installers have gone bust.
After you discover there is no help from the solar industry, your local friendly licensed spark, if asked for his opinion, says that the installation is unsafe (because he was not involved in the original installation and can now see cash registers in his mind) and he advises that there is a risk of fire and/or electrocution etc. and the whole lot should be isolated. This he does in exchange for several twenty pound notes.
You may have to get the local electricity supply company to come in to put the meter back into its original configuration. They will do this in exchange for several twenty pound notes.
You then realise that all the kit will have to removed because the house will be unsellable with a duff power station on the roof and various computerised boxes in the hall cupboard.
Now, where are all the roof tiles that were removed? OMG, they went in the skip along with various bits of rafters and purlins that got in the way of the cowboys. Complete replacement of that part of the roof will not not cost more than a few grand, will it?
Then you find out that "Nuclear Free Zone" in which you live has declared the PV cells as toxic waste and the nearest licensed handler is located 500 miles away; his call out fee is £500 before he starts work. You get a estimate of £2,000 for the work (health and safety don'tcha know) plus call out fee plus council dump fees plus council supervising engineer fees plus police escort fees plus all bills at a local 5* hotel for himself and his entourage.
Yes indeed, your initial investment of £10,000 was money well spent.
Srocket
The FIT for Photovoltaic installations is supposedly guaranteed for those who install them before the cut off date. Facing East is certainly not good but your neighbour should have been given a calculation of likely annual income and payback period that takes account of the orientation of his/her roof. Some of the installation companies will guarantee a minimum income from the panels and base the pay back calculations on this figure.
If the FIT is cut for existing PV systems the government will be breaking a direct promise to maintain and index link the FIT for 25 years and there will be a lot of angry people out there who have bought panels in the last 6 months to take advantage of this years advantageous FIT. It will also kill the industry as PV is not economically viable without the FIT.
However the FIT itself is not economically viable as it forces the electricity companies to buy electricity at 44p per kWhr when they can buy it from gas turbine generation for nearer to 4.4p per kWhr. Of course they raise the cash required to pay the FIT by increasing electricity prices for the poor, elderly and everyone else.
The FIT cannot be allowed to continue at its present rate as it will drive electricity prices up to truly staggering levels. I suspect that the government will significantly reduce the FIT for new systems from April onwards which will make the whole scheme even more expensive due to the extra administration involved in running differential payment schemes.
Yesterday afternoon I had a young man call at the door to tell me all about the money I could be making from Solar. And he wasn't alone - I saw three others calling at neighbouring houses, which seems like quite an investment in manpower from someone pushing this stuff.
I didn't have the patience to find out who is was calling from, as after giving him a short lecture on the evils of stealing money from my 91-year-old mother via her fuel bills to pay for eejits like him, he just left.
@scots renewables
'Those who are going to be hit worst are the hundreds of small companies who have been set up to install domestic solar and gone to the expense of attaining MCS accreditation etc'
And I will feel just as sorry for them as I do for those 'advisers' who were seduced by the need for the useless and unwanted Home Information Packs and other useless government impositions on the hard working populace.
Being a subsidy farmer - even if it at second hand - is a professon I rate a bit lower then Estate Agent, and only marginally above most climatologists. While hospitals still need cleaning and bins need emptying I shall weep no tears for these parasites.
"So the lucky few wealthy people will continue to be subsidised by the poor. "
Perfect description of Greenie Socialism.
Anyone who thinks that the government (and future ones) will stick to the FIT as originally agreed is being very naive.
Look what happened to the CRC monies envisaged by the Climate Change Act of 2008. This is the original version of the act:
"The CRC is a cap and trade scheme. At the end of each scheme year participants purchase and cancel emission allowances corresponding to their total CO2 emissions. One allowance = one tonne of CO2, CRC participants are required to plan and buy sufficient allowances to cover their annual CRC emissions.
All revenue raised from the sale of allowances in April each year is returned to participants in the form of a recycling payment. The amount each participant receives depends upon their proportion of emissions in relation to the total CRC sector emissions and their performance in a league table. The revenue recycling occurs six months after the end of each sale, in October."
The idea was that better performing businesses would receive money levied against the worse performing businesses - a carrot and stick approach to reducing emissions.
