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The wisdom of the man in Whitehall

Yesterday came the news that another major power station is to close. Eggborough is a big 'un, its 2GW coal-fired capacity meaning that it generates as much as 4% of the UK's supply. According to the operators, electricity prices have now fallen so far that they cannot operate profitably.

Many might wonder whether this is a big deal or not. After all, businesses close all the time - markets have always weeded out the weak and old and uneconomic. But as the operators also point out, we are on the verge of blackouts this winter because of a lack of supply. Ofgem thinks they can avoid this, but only because the government is paying to have diesel generators on standby and because it is going to pay major industrial users to switch off when margins become unbearably tight.

So Whitehall has managed to get us into the situation where we are going to replace (relatively) efficient coal-fired stations and a productive population with inefficient diesel generators and (potentially) people standing around waiting for the power to come back on.

Such wisdom is not seen every day.

Thank goodness.


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Reader Comments (66)

According to the operators, electricity prices have now fallen so far that they cannot operate profitably.
Somebody needs to explain that in simple terms (words of one syllable) to the hard-pressed consumer.
If there is a shortage of supply then prices go up, someone steps in to increase the supply, prices come down, equilibrium is restored.
This only comes apart if some organisation gets in the ..... way ...
Got it!
Somebody still needs to explain that in simple terms (words of one syllable) to the hard-pressed consumer.

Sep 3, 2015 at 11:39 AM | Registered CommenterMike Jackson

As many contributers to BH have been saying for years now, the problem will not just be the reduction in capacity and resulting blackouts. Such a loss of grid inertia will lead to increased grid stability problems and brown-outs, long before the grid engineers have to decide which areas are chosen for the rolling blackouts, and which consumers are to be cut off. Especially in Scotland after Longannet is closed and the wind decides not to blow or blows too hard.

Sep 3, 2015 at 11:55 AM | Registered Commenterlapogus


Coal is cheap and plentiful, how do the government explain to people that they are making it more expensive through carbon taxes and that this is to the benefit of the consumer?

Sep 3, 2015 at 11:58 AM | Registered CommenterDung

Ofgem thinks they can avoid this, but only because the government taxpayer/consumer is paying to have diesel generators on standby and because it is they are going to pay major industrial users to switch off when margins become unbearably tight.


Sep 3, 2015 at 11:59 AM | Unregistered CommenterKevin B

The first people to have power cuts should be:
1. The Universities where this climate extremism is endemic.
2. The public sector (not directly affecting the public) - who support this climate extremism (i.e. DECC).
3. The BBC
4. But if one group deserves it most: the blasted politicians ... they should be the very first to have their power cut (particularly the EU!)

And ideally we should have smart power meters, so that when needed we can immediately cut the power at home of all civil servants, University staff, BBC and greenspin NGOs. So, that those most strongly advocating the wholesale destruction of the UK energy generating capacity are the first and hopefully the only people to experience the impact of their insane utopian nightmare.

Sep 3, 2015 at 11:59 AM | Registered CommenterMikeHaseler

If you would like to read some of the expert opinion given to the Scottish Parliament Economy, Energy and Tourism Committee on security of supply here is the link:

Simon Skillings of Trilemma offers interesting opinion. He does not think there is much danger to security of supply.

On the other hand the written submission by Colin Gibson, former Network Director of the National Grid (83-87) and Sir Donald Miller, former Chairman of Scorrish Power is scathing about UK energy policy. Here is that link:

A great deal of the Committee hearing was of interest to me. there is another link I can put up if folk are interested. Beats me why it is not of interest to Andrew Montford. After all he lives in Scotland.

Sep 3, 2015 at 12:03 PM | Unregistered Commentersam

"people standing around waiting for the power to come back on"

Brown-outs will occur between 5 and 7 pm. It will hit households harder than companies.

Sep 3, 2015 at 12:04 PM | Unregistered CommenterRichard Tol

What fun it would be if the grid engineers decided to disproportionately choose Scotland for the rolling blackouts, how the Scotch sense of grievance would be magnified (if such a thing is imaginable). But it could be justified: not many people work in Scotland, hardly anyone pays tax, the SNP government is dead keen on windmills.....

