Renewable Energy Foundation

REF was the first organisation to draw attention to the excessive prices demanded by windpower to reduce output (constraint payments), and the resulting publicity is in part responsible for the fall in prices, though these are still, in our view, excessive.

The wind industry has responded to this criticism by attempting to confuse the public with claims that other generators are paid more to be constrained off. This is untrue, but unfortunately was made the central argument in a piece in the trade journal, Utility Week:

On 26 April 2013, REF wrote to the Scottish Government seeking the details underpinning a Scottish Parliamentary Answer concerning wind farm performance. We received a reply on 30 May 2013 which has prompted the following answer.
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Attachments:

REF to Scottish Government on Wind Farm Performance 10.06.13

Scottish Government to REF on Wind Farm Performance 13.05.13

The think-tank Civitas has today published a short paper, "Are Green Times Just Around the Corner?", by REF's director, John Constable.

The paper asks whether a low carbon economy can sustain contemporary standards of living, and argues that it can only do so if the costs of renewables fall to make them competitive with current fossil fuels. The paper further suggests that subsidies to renewables are actually counterproductive, and discourage invention and innovation.

The May issue of the magazine Standpoint carries a new article by John Constable, REF's director, in collaboration with Patrick Heren, "An Alternative To Our Reckless Energy Gamble"

The piece argues that the costs of the current low carbon energy policy are dangerously extreme, and that consequently there is a high risk that consumers will become disenchanted with the climate agenda. Instead, the authors suggest that government should use gas generation as a means to reduce emissions in the short term, while generating wealth to fund a new innovation based energy policy.

REF has today (26 April 2013) written to Mr Fergus Ewing, MSP, Minister for Energy, Enterprise and Tourism in the Scottish Government.

The immediate cause is the following Question and Answer exchange between Mr Ewing and Mr Murdo Fraser, MSP concerning the study by Professor Hughes of wind turbine performance degradation and economic lifetime:
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Attachments:

REF Letter to Fergus Ewing MSP

On the 4th of February, REF wrote to the Secretary of State for Energy & Climate Change, The Rt Hon Ed Davey, MP, defending our calculation of the future costs of the offshore wind program, which DECC had called "pure speculation". We also criticised the Department's assumption that costs would come down in the future, and suggested that if anyone was speculating it was DECC. We received a response yesterday, with additional underlining in Mr Davey's own hand.

In his response, the Secretary of State shows that he trusts the wind industry when they promise to cut costs in the future. That seems to us an extremely hazardous position to take. Bluntly, a subsidy-seeking industrial sector might say anything to get their foot in the door, and their undertakings should be treated with caution, particularly when the consumer burdens entailed are so vast.
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Attachments:

DECC Letter to REF on Off-shore Wind Costs

If we have learned anything over the last ten years of arbitrary targets and policy mandated income support to renewables, it is that the sector has failed to reduce its costs significantly, and, far from learning to stand on its own feet, is content to be a long-term subsidy dependent. This won't be acceptable to the consumer in the medium let alone the longer term, and it fails to provide an economically compelling low carbon example to the developing world.

Clearly, something has to change, and will change. If renewables are to have a role in that new dispensation they will have to improve dramatically. But how? What are the major problems that have to be solved before they are fundamentally economic and can make their way in the world without special and unsustainable commercial favours?

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The following talk was given at a meeting of the All Party Parliamentary Group on Rebalancing the Economy, at the House of Commons at 10.00 on the 13th of February 2013. The session topic was The Cost of Energy. Other speakers were Tamaryn Napp (Imperial College London), Professor Alan Riley (City University Law School), and Jeremy Nicholson (Director, Energy Intensive Users Group).

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On the 3rd of February the Sunday Telegraph published an article about the costs of Round 3 offshore wind, and used cost estimates generated by REF: "Foreign Firms' '£100bn wind farm subsidies'" 

The Department of Energy & Climate Change was quoted as saying that our figures were "based on pure speculation". This is untrue, and we have written to the Rt Hon Ed Davey, Secretary of State at the department to point this out. Here is our letter.

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The Public Accounts Committee has today published its report on the costs of grid connections for offshore wind: Public Accounts Committee - Twentieth Report Department of Energy and Climate Change: Offshore electricity transmission-a new model for infrastructure.

The central finding of the report is that:

"The terms of the transmission licences awarded so far appear heavily skewed towards attracting investors rather than securing a good deal for consumers." (Summary)
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