Andrew Neil’s interview, or perhaps we should say evisceration, of Michael Fallon MP, the new Minister at the DECC on the Sunday Politics show was a classic. Starts 10 mins in. Fallon seemed exceedingly poorly prepared, although his performance was certainly more surefooted than Ed Davey the other morning. Neil pointed out, with the aid of an excellent pre-prepared graphic(!), the under performance of wind at 2% and in February a long period at 0.2%. All Fallon could respond with that on the one day when he was at the
National Grid it was 6%. Umm! That is, at best, less than 50% of the Grid’s safety margin on 1/365th of a year. On mothballed(Coal?) capacity Fallon says it can be brought back into production but was fazed as Neil pointed out that it takes a year to re-commission such facilities. Apart from anything else coal power stations will have used up all their fuel supplies including reserves and these would need replenishing, often from Russia, Poland or even the USA. That cannot be done in a matter of days. At least not at an equitable cost. Fallon simply suggested that the projected shortfall was still two and a half years down the line but failed to understand that the whole scenario could be prevented if we extended the life of power station due to close, until alternative new production would be on line. On why we should follow EU diktat of an agreement signed by the last Labour administration, Fallon seemed more concerned about not breaking EU laws than keeping the UK residents working and warm. The business fact remains that whilst we keep existing capacity on line and show a willingness to extend end of life ad nauseam, we are in a position to negotiate with nuclear and gas producers from a position of strength. As capacity diminishes and more concerns are raised these mostly German companies such as RWE and E-on, the French EDF and the Japanese Mitsubishi know they have us by the short and curlies and seeing the massive billion pound subsidies lavished on wind, simply want their share. Ditch the wind and renewable subsidies, promise some tax breaks; like if you invest your UK profits that you are presently dodging UK taxes on we won’t need to chase you for them; and consider methods to encourage UK financed and owned generation to take a share of future capacity. At least they should pay UK taxes!
Is this the same Fallon who as a Minister with BID championed the shares for workers rights program. Yes, the one that has bombed. Again a lashup of a scheme that would have been pro business ends up going down the toilet due to Lib-Dem veto. The alternative proposal finds little support possibly because of it’s debatable legal status.
So now we have the Grid and Ofgem, backed by SSE, saying the Gov has it’s knickers in a twist and a Minister saying the the Grid will sort it out. Passing the buck with the sure knowledge that when the proverbial hits the fan this Minister will have moved on. In all probability, if the present administration doesn’t pull the digit out, be collecting his P45. As to paying companies not to take power, sort of constraints payment in reverse, there is history to this. As part of the discounted energy deal to major users; steel works, car plants etc; there already is a provision to cut these off if the Grid comes under duress. It is already in place and there is no necessity to pay these users any form of “constraints” payment. Since the decline of heavy industry it is debatable when this provision was last used but these large users do have backup generation in the form of diesel generators. So we close down coal, nuclear and old gas generation in compliance with EU (anti competition?) Carbon laws and rely on old fashioned, less efficient, more expensive, diesel generation to keep our industry working. And this from an ex Business Minister.
On a similar note it was great fun to hear Clarkson on Top Gear (BBC2) have a real crack at wind. The Gov want to install two thousand five hundred wind turbines in your back garden to provide enough electricity to run “my tropical fish tank”. Well after hearing from Fallon we needed something to cheer us up. The Carbonistas at the BBC Trust must have been puce with fury at that, and on prime time BBC too. But then they are probably far too high brown to listen to Top Gear!