SPECIAL REPORT: A look at the wind energy debate

A United Nations (UN) report on climate change warned last week that storm surges, flooding and rising sea levels will wreak increasing havoc on our lives unless Governments take urgent action to reduce carbon emissions.

Later in the week, the warnings were emanating from the US: Europe needed to become more energy independent as its dependency on Russian gas was giving Moscow far too much political leverage, as witnessed by its limp response to the seizure of Crimea. In the same week, Energy Minister Pat Rabbitte attended the Oireachtas Environment Committee, where the generation and use of electricity in this country was the order of the day. Amid cries from TDs and senators that fuel poverty needs to be tackled, Mr Rabbitte backed “our unique wind resource” as our most realistic way of meeting our EU renewable energy targets.

Wave, hydro and tidal energy “are not an answer today or tomorrow”, he said, and “the advice is that we don’t have the biomass”. His department’s green paper on energy is to go to Cabinet in three weeks after which it will be debated in and outside the Oireachtas. But the energy debate isn’t confined to this country.

As the Observer noted in the UK, “how can we modernise and decarbonise without pushing up prices and increasing fuel poverty?”.In this country, the wind energy sector is being strongly backed by the Department of Energy and semi-state bodies but not by many rural communities and a cohort of economists. We look at the arguments about why wind is and isn’t the way forward for this country.

'QUALITY OF ELECTRICAL SUPPLY CRITICAL'

Brian Ó Gallachóir is a lecturer in energy engineering at University College Cork and he thinks there’s too much focus on how to decarbonise electricity in this country.

“Electricity is less than one fifth of the energy mix here. I think our electricity targets for 2020 are appropriate but we have stalled development in other areas of energy. We need to shift the emphasis away from just electricity.”

In order to meet binding EU targets, the Government chose to set a target of 40% of electricity, 12% of heat and 10% of transport from renewables by 2020.

A fan of wind energy himself, he says it’s good for the consumer as “it’s a hedge against fossil fuels that we have no control over”.

“We know where our wind energy can come from and we can’t rely on fossil fuels. Without doubt, the wind has made a very positive contribution to the increase in renewables. And Eirgrid, I believe, have made a very positive contribution, not just when it comes to wind but also in ensuring that we have a strong electricity backbone.

“If we want to attract industry to this country, the quality of electrical supply is critical.”

He thinks attention must now turn to decarbonising the heating and transport sector and he says bioenergy has a role to play here.

He points to biogas solutions as developed by his colleague, Jerry Murphy, who says Irish grassland is under-utilised and is the “optimum biofuel for Ireland” as we “are the best grass growers in the world”.

“This gas could be fed into the gas network and blended in. Bord Gáis would need to put certain specifications in place for the gas but it could enter the mix like wind-generated electricity.”

Mr Murphy has long said unemployed construction workers could be used to build the grass digestors needed, while thousands could be employed in rural areas through agricultural co-operatives which could feed grass, slurry and domestic waste to the digestors.

As Energy Minister Pat Rabbitte has acknowledged, Mr Ó Gallachóir believes building regulations need to increase their emphasis on energy efficiency in homes and businesses. He says too much oil is being burnt in Irish homes. “Gas and biogas would make lower carbon heating options for houses on the gas network while those off the gas grid might look at heat pumps,” he says.

But aren’t heat pumps expensive? “Yes, that is a consideration but we need to consider the long term and not just the short term. The era of cheap oil is over.”

Cheap oil may be over but finding a competitively- priced alternative that will allow us security of supply is convulsing Western countries. While many of the opponents of wind export point to fracking, bioenergy, even nuclear as a cheaper alternative to wind, the Irish Wind Energy Association are categoric.

“There is no other renewable alternative existing today which can deliver clean, efficient, sustainable and economical energy. This is why the Government has chosen wind energy as the prime renewable resource to meet our EU targets,” a spokesman said.

“The February Bord Gáis Energy Index states that 23% of Ireland’s electricity demand was met by wind in which displaced more expensive gas powered plants and helped lower wholesale electricity prices.

“Wind similarly brought down wholesale prices in January and December, and has been helping to counterbalance the Ukrainian crisis which pushed wholesale gas prices higher.”

