As they age, wind turbines generate about 1.6% less power each year

All machines get less efficient as they grow older. Wind turbines are no exception to the rule. A new study shows that a turbine has an average ‘capacity factor’ of 28.5% when new and this falls to about 21% in the nineteenth year of its life. (1) This finding implies shows that the average wind farm loses just less than 1.6% of its expected output for each year that passes. Over a twenty year working life, a turbine will therefore produce about 12% less electricity than predicted by the manufacturers. Some of this decline is due to the turbine being out of action and awaiting maintenance more frequently later in its life. Another reason is simple wear and tear. These results are very different to those obtained by Gordon Hughes and published in late 2012. Hughes said that the rate of decline was very much faster, calculating that typical output of a wind farm halved by the fifteenth year, implying a rate of decline three times the speed of the new study. Hughes didn’t use estimates of actual wind speeds and experts such as DECC Chief Scientist Professor David MacKay have strongly criticised the statistical techniques he employed.

Iain Staffell and Richard Green of Imperial College Business School have produced an elegant and clear paper that is accessible to non-technical readers. Their most significant advance over the work of Gordon Hughes is that they incorporate estimates of the hourly wind speed at each of the several hundred UK wind farms. Since we know how much each type of wind turbine should produce at different wind speeds, Staffell and Green were able to calculate whether the performance deteriorated at time. If a turbine aged ten years produces 15% less power at a specific wind speed than it did when it was new, we can use this figure, along with many thousands more from that turbine, to calculate its rate of degradation.

Staffell and Green show that the 1.6% annual rate of output decline is fairly consistent among turbines of different vintages, and across the UK’s many wind farms, although they do suggest that the newest turbines may be performing better than predicted. Perhaps this latter finding is because of better maintenance in the first years of their lives when manufacturers offer performance guarantees. It’s also important to note that their findings are compatible with the real-life experience of wind farm operators, who were amazed at Hughes’ estimates of performance fall-off.

The wind speed estimates that Staffell and Green use aren’t perfect. Although each large wind turbine in the UK has an anemometer on its nacelle that measures and records wind data, this information isn’t made public. Staffell and Green were therefore forced to use a huge NASA database of wind speeds at low heights above the ground taken from weather stations, balloons, aircraft, ships, buoys and satellites. The resolution of this data is only down to squares of about 50km by 50km. However when the researchers looked at how well the NASA data predicted wind power output across the UK’s wind farms they found a very good fit. Their simulations of wind speeds in 50*50 km squares seem to give excellent predictions of power output from wind turbines inside those areas.

Gordon Hughes’ highly controversial 2012 study didn’t use wind speed data at all. In fact his model allowed wind speeds to rise across the last twenty years and used this increase as an input into the model. (Actually, if anything, UK wind speeds have tended to fall over the last couple of decades - at least until the last three months - so this was a very strange technique to use). The reason his research showed much higher rates of performance degradation is therefore that old wind farms, such as Delabole in Cornwall, appear in his model to be losing power because their output has stayed relatively flat, rather than rising with the higher assumed wind speeds in Hughes’ computer model. Hughes defends his approach by saying that it produces the best statistical fit. Critics have commented that any computer simulation that plugs in an assumed rise in national wind speeds that has not actually occurred is clearly inadequate.

Staffell and Green’s detailed analysis shows that turbine performance takes a dive in the last year or so before ‘repowering’, or the replacement of an old machine with a newer, and often much bigger, version. This is also consistent with the real world experience of wind farm owners who reduce maintenance as the wind turbines approach the point of being taken down. It’s far cheaper to repair old machines on the ground prior to reselling them into the second hand market.

The implications of this new study are important. Surprisingly, the financial models used by investors to plan wind farms seem to generally exclude any figure for performance degradation. The loss of power output in later years raises the cost of electricity derived from the turbines. The increment is small – no more than 9% - but it needs to be factored into the calculations about the true cost of wind power.

