The 15% target
221. The former Minister of State told us the
Government was committed to achieving the 15% target and the resultant
ten-fold increase in renewable energy use. It would however be
hugely challenging, a view shared by most other witnesses. The
Government favoured some trading within the EU if it would bring
down the cost to consumers. In particular, the former Minister
told us that the last percentage point of renewable energy, needed
to raise its share in the UK from 14% to 15% "would probably
be the most expensive point to achieve." But in the former
Minister's view the target could still be achieved without trading
(Q 492). Much may depend on the outcome of negotiations in
the EU; there was substantial disagreement over individual national
targets at the October European Council.
222. Professor MacKerron thought it was
possible but unlikely the target would be achieved, If it were
met, it would be at high cost as we would have to build renewable
generators at less and less favourable locations (Q 265).
Dr David Clarke of the ETI cited the Renewables Advisory
Board which believes it is nearly achievable (Q 333).
223. BP saw a risk that because the time scale
for the targets was short, investment would be skewed to technologies
that worked today as opposed to those which might be right for
the longer term (Q 360) Malcolm Keay suggested the pressure
to meet the EU target led to too much emphasis now on increasing
the quantity of renewable projects at the expense of all other
factors and interests involved. He said: "the problem with
renewables now is that it is based very much on just getting a
certain quantity of renewables built rather than thinking about
the ultimate objectives which include reducing carbon emissions
but also include preserving local landscapes, amenities and many
other things" (Q 101). He thought that "an approach
more focused on actual technology development rather than just
building arbitrary quantities of renewables might be more effective"
(Q 104).
224. A number of witnesses thought the target
was impossible to achieve. Mr Keay pointed out that "every
single renewables target ever in the UK has been missed and by
quite a long way" (Q 82). Professor Helm's view
is that "we should have a credible [renewables target] that
there is a reasonable prospect that we can achieve" (Q 184).
He believed that the government had a policy of providing leadership,
and had set a policy of reducing carbon dioxide emissions by 20%
between 1990 and 2010. The intention was to demonstrate that,
through renewable energy and energy efficiency, this could be
done at an extremely low cost, so that other countries would be
willing to sign up to Kyoto. In practice, he believed that we
had demonstrated that we were unable to achieve the objective,
that what we have achieved has been at extremely high cost, and
this has not been persuasive. Professor Helm agreed that
"we should show leadership and … adopt a tight set of
carbon targets, but what I think is most important is that we
do not go around wishfully promising that we are going to achieve
this renewables target or that particular CO2 target
in a way that is just not credible" (Q 183).
225. We endorse the Government's objective
of ensuring a secure, reliable and affordable supply of energy.
226. The Government is right in stating that
a portfolio of policies is needed to achieve this objective, if
we are also to bring about reduced carbon emissions. Renewable
energy has a part to play, as does nuclear power, the only other
currently existing source of low-carbon energy. Investment in
conventional power (preferably equipped with CCS, if and when
it becomes available) will also be needed, together with improvements
in energy efficiency. Against a background of developing technologies
and uncertain costs, the Government will need to give a firm lead,
with clear priorities and realistic objectives, while maintaining
the stable framework needed by investors in the context of the
long lead times needed by many energy projects.
227. The main plank of Government policy on renewables
is the proposed target of a 15% share of total energy by 2020,
most of which is expected to be met by increasing to 30-40% the
share of renewables in electricity generation, with most of that
coming from wind power, onshore and later offshore. Witnesses'
views of the target ranged from challenging to unattainable. The
Government is however committed to achieving it and estimates
that £100bn of private investment will be needed by 2020.
Most, if not all of the cost is to be passed on to the consumer.
228. We recognise that the Government has
committed the UK to contribute to the EU target of 20% renewable
energy by 2020 and that a target of 15% for this country is envisaged.
But the bulk of the evidence presented to us casts doubt whether,
under current policies and with current resources, it will be
feasible to increase the share of renewable energy so much in
the UK over the time available. This is especially so, as most
of the growth is expected to occur in power generation, which
represents only a fifth of the UK's energy use, and that this
growth will be largely in addition to the substantial replacement
programme of old conventional and nuclear plant that has to take
place over the same time period. The UK has a track record
of missing its targets in this area and, although meeting this
one would mark a step change in the use of renewable energy, failure
to meet it would negate the effect of setting and achieving realistic
targets and reduce the UK's credibility still further.
229. We are also concerned that determination
to meet the target may lead to an over-emphasis on promoting short-term
options, simply because they are available, rather than because
they offer the most effective and economical means of reducing
carbon dioxide emissions over the longer term. For example,
as we have mentioned earlier in this Report (Chapter 5) the Government
should lay at least as much emphasis on the opportunities for
renewable heat as on power generation.
230. We have a particular concern over the
prospective role of wind generated and other intermittent sources
of electricity in the UK, in the absence of a break-through in
electricity storage technology or the integration of the UK grid
with that of continental Europe. Wind generation offers the most
readily available short-term enhancement in renewable electricity
and its base cost is relatively cheap. Yet the evidence presented
to us implies that the full costs of wind generation (allowing
for intermittency, back-up conventional plant and grid connection),
although declining over time, remain significantly higher than
those of conventional or nuclear generation (even before allowing
for support costs and the environmental impacts of wind farms).
Furthermore, the evidence suggests that the capacity credit of
wind power (its probable power output at the time of need) is
very low; so it cannot be relied upon to meet peak demand. Thus
wind generation needs to be viewed largely as additional capacity
to that which will need to be provided, in any event, by more
reliable means.
231. We consider that the Government, if it
pursues a renewable energy target in addition to its targets for
reducing carbon dioxide emissions across the board, should prioritise
the development and promotion of the other effective and economic
options, both to bring down carbon dioxide emissions and to achieve
security of electricity supply. In that regard it will be important
to ensure that incentives to promote those renewables which offer
only intermittent supply do not divert attention from, and deter
investment in, other low-carbon generation options and thereby
risk power shortages. So far as reliability is concerned, the
best options among renewable sources of generation are tidal barrage
and biomass, which are problematic for other reasons, and hydro-power,
which is not, but is already near the limit of its potential in
the UK. The most reliable low-carbon alternative to renewables
is nuclear power (together with conventional fossil fuel generation
with carbon capture and storage, if and when that becomes available).
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