However, in March of this year the government declared that all allowances would instead be transferred to the general coffers and none of it would be recycled to the participants. Never trust a politician!
Snotrocket
The fact that a return on investment can be achieved for PV panels installed facing east shows the FIT to be overgenerous.
On the radio earlier there was an interview with a chappie from Bloomberg investments. He sounded very happy with things.
How do the French put it? "Plus the change, plus the memmy choose?
@ Latimer Alder
I didn't expect you to be sorry for them, I was merely making an observation that this is the only (small) group that will suffer financially as a result of the coming solar FIT cut. Those citizens who have already installed solar PV will continue to do very nicely indeed.
I prefer to see the limited sums available given to accelerating the development of wave and tidal generation, which makes a lot more sense in Scotland than solar.
Well, perhaps it is all for the better. Instead of the mindless waste of money on this sort of crap, they could instead do what the American government does and spend the money on mindless never-ending wars like Big Brother did in 1984 and control the world's population by attrition.
@scotsrenewables
D'accord.
If wave and tide can be shown to be comparable in cost to other ways of generating power I am all in favour of them.
But if they, like every other supposedly 'renewable' source require vast subsidies to persuade anybody to be daft enough to build one, then thay should stay as drawing board projects, not concrete and kit.
There is no point in mpoverishing this generation because of some possible potential har that soem believe might befall some possible future generations if the night temperatures rise a little in 100 years time.
I rememmebr visiting the Rance Barrage in the late 1960s as a wide-eyed teenager. It is great! But I also note that it is almost the only one of its kind. In teh subsequent 40+ years very few have been built. There is a good reason for this....
Scots Renewables
If it suits the government it will pass legislation to alter past contracts.
Look whats happened to the way pension increases are worked out.
A lower index of inflation has now been substituted for the original index used for years.
This despite contracts that specified the original.
Scots Renewables
The Salter duck arrived in 1974 with interest then in wave energy. On paper it is all technically possible but to claim that wave and tide make more sense in Scotland than solar sets a pretty low bar and may still be unachievable.
Lets not be to harsh on all the companies set up for solar. As with any business, I am sure there are good people that have started up in good faith and have employed people in need of work only to find themselves shafted, unlike large land owners!
PeteH: Thank you, that is the point I was trying to make. If the government makes noises and encourages the setting up/expansion of a certain business sector then pulls the rug you have to feel some sympathy.
Simpleseeker : We have gone well beyond 'on paper'and well beyond Salter's Duck for wave and tidal - and that is with virtually no subsidy. A little government seed corn in this sector ten years ago would have gone a long way, but better late than never.
Latimer Alder: The idea that no subsidy for the development of new energy sources should ever be contenanced is rebutted by history. Nuclear power would never have become commercial - if indeed it really is even now - without massive government subsidies.
Maybe the Government will not simply slash the rate although it will drop for sure. Alternatives are taking away the RPI link and shortening the 25 year period. Both those would reduce cost substantially over the term and might reduce the drop in demand in the short term.
Solar PV panels facing east or west work reasonably well, though not as well as south of course. North is a genuniely bad idea; south east is perfect acceptable. Note that if you use two roofs facing different ways (e.g., east and west), or just differentially shaded, you need to be carefulhow you wire things up.
If Snotrocket's neighbour is indeed using one of the schemes where somebody else pays then he is facing little risk. In standard schemes the homeowner pays nothing, and the installer keeps all the FITs and income from sales; the owner just gets free electricity during part of the day. So the installe carries almost all the risk.
Like EddieO I expect a massive cut in FIT rates in April, applying to new installations. We already know that there will be a small cut then, so the argument about differential tarrifs does not apply; I expect this will turn into a large cut (40%?). I also expect that the government will at some point reverse the favourable tax treatment of FIT income. If they go further than that then my investment will not be looking rosy - but then that's the risk we rent-seekers take.
Brownedoff is over pessimistic, at least if you use a decent installer. The damage to my roof is negligible (installing solar thermal by contrast had a more major effect). The system can be cut off from the mains by turning a single isolation switch. It may become valueless, but I don't see it becoming a major liability under any half plausible scenario.
And I meant to add.....