This isn’t necessarily a comfortable finding to financial people who had assumed that wind turbines had no perceptible performance decline. But Staffell and Green’s comprehensive and lucid work will for the first time provide the industry – and society at large – with proper estimates of the lifetime power output of a wind farm. And, as Gordon Hughes originally suggested, it will mean that a bigger than expected fleet of wind turbines will be needed to provide the UK’s desired electricity output from this source. If the UK does achieve 30 GW of wind power by 2020 - an increasingly unlikely target as offshore operators rapidly retreat from their projects - this will mean installing an extra 435 MW a year, or four large new farms, to counteract the ageing of the fleet.

(1) A turbine's capacity factor is its actual output as a percentage of its maximum yearly production if the wind were to be blowing strongly all the time.

A cheap and effective form of house insulation?

Sally Philips, the inventor of the Chimney Sheep (www.chimneysweep.co.uk), sent me the following email over the weekend. I think that Sally's story clearly illustrates the challenges that energy efficiency entrepreneurs face. Although her product offers savings that match other improvements, such as better loft insulation, entrepreneurs like her face difficult obstacles in getting their product accepted by regulatory bodies. Products that improve air tightness are vital additions to the armoury of energy efficiency inventions but never get the attention that they deserve. (Her letter is reprinted with her permission). ***

Hi Chris,

I was interested to read the Guardian article recently ('The energy efficiency 'savings' that are just hot air') that referred to your blog.

I have developed a draught excluder for chimneys made of felted sheep wool. We lose about 4% of our household heat up redundant chimney flues. About two thirds of the UK housing stock was constructed pre-1970’s before central heating was installed as standard, meaning millions of UK homes have open chimneys, many of them with several. Plugging the gap with a Chimney Sheep saves about £64 per year, according to recent research conducted by the University of Liverpool:

http://www.chimneysheep.co.uk/pdf/University_of_Liverpool_efficacy_report_September_2013.pdf

I don’t know why the issue of heat loss up chimneys is completely ignored by the industry, by DECC, by EST…nobody takes it seriously but it is a problem that affects a significant number of homes and is so readily resolved.

I actually won a Green Economy Award in a category that was sponsored by DECC but nothing has happened as a consequence.

BRE estimate that 40 cubic metres of air is drawn up an open chimney flue per hour. I asked them to look at my product as the first step to getting it approved by OFGEM to be used as an ECO product. They calculated its performance in SAP, then told me that SAP assumes a closed flue is still 50% open to allow for ventilation. This isn’t a building regulations requirement so I don’t know how they can still use that calculation but they have and are now charging £5K for a report that shows that the product is half efficient!

HMRC said they would be happy to add my product to the list of insulation / draught exclusion products that are eligible for 5% VAT rate but I would have to get the law changed first. I met my MP who wrote a few letters to people who haven’t written back.

To be a member of the National Insulation Association I need a test that costs £15K.

To be listed among the products that are eligible to be used for ECO measures I need a different test that costs £15K. To be endorsed by EST I need another test that costs £5K

I’m not getting in touch just to have a moan, but I thought you might be interested to know just how hard it is to get the issue of chimney insulation noticed or taken seriously, when such a tremendous lot of heat is wasted up chimneys and it is so easy to prevent.

Yours sincerely

Sally Phillips

Chimney Sheep Ltd

19K Solway Industrial Estate

Maryport

Cumbria

CA15 8NF

Web: www.chimneysheep.co.uk

Phone: 01900 825019

Facebook www.facebook.com/chimneysheep

Green Deal promises break laws of physics

I’m not sure that the Green Deal needs any more kicking than it is getting at the moment. But, as one illustration of why I want it buried quickly, here are four sentences from the recommendations produced in the Green Deal assessment for my house in August of last year.  

‘Based on this assessment, your home currently produces approximately 1.7 tonnes of carbon dioxide a year.... Adopting the recommendations in this report can reduce emissions and protect the environment. If you were to install these recommendations, you could reduce this amount by 2.1 tonnes per year. You could reduce emissions even more by switching to renewable energy sources’.

In other words, the very nice assessor was promising me the very first carbon negative house in the world, without even using renewable energy. A world first and all by simply installing a bit more insulation! I think I am right in saying that this would break the laws of thermodynamics. That, and the several dozen other errors in the software that drives the Green Deal process, mean that people are systematically being offered inaccurate, expensive and utterly confusing advice in their assessments.

