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Energy prices, fuel prices, independence, politics, renewable energy, scotland

Independence warning: the lights will go out if Scotland votes yes.

There are many things that I don’t understand. Like why a day return rail ticket between Edinburgh and Glasgow costs £22 when we are trying to get people to stop using their cars. Or why a cup of coffee costs £2.50 when its ingredients cost 0.5p. But nothing puzzles me more than energy prices. They have doubled in five years even though Scotland is sitting on a mountain of power. Yesterday, we were warned by Alistair Buchanan, the chief executive of Ofgem, the energy regulators, that energy prices are going to soar again because of something called a “gas crunch”. We haven’t seen anything yet. The lights will go out.
Now, every six months or so there is a scare about lights going out (LGO). The most recent – inevitably – was a warning that independence for Scotland would lead to LGO because England wouldn’t continue to subsidise Scottish power generation. This seems utterly baffling since Scotland has a vast surplus in electricity generation at the moment and is sending the surplus south.
Ah, but that’s only because of those nasty fossil fuel stations like Cockenzie that are being closed down. And nuclear power stations like Torness that are coming to the end of their unnatural lives and will not be replaced because, according to Labour, the SNP is irrationally biassed against nuclear power. Labour have for years been predicting LGO without more nuclear power stations, which the Scottish government has ruled out on the grounds that they would be hugely expensive, dangerous and surplus to requirements.
At present, Scotland has total energy generating capacity from all fuel sources of just over 12 GigaWatts – or so I am told. By 2020, we will have the capacity to produce 100% of electricity demand from renewable sources like wind. Scotland supposedly has wind, wave and tidal energy potential of 60GW – six times current capacity. We have 25% of Europe’s wind and tidal and 10% of wave energy potential – a colossal comparative advantage in green energy.
And these aren’t fantasy figures from some environmental pressure group. 20 GW are already in the pipeline, according to the Scottish government, which is nearly twice what we have now. We already provide nearly 40% of the UK’s renewable energy output – which is why the UK government has been helping subsidise the development of the Scottish renewable energy, so that Scottish wind can help England meet its climate change targets.
So, lights going out? I don’t think so. Unless this is all garbage. But assuming ministers are not lying, we seem to have rather a lot of energy. Indeed, we still have a trillion pounds worth of oil in the North Sea, prodigious amounts of Scottish coal and a lot of the latest fad – shale gas, which is supposed to be worth £5nb a year in Scotland alone if fracking (that’s a method of extraction not a term of abuse) turns out to be safe. Germany would love to have our renewable energy sources – they are turning green and phasing out nuclear powers stations at the same time. But they are of course German, and their lights do not go out.

But a daft laddie like me still wants to ask: why are Scottish energy prices rising by 10% a year? It’s to do with the energy market, according to the Scottish government. We are locked into a UK generation and distribution system. What happens is this: we produce the electricity and send it to England, then they send us subsidies to build more wind farms. Then the power companies charge us a price based on world market conditions, which have nothing to do with the cost of energy in Scotland or England. At this point people start talking about renewable obligations, contract for difference, feed in tariffs and other interplanetary nonsense.
Well, that may make sense to people in the energy business, but all I know is that energy bills have been rising at an intolerable rate, leaving an ever increasing number of Scots in fuel poverty – 900,000 according to Energy Action Scotland. There is hyper-inflation in fuel prices in the UK, and no one seems able to do anything about it – least of all the Scottish government even though we are supposed to be on the cusp of another energy revolution.
In the 1950s, we were old that nuclear energy would be so cheap it wouldn’t even be metered. In the 1970s we were told Scots would be driving around in Rolls Royces because of oil from the North Sea. In the 2000s we were told that Scotland would lead the world in green energy that is cheap and safe. But energy prices just kept going up and up.
And will continue to do so after independence, because we will still be part of that UK energy system, which keeps energy prices down by making them higher. We will still be at the mercy of the energy companies, most of them foreign owned, who will continue to charge whatever they feel they can get away with. This of course was why we privatised all those inefficient nationalised energy companies 20 years ago so that we could have a healthy competitive market that would keep prices down. Except that our privatised energy companies were bought by companies like the nationalised French EDF and prices quadrupled.
The UK government was hoping that EDF would build a new generation of nuclear power stations which would stop the LGO and give us all cheap energy. But they are now saying that they need guaranteed profits. And those profits will be guaranteed by higher prices for 40 years set at twice current energy costs. Oh, and we of course will be left with the cost of cleaning it all up again, and insuring against nuclear accidents, and looking after the waste for the next thousand years – that’s if anyone is willing to take it now that Cumbria has said it won’t.
No, the only thing I do understand is that energy production is a racket, like the railways and Costa coffee. And there is nothing any of us can do about it.

