We can meet our low carbon energy goals

From the ongoing squabbling over energy you might think that meeting our energy targets was impossible.  It's certainly a big job. And we have been slow to get things going as Ofgem's recent analysis of UK energy supply has made clear. But the technologies exist to get the job done. We just need to avoid making it too difficult for ourselves.

The costs of decarbonising our energy system, though material, are lower than the cost of climate damage that would harm our infrastructure and undermine food production.

We need low carbon energy at the least cost. The Energy Technologies Institute estimates that, with targeted R&D and the right technology choices, the UK can achieve its low carbon goals at a cost below 1% of GDP. However the Institute also estimates that the wrong choices could cost tens of billions a year more.

So why the arguments and portends of disaster?

Perhaps there is a strong sense of disappointment following that period of euphoria when it was thought that new energy sources would be found that were clean and cheap and always on.

There was never going to be an energy company like Google. Energy engineering is big engineering. It's not like software development and consumer electronics. Developing a new energy source, whether it's fossil or renewable, takes about 30 years.

Also there seem to be deeply held and divergent views about technologies that are acceptable and those that are not. Some people have a narrow definition of what is 'green'.

Then there is lot of commercial competition. It is great that people are enthusiastic about the technologies they want to develop. But the discussion needs to be balanced. I think there's plenty of room for everyone. Dishing the competition is both unfair and impedes progress.

Kicking the fossil habit

Kicking the fossil fuel habit is going to be very hard. Geological time has bequeathed a bonanza of vast quantities of fossil energy, being solar power accumulated over tens of millions of years,  condensed into small packages.

Fossil fuel energy density is a boon. We have built our modern industrial society on its phenomenal energy density. 

But the fossil energy bonanza cannot go on as it is. The rapid release of carbon dioxide  from fossil fuel is a curse for the climate. Therefore, fossil fuels can only have a future if they can be used while curbing their emissions.

In contrast, energy that reaches us daily from the sun, thought vast in aggregate, is extremely dilute. For example, a tonne of water would need to be lifted 16 kilometres to have the same potential energy as is bound up in the chemical bonds of a litre of petrol.

To say that daily solar energy is dilute is not to exclude it. Incident solar energy must be part of the solution. We just need to realise that, because incident solar energy is dilute, the engineering scale and the costs of harvesting it are going to be substantial. Almost by definition, harvesting today's solar energy, in whatever form - solar PV, solar thermal, CSP, wind, wave and hydro - won't be cheap.

There is also a real irony when concerns about the environment lead to refusal to accept onshore wind turbines. Onshore wind is a maturing technology and ought to have a place in a diverse set of low carbon energy technologies. And let's not forget lunar energy.  The tides offer major volumes of reliable energy.  The Carbon Trust and others are looking at ways of bringing the costs down.

We must not kid ourselves about the risks. Betting that something will turn up to neutralise the impact of much higher carbon dioxide concentrations is dangerous.  We tend to like muddle through options. But there isn't one for climate damage. It seems much more likely that the impact of more carbon dioxide will be amplified by such things as melting ice caps, darkening sea surfaces and releases of methane.

Option management and the Energy Bill

I believe there are three big technologies that matter at the moment for low carbon electricity - nuclear, wind (on and offshore) and carbon capture and storage (CCS). They all "work" but what we don't know for sure is their relative and absolute cost.  Until we do we need to preserve room for manoeuvre and apply the principles of option management.

Although the Energy Bill has been criticised, if we look at its core, it is designed to do just that - preserve essential room for manoeuvre and support testing of the low carbon technology options.

Sensibly, the Energy Bill sets out a phased approach and creates a kitbag of tools, the main one being the "contract for difference" (CfD). The CfD is essentially an instrument for delivering subsidy. This enables the options to be tested.

Longer term, the subsidies fall away and the unseen hand of the market takes over from the period of option management.

CCS is essential

Although the future energy mix is likely to be much broader than that of today, CCS stands out as an essential technology. This is for two reasons. Firstly the relatively low cost of coal and gas means that they will be burnt. Their carbon emissions cannot be allowed to continue to escape.

Secondly, we need CCS because it is pretty clear we are already past the point of no return and negative carbon technologies are going to be required. CCS plus biomass enables this.

It is dissapointing therefore that CCS is a technology with few friends and apparently no natural owners. Gas and coal producers need to be investing now in CCS.

It is frequently said that CCS is not yet commercial. However if the same subsidies given to offshore wind were given to CCS I'm pretty sure there would be a queue of CCS investors.

In conclusion

Asked why economists argue among themselves so much, Henry Kissinger famously said "Because there's so little at stake." For climate change there is a huge amount at stake. We can't afford to get caught up in endless argument.

We need to recognise there are no perfect solutions but there are solutions that work. We should be focusing on making sure we implement the least cost route to our low carbon energy goals.


First published in the April 2013 issue of Energy World magazine by the UK Energy Institute