Partner with Philip Lee Solicitors, Alice Whittaker, who specialises in climate and environment, has warned of the dangers of the “information vacuum” that exists around energy options here.

Like TDs at last week’s environment committee, she called for an energy plan where everything from wind to bioenergy to fracking can be compared in terms of economic benefit, security of supply, emissions and cost to consumer. The Department of Energy has completed such an analysis but it won’t be published until the talks on the wind export deal end.

WHY DO WE NEED WIND ENERGY?

Economy

Secure, sustainable and competitive energy is fundamental to economic recovery and wellbeing, according to the Department of Energy’s Strategy for Renewable Energy.

Meanwhile, the Sustainable Energy Authority of Ireland (SEAI) says we have saved a billion euro in fossil fuel imports already through the development of our wind industry.

The IWEA point to the significant land rents that farmers receive for hosting wind turbines and to the local authority rate intake of over €11m from commercial windfarms last year. But, submissions to the Department of the Environment from groups opposed to windfarms point to the damage to tourism and agrifoods industry.

The Irish Thoroughbred Breeders’ Association, the Irish Jockeys’ Association, the Irish Racehorse Trainers’ Association, and the Association of Irish Racehorse Owners have warned that wind turbines, if not “placed at a suitable and appropriate distance” will pose a “very real risk” that could threaten international investment in the Irish horse industry.

Security of supply

Russia’s annexation of Crimea has once again shone the spotlight on how energy insecure we are in Ireland having to import up to 85% of our energy. Wind energy and other renewables offer us indigenous and clean security in the face of political uncertainty or fuel shortages. The minister for energy has said experts have told him “we don’t have the biomass” to deliver our EU renewable targets from this source and most other renewable are only at research stage and so wind makes the most sense for us.

But the Irish Academy of Engineers and economists like Senator Sean Barrett of Trinity College Dublin are arguing however that energy security can be most economically and competitively managed by completing the Corrib project, storing gas and encouraging the construction on a commercial basis of an LNG regasification plant. Shannon LNG (Liquid Natural Gas) want to import US gas as it’s now one-third of the price of European gas. “The proposed terminal in Co Kerry would give Ireland unfettered access to global gas supplies thereby eliminating our dependence on decisions made in the UK regarding gas acquisition,” said a Shannon LNG spokesman.

Jobs

With approximately 400,000 Irish people signing on, Ireland badly needs to create jobs — and even those opposed to the massive Mainstream, Element and Bord na Móna projects, which would bring up over 1000 turbines to the Midlands, can’t deny this.

“As a society we may have to make a trade off when it comes to jobs, for example people in coal mining regions know there is a residual side-effect to mining but that it will bring general employment to the area. If I thought there were tens of thousands of permanent jobs from these big wind projects, I would have to sit back down with my concerns and give it serious consideration,” says Labour senator John Whelan, who has repeatedly questioned the cost-benefit analysis of the Midlands project.

Eddie O’Connor from Mainstream Renewable Power, which wants to export 5GW of Irish wind energy to the UK, has previously acknowledged the low domestic job count from wind saying only 10% of the jobs created from Ireland’s existing turbines were actually in Ireland. He argues though that the Midlands export project would be a “game changer” as its scale could potentially attract industry such as turbine manufacture to the area.

Earlier, this month referring to the Element, Mainstream and Bord na Móna export projects, Minister for Energy Pat Rabbitte said 6,500 jobs are likely during construction, along with permanent care and maintenance posts that would “run into the hundreds”.

The reality is that the long-term jobs figures from wind energy will be nothing like the bonanza that is being suggested unless Ireland does become a turbine manufacturing base. According to a recent ESRI/TCD report on job creation, the majority of jobs in wind energy are in the manufacture of turbines and their associate parts. Ireland doesn’t have a comparative advantage internationally in the mechanical engineering sector but the report does note an Irish advantage in software and IT design.

“Design of systems for control and management for smart grids etc is likely to be a more fruitful field for future investment and employment. However, such activity is likely to be driven by world demand rather than purely domestic forces” says the report commissioned by the IWEA.