The review is not news. The plan was always to scale the FiT back as the volume of installed systems grows. At the same time the wholesale price will rise and they would meet at a future date. A cut of three-quarters is not what was envisaged but is probably a more sustainable figure that is not quite as distorting. It was simply pitched too high. It will put more pressure to bring installation costs down which is good.
Going to be some very unhappy landowners if they miss out. But some happy consumers who will see their bills rise by a smaller, but still large, sum.
I do think the Govt might well be in a panic at the thought of the cost of FiTs appearing as an item on bills along with RHIs - announcement in December. Might RHIs be scaled back as well?
@scotsrenewables
'The idea that no subsidy for the development of new energy sources should ever be contenanced is rebutted by history. Nuclear power would never have become commercial - if indeed it really is even now - without massive government subsidies'
History rebuts nothing. You have merely shown an episodexampel where my good advice was not followed. That is not a rebuttal. It is an example. Please consider teh difference.
I suggest that, since there is said to be a huge hunger for renewables north of the border, but littel to the south, that Holyrood uses its cash to susbdidise the development. In England, we'll buy your surplus at the going market rates if we need it. I wonder how much Mr Salmond will be in favour when it is Scottish money that has to pay?
@argusfreak
'But some happy consumers who will see their bills rise by a smaller, but still large, sum'
I think you must have a very distorted view of what makes consumers happy. What you describe sounds to me like the governement saying.
'Dear Consumer,
You will be pleased to knwo that we are ripppign you off somethign rotten to pay for windmills and solar panels whoch are so f...g expensiveand so ineffeicient that nobody in their right mind would touch them with a barge pole if we didn't give them huge bribes with your money.
You should know that we once thought of giving them even more of your csh. But we've changed our minds. Wasn't that good of us? So we really are on your side. Please re-elect us.
Love Chris Huhne - His Worship the Most Adored Saviour of The Planet and High Priest of Gaia
indeed Latimer....or a few years down the track comes the announcement (hopefully Huhne will be in prison by then)..."because solar power has not taken off in the way we had hoped, hereby we reduce the FIT to 4p per kwh along with the other sources of power."
More people are already dying as a result of fuel poverty- about 2500 last winter alone- than will die from climate change in the next 100 years.
But it's OK, it's all for the greater good.
Scots Renewables
Why? The renewables subsidy bonanza was a policy error. Nobody serious now argues that it has not increased the national energy bill (UK). This impacts all low income groups.
You argue for sympathy for opportunists. I have none.
Oxbridge
And if you have a slipped slate or two under the panels, necessitating removal for repair? It's devil's advocacy, obviously, but I do wonder. Storm damage might also be an expensive nightmare.
BBD
Solar at our latitudes is just not efficient, we all know that, but we waste our valuable resources on it.
I more than share your views on the need for a healthy and efficient UK nuclear industry, partly, I must admit by having worked in the industry.
Over the years I have witnessed the exodus of engineers from the industry as subsequent governments have bowed to the "green machine" and slowly throttled the industry,
The final straw, the one that really decimated our nuclear engineering capability was when our politicians endorsed CO2 CAGW. That was the end, all resources went “renewable” no bother whether “workable”. It only takes 2 decades to change a generational thought pattern.
UK Governments, planning for an inevitable 2 deg increase in temperature and mild winters saw an “energy gain” from AGW. Whilst any prudence would say plan equally for -2 deg C?
So we are left trying to ply multi-nationals with guarantees to build generation capacity, because we were convinced?
I have no argument about CO2 and its physical attributes, what I do not know and neither does anybody else is what Gaia does with CO2’s physical attributes.
So 2/3 decades on we are now faced with rebuilding our nuclear engineering capability, which realistically is going to take another 2 decades. Going to be fun!
@Scots Renewables
Tidal Energy. The tide comes in twice a day. Twice a day it stops coming in and start going out. Twice a day it stops going out and start coming in. That's 4 times a day - called slack water - when it's not generating power.
Unlike wind the slack periods are predictable but nowhere in the world has anyone figured out how to keep the power flowing to the consumer.
"Tidal" is a nice word to slip into the conversation - but it's not a serious energy source.