About @iainmacwhirter

I'm a columnist for the Herald. Author of "Road to Referendum" and "Disunited Kingdom". Was a BBC TV and radio presenter for 25 years - "Westminster Live" and "Holyrood Live" mainly. Spent time as columnist for The Observer, Guardian, New Statesman. Former Rector of Edinburgh University. Live in Edinburgh and spend a lot of time in the French Pyrenees. Will that do?


6 thoughts on “Independence warning: the lights will go out if Scotland votes yes.

  1. "And there is nothing any of us can do about it."Um, vote Yes in 2014 and legislate in favour of energy consumers.

    Posted by Cenuij | February 24, 2013, 12:16 pm
  2. Well said Cenuij… that works for me…!!

    Posted by DanTDog | February 24, 2013, 1:38 pm
  3. Iain,While the Scottish government energy policy is by no means perfect, it is infinitely saner than the UK. You ask where price hikes are comming from, I will give you one of the biggest examples.Please study the following map carefully. It comes from the EEA, the European Environmental Agency. I know the data are somewhat dated, but in the context of comparison and conclusions one might draw from it, that is not important. It depicts the expected cost per unit (kWh) of elctricity production from windpower which are largely a function of terrain type and average wind speed – in that order in NW Europe. It does not include grid support costs as that varies enormously due to how remote from centres of use the wind farms are.http://i51.photobucket.com/albums/f390/chicmac/Windcost2005.jpgWhat I want you to note is:1) The British Isles, including England, is slap bang in the lowest cost band for ON shore wind production along with Denmark, Far North of Germany and Southern Sweden.2) The cost of OFF shore wind power compared to ON shore British Isles is TWICE AS MUCH.3) The Highlands of Scotland are not as commercially attractive even discounting extra griding costs.OK, got that?Next,I want you to look at the following chart. This is also based on EEA data but which are kept up to date so is only about a year or two old. It shows the actual installed ON shore wind capacity of various countries in the Europe. To take account of the varying size of country, it has been normalized to population by calculating installed capacity per million people.http://i51.photobucket.com/albums/f390/chicmac/WindPowerChart.jpgNote the extraordinary extent to which English NIMBYISM has been indulged.It has been described by a European wind power expert as "Being like a Saudi Arabia which refuses to drill for oil".Now take on board the fact that England already has more OFF shore wind generation than the rest of the world put together and is planning up to 35 GW in total.Think what that means for electricity prices in the UK.That is why no other country, even Green Party lobbied environmentally mad Germany has considered serious OFF shore development until they had filled the place up with ON shore.Note, I am not at all saying that it is not right that we should have OFF shore, but it is commercially insane to do so until you need to. UK leccy bill payers (or tax payers if they disguise things by "subsidy", "tariffs" or whatever ) will have a very high price to pay in order to indulge English NIMBYISM.Nuclear, again is even more costly but we'll leave the above to sink in for now.

    Posted by chicmac | February 24, 2013, 6:12 pm
  4. Tidal generators in Scotland? I didn't know about the share of tidal power in total energy balance in this country. Very informative post, anyway!