CEO of Sustainable Energy Ireland (SEAI), Dr Brian Motherway, says it’s estimated that 10 jobs are generated by every one turbine installed — but he too concedes that all these jobs may not be in Ireland.

“Wind is more labour intensive than importing gas for energy, it’s thousands of jobs versus tens of thousands. If we were to build more wind here manufacturers may choose to base in Britain or Ireland to save on shipping costs as they do tend to locate in nearby regions. It all depends on what strategy we adopt, we will have to look at the value chain and work out which area to focus on so we can maximise job creation.”

Public greenhouse gas emissions

According to SEAI, wind is environmentally clean and underpins a move towards a low carbon economy. A SEAI report last year showed how the deplacement of fossil fuels by renewable energy saved up to €280m in fossil fuel imports with more than half of this saving made by wind. But Co Laois-based Windaware campaigner Henry Fingleton has queried this figure saying it does not take into account that gas generators are still required to run in the background in case there is little or no wind. “Gas and coal plants operate at half of normal efficiency when turned up and down to cater for intermittent wind. This means they can emit twice as much carbon per unit of electricity produced,” he said.

He is arguing that investment in another 2GW of wind power will cost up to €4bn and at least €1.6bn to connect and balance power on the grid. Citing a study by Dr Fred Udo in 2011, he says 12% wind penetration will lead to a 4% reduction in CO2 while a 34% wind penetration with the massive investment required will see just 6% reduction in CO2 — this is without carbon figures from construction.

In 2011, the Irish Academy of Engineers issued a report on Irish energy policy where it described wind as “an extremely expensive way of reducing greenhouse gas emissions when compared to other alternatives”.

The following year, a SEAI study revealed the Irish wind sector was reducing Irish carbon dioxide emissions by 200 million tonnes per year.

Costs of wind-generated electricity

According to Dr Brian Motherway of SEAI, wind is no more expensive than gas powered electricity.

He argues the growing wind component of the Irish electricity mix has served to reduce the wholesale price of electricity. Research completed by SEAI showed that wind costs the same as gas generated energy when curtailment costs and the PSO levy are included. Dr Motherway also argues that only a quarter of the PSO levy goes to wind and that a curtailment factor has to be built into gas powered plant too as they can’t be expected to run constantly. He says that electricity prices remain high in Ireland as we are still so dependent on oil and gas while cheaper countries like France have nuclear power and greater access to hydro schemes.

When questioned by Deputy Michelle Mulherin on this at the Environment Committee last week, Minister for Energy, Pat Rabbitte said “many of the costs of electricity such as the international gas supply cost are outside the control of a supplier”. He pointed to “a good transmission network and improved energy efficiency” as two ways that we can influence electricity cost.

But UCD economics lecturer, Colm McCarthy has questioned why Irish taxpayers are being expected to fund infrastructure which he says are to the benefit of private wind farm developers.

“EirGrid believes that certain grid improvements are necessary anyway but it is clear from the Grid 25 documentation that a substantial portion of the cost of around €4bn arises because of the continuing proliferation of remote wind farms,” he wrote in a Sunday newspaper.

McCarthy argued that aside from funding grid investment, the taxpayer is also expected to subsidise private sector wind generators in the form of a minimum price. As wind will only blow on average about 30% of the time, conventional fuel backup must remain on standby ready to be “ramped up” when the wind dies down, he said. This up-down production model is not carbon efficient he says. Meanwhile, SEAI say back-up runs at a “very low level” and wind’s contribution outweighs the cost of the backup. Meanwhile, the likes of David Reid of the Westmeath Alliance are scathing about the €148m he argues was paid in curtailment costs, to fund the industry when wind isn’t blowing.

TAPPING INTO AN ENERGY SOURCE

The earliest proponents of wind energy were the Green movement who as far back as the 1980s championed its environmental friendliness, low cost, and ability to unchain this country from a disturbing over reliance on imported oil and gas.

Even in the early 1990s, wind power was still considered more ideological than commercial — with the notable exception a few pioneers such as future wind millionaire, Eddie O’Connor, who as CEO of Bord na Mona set up the country’s first commercial wind farm in a cutaway bog in Mayo in 1992. In 1996, the then government drew up its first renewable energy strategy but there was no real political fire behind it.