Actual energy savings from efficiency measures only half what is officially claimed

(This article provided some of the data for the Guardian's article on energy efficiency on 18.01.14. I have put it at the top of this web site in order to make it easy to find. Chris Goodall)  

Research published by DECC last month showed that home insulation measures deliver half the savings that are claimed. A study of homeowners installing a package of cavity and loft insulation and a new boiler in 2010 indicated a 19% reduction in energy use, and a likely saving of about £140 at current gas prices. The government’s Energy Saving Trust claims savings from these measures of twice this amount. The smaller than expected reductions in energy use mean that the typical UK householder will lose hundreds of pounds a year from taking out a Green Deal loan.

The research

The DECC study is part of a long running research project to track energy use in British homes. Actual gas and electricity use is logged for a large sample of households. Homes installing energy efficiency measures under government schemes can be compared to a control group of houses with initially identical gas and electricity consumption.

The results released on 21^st November tracked those homes that had cavity wall insulation, loft insulation or a new boiler installed in 2010. The numbers showed the reductions in energy use in 2011 in these houses. Energy use in UK houses is tending to fall so the DECC survey  estimates the extra reduction in gas bills arising from the energy efficiency measures compared to the control group average.

The results

The table below gives DECC’s estimate of the cut in energy consumption arising from the individual reduction measures

Measure	Percentage reduction in gas use	Estimate of kilowatt hours of gas saved
New boiler	9.2%	1,800 kWh
Cavity wall insulation	7.8%	1,400 kWh
Loft insulation	1.7%	400 kWh

Notes:

a)       Loft measures include full insulation where the house had none laid and also ‘top-up’ measures to take the depth to 270mm.

b)       The homes having, for example, new boilers would have had a different control group to the cavity wall houses. So the baseline energy consumption may well be different.

c)        The average (mean) gas consumption across all the houses in DECC database was 14,100 kWh in 2011.

d)       By coincidence, those homes installing all three measures together achieved a saving of 19.0%, almost exactly the same as the individual elements combined.

At today’s gas prices, what are these savings worth? (I have used the lowest Big Six energy company costs of 3.874p per kWh for an address in Oxford). And what does the government’s Energy Saving Trust say that the measures should save a householder?

Measure	Annual value of savings	EST estimate of savings
New boiler	£69.73	‘£105 to £310’ depending on the age of the replaced boiler
Cavity wall insulation	£54.24	‘up to £140’
Loft insulation	£15.50	‘up to £180’ when loft had no insulation otherwise ‘£25’.

The DECC survey also looks at homes that had all three measures installed in the same year. The typical saving was 3,600 kWh, producing a saving in 2013 prices of £139.46. This compares with the EST’s headline saving estimate of £270, almost as twice as much as actually achieved. (I have used the EST’s figure of ‘up to £140’ for cavity wall insulation.

What would this package of measures cost today? The EST web site gives a minimum figure of £3,050. In other words, the typical return to energy efficiency investment is less than 5% per annum. (£139.46/£3,050) It may still make sense financially in these times of low interest rates on savings but the benefits are not large in cash terms.

The DECC study also shows that many households saw an increase, not a decrease, in their gas consumption after installing cavity wall insulation. The report doesn’t provide a number but a chart (Figure 3.3) suggests that perhaps 40% of homes with new insulation experienced increased bills compared to the control group. This may be because the insulation was installed badly - a depressingly common phenomenon - or because the occupants decided to heat their house to a higher temperature as a result of the better insulation.

The implications for the Green Deal, the government’s main energy efficiency policy, are very troubling indeed. Unsurprisingly, the DECC statistical report doesn’t make this clear.  The Green Deal arranges for householders to get loans to improve their properties. The interest is charged at commercial rates and repayment is made through the electricity bill.

According to the EST figures, the typical householder installing loft and cavity insulation and a new boiler would need to take out a loan of about £3,050 to pay for the measures. At an interest rate of 8% and repayment over 20 years, the annual addition to the electricity bill would be £342.87, compared to the average savings on the gas bill of £139.46. In other words, a family taking out Green Deal finance would be over £200 a year worse off as a result of doing what the government suggests and improving the energy efficiency of their home.

