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On-shore wind power cost households less than £5 last year

Ofgem says RO added just £15.15 to the annual energy bill

Despite scaremongering from sections of the the media and the pro gas and nuclear lobby – figures out on Wednesday this week showed that on-shore wind added less than £5 to household energy bills last year.

Ofgem has just released the Renewables Obligation (RO) annual report for 2010/11, which is the main support mechanism for encouraging the growth of renewable energy in the UK – including both on-shore and off-shore wind, wave, tidal, biomass and landfill gas.

Ofgem’s report shows that the RO added just £15.15 to the annual energy bill of the United Kingdom’s 26.3 million households – with just £4.68 of that supporting on-shore wind.

By comparison, the rising cost of imported gas added around £120  to energy bills last year.

This increase in the cost of gas added more than 10% to energy bills, while support for on-shore wind added less than 0.05%. Ignoring the real reason for rising energy bills – imported gas – 101 Conservative MPs recently wrote to Prime Minister David Cameron saying “in these financially straightened times, we think it is unwise to make consumers pay, through taxpayer subsidy, for  . . .  on-shore wind turbines.”

Ecotricity founder Dale Vince said: “Let’s set the record straight. Supporting onshore windmills and making use of our indigenous energy supplies – cost each household less than a fiver last year. This is an investment, not just in clean energy, but in energy security – reducing our reliance on imported gas.”

“There has been a massive campaign of misinformation over the last six months by the media and lobbyists for the gas and nuclear industries – all taking aim at wind energy for some reason. With the rising cost of imported gas increasing household energy bills by £120 last year, it’s bizarre to see a group of Conservative MPs complaining about the £5 spent on onshore wind. Are they not in possession of the facts, or do they care little for such inconveniences?”

“In January this year, coal took over from gas as the major provider of electricity in Britain because the high price of importing gas caused the Big Six energy companies to mothball gas power stations. That’s the reality – it’s gas that we can’t afford, not onshore wind.”

“Britain should not be left at the mercy of the international gas market. We have 40% of Europe’s wind resource. Let’s use it, to create jobs, industries, clean energy and independence from global energy markets.” 

Source:

Dual-fuel bills rose from £1,145 in 2010 and £1,345 in 2011. The other £80 was increased delivery costs and improved profits for energy companies.

7 Responses to “On-shore wind power cost households less than £5 last year”

  • that’s an interesting take on things. 🙂

    http://www.ref.org.uk/publications/238-the-probable-cost-of-uk-renewable-electricity-subsidies-2002-2030

    The empirical data shows that the ROC cost to date, from 2002 to 2010, amounts to approximately £5 billion. The annual costs follow an upwards trend towards £6bn a year in 2020, with the total cost 2011 to 2020 being £39 billion.

    These figures are consistent with estimates given by the Department of Energy and Climate Change in their response to the Treasury’s recent Control Framework for DECC Levy-funded Spending.8 DECC observed that the costs of the Renewables Obligation would be nearly £1.8bn a year in 2011 to 2012, rising to £3.2bn a year in 2014 to 2015.

    Even if we assume that after 2020 no further efforts are made to expand capacity, but that, as is reasonable and expected by the industry, subsidies are maintained for capacity already installed under the RO, the annual cost is around £6bn a year, and consequently a further £60bn cost is incurred over that decade. Thus the total cost of the scheme from 2002 to 2030 would amount to approximately £100 billion.

    While these are estimates, they are grounded in reasonable assumptions and on the government’s own projections. Since, for the purposes of this estimate, we make the assumption that renewables capacity will cease to grow in 2020, and that no further attempt will be made to attain higher reneawbles targets, the cost figure of £100bn to 2030 can be regarded as conservative.

  • itsyourself:

    Ah yes that bastion of objectivity the REF, founded by a Mr Blobby?. Oh no that was another thing Noel Edmonds did wasn’t it. Empirical ? Inferred? Estimated?. Made up? Pulled out of the air? Haven’t a Scooby? The DECC has it right, change is due to fossil price fuel rises.

  • itsyourself – Is there really any need for your ad hominem nonsense?

    There is also really no need to guess at all about wind efficiency since DECC publishes the data needed to calculate this every quarter. [See page 48]

    http://www.decc.gov.uk/assets/decc/11/stats/publications/energy-trends/3917-trends-dec-2011.pdf

    The load factors have been..

    ……………..Onshore Offshore
    Quarter Load Factor Load Factor

    Q1 2010 22.40% 32.60%
    Q2 2010 14.10% 21.00%
    Q3 2010 21.90% 31.20%
    Q4 2010 25.70%37.10%
    Q1 2011 26.50% 34.30%
    Q2 2011 26.40% 35.80%
    Q3 2011 19.20% 30.70%

    The 7 qtr mean 22.31% 31.81%

    The load factors seem to have been computed correctly in that the number used is for electricity generated in terms of the actual hours measured. in other words the fact the wind blew harder at one time than at another is irrelevant here since this calculation of the load factor is based only on the fixed capacity and the actual electricity produced.

    So over time, it appears as though an onshore wind turbine will produce on average 22.3% of its total capacity and an offshore system will produce about 32% of its capacity.

    A better way to view this, is to say that 1 MW of Capacity of onshore wind will produce about 1,950 Mwh of electricity for which the owner will be paid £210/Mwh [for which the owner will be paid about £410,000/yr]. If a utility was purchasing a similar amount of electricity in the form of natural gas, the variable cost for that natural gas at a 50% conversion rate {2kwh of gas burned yields 1 kwh of electricity} £80,000. So this electricity is fed into the grid at a cost of £170 more per MWH than would have been the cost for the same amount of electricity created by natural gas.

  • admin:

    a) Pointing out that the REF is not objective is hardly ‘ad hominem’ or ‘nonsense’

    b) This article was not about load factors, it is about the cost added to electricity bills by the ROI and what wind’s contribution to this is. OFGEM and the DECC have the figures on this. Total ROI-implicated costs, 15%. Wind’s share is one third of this. Your talk of load factors is an irrelevance in this context.

  • The REF report is entirely consistent with HMT, Control Framework for DECC Levy-funded Spending (2011). See http://www.hm-treasury.gov.uk/psr_controlframework_decc.htm.

    I fail to see how this is not objective, however it’s nice to see you have ignored references to ‘Mr Blobby’ and ‘Scooby Doo’ . . . I assume those references must be considered ‘on topic’.

  • itsyourself:

    Troll alert! Call Hans+the Norwegian TSS! 😉

  • itsyourself – Ah, more ‘on-topic’ data from the real world. well done.

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