But as oil prices began an inexorable slide upwards in 2005 and the EU introduced binding targets aimed at creating a low-carbon and energy efficient union two years later, renewables were to move away from the fringe and become a political and economic imperative for the mainstream political parties.

In 2007, Fianna Fáil formed a government with the Green Party and soon a Programme for Government was born that saw onshore and offshore wind as a way to reduce the country’s cost base and spoke of the need to “dramatically accelerate the growth of renewable energy sources”. It was also the year that the former Bord na Mona head, Eddie O’Connor, sold his Airtricity business to E.ON and Scottish and Southern Energy for up to €2bn.

The future was looking increasingly green.

But it wasn’t until a year later with the spectacular derailment of the economy in 2008, that green energy, green technology and green jobs were being suddenly hailed by politicians as the great white hope for the tens of thousands of former construction workers who had been jet propelled on to the dole queue. An EU directive meant that we had to source 16% of all our energy needs from renewables by 2020. Wind to Ireland was now what oil was to Texas.

For investors and developers, Ireland with the fastest wind speeds in Europe was the ‘Wild West of Wind’. The State was offering a blue-chip return as between the EU targets, curtailment fees and the public service obligation, a growing market and price was guaranteed.

But out came a report from the Irish Academy of Engineers that concluded that the aim of producing 40% of electricity from wind power by 2020 was “not appropriate” as it would involves spending up to €10bn on capital expenditure at a time when new generating capacity was not required. They also said that largescale energy production for export was “without sound economic basis” and should “not be subsidised by either the electricity consumer or taxpayer”.

However, that same month when a record 1.323GW of wind energy was generated here, the Irish Wind Energy Association (IWEA) was talking earnestly about Ireland exporting as much renewable energy as it uses itself. “Such are the opportunities ahead for us that we can export as much renewable energy as we use by 2020… we could export up to 5GW of renewable energy in 10 years. These resources could generate an annual export value of over €2bn,” IWEA chief executive and now Eirgrid head of corporate affairs, Michael Walsh said.

A year later, Element Power, headed up by former SWS Energy head, Tim Cowhig and Mainstream Renwables, Eddie O’Connor’s latest enterprise, were looking for sites to develop the Greenwire and Energy Bridge mega wind farms across five counties in the midlands. The companies also secured a grid connection to the UK. Semi-state Coillte also signed up to lease land to the wind developers and Bord na Mona’s Green Energy Hub are now seeking to develop another 154 turbines in the midlands and Co Mayo for domestic and international use.

Green Energy has become big business but the big bucks are increasingly in the export market, particularly to the UK after the Irish and British Governments signed a memorandum of understanding to export Irish wind.

But with enormous opposition growing locally to the scale of the midlands wind projects and to Eigrid’s Gridlink and Gridwest projects to upgrade the electricity network, renewable energy has suddenly become a political hot potato. And then the EU announced that its post 2020-renewable energy targets are likely to not be binding on individual countries.

Is it a rowback from wind as cheaper nuclear energy and fracking became more attractive to countries like the UK? The anti-wind campaigners have found welcome bedfellows in the anti-pylon lobby and both groups have been asking questions about where Irish energy policy is going.

And so there was certainly a sense of ‘told you so’ when it emerged last month that the export plan is in limbo after the UK and Irish governments couldn’t strike a deal. Anti-wind and pylon groups are once again asking why up to 28GW of wind is being planned for yet Ireland at peak only uses 5GW of electricity. The anti-wind groups say this level of wind development is not economically, environmentally or socially sustainable while the Department of Energy, Sustainable Energy Authority of Ireland and the IWEA, say wind energy is a great opportunity that will ensure jobs, security of energy supply, help us meet our EU carbon reduction targets and help lessen our dependence on expensive fossil fuels.

SEAI, meanwhile, has dismissed 28GW of wind as “speculation”. Its focus is squarely on 4GW-4.5GW to meet 2020 EU targets.

SOURCE OF POWER

- Last year, 15.3% of electricity demand was met by wind generation.

