The Joy Of Green Energy: The Lights Go Out In 2015

October 8, 2012 by  
Filed under Green Energy News

It’s entirely possible to be convinced by the case about climate change and yet still believe that what we’re doing about it is even worse than the original problem. It must be possible for that’s the situation I find myself in. The latest little piece of news to underwrite this gloomy view is the news that the lights are likely to go out in my native UK, starting in only three year’s time.

Britain risks running out of energy generating capacity in the winter of 2015-16, according to the energy regulator Ofgem.

Its report predicted that the amount of spare capacity could fall from 14% now to only 4% in three years.

There are other reports on the same news here and here. That last is “only” a blog of course but it’s also one written by a senior City figure whose job is financing the energy sector. One who knows and one who has been shouting about this very problem for years now.

The basic problem is that the political classes decided that climate change was something that needed their incredible skills as planners to reach a solution. Rather than what every economist has been screaming for a decade or more: change just the one price in the system, the price of carbon emissions, and let the market work out what to do next.

First the politicians decided that we really must close down the coal fired stations because they;’re very polluting. Which they indeed are. Then there was a decade of muddling around about new nuclear plants. Some would prefer for the usual scaremongering reasons that no new ones be built. Enough people thought that that the political fight about approving and financing them was never really prosecuted. While the country does have at least some shale gas the idea of fracking for it and building new gas fired plant was put on the back burner (sorry). On the idea that we could instead just plan that everyone would use less power. Oh, and that wind and solar would fill any final gap.

Except there’s a problem there. Peak electricity demand in the UK comes on cold winter days. Cold winter days come in the UK when a high pressure area moves down from the arctic and parks itself over the country for a day or a week. Along with such high pressure areas we also get no wind. Which is where we really start to have our problems. Yes, Britain is pretty biog, it’s a whole country sort of size. But those cold winter days do happen to coincide with there being no usable wind generated electricity at all. Yes, this has actually happened: wind generation falling to zero percent of the total generation.

Which is what leads to our interesting problem: the margin for error, the gap between the entire system working at full output and potential peak demand is going to be only 4% of that peak demand. Yet wind will make up more than 4% of the energy mix. And that wind power will, on those cold winter days, be able to provide no electricity at all (or, to be more truthful, on some such winter days). That is, the lights are going to go out for peak demand will be greater than peak theoretical production minus the wind that won’t be there.

All of this is because the politicians thought they could grapple with a problem as complex as this and grapple with it without messing up. Clearly an example of the Dunning Kruger effect in action.

What they actually should have done is what I and near every economist (yes, including even such as Lord Stern and his report) have been saying for a decade and more. Change the price of carbon emissions through a tax or a cap and trade system: then stop. Do not try to plan anything more. You’ve now introduced the correct incentive into the market and you need to allow the only calculating engine we’ve got, that market, capable of running through a problem of such complexity the opportunity to work.

The politicians didn’t do this: ergo, the lights are going to go out.

Comments are closed.