Sense About Science / House of Lords
2nd December 2015

Why 'Good Energy Policy' is difficult –
Reflections on 5 years in Whitehall


David MacKay FRS

Department of Engineering
University of Cambridge

Former Chief Scientific Advisor
Department of Energy and Climate Change


 

[Talks menu]


Why Good Energy Policy is Difficult 45 minutes

Paris – how to improve international negotiations 20 minutes

Messages from the Global Calculator 5 minutes

Innovation priorities 10 minutes

Comments on the IPCC Fifth Assessment Report 30 minutes

Why Climate Change Action is Difficult – and what we can do about it 45 minutes


One lane of cars

60 miles per hour
 
30 miles per gallon
1200 litres of biofuel per hectare per year
80 metres car-spacing

One lane of cars

60 miles per hour
30 miles per gallon
1200 litres of biofuel per hectare per year
80 metres car-spacing

= 8 kilometres wide

This book is free online


www.withouthotair.com

This book is free online


www.withouthotair.com

Why DECC's work is difficult

Multiple misaligned objectives

Wishful thinking

Lack of evidence

The 2050 Calculator



2050-calculator-tool.decc.gov.uk

"Renewable" target misaligned with primary energy-saving and emissions reduction


- example 1

Which is more valuable?


1 cup of boiling water and nine cups of ice-cold water

or


10 cups of water at 10 °C?


[The quantities of heat are identical]

The value of heat depends on its temperature

Standards for Heat-pump Installations

Chris Wickins and the Microgeneration Certification Scheme Heat-pump Working Group

"Renewable" target misaligned with primary energy-saving and emissions reduction

- example 2

Source: IPCC

Policies

  • Renewable transport fuel obligation
  • Renewable obligation
  • Renewable heat incentive
  • International negotiations: prevention of deforestation


Vancouver to Immingham: 8888 nautical miles

(skip to pv example)

"BEaC"

Roundwood and energy crops

   

Wastes and residues

more about BEaC


Using these assumptions, and assuming all harvested wood goes to power station
Area required for 30 M odt/y of pellets, delivering roughly 35 TWh/y:
about 40,000-50,000 km2 (two Wales)

3: "Renewable" target misaligned with energy security and with value-for-money

 
Electricity price in pounds per MWh

(skip to ivc example or continue to GB wind)

www.energy-charts.de

(skip to ivc example or continue to GB wind)

Electricity production in Germany: Week 29

Graphs: B Burger, Fraunhofer ISE; data: EEX Transparency Platform

(skip to ivc example or continue to GB wind)

Electricity production in Germany: Week 25

Graphs: B Burger, Fraunhofer ISE; data: EEX Transparency Platform

(skip to ivc example or continue to GB wind)





"using a fixed number (like Levelized Cost Of Energy) to characterise a technology's economic value is unhelpful... When assessing the economic effect of a technology it is essential to do so in the context of the system to which it is being offered."



"using a fixed number (like Levelized Cost Of Energy) to characterise a technology's economic value is unhelpful... When assessing the economic effect of a technology it is essential to do so in the context of the system to which it is being offered."

(skip to ivc example)

GB Electricity Supply, June 2012

(skip to ivc example)

Lowest demand in Summer, 2012

Source: National Grid 2013

simulation of 40 GW of solar capacity in the UK
clear-sky, partially sunny, overcast: 1, 0.547, 0.1

4: Renewable target in conflict with energy efficiency

Impington Village College



According to the UK's renewable target,
a MWh saved is worth 7 times less than a "renewable" MWh generated

5: "Fairness" in conflict with "Save public money" –



How subsidies are often set

The "50th percentile" method for setting subsidies


The "50th percentile" method for setting subsidies


The "50th percentile" method for setting subsidies


The "50th percentile" method for setting subsidies



 
March 2010
 
 

Monbiot continued...

The people who sell solar photovoltaic (PV) panels and micro wind turbines in the UK insist that they represent a good investment. The arguments I have had with them have been long and bitter(2,3). But the debate has now been brought to an end with the publication of the government's table of tariffs: the rewards people will receive for installing different kinds of generators(4). The government wants everyone to get the same rate of return. So while the electricity you might generate from large wind turbines and hydro plants will earn you 4.5p per kilowatt hour, mini wind turbines get 34p, and solar panels get 41p. In other words, the government acknowledges that micro-wind and solar PV in the UK are between seven and nine times less cost-effective than the alternatives.
[emphasis added]

"Government mustn't pick winners"..