Sep 3, 2015 at 12:04 PM | Unregistered Commenterbill

'Old Sparky' in Private Eye draws attention to the problem this week, comparing the UK unfavourably with third-world countries that also rely on diesel generators. I wonder how long it will take Mr Editor Hislop to wake up to the fact that he's been sitting on an explosive story of government incompetence for years, apparently thanks to Mrs EH's opposing views...

Sep 3, 2015 at 12:08 PM | Registered Commenterjamesp

Rolling blackouts will occur in the rural backwaters where civil unrest is unlikely to break out. The first blackout to hit a major city would result in rioting and looting and lots of deaths.

Sep 3, 2015 at 12:12 PM | Registered CommenterPhillip Bratby

Mike Haseler,

Brilliant idea! Why didn't I think of that.

Sep 3, 2015 at 12:16 PM | Unregistered CommenterJohn Marshall

OT: Many (many) moons ago I worked at Eggborough for a short while. Good fun and most notable for being propositioned by a very attractive office girl (who had come 2nd in Miss Yorkshire TV apparently!). Being young, naive and having another prospect back home I didn't take advantage of the opportunity. Ah, life's regrets...

As you were.

(Oh and just come back from Morzine in the Alps where there were intermittent power cuts most nights. Lights out for 30 seconds then back on again maybe 3 times a night. Do they have grid problems, I thought it was all nice nuclear base load in France?)

Sep 3, 2015 at 12:18 PM | Registered CommenterSimonW

Smart meters that rationed electricity according to generation method, pre-selected by the customer, could be a win-win.

That way people who believe in nuclear, fossil fuel, or wind etc could put-their-money-where-their-mouth-is, with the added incentive of bragging/gloating-rights.

Sep 3, 2015 at 12:23 PM | Unregistered Commentermichael hart

Private industry is great, but not when it leads to this kind of thing, the govt is now reduced to trying to herd cats, i.e. to entice "private investors" to venture into a highly regulated industry, one where the rules can change at the whim of politicians looking for votes and legacies.

State ownership of power stations is the way to go.

Sep 3, 2015 at 12:27 PM | Unregistered CommenterMikky

It might concentrate politicians' minds if the Palace of Westminster had no standby generation.

Sep 3, 2015 at 12:44 PM | Unregistered CommenterJoe Public


Good idea in theory, but then how would they "lead beyond authority"....?

Sep 3, 2015 at 12:48 PM | Unregistered CommenterAnthony


It would be better if they stopped leading all together.

Sep 3, 2015 at 12:53 PM | Unregistered CommenterJohn Marshall

"into the situation"

But not a new one:

"This island is made mainly of coal and surrounded by fish. Only an organizing genius could produce a shortage of coal and fish at the same time."

Aneurin Bevan (1945)

Sep 3, 2015 at 12:56 PM | Registered Commenterjamesp

"According to the operators, electricity prices have now fallen so far that they cannot operate profitably"

Funny that. My electricity bill keeps getting bigger even though I'm using less energy. Must be the phase of the moon, or the tides, or cosmic rays or summat like that.

Sep 3, 2015 at 12:56 PM | Unregistered CommenterJoe Ronan

"Scotch sense of grievance"

Or, as PG Wodehouse noted:

"'It has never been hard to tell the difference between a Scotsman with a grievance and a ray of sunshine."


Sep 3, 2015 at 1:00 PM | Registered Commenterjamesp

I thank goodness for woodburner & a logshed full of logs, as autumn/winter approaches, at least I'll be able to keep warm. That is until they tell me I mustn't burn wood for heat because of the carbon release to the atmosphere, they're bound to, guvment doesn't like any section of society to have advantage over the other, apparently, that is certainly why diesel is so expensive compared to mainland Europe!

Sep 3, 2015 at 1:00 PM | Unregistered CommenterAlan the Brit

O/T I know but relevant...and completely insane:

Sep 3, 2015 at 1:02 PM | Unregistered CommenterJonT


"Beats me why it is not of interest to Andrew Montford"

Perhaps that's why he runs a Blog..?

Sep 3, 2015 at 1:03 PM | Registered Commenterjamesp

Windmills plus Diesel STOR plus the extra grid inefficiencies cause more fossil fuel use than the old coal fired power stations with no windmills.