Outside government, everybody knows the Green Deal is a disaster. The scheme is excessively complicated, over-bureaucratic and expensive. The initial assessments for the programme use software that is misleading, and often simply wrong, in its estimates of cost savings from energy efficiency. (I know; I had one done on my house).

More generally, I want to ask this question. If the research arm of DECC knows the true figure for the likely cost savings from energy efficiency  measures, why are other parts of government continuing to promulgate much larger figures in order to get householders to take out Green Deals? When is DECC going to get sued for not telling people trying their best to save money that the Green Deal will typically cost families hundreds of pounds a year?

Power to the people: Islay looks set for a hugely successful community turbine

Local investors have put over £150,000 into the Islay community wind turbine in the first 48 hours of a share offer.  Islay, an island off the west coast of southern Scotland, looks set to join nearby Tiree, Gigha and Westray in the growing list of areas developing, funding and owning their own energy resources and using the financial surplus to reduce energy consumption in their homes and community buildings.

Islay is one of the windiest places in the UK. A commercially owned turbine on the island would make a very decent return. In this case, however, the community has decided to hold the interest paid to individual investors at 4% and will hand the remaining profits to a fund to improve local energy efficiency and relieve fuel poverty. The illustrations in the fundraising prospectus show about £80,000 a year flowing to these causes. Among many other advantages, this has ensured very wide support for the turbine. A 2011 survey suggested 92% of the island’s residents were in favour of the project.

The Islay cooperative (strictly speaking an ‘industrial and provident society for the benefit of the community’) is promised loans and other support from the Scottish government and other institutions if it fails to raise its target of around £750,000 investment from individuals. But if the cash keeps on flowing in at the rate of the first 48 hours it won’t need the money. The total cost of the project to install the Enercon 330kW turbine is around £1.25 million, a high figure inflated by the substantial costs to reinforce the electricity grid.

The output of the turbine will be about 1,000 MWh a year, enough to cover the needs of about 300 homes, or about a fifth of local domestic needs. In addition, of course, the local whisky distilleries need power, which is partly provided by anaerobic digestion plants on the island.

Speaking personally, I find Islay’s success hugely cheering. Although it should be acknowledged that getting to £150,000 outside investment is made relatively easy by the generous tax reliefs available to the first investors in the project, the degree of enthusiasm for this project is striking. Like the Osney hydro installation on the Thames, Islay shows that a well-planned scheme led by local people and with robust philanthropic intent can raise money at 4% (plus some benefit from tax relief) and still devote the bulk of its return to improving the lives of a wide spectrum of the community. We need hundreds of thousands of schemes like this.

One response to my zeal for projects like this is to comment that they are only possible because of the generosity of feed-in tariffs. And these feed-in tariffs are (slightly) inflating the bills of everybody else. It’s true that medium sized wind turbines on windy sites can make high returns with the subsidies currently available. However the really interesting thing is that individual investors are prepared to take a far lower return from community energy projects than is required by commercial operators.  People are happy with 4% interest; companies need 10% or more. In the long run, the switch to local ownership will reduce the bills paid by everybody because of what finance people call a lower ‘cost of capital’ for energy projects owned by individuals, not corporations. Perhaps as importantly, the Islay people will target the surplus money far more efficiently towards genuinely worthwhile local energy-saving projects. We’ll see far lower costs to reduce fuel poverty if the money is generated and allocated by local people than if it is done to meet the targets imposed on the Big Six.

The Germans in the unusual role of impractical dreamers

We Brits haven’t properly understood the scale of the German Energiewende, or energy transition. A recent seminar at Germany’s Environment Agency (Umwelt Bundesamt or UBA) assessed whether the country could stop using fossil fuels entirely by 2050 and concluded it is technically feasible to produce all the country’s energy (and not just electricity) from renewable sources without using biomass, nuclear or carbon capture. This would mean generating about 3,000 terawatt hours (TWh) of renewable electricity and converting most of this into methane (Power to Gas) or methanol/butanol (Power to Liquid).  This is six times current electricity generation from all sources. And it assumes a 50% reduction in Germany's total energy use. Are they mad? I think they probably are. But Germany society is strongly behind the Energiewende and we shouldn’t underestimate the ability of a determined, resourceful and technologically sophisticated country to achieve almost unimaginable growth in renewable energy. What looks to us like impractical dreaming may eventually work. 

