Select Committee on Trade and Industry Minutes of Evidence

Examination of Witnesses (Questions 589-599)




  589. Good morning, Dr Lees. Perhaps you would introduce your colleague and yourself?
  (Dr Lees) Good morning. My name is Eoin Lees. I am Chief Executive of the Energy Saving Trust. My colleague is Nick Eyre who is the Director of Policy and Development at the Energy Saving Trust. Between us we probably have about 34 years' experience—certainly a lot more than we care to remember—of energy efficiency, combined heat and power and renewables, but today we are particularly focussing on energy efficiency and sustainable energy in households, and we are grateful for this opportunity.

  590. Thank you. You see the development of small-scale, community-based renewable energy schemes as a means of ensuring diversity and security. In macro terms, what proportion of our energy needs do you think could be provided by such sources?
  (Dr Lees) In the short term, to 2010?

  591. Yes, let us say 2010 and maybe beyond that, because the PIU is talking about over 50 years.
  (Dr Lees) I suspect the answer to that is small—but Nick will be able to answer that—in the short term.
  (Dr Eyre) Certainly if you look at the very long term, if technologies like micro-CPH and fuel cells are developed, they have a capability to deliver the whole of the domestic sector's electricity supply. Small-scale renewables—to some extent it depends what you mean by "small-scale". I think we would see small-scale renewables in the first instance as playing a role in helping to promote public understanding and involvement in the renewables sector and therefore perhaps help more in the planning issues, but I would have thought that wind and biomass at relatively small scales will probably be generating 10 per cent of the UK energy supply by 2020.

  592. Given that 20 per cent of our energy is consumed by the domestic sector, you would see the domestic sector, that 20 per cent, perhaps—
  (Dr Lees) It is actually over 30 per cent.

  593. 30 per cent, I am sorry. You see that as contributing quite a reduction?
  (Dr Lees) In the longer term certainly.

  594. But by 2010 you think it will be fairly modest?
  (Dr Eyre) By 2010 it will be fairly modest. By 2020 we think that micro-CHP will generate about 20 per cent of domestic energy, so it is a significant contribution.

  595. So that is about 6 per cent of total needs?
  (Dr Lees) Yes, this is why, because of the local market time factor, we are so keen to exploit all the alternatives on energy efficiency that are available to us today.

Mr Hoyle

  596. Is it not fair to say that the problem with commercial renewable schemes is that they are located so far away from the customer base, and that there are real problems for the distribution network?
  (Dr Eyre) I think you have to differentiate between the technologies like wave energy and offshore wind which clearly, if they are going to be used in substantial amounts, would require substantial extension of the transmission and distribution networks. You have to differentiate between those and technologies like onshore wind, biomass and photovoltaics which in general are going to be somewhat closer to the customer than large-scale power generation has been historically. More importantly, there will be embedded generation connected within the distribution network that will therefore tend to reduce the losses in the power system compared to the traditional centralised generation going through high-voltage transmission down to the customer.

  597. In fairness, some of the wind farms are quite remote as well. I think that has been part of the difficulty in trying to get those into the distribution network as well, in terms of its relationship to the customer base. I do not think it is just a case of saying, "Well if it's offshore, yes, it's a problem: if it's inshore, no, it's not a problem." I think you have to agree that some of the problems have been that wind farms have been located so far away from the customer base?
  (Dr Eyre) I would not agree with that in the short to medium term, no. I think there is perhaps one example where wind energy is being generated in excess of what is needed.
  (Dr Lees) I think the problem has been much more one of visual intrusiveness of wind farms, which is where I think the community-based approach, which is what they have done in Denmark, has so much more potential for it.

Mrs Perham

  598. In your submission regarding NETA you have said that the operation of NETA "adversely affected the renewable energy and CHP suppliers, particularly for new generators." The DTI published its response to Ofgem's assessment of the impact of NETA on small generators in the first two months, and it was operational from 1 November. Were you encouraged by anything you saw in the Government's response that would help those sectors?
  (Dr Eyre) I think the first thing I should say is that none of us is an expert on NETA; it is one of those areas in which not many people are experts.


  599. We have discovered that!
  (Dr Eyre) I think some of the options canvassed in the DTI document, notably consolidation, single cash-out price and the option of a dead band treating small generators differently from large generators, for perfectly justifiable reasons, are encouraging and would help considerably.

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