More examples



Contract-for-Difference – time-varying strike-prices, longer duration

short duration reduces CFD's main benefit (eliminate investor exposure to uncertain wholesale price); also increases deadweight pressure on future decision-makers raising the carbon price floor

ETS perverse consequences

• The UK sees no carbon-account benefit from interventions in the traded sector.
• At European level, efficiency and taxation policies are modified for fear of "undermining the emissions trading scheme"


"... the [ETS] scheme has been invoked time and again to undermine more effective forms of direct emissions regulation."
source: "Life beyond emissions trading" Corporate Europe Observatory January 2014.
Citations: 7. Gilbertson, T and Reyes, O. (2009) Carbon Trading: how it works and why it fails Uppsala: Dag Hammarskjöld Foundation, p 21; European Environment Agency (2008) "Application of the Emissions Trading Directive by EU Member States – reporting year 2007", EEA Technical Report no. 3/2008, p.27;
8. Prieß, H-J., and Stein, R. (2012) "Developments in the amendment to the Energy Taxation Directive", London: Freshfields, Bruckhaus, Deringer LLP, http://www.freshfields.com/uploadedFiles/SiteWide/Knowledge/Developments... (link is external). On aviation and shipping, see European Parliament (2011) "Draft Opinion of the Committee on Transport and Tourism for the Committee on Economic and Monetary Affairs on the proposal for a Council Directive amending Directive 2003/96/EC restructuring Community framework for the taxation of energy products and electricity", http://www.europarl.europa.eu/meetdocs/2009_2014/documents/tran/pa/878/8... (link is external) ;
9. Seager, A. and Milner, M. (2007) "Revealed: cover-up plan on energy target", The Guardian, 13 August, http://www.theguardian.com/environment/2007/aug/13/renewableenergy.energy (link is external)
10. European Commission DG Energy (2011) "Impact Assessment Accompanying the document Directive of the European Parliament and of the Council on energy efficiency", SEC(2011)779 final, 22 June, p.30
11. Van Renssen, S. (2011) Climate-action department warns that energy-efficiency plans could deflate carbon prices, European Voice, 16 June

6: Keeping future energy demand and supply in balance





Electricity, gas, and transport demand; and fictional wind (assuming 33 GW of capacity), all on the same vertical scale.
Electricity, gas, and transport demand; and fictional wind (assuming 33 GW of capacity), all on the same vertical scale.

Keeping energy demand and supply in balance

– almost every policy area in DECC impacts this issue
Capacity mechanism
CFDs (wind/CCS/nuclear)
Feed-in tariffs (solar)
Building insulation and building standards
Heat strategy
Smart controls policy
Heat pump policy
Boiler policy, gas grid policy
Smart meters
"Simplified energy tariffs"
OFGEM rules on fairness
Energy storage
photos by pollok-gonzalo.de
Electricity, gas, and transport demand; and fictional wind (assuming 33 GW of capacity), all on the same vertical scale.

Keeping energy demand and supply in balance

– almost every policy area in DECC impacts this issue
Capacity mechanism
CFDs (wind/CCS/nuclear)
Feed-in tariffs (solar)
Building insulation and building standards
Heat strategy
Smart controls policy
Heat pump policy
Boiler policy, gas grid policy
Smart meters
"Simplified energy tariffs"
OFGEM rules on fairness
Energy storage

Smart heating controls

passivsystems.com
Electricity, gas, and transport demand; and fictional wind (assuming 33 GW of capacity), all on the same vertical scale.

Keeping energy demand and supply in balance

– almost every policy area in DECC impacts this issue
Capacity mechanism
CFDs (wind/CCS/nuclear)
Feed-in tariffs (solar)
Building insulation and building standards
Heat strategy
Smart controls policy
Heat pump policy
Boiler policy, gas grid policy
Smart meters
"Simplified energy tariffs"
OFGEM rules on fairness
Energy storage

Heat pumps

Electricity, gas, and transport demand; and fictional wind (assuming 33 GW of capacity), all on the same vertical scale.

