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Powering Our Zero Future

Summary:
Santa’s reindeer delivered the long-delayed energy white paper on December 14th. It is full of good cheer: zero carbon, more jobs, more prosperity, cheaper greener energy for all.  As Alok Sharma concludes his introduction, “The UK is leading from the front in the transition to clean energy, while ensuring that we leave no one behind”. (p.3) The 170 pages include no executive summary but plenty of tubs are thumped.  The first question, though, is whether this is a white paper at all.  According to Parliament, “White papers are policy documents produced by the Government that set out their proposals for future legislation.” In this case the proposals for future legislation are skimpy and refers to only two proposals.  Using coal for electricity generation is already due to cease by 2025;

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Santa’s reindeer delivered the long-delayed energy white paper on December 14th. It is full of good cheer: zero carbon, more jobs, more prosperity, cheaper greener energy for all.  As Alok Sharma concludes his introduction, “The UK is leading from the front in the transition to clean energy, while ensuring that we leave no one behind”. (p.3) The 170 pages include no executive summary but plenty of tubs are thumped.  The first question, though, is whether this is a white paper at all.  According to Parliament, “White papers are policy documents produced by the Government that set out their proposals for future legislation.” 

In this case the proposals for future legislation are skimpy and refers to only two proposals.  Using coal for electricity generation is already due to cease by 2025; Sharma is making the bold decision to cease by 2024. (p.41) Secondly, when the government legislated in 2017 to allow electricity storage. they forgot to define the word “storage”. “We will legislate when Parliamentary time allows to define electricity storage in law”. (p.73) This leads into a rather confused discussion of networks. We should be proud, it seems, of our 284,000 kilometres of gas pipelines and open up electricity networks to competition but whether this refers to operating sections of the national grid or running parallel power cables down gas pipelines or digging up our road to create new networks is not clear. Apparently “competition in network assets is key to reducing network costs” (p.76) and legislation will be required for that. If that means a vast expenditure on competing networks, I hope you will forgive an old accountant for being sceptical. 

The “key commitments”, which should have begun the paper, appear on page 87 and summarise these legislative promises as well as other visions and areas for consultation.  The “digital infrastructure” will be, like Test & Trace, “world-beating”.  “Transport is an important aspect of our everyday lives and fundamental in connecting us together” and “the Department for Transport will publish its plan to decarbonise the UK’s entire transport system in spring 2021.” (p.88) Decarbonising the entire transport system in spring 2021, is indeed a challenging target. 

In substance, this is not a white paper, but this government does not care for green ones as they only encourage backbench MPs, not to mention the plebs, to contribute their ideas and challenge those of the government. This paper undoubtedly includes great ideas, but it does not translate those into credible quantified forecasts.  The section on modelling merely states that they are going to learn how to do that and would welcome some help. (pp.60-63).  The only forecast chart, intriguingly, shows that all sources of carbon emissions will be above zero by 2050 but their total will be zero (Figure 4.1, p.61). Maybe, carbon capture from the atmosphere might account for that but that is not mentioned nor has it been commercially attempted. 

The extensive chapter on the oil and gas industry (pp.132-147) says very little but indicates that this important industry has been lobbying hard.  It reads like the 19th century horse and buggy industry lobbying for protection from automobiles. The most key commitment is “We will support the UK oil and gas sector to repurpose its existing infrastructure in support of clean energy technologies.” (p.147) Whilst it does not say so, that probably accounts for at least part of the Business Department’s (BEIS) enthusiasm for hydrogen which Big Oil can make out from natural gas and bury the carbon in its disused oil wells.  But at what cost to the taxpayer? 

In contrast with the attention given to the redundant need for oil and gas, minimal attention is given to nuclear.  France derives 75% of its electricity from nuclear and Hungary 49%. The most positive support quoted from the Prime Minister’s ten point plan “Nuclear power provides a reliable source of low-carbon electricity. We are pursuing large-scale nuclear, whilst also looking to the future of nuclear power in the UK through further investment in Small Modular Reactors and Advanced Modular Reactors.” (p.12).  BEIS has received briefings from one of the most cost efficient and cost efficient new technologies, due to be operating in Canada by the end of the decade, namely molten salt reactors but elected not to mention them at all.  Figure 3.4 (p.44) forecasts nuclear to grow by two or three times by 2050. 

Perhaps the greatest surprise in the paper is its expectation that electricity will provide less than half of our energy needs in 2050. (p.73) According to Figure 1.4 (p.7) hydrogen and biomass/fossil fuels, with carbon capture and storage (CCS), will provide about 25% each and a small amount from removing carbon from the atmosphere although how that delivers electricity stumps me.  The Figure makes no mention of nuclear or renewables, presumably because their energy is delivered by electricity, but in that case why is the biomass/fossil fuel energy not included in electricity? How else could it be delivered? Presumably all the miles of gas piping will be converted to hydrogen for home heating and hot water fuel cells although this is not stated nor does the paper mention hydrogen fuels cells at all. 

The paper’s magic bullets are hydrogen and CCS.  The latter enables natural gas and biomass (wood or other material of biological origin) to be used in electricity generation if the carbon dioxide is captured and stored somewhere 

The trouble with hydrogen, be it produced from natural gas (blue) or water electrolysis (green), is that it takes more electricity to produce than it replaces.  A report for the IEA in 2018 stated “Producing all of today’s dedicated hydrogen output [70 million tonnes] from electricity would result in an electricity demand of 3,600 TWh, more than the total annual electricity generation of the European Union.” On that basis the above target for hydrogen would be unrealistic although it has been suggested that the UK import the hydrogen leaving the CCS problem with the producing countries.  But that would be more like 19th century imperialism than leading the world towards net zero carbon. 

On the other hand, the renewables sector has an affinity with the production of green hydrogen in that renewable electricity is generated in peaks and troughs; the surplus electricity at peak production could generate hydrogen for storage for later use.  Its use for storage is a big plus for hydrogen.  

Unfortunately, the white paper does not explore these issues or the comparative costs of the various methods of generating energy and electricity. This cavalier approach to the economic realities makes it all the odder that the paper can predict the detailed effects on consumers (favourable of course), not to mention jobs, exports and economic growth. But then it is Christmas.

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Tim Ambler
Tim Ambler (born 1937) is a British organizational theorist, author and academic on the field of Marketing effectiveness. Ambler featured on Marketing's list of the 100 most powerful figures in the industry. He is cited by the Chartered Institute of Marketing as one of the top 50 marketing experts in the world

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