Looked at as a multiple of existing low carbon generation, the target numbers are even more startling. In 2013, German wind produced 47 TWh and solar 30 TWh. Hydro added a further 15 TWh. In total, these renewable sources provided 92 TWh, or about 3% of what the Agency says will be needed to decarbonise the economy in 2050. Large scale expansion of hydro power is not an option. So wind and solar will have to be expanded about 40 fold to cover all the country’s energy needs.

It should be said that the UBA seminar papers avoided any detailed discussion of how the country will grow PV and wind to meet the huge need for electricity at mid-century. A 40 fold expansion of PV would mean that over half of German grassland would carry photovoltaic panels but nobody mentioned this. Of course some energy can be imported, but since most other countries in Europe will attempting their own form of Energiewende there won’t be much surplus to go around.

The nature of the ambition.

The UBA seems to have decided that a low-carbon future critically depends on using electricity to completely replace gas and motor fuels. Whereas the UK talks of converting to electric cars and using electric heat pumps to provide home heating, Germany is committing to using power as the raw material for renewable methane and for renewable liquid fuels. (Older articles on this web site have looked at the reasons why the natural gas grid is the only conceivable way of storing surplus electricity generated on very windy days).

One paper at the symposium examined the relative storage capacities of the existing electricity system in Germany (this is almost entirely hydro-electric power schemes that pump water uphill when the grid is in surplus and then let it flow down again at times of shortage) and compared it with gas and oil storage networks.

The argument is compelling: large scale seasonal storage of electricity can only be achieved by converting power into gas, through electrolysis and methanation, or into methanol/butanol using similar processes. Whatever advances we can possibly expect in batteries or other conventional technologies won't provide more than a tiny fraction of the energy storage we will need. Complete decarbonisation, the UBA seems to be saying, will need huge investment in today’s nascent power to gas and power to liquids technologies.

The graphic below makes repeated appearance in the symposium papers.

To replace all carbon fuels with renewable electricity, much of it converted to other energy carriers, necessarily involves large conversion losses. Turning surplus power into methane, and then burning it a gas-fired power station to regenerate electricity, recreates less than a third of the original energy. But if an advanced society, such as Germany or the UK, really wants to decarbonise, there really is very little choice. We have to accept the wastage of energy entailed because intermittent renewables will otherwise need huge backup from fossil fuels.

The scale of what is envisaged

The seminar saw estimates of the amount of primary energy needed to create the fuels a modern economy requires. The table below gives the figures.

	Primary energy needed	Final energy created from this
Electricity	550 TWh	460 TWh (1)
Gas	1110 TWh	300 TWh
Liquid fuels	1280 TWh	520 TWh

 (1)      For electricity, the difference between primary and final energy arises from grid losses and from the losses in pumped hydro and in using some electricity for making methane, prior to conversion back to electricity.

The Germans are saying no to nuclear, but also to CCS and biomass. In one paper from a UBA employee, CCS is called ‘unsustainable’, an attitude remarkably at variance with the UK position. Biofuels of all forms are rejected for similar reasons. So all energy (not just electricity) comes from renewables in 2050 and the UBA sees PV and wind as being the dominant source. The need is for almost 3,000 Terawatt hours of electricity to provide this.

Today Germany has 36 GW of PV, compared to around 3 in the UK. This technology 5.3% of total electricity production in 2013. Wind power supplied about 8% of all electricity need from 33 GW of turbines, about four times the UK’s capacity.

To supply just Germany’s current electricity demand, not the total energy need that the UBA suggests, would need a sevenfold increase in turbines and solar panels. This is not impossible, particularly if Germany successfully moves into offshore wind, which is currently a negligible fraction of its wind capacity. But can Germany reasonably aim to then increase renewable electricity a further six fold to produce the power for methane and butanol production as well? I’m sceptical.

There’s one other important point. Whether or not Germany achieves the ambition of 100% renewable energy, avoiding biofuels and other questionable sources, it is now very focused on developing conversion technologies that turn large volumes of electricity into gas and liquid energy carriers. There is no discussion whatsoever of this in the UK. Time to start learning from the German focus on this critically important issue?