Keeping energy demand and supply in balance

– almost every policy area in DECC impacts this issue
Capacity mechanism
CFDs (wind/CCS/nuclear)
Feed-in tariffs (solar)
Building insulation and building standards
Heat strategy
Smart controls policy
Heat pump policy
Boiler policy, gas grid policy
Smart meters
"Simplified energy tariffs"
OFGEM rules on fairness
Energy storage

Smart meters and smart tariffs

Electricity, gas, and transport demand; and fictional wind (assuming 33 GW of capacity), all on the same vertical scale.

Keeping energy demand and supply in balance

– almost every policy area in DECC impacts this issue
Capacity mechanism
CFDs (wind/CCS/nuclear)
Feed-in tariffs (solar)
Building insulation and building standards
Heat strategy
Smart controls policy
Heat pump policy
Boiler policy, gas grid policy
Smart meters
"Simplified energy tariffs"
OFGEM rules on fairness
Energy storage

Energy storage



How we might do better

Project proposal

Customers:
a few heads of analysis in Whitehall

Deliverable:
A probabilistic programming environment:
  1. enabling rapid creation of tools to support decision-makers with multiple conflicting objectives;
  2. including uncertainty about parameters;
  3. and including automatic inference of uncertain parameters from data


This book is free online


www.withouthotair.com

Part 2

Innovation support is crucial

What we need for most 2050 pathways

lots of low-carbon deployment

and innovation to drive down costs

What we need for most 2050 pathways

Amazing insulation


Thermablok

and cheap building-retrofit

Electric vehicles

  • batteries
  • capacitors
  • light-weighting
  • fly-wheels

Smart meters and smart controls that induce behaviour change

What we need for most 2050 pathways

Heat pumps that work

What we need for most 2050 pathways

Cheaper wind, especially offshore

2benergy.com
Makani Power
Makani Power

What we need for most 2050 pathways

Biomass-to-good stuff

Waste-to-good stuff

What we need for most 2050 pathways

Proliferation-resistant, safe, low-waste nuclear power

Jules Horowitz materials test reactor

What we need for most 2050 pathways

Carbon capture and storage at scale


NET Power, LLC

What we need for most 2050 pathways

Smart grids, DSR

Interconnectors

Energy storage

Dinorwig - 10 GWh energy; 2 GW maximum power

Energy storage

What we need for most 2050 pathways, in the long term

Carbon dioxide removal technologies

What we need for most 2050 pathways


Backup plans


  • eg, in case low-cost electric vehicles don't materialise
    • hydrogen, ammonia

  • in case sustainable bioenergy can't be delivered
    • air-fuel synthesis

  • or in case climate sensitivity turns out on the big side
    • geoengineering research

What the world needs for 2050


Solar power

Deep geothermal

What we need for most 2050 pathways

Public and political support for a numerate approach

An ever-improving energy model for each country

Innovation support to drive down costs

Well-trained engineers

PV efficiencies

2012 2013 2014
J M Martinez-Duart
"Photovoltaics firmly moving to the terawatt scale"
March 2013

Electricity storage costs

Storage costs - assume $125 per kWh [optimistic?]

installed June 2011 — cost $12M ($28 per average watt)


Solar system cost: $28k per average kW;
(to compete, aiming perhaps for $10k per average kW?)

To keep 1 kW going for 12 hours of darkness, need 12 kWh of storage, which costs an extra $1.5k
To keep 1 kW going for 5 dull days, need 120 kWh of storage, which costs an extra $15k
So, for PV to deliver cost-competitive reliable electricity in a sometimes-cloudy location, we need two cost breakthroughs!

From "Solar energy in the context of energy use, energy transportation, and energy storage"
by David MacKay (2013)

Imagine solar panels are free; look at the average cost of putting a kWh through the battery

Ivanpah CA: 377 MW capacity
1079 GWh/y (123 MW)
  from 14.2 km2 of land
Power per unit area: 8.7 W/m2
Kagoshima: 70 MW capacity
expected load factor 12.8%.
1.04 km2 of land
Power per unit area: 8.6 W/m2
Solana AZ: 280 MW capacity
944 GWh/year (108 MW)
  from 12.6 km2 of land
Power per unit area: 8.6 W/m2

This book is free online


www.withouthotair.com
source files: cd metapost; source climate.runme

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