Sep 3, 2015 at 1:56 PM | Unregistered CommenterNCC 1701E

Let us not forget the great achievements of Ed Miliband's Climate Change Act, that risk throwing Britain's recovering economy into third world chaos, with wholly avoidable power cuts.

The Lib Lab Con parties all supported this. I presume the SNP did too.

The Greens have been praying for climate change disasters to prove them right. Nothing has happened.

Manufactured power cuts will prove disastrous for Government policy, wherever the political blame lies. As they are inevitable, I hope it starts BP (Before Paris), rather than AP. I am pleased with progress made so far by Amber Rudd, but Paris is set to be a massive disaster, attributed to climate change policy, not climate change itself.

Sep 3, 2015 at 2:05 PM | Unregistered Commentergolf charlie

"Manufactured power cuts will prove disastrous for Government policy, wherever the political blame lies" unless I'm not understanding you correctly Golf Charlie, it seems to me that it is the very fact that power cuts will raise political blame, that will cause policy to change. Governments don't like being blamed, anyway (re-election trumps every other consideration); they don't like being blamed for things they were a party to - Climate Change Act, and they don;t like to blame it on 'Europe' because that makes them appear less of a government and more of a large county council being told what to do by the capital and of course makes it obvious what they try to screen the people from, that they really are not in charge. So, blame today, new policy tomorrow. This was what drove rail privatisation: millions of commuters every morning seething as 8.22 failed to arrive yet again, muttering "effing government can't even run a railway..." ie government getting the blame for something that was not really their fault (up to a point); easiest answer was to dump the whole bloody mess on someone else who could take the blame that went with it - somebody who didn't have to get re-elected!

Sep 3, 2015 at 2:41 PM | Unregistered Commenterbill

"According to the operators, electricity prices have now fallen so far that they cannot operate profitably."

Not only is that statement one of total bollocks, it is craftily pitched and in terms the average geezer must surely understand? Subtext being, "it's not our fault.............I mean cripes we're only the energy company guys".......

As the price of oil and gas falls, coal prices drop and is cheap and plentiful, gulp and UM and ERRRRRRR........ is there something that the energy company [EP ltd] is not telling us? The unilateral Gideon [Osborne] Carbon floor price anyone????? And why are they so reluctant to let on - tell the truth of it?

Agreed, Eggborough - it is an aging generating plant, it could however be up dated, rebuilt/refurbished......FFS

But to close it now, is simply ocean going lunacy and on stilts but which, is so typical of the eco SJWs aka the boys and girls in the DECC. Department of Energy stupid, stealth and obfuscation, WHERE, dedication to political dogma [and obeying the LCPD] with their total commitment to the green faeries, is of an order so far above - energy security and more to keeping people warm in winter. We note your duplicitous meandering, your lies, deceits and absolute incompetence - that's to be expected but to allow this sort of unnecessary plant closure - is unconscionable.

We will remember. Your cards are marked, Rudd-Amber and the rest of you.

Sep 3, 2015 at 2:48 PM | Unregistered CommenterAthelstan.

Athelstan, it doesn't matter how cheap your raw materials are if you're not called upon to generate. You've got to cover all the running costs except fuel 365 days a year, 24/7. Wind and other renewables get priority. The conventional stations are just not getting a big enough share of the supply.

Sep 3, 2015 at 3:07 PM | Unregistered CommenterTinyCO2

Athelstan., sorry, re-read what you wrote. You know already what the situation is.

Sep 3, 2015 at 3:09 PM | Unregistered CommenterTinyCO2

In this article is also something I hadn't previously noted, your Chancellor has apparently brought the hammer down on the Drax wood pellet rort.

Sep 3, 2015 at 3:10 PM | Unregistered CommenterJEM

I have noted they seem to be practising running the grid with only Drax and Maasvlakte in coal this week. Of course, that's not while trying to meet winter peak demand with no wind.

Sep 3, 2015 at 3:20 PM | Unregistered CommenterIt doesn't add up...

bill, I am deeply suspicious of all politicians, but it does not mean that I don't have views, and support past and present policies.

