Denmark

Denmark

In search of facts

While there is a reasonable consensus on the need for renewable energy, sorting out which type of market support mechanism is needed and which technologies to encourage is a minefield. The conventional power sector is making underhanded attempts at saving its own skin while visionaries have a tendancy to lead policy makers into dead-ends. Identifying those facts and shedding some objective light on them is the purpose of this month's feature, The Essential Energy System -- Fact and Fable. What is needed is a balanced approach, but a hard-headed one. The EU, in particular, needs to leave behind "careful cost benefit analysis of every policy measure" and instead get on with eliminating subsidies that harm progress.

Energy ministers charged with formulating renewable energy policies have an unenviable task. While there is a reasonable consensus on the need for renewable energy, sorting out which type of market support mechanism is needed and which technologies to encourage is a minefield -- and a booby-trapped one at that. The conventional power sector has few qualms about laying false trails to save its own skin (quoting astronomic prices for integrating wind into supply systems is a favourite trick), while well-meaning visionaries with expansive talk of fuel cells, microturbines and distributed generation can lead policy makers into dangerous dead-ends. Fuel cells and microturbines are neither clean nor renewable, and distributed generation is a side issue. Successful navigation through the minefield requires a clear grasp of all the facts before venturing forth. Identifying those facts and shedding some objective light on them is the purpose of this month's feature, The Essential Energy System -- Fact and Fable (page 54).

The days of renewables playing a minor role in the energy scene are over. Even the traditionally conservative International Energy Agency says so. Its Danish director, Hans Jørgen Koch, believes that international climate change commitments can be reached using renewables -- instead of nuclear -- and at little macro-economic cost. That simple message for the most part remains obscured, leaving politicians lost in the minefield. Yet their participation in identifying the right path for energy policy is essential, says Koch, in an interview last month with Denmark's Jutland Post newspaper.

Once upon a time governments delegated their state owned electricity industries to run national electricity systems. Liberalisation of the energy sector has put paid to that and governments now consult widely to try and ensure that the strategies for renewables are consistent with the capabilities of the market. To sort fact from fiction demands commissions, committees and advisory boards. In the UK, at least six government or quasi-governmental committees are poring over varous aspects of renewable energy. Probably twice that number touch on renewables as part of a wider brief. Some are more effective than others at clearing the minefield. Then there is the need to keep the Treasury happy and be aware of the government's political colouring. Perhaps it is no suprise that policies take an age to evolve.

When it comes to priorities, ranking the technologies by price is the (relatively) easy bit. The tricky bits are deciding support priorities for bringing the most commercially viable options to the market as soon as possible -- and how that support should be split between research, development, demonstration and market stimulation. There must be "decision points" when R&D is stopped if the prospects for new technologies look poor. This is where searching questions need to be asked and detailed answers obtained, particularly of the technical ability of technologies. Wave is enjoying a sudden renaissance in Britain, but there seems to be no detailed technical justification for why wave power is getting money instead of a renewable like small tidal barrage that has already proved itself viable. The EU Commission seems to think that biomass electricity production will increase by a factor of ten up to 2010 -- and is pursuing a renewables policy in this expectation. Denmark and the UK see biomass increasing much more slowly and are thus planning a far greater relative role for wind than that envisaged by the EU's legislative arm. Indeed, it is not uncommon to find visions of the energy future -- with or without renewables -- based on hope rather than hard facts.

Few countries have energy strategies based on an objective view of all the facts, but it can be done. Denmark has a clear, long term energy policy with renewables, particularly wind power, set to supply 50% of electricity by 2030 (page 58). The award for clarity and a willingness to discuss all the issues, however, should perhaps go to the Australian government. Its program may be modest in its expectations for renewables, but at least the underlying arguments for supporting -- or neglecting -- the various technologies are properly discussed, either in the government's own reports, or in commissioned studies.

More courage needed

It is not the job of governments to pick technologies for funding which they think might become winners: research and development money must be allocated across the whole spectrum, using priorities evolved from sound technical argument. It is a government task, however, to put policies in place that fast-track renewables to the market. Siphoning off money that could be used to accelerate the uptake of wind power into technologies which have yet to prove themselves feasible does not appear to be a rational use of public money. Yet that is what is happening today.

What is needed is a balanced approach, but a hard-headed one. As the World Business Council for Sustainable Development so rightly says, there is a great need for more business and policy courage. The EU, in particular, needs to leave behind "careful cost benefit analysis of every policy measure" and instead get on with eliminating subsidies that harm progress to a cleaner future as well as internalising environmental and social costs. Above all, there is a need for a better informed debate, reaching across the technologies.

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