- According to the Department of Communications, Energy and Natural Resources wind energy has been the largest driver of growth in renewable electricity.

- Ireland’s binding EU target is to achieve 16% of all of its energy from renewable sources by 2020.

- It was up to the Irish Government to meet this 16% EU target as it pleased and it opted to set a target of 40% of electricity, 12% of heat and 10% of transport from renewable sources by 2020.

- The June 2012 ‘Renewable Energy in Ireland’ report by the Sustainable Energy Authority of Ireland (SEAI) forecast that installed wind energy capacity would rise from just over 1,600 MW to 3,521 MW by 2020.

OVERSEAS

UK: Energy costs have become a political hot potato in the UK ever since the Labour party pledged an energy freeze if elected in next year’s general election. Not unlike here, electricity costs are well above the EU average with a 20% hike in bills between 2007 and 2013.

In last week’s budget, the government caved in to demand by freezing a carbon dioxide tax designed to fight climate change. chancellor George Osborne said he would keep the carbon price support stable until 2020 making it cheaper for utilities to burn coal instead of gas.

The government has also been looking to nuclear fuel to keep costs down and push competitiveness. The first nuclear plant in a generation has been sanctioned at Hinkley in Somerset.

Backbench conservative MPS are also looking for swingeing cuts to wind subsidies after research showed they were higher than elsewhere in Europe but climate change secretary, Ed Davey has held tough so far.

In the UK, it’s all about the cheapest energy that will keep household costs down and industry competitive. Fracking is also now high on prime minister David Cameron’s agenda and in recent days he said it would be “good for our country” and a vital element in UK energy independence. In such a political environment, where price is the most important factor, it’s clear why plans to import potentially expensive wind from Ireland are in jeopardy.

GERMANY: There’s a major push towards renewables going on in Germany and they are one of the most ambitious countries in Europe in this regard, planning to have 80% of energy supplied by renewable sources by 2050. Simultaneously though, they have reduced state subsidies for solar energy and this has had a profound effect on their solar industry. The EU has also opened an investigation into Germany’s green energy subsidies and there is backbench pressure in the Bundestag, questioning the efficiency of such subsidies.

A quarter of German energy generation now comes from renewables and the government is aiming for 40%-45% by 2025.

Energy independence is top of the political agenda in recent weeks as Germany imports a third of its gas and oil from Russia. So far, though, the government is saying it doesn’t have a problem as it has the best gas storage capacity in Europe and it has been a mild winter. The country, unlike the UK, is also sticking by chancellor Merkel’s post-Fukushima plans to close all of its remaining nine nuclear plants by 2022 and Merkel has also said there won’t be fracking in Germany unless individual communities are happy to support it.

But despite Merkel’s government’s focus on green energy, the country’s coal use hit its highest level since 1990 last year. But even with its growing move towards renewable energy and high domestic electricity costs, Germany is still the fourth most competitive country in the world, even ahead of the US, which is enjoying an energy boom from low-cost gas from fracking.

DENMARK: The Danish government has set an ambitious target of weaning Denmark off fossil fuels by 2050. Its ‘Energy Strategy 2050’ is referred to by the Danish minister of climate and energy, Dr Lykke Friis, as a declaration of energy independence. Denmark wants to reduce dependence on fossil fuels by 33% in the coming 10 years alone. From 1980 till 2010 the share of renewable energy, primarily wind and biomass, in Denmark rose from 3% to 19 % and under the new plans, the rise will continue to 33 % by 2020. As part of that strategy there’s to be significant investment in offshore wind and in more interconnectors, possibly to the Netherlands and even the UK, so the excess energy can be sold on.

It’s planned that by 2020, nearly half of Danish electricity will come from wind and another 20% from biomass. Denmark says it will maintain grid stability by having a regional electrical grid and spare capacity backed up by biomass. Denmark’s green march is financed by feed-in-tariffs paid by consumers of electricity.

It says the rising efficiency of renewable energy means the cost to consumers of 33% renewable energy in 2020 will be lower than the 11% provided in 2002.

The Danish government says this is a “solid investment in Denmark’s future energy security”.


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