The Climate Change Act was supported by all parties, in the House of Commons. All parties should share the blame, but all parties would rather shift the blame, by shafting somebody else.

Currently the Tories are backtracking (good), the Liberals are clueless, and Labour leaderless, without knowing which direction not to charge in, or even why. The SNP are still stuck with the script they practised for coalition with Miliband. Therefore there has been no credible opposition to the Tory backtracking.

The Green Blob portray Paris as being the latest, absolutely final chance for victory. UK political power cuts could prompt an outcry before then, leading to panic back pedaling by the Tories, or a UKIP revival, with a stronger anti-EU climate change policy. Depending on Labours leadership, coal mines could be reopened, with miners being the heroes, rescuing the economy!

Sep 3, 2015 at 3:46 PM | Unregistered Commentergolf charlie

Sep 3, 2015 at 3:09 PM TinyCO2

Just to put some numbers on it:

Every MWh generated by wind and solar is a MWh denied to the coal and gas fired power stations. The wholesale price of fossil fuelled generation is about £50/MWh.

According to the latest DECC figures in DUKES 2015:

In 2015 Q1, wind and PV generation rose 7.6 per cent from 11.6 TWh to 12.4 TWh, due to an increase in capacity.

In order to maintain grid frequency that wind and solar generation inevitably causes a reduction in the output (and therefore income) of a mix of coal and gas fired generation.

12.4TWh = 12 400 000 megawatt hours, which at £50/MWh is £620 million pounds in 13 weeks (Q1 2015), that is about £2.4 billion per year.

Eggborough will not say this publicly for fear of incurring the wrath of the GreenBlob for whom wind and solar is the stuff of nocturnal emissions.

Sep 3, 2015 at 3:51 PM | Unregistered CommenterBrownedoff

Last winter, coal was supplying up to 16GW of power, but - looked at on a daily basis - this was fluctuating by 3-4 MW most days. Since the generators were not being switched on and off during this fluctuation (ramping up and down takes both time and reduces the life of the equipment), what this means is that for a certain portion of each day, the coal plants are burning fuel and not being paid for it.

Taking out 2GW means that at peak demand next winter we will need to have something like 20GW of gas powered plants available at all times (14GW coal, 8GW nuclear plus another 2-4GW from the various international links - if they have it to spare and the odd burst of hydro/pumped storge) for the 45MW we have needed in the past. Is that in place? What about when one of the nuclear plants needs to ramped down for some reason? Diesel generators to replace a few wind towers when the wind isn't blowing is simply not on the scale required to replace the loss of a station the size of Eggborough.

Sep 3, 2015 at 4:17 PM | Unregistered CommenterRob

Brownedoff and Rob,

Makes you wonder how much it would cost to install a backup diesel generator, at the foot of every wind turbine, that was equal to the maximum quoted output of the wind turbine.

The generator and fuel tanks could be installed within the turbine mast, with exhaust flues fed out of the top. Well insulated from engine noise, they would be quieter and less damaging to the environment, and easily serviced/replaced without cranes.

A reliable source of electricity, on demand, irrespective of wind or sun, would be a giant leap forward for industrial and domestic consumers, making all these solar panels and windmills seem like they were from a bygone era.

It is a tragedy that politicians are not allowed to talk commonsense any more, without unsustainable threats of harm being fired at them in sustained bombardments of hostile gunnery by the Green Blob.

Sep 3, 2015 at 4:55 PM | Unregistered Commentergolf charlie

Sep 3, 2015 at 4:55 PM golf charlie

Not a lot, but unfortunately the diesels would be hammering away for 5,000 hours a year.

For a 2MW windmill that is 400 litres of diesel/hour - about 70 x 44 tonne tankers per year - more than one tanker per week per windmill.

It would not take long for any GreenBlob a**hole, who thinks windmills are beautiful, living just down the lane from a 15 x 2MW wind farm to come to his senses.

Trebles all round.

Sep 3, 2015 at 6:00 PM | Unregistered CommenterBrownedoff

" Windmills plus Diesel STOR plus the extra grid inefficiencies cause more fossil fuel use than the old coal fired power stations with no windmills. Sep 3, 2015 at 1:56 PM | Unregistered CommenterNCC 1701E"

+ 10!