@JackHughes
The times of slack water are different all round the coast - i.e. when it is slack water in one area the tide is in full flood (or ebb) in another area. For example, today high water in Oban is at 13.40 while at Scrabster in the Pentland Firth it is at 16.20 - so during the short period of slack water in the Pentaland Firth tidal devices in (eg) the Sounds of Luing and Cuan or the Corryvreckan would be producing at maximum output. Tidal energy can therefore - unlike wind or wave - actually be used to provide a certain amount of base load power to the grid. There is no point in the next ten thousand years when tidal power could not be making a very substantial contribution to the grid.
Also, unlike wave or wind the amount of power that is going to be available at any one time can be calculated to the kilowatt, making its incorporation into the grid or integration with other power sources (eg pumped storage) much easier than wth other renewable sources. No constraint payments required.
Why not do a little more research before making sweeping statements ?
@Oct 21, 2011 at 1:48 AM | Jack Hughes
Actually there are perfectly practicable ways of dealing with the 'slack water' problem. The favourite seems to be two huge concentric coffer dams with various turbines mounted between the centre and the 'annulus' and between the "annulus" and the mighty restless ocean. I believe the Chinese are developing such a project.
I'm sure you can imagine how it might work. But (obviously) it would be even more amazingly unaffordable than a normal tidal barrage.
However, the big advantage of tidal is that you can sit down and predict with good precision exactly how much electricity it should produce at 7:30 pm on the 19th October 2035. Or whenever. The other advantage of tidal barriers is that they really upset the greenies because of the predicted effect of the changed water levels on the inside leg measurement of the British Standard duck. But that's a poor reason to pour billions into cockamamie schemes that a modern coal fired power station would outperform at a fraction of the cost.
If Scottish Ruinables thinks that wave and tidal are the way to go (perhaps having seen the writing on the wall for BigWind), I hope he re-mortgages his house and invests all the proceeds in these scams.
Oct 20, 2011 at 8:11 PM | Oxbridge Prat
at least if you use a decent installer
Define "decent" - do you mean installers who are gentlemen and do not expose their bums and/or utter a continuous stream of effs whilst installing the the apparatus that will reduce the value of your house at the time of sale?
I have a pricking in my thumbs that a mortgage provider's surveyor will regard this technology as a major downer to the tune of several grand.
Are there any members of RICS reading this who could comment?
Oh, wait, I may have been too hasty.
I do apologise. /sarc off
@JackHughes:
'Huge coffer dams' and tidal barrages are not at the cutting edge of tidal development. Submerged individual turbine units are what are currently being developed and deployed. Latest to commit to testing tidal devices in Scotland is Kawasaki Heavy Industries - announced yesterday.
The Severn Barrage was a lost opportunity though - due largely to the RSPB and other conservation groups who do indeed worry about wading birds more than people The barrage could have generated the equivalent of 8 conventional or nuclear power stations, and although the habitat upstream from the barrage would be changed this is not necessarily a bad thing for wildlife. Studies show that the Rance barrage in France has increased biodiversity, not decreased. it.
Scots Renewables
Hundreds of thousands of submerged windmills. Salt water. Grid connections for same. What could go wrong?
@ Scottish Ruinables
The only thing "cutting edge" about tidal development is the obscene subsidies our incompetent and malicious arts-graduate politicians have stuffed into it.
And the further lacerations made in the budgets of decent hardworking people who already struggle to pay their energy bills.
People who would never dream of coming on here are nevertheless quite bright enough to see when the much feted wind farms are producing nothing. No doubt the big players who will make a fortune out of this scam, already have their Swiss bank accounts ready and their escape route to sunnier climes well planned. But the useful idiots who endlessly promote this kind of nonsense may be a tad exposed once people are forced to shiver in the dark, without even Strictly Come X Factor to numb their senses.
You do well to use a pseudonym.
Those who believe they will receive the operating subsidies on their existing 'alternate energy' 'investments' are kidding themselves.
When the economic pressure overcomes the suspension of reality, the subsidies will go away.
As was outlined upthread, a future growth industry in the UK and the other foolish countries that have squandered their money on windmill and PV will be the removal and remediation of property and land as the current owners will want the unsightly and potentially hazardous junk removed.
Scots Renewables
What are we talking about here anyway? How much are we going to get for the billions (and decades) that will need to be spent on developing the unproven technology and then building tidal stream farms?
The ever-helpful MacKay provides a detailed estimate. It's 9kWh/day per person.
Oh FFS. You're an energy fantasist.