Reducing draughts: a national competition to show how much can be saved

The latest government data shows that draughts cause about 25% of all heat loss from the average house. That means that a quarter of the household gas bill is disappearing through such places as cracks in doors, holes around water pipes and the gaps around window frames. Reducing losses through ventilation is fiddly. It requires perseverance and care. Nevertheless, the savings can be large at a minimal cost. As the Green Deal unravels, we need a new national programme to improve house insulation standards: draught-proofing is the obvious target. The return on investment is likely to exceed all other energy saving initiatives.

Here is my proposal. I suggest a national competition, run by an institution such as the Building Research Establishment (BRE), challenging home insulation companies to reduce draughts in a number of pre-selected homes. It’s possible to accurately measure the draughts in a house before and after insulation and the winner would be the company that cut heat loss the most. It would be finicky, laborious work but it would demonstrate the value of careful draught-proofing. Perhaps each competitor would be given two working days per house and might be asked to work on five houses to prove their skills. Most amateur draught-proofing work isn’t particularly effective but shown the way we could all improve our appalling leaky homes.

In the government’s compendious and fascinating ‘Housing Energy Fact File’ has a table that estimates the actual heat losses from the components of a typical home. For every degree that the home is maintained above the external temperature, the house loses 287 watts of heat. So keeping the home at an average of 18 degrees when it’s -2 outside requires heating that provides about 5,740 watts, or 5.74 kilowatts.

The walls are most important drain of heat. About 32% of all heat leaves this way. What are called ‘ventilation’ losses are next at about 25%. This is 50% more than the windows and three times as much as the roof.

These figures are for the average house. For a home with good cavity insulation, the loss from draughts might actually exceed the loss through the external walls. To put a monetary value on this, let’s assume that the average house uses about 12,000 kWh of heating per year. 3,000 kWh of this needed to replace the heat lost through draughts, and this will cost around £120 at current prices. Saving a good fraction of this by better draught-proofing is cheaper, quicker, less disruptive and more fun than wall insulation or getting into the loft to roll out some another bale of fluffy mineral wool. It may be actually more effective as well: a previous article on this web site showed that major measures such as cavity wall insulation saved much less energy than predicted.

And, perhaps as importantly, reducing draughts around the house will improve perceived internal temperature. Draughts moving across the skin suck heat out of the body faster than still air does so a still house will seem to be a warmer house.

Current UK building regulations require a new house to lose less than 10 cubic metres of air per square metre of external surface area an hour at a standard pressure difference (50 pascals, if you want to know, which is an order of magnitude more than the normal gradient) between the inside and the outside. This will usually mean hundreds of cubic metres of expensively warmed air are being lost every hour. Put another way, all added together the average new house is said to have gaps the total size of a basketball. (I don’t have the data to back this comment up, by the way).

Everybody knows about the leaks that arise because the door doesn’t fit properly, or the windows that have a gap around the edge. It’s easy to deal with this with some cheap insulating tape bought from a DIY store. Applied carefully, this will make some difference. The real gaps are probably less visible. They occur where water or waste pipes go through walls, where light fittings meet the ceiling or skirting boards touch the floor. Filling these gaps is not difficult and nor does it require expensive materials. But it is time-consuming and requires punctilious care. The photograph below is from a Strome presentation on sources of heat losses in new UK houses. Finding and filling gaps like this is difficult work if it is to be done well.

This is presumably why home improvement programmes such as the Green Deal focus on expensive but standard suggestions such as changing the boiler or putting up solar panels.

None of us really know how to improve all aspects of draught proofing. Which of us has looked carefully behind the loo to see if there are gaps in the cement, or gone under the kitchen sink to see if hole through which the cold water comes into the house is sealed? These are where the biggest savings are likely to be.

I think we should have a competition to see who can improve houses by the largest amount. The competition can be documented and filmed. The winner would be the company or person that cut draughts the most (measured in the reduction in air leakage per hour). The competitors could use equipment such as infra-red thermometers or smoke pens. (A pen that issues smoke so that the observer can see where the draughts are).

We cannot predict what the savings are likely to be. Cavity wall insulation saves an average of 1,400 kWh a year, reducing bills by £56 or so. Really good draught-proofing might do better. But the cost might be a third or less. And the impact on perceived warmth might be greater.