Sep 3, 2015 at 6:45 PM | Registered CommenterAlbert Stienstra

Hmm, and Eli reads that a) the station is closing because the owners can't make money at current prices b) the owners are a Czech bunch who bought the thing in 2014 c) the station was built in 1966 and the last significant retrofit was in 2005 d) coal is cheaper than dirt (well, in the case of brown coal it is dirt)

So here is an old, inefficient coal power plant that can't even make money at a time of ridiculously low coal prices from covering surge supply owned by a foreign company

What do you clowns have against capitalism?

Sep 3, 2015 at 9:12 PM | Unregistered CommenterEli Rabett

Mikky on Sep 3, 2015 at 12:27 PM

We have:
"According to the operators, electricity prices have now fallen so far that they cannot operate profitably."

This is because:
"... the rules can change at the whim of politicians looking for votes and legacies"

You suggest:
"State ownership of power stations is the way to go."

All you will be doing is moving the controlling, dysfunctional politicians up the food chain. The public sector owned power stations will lose money so, logically, the fuel suppliers will need to be publicly owned, and then the transportation, then ... it sounds like the 1970's to me!

Why not let the market decide? It is what prices are all about! And remove the green taxes, they are part of the 'dysfunctional politicians' world.

Sep 3, 2015 at 9:47 PM | Registered CommenterRobert Christopher

If Eli reads more, Eli will understand how the economics of this asset were sunk by UK Carbon Price Floor. Eli is a mistaken bunny when he characterises this is a matter of capitalism.

If Eli reads more, Eli will know that foreign ownership is nothing unusual in the UK power industry. Eli is a very naughty bunny when he refers to a "Czech bunch who bought the thing in 2014".

Eli is a silly bunny indeed when he refers to the last significant retrofit in 2005. Eli should read more about Drax, reported to be suing the UK government for policy changes affecting the investments it has made in recent years.

Sep 3, 2015 at 10:13 PM | Unregistered CommenterJordan

Ah so they are trying to rescue a sunk asset in court

Who knew

Sep 3, 2015 at 10:15 PM | Unregistered CommenterEli Rabett

The diesel cycle is the most fuel efficient energy transfer process ever known.
The combustion of coal is probably the least fuel efficient energy transfer process known. The writer of the piece “..wisdom of man etc..”probably recognised this with the inclusion of “relatively” in his mention of coal-fired stations, which is probably an acknowledgement that coal is only “efficient” if constrained by a morass of supplementary devices, condensers, superheaters, reheaters, takeouts, feedins, and so on. The effect of these is to increase the complexity of the original simple steam cycle.
The early steam cycle, without which we’d still be living in ghastly conditions, has been lost.
In the meantime, our friendly diesel is sitting in the corner there, exactly as made, simple, strong, reliable. OK, perhaps a bit smelly, but anyway, there it sits, just begging for someone to press that there button so that it’ll have an excuse for leaping into life, and saving civilisation, economically, yet again.

Sep 3, 2015 at 10:24 PM | Unregistered CommenterPeter Melia

Eli, I have nothing against capitalism, however this mess has been deliberately created by Green Blob price fixing, which consumers have suffered, with no discernable benefit.

As subsidies and free profits have been cut from pointlessly unreliable wind and solar, the world is falling out of their bottom too.

The UK Climate Change Act is now biting the UK economy, as it was intended to. The unintended consequences are that the UK public and the current Government are getting wiser to the Climate Con Trick.

The US voting public can view the goings-on in Paris with interest, knowing that developing countries are only turning up to see how much money they can get bunged, to pay for luxury lifestyles for their ruling elite. It makes FIFA seem like a bunch of amateurs.

The clowns of phoney croney capitalism rarely visit this site, but you are welcome to join in.

Sep 3, 2015 at 10:51 PM | Unregistered Commentergolf charlie

Golf Charlie- and then you could just skip the turbine generator guts completely and let the blades windmill...

a clear win-win.

Sep 3, 2015 at 10:53 PM | Unregistered CommenterJEM

JEM, the blades could be used to turn stones, to mill flour, to make bread with authentic gritty bits in, that some people find desirable. I believe some animals deliberately swallow stones and grit to assist the grinding processes in their digestive system. Dogs do not do this, hence the slipperiness of some pavements.