If you care about emissions/climate/humanity/environment, you will forget this dangerously time-wasting, hyper-expensive, speculative nonsense and get behind the necessary expansion of UK nuclear capacity.
Now.
Hundreds of thousands of submerged windmills. Salt water. Grid connections for same. What could go wrong?
Lots - which is why the technology is still in development. Of course, there are never any problems with nuclear power stations are there? Oh wait a minute - what about the Torness jellyfish?
I find that a particularly pointless luddite comment. No-one had ever drilled or installed platforms in such deep water when the North Sea oilfields were being developed off Aberdeen and Shetland in the seventies but the oil companies didn't let that stop them.
BBD
The Scottish tidal resource alone has been estimated as 7.5GW, or 12.5% of current UK peak demand. Of course it isn't going to meet all our energy demand - no single source is - but it is significant. Why you see that as a reason to NOT invest in tidal is obscure.
Interesting that people here are so keen to cite MacKay - a confirmed warmista - when they think it helps their argument.
Scots Renewables,
Your handle pretty much implies you are a bit 'eccentric' as we say diplomatically.
The north sea oil rigs were an outgrowth of technology developed since the 1940's and even before.
And, by the way, they involved mining something that had value- nice North Sea Brent, a sweet good oil.
Your disgusting tidal systems will damage estuaries, wetlands, migratory patterns of fish and other, less popular critters.
The windmills are proven bird killers and PV is great, as long as the sun shines and you don't need much power.
Enviros were great when it came to cleaning things up, setting aside land, decreasing toxins- you know actually helping.
But now big enviro is trying to pretend it is an industry, and all they can do is shake down tax payers for endless subsides of things that profit their friends, hurt everyone else and damages the environment.
And, by the way, not one thing you 'eccentric' people do will actually have any significant impact on climate. It will still ignore you.
But eccentric people do not really care about reality.
Hunter,
As usual with your ilk you will grab randomly at any argument. Semi-sub oil rigs were new technology, developed to meet the technogical challenges of the new drillig environment. The first purpose built drilling semi-submersible Ocean Driller was built in 1961, not the 1940s. Wind turbines are based on much older technology - so I am at a loss to follow your train of thought there.
As for your use of the word 'disgusting' to deride tidal energy - well , in what way does it 'disgust' you? Without debating barrages for the moment, current tidal development is focussed on sub-sea tidal turbines, which will have almost zero environmental impact.
Your insistence on the use of childlkie and emotional terminology like 'bird mincers' to describe wind turbines when cars, windows and domestic cats kill many thousands of times more birds than turbines only goes to further show the paucity of your arguments.
As to my 'eccentricity' - well, all I can do yet again is point you to the incredibly small, insignificant number of people that have signed the e-petition to repeal the climate change act. You may feel when posting on here that you are part of some huge movement of truth-seekers, but in fact it is you who is the eccentric.
Scots Renewables:
I always liked the effect of tide machines, and dams for that matter, of slowing the rotation of the earth - a centripetal effect due to increasing the radial distance of mass from center of rotation. One might ask what impact this admittedly very small change would have on our climate?
'insistence on the use of childlkie and emotional terminology'
Whom, do you think, hunter is caricaturing? (probably a more apt caricature in this instance anyway)
Scots;
"The Scottish tidal resource alone has been estimated as 7.5GW, or 12.5% of current UK peak demand."
That is potential laddie. A way has to be found to extract it. If you are of the Huhne 'unlimited resources CCS' mindset then you could still fail. As I commented earlier; only on paper.
The following project is a working example of the "Herring Shredder" tidal turbine.
The RITE Project
East River – New York, NY
http://verdantpower.com/what-initiative/
It will be worth watching to see how it develops.
@jferguson
For every action there is an equal and opposite reactiopn - but I don't think we need to panic even if we end up extracting a sizeable percentage of the tidal energy available.
Tides are caused by the interaction between the Earth's rotation and the gravitational pull of the Moon. The tides themselves introduce friction into this system and dissipate energy because of their drag on the coastlines and ocean floor. Even without any tidal power plants the tides are slowing the earth's rotation and causing the Moon's orbit to recede. However the effects are so small it takes thousands of years to be noticed. Tidal power plants would increase this effect in a microscopically small way.