    Posted by Maria | March 12, 2013, 2:26 pm
  5. Dear Ian,It really isn't hard to understand. May I try as a professional physicist, electrical engineer and MBA?Energy policy is an undeliverable fiscal fraud on the public that is creating the opposite effects in technical and economic reality to each of its claimed benefits.It is a legalised climate change protection racket for generating companies. Its only significant outcomes are excessive generator profit and massive energy poverty affecting the poorest most, by law. All avoidable. Legalised graft.The physical reality?You may have gezillion GW of max rated wind power, but not necessarily available to meet demand when needed – the majority of the time. So it MUST have 100% cheap gas fired backup in permanent operation – to be pushed off the grid at 2 or 3 times the price when the wind blows (1ROC onshore, 2 offshore, 1 ROC = base load unsubsidised rate/MWh). When the wind drops the energy drops with the cube of wind speed = dramatically, 1/8 the energy at half speed. So the cheaper, 50% the CO2 of coal, gas fired "backup" has to be able to kick in fast and is actually running full time in spinning reserve without the output going onto the grid This operating regime means all the expense is largely CO2 neutral. NO CO2 reduction for all the expense over just plain gas. So the justification is invalid also. Another deception.In fact the reliable cheap gas fired generation is host to the alternative wind parasite and is dead without it, but not in alternative reality. I have discounted substantive electrical energy storage in the UK on both additional cost and availability of hydro possibilities – and we don't need it, or wind power, anyway. The subsidies are set to make what can't work much more profitable to build than gas and nuclear that works unsubsidised, e.g. onshore wind is made more profitable than cheap CCGT gas or nuclear by 1 ROC = double the price to the grid. Offshore wind gets 2 ROCS but less increase in cost so is even more profitable than onshore. Generators are bribed to build the most expensive possible generation. You may have already realised that 2 or 3 times the price duplicative and parasitic on fossil power wind generation is not viable without its fossil hosts. The industrial revolution was made possible by intense fossil fuel. Weak wind and water power went out of business and the forests were disappearing fast. Remember how long sailing ships lasted? Only the wind is free. Weak energy is massively expensive and resource intensive to collect and distribute. At the end of fossil only nuclear energy is intense and controllable enough to deliver the plentiful, cheap, controllable, sustainable, clean and zero carbon electrical energy that is essential to stay a developed economy (2-3 times today's 330TWh), Alternatives are a completely undeliverable scam on the tax/subsidy/bill payer that cannot in fact deliver any of the claims made to justify their existence and expense.This conclusion can be independently tested by anyone who has basic physics or engineering. You have independent and very distinguished academics who understand and will explain, down to whatever level of evidence you need. I can do it too, but they are Profs AND Scottish. Stuart Young is also good. Prof Colin McInnes at Strathclyde re the underlying intensity physics consequences and Prof Gordon Hughes at Edinburgh on the costed economics. Struan Stevenson on the politics. I hope this clears the fog of political deception and received opinion a bit? In the end, there is only the physics. Ask Scotty. Politicians have been exploited by generators, to pass massively profitable but utterly fraudulent energy laws to enrich themselves – at our cost in every way. Ye cannae legislate the laws of physics. The above is fact based and independently verifiable with some simple research of the physics basics at GCSE level, DUKES stats, DECC and OECD cost figures, etc. and AS level maths at worst.Regards,Brian Catt CEng, CPhys, MBAbrian.catt@physics.org

    Posted by Brian Catt | March 26, 2013, 3:23 pm
  6. CORRECTION: I miswrote myself."In fact the reliable cheap gas fired generation is host to the alternative wind parasite and is dead without it, but not in alternative reality."Should say:"In fact the reliable cheap gas fired generation is host to the alternative wind parasite which is dead without its gas fired host, but not in alternative reality."Brian

    Posted by Brian Catt | March 26, 2013, 4:26 pm

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