Sep 3, 2015 at 11:01 PM | Unregistered Commentergolf charlie

Eli, Mann is trying to salvage a sinking Hockey Stick in court.

Everybody knows that artificial Hockey Sticks don't float.

Sep 3, 2015 at 11:12 PM | Unregistered Commentergolf charlie

Eli has scampered into the hutch. But I shall coax Eli from the hutch with a simple assignment as follows:

A close approximation to the cost of steam coal in the UK can be calculated as follows:

P = W/E + CT

P is the cost of coal in GBP/tonne
W is the prevailing price of world coal in North West Europe (CIF ARA) in USD/tonne
E is the prevailing USD/GBP exchange rate
C is a ratio of tonne CO2 produced per tonne of coal burned (mass balance for C+O2->CO2)
T is the UK Carbon Price Floor (tax) in GBP/tonne

Eli is requested to state the ratio (CT)/P as a percentage. Eli can find relevant data for W,E,C and T on the internet.

If Eli does this properly, it will confirm Eli's assertion that coal is very cheap. It will also demonstrate how much government intervention alters the cost of burning coal and the economics behind this closure.

Sep 3, 2015 at 11:17 PM | Unregistered CommenterJordan

Peter Melia, the German engineer Herr Diesel invented his engine to run on sub standard coal dust, which Germany had ample supplies of, but no oil.

The shortage of oil still became a problem for Germany in WW1, and helped motivate the attack into Russia in WW2.

The EU, so reliant on Germany, is heading for an energy crisis, as Germany still has no oil or nuclear to replace its readily available coal, and must rely on homegrown wind and sunshine, which does not meet Teutonic engineering standards of reliability. The conflict in the Ukraine is a partial result of doomed climate change policy aswell.

So we have a lot to be grateful to Diesel for, but shortages of fossil fuels whether created in war or peace do have unintended consequences. The original Common Market was intended to reduce conflict due to food shortages. The EU is determined by Green Group Think, and the body count is rising.

It is basic human nature. Deprived people get hacked off, especially when sat in the dark, cold and hungry.

Sep 3, 2015 at 11:40 PM | Unregistered Commentergolf charlie

If you are correctly planning to install your own power generating capability may I suggest you double the capacity you first thought of, and look hard at the potential longevity of the kit:-

Nuclear delay: EDF admits Hinkley Point won't be ready by 2023

" Britain's first new nuclear plant in a generation has been delayed and will not start generating power in 2023 as planned, French energy giant EDF admits ...."

The proximity of that "stuff" and the fan at the back of the diesel generators is getting mighty close and looks like the stench is going to be about for a generation or two! I wonder just how the next couple of generations will consider their legacy?

But for this generation the mandate is clear! Make yourselves ready!

Sep 4, 2015 at 12:03 AM | Registered CommenterGreen Sand

Green Sand, the problem with making decisions about how to generate electricity, is that years go by during planning and construction before you buy any fuel, by which time market conditions will have changed the price advantages used in the original choice.

What Eli pretends not to know, is how much more expensive fossil fuels are on this side of the Atlantic. This has been due to taxation and supply and demand. WW2 rationing, Suez crisis, miners strike, OPEC, OPEC again, North Sea Oil, miners strike again, etc have all taken their toll. However the Green Dream Climate Change Act was intended to price fossil fuels out of the market, it was the intended purpose, not an unintended consequence.

The quickest and cheapest fix using available technology would be small diesel generators, replacing wind turbines, hence my post earlier. This would probably be far more expensive to run than large powerstations in the longer term, but the Government has clearly done some quick calculations on the semi permanent use, of standby diesel generators, and so this is currently the UK's emergency plan.

Diesel engines will run on vegetable oils, but the resultant food shortages have already caused problems.

Eli had high hopes for the Green revolution, but failed to foresee the bloodshed, so declines any responsibility. If the US tries to enforce fuel price hikes, to European levels, Green blood will flow. Obama doesn't care, he won't be standing, just relaxing on his beach front property, without a care about sea level rise.

Sep 4, 2015 at 1:35 AM | Unregistered Commentergolf charlie

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