Too many government energy efficiency initiatives are not backed by hard information about their true effectiveness. Air source heat pumps are a prime example. I believe a big national competition to crown the best draught-proofer, run by the Building Research Establishment over a long weekend, would attract attention, help build understanding and provide some real numbers about the benefits of careful plugging of leaks from domestic homes. As the Green Deal dies a death and takes the UK insulation industry with it, a new campaign to reduce heat losses might provide some much needed alternative employment.

Response from Professor Gordon Hughes to previous posting

(Professor Hughes has very kindly provided a response to a recent posting on this site. (Electricity output figures show wind turbine performance deteriorates very slowly with age). The original article was also carried on other web sites and Professor Hughes refers to the title and date of publication on the Ecologist blog. My reply to Professor Hughes is carried as a comment below his text.)  

Wind Turbine Performance Over Time: A Response to Chris Goodall

In his blog published on 03.01.14, “Wind turbines – Going strong 20 years on”,[1] Chris Goodall argues that the degradation in the performance of wind turbines with age is much lower than reported in my 2012 study The Performance of Wind Turbines in the United Kingdom and Denmark.[2] The following note explains why I believe that my conclusions are sound.

Mr Goodall has kindly provided me with the data to which he refers to in his work. With the exception of a long series for Delabole wind farm, Mr Goodall’s data is a small subset of the much larger sample of wind farms, several hundred in fact, analysed in my original study. Mr Goodall’s data also adds a few monthly observations that were missing when my data was originally extracted from the source database. Overall, Mr Goodall’s data amount to about 5% of the data that I analysed, and where he has new material it adds very little.

Furthermore, Mr Goodall himself very frankly admits that he does not have the statistical skills required to replicate the methods of my analysis. His work does not constitute a reanalysis or a rebuttal of my paper. In fact, his calculations simply reproduce one feature of the results reported in my paper.  There was a generation of wind farms developed in the early 1990s, both in Denmark and the UK, using turbines of less than 0.5 MW which have experienced a relatively limited decline in performance with age.  By focusing exclusively on these wind farms, Mr Goodall misses the bigger picture.  The performance of wind farms developed from the mid-1990s onward is much worse.  The average size of the turbines and the wind farms increased.  The larger turbines appear to have been less reliable, while my analysis suggests that the siting and maintenance of wind farms may have deteriorated.

Mr Goodall concludes with two challenges/questions which are representative of many comments on my work.  They spring from a lack of understanding of the statistical reasoning involved.  I will begin with his second question, since it is central to the analysis. Mr Goodall wonders how it is possible to estimate the decline of load factors over time when we have less than twenty years of data for any wind farm. This is where the mathematical/statistical specification described in the Appendix to my paper is crucial.

The load factor for any wind farm in any period is expressed as the sum (or product in the multiplicative version) of components associated with the age of the wind farm (held constant over all wind farms of the same age), the period (constant over all wind farms in one period), the site of the wind farm (constant over time and age), and a random error. This is a standard formulation used by statisticians, including for the analysis of data from a wide range of medical and biological trials. The age effects can be identified from the variation in output across wind farms of different ages for each month. So long as each wind farm is tracked for a number of periods, the site characteristics of the wind farm can be separated from age effects which are common to all wind farms of the same age.

In his first question, Mr Goodall challenges me to produce a counter-example to the case of Delabole, which he claims demonstrates a much lower rate of degradation with age than that reported in my paper (in fact it is similar to the overall rate I report for Denmark). This is a recurrent theme among critics of my work. As an argument it is equivalent to someone claiming that smoking cannot harm anyone’s health because their “Uncle Jack” has smoked a pack a day for 60 years and is still fit and well at an age of 80. Of course there are apparent counter examples, and these can be found in the REF load factor database: www.ref.org.uk. It would be invidious to name them, and in any case they no more prove my analysis than Delabole disproves it. Individual cases prove nothing about population epidemiology, a point which is as true for wind power as for public health. The proof is in the statistical analysis itself.

As a separate point, I am struck by how selectively critics report the results of my work. As noted above, the experience of Delabole and other wind farms built in the period 1991-93 is consistent with my analysis of wind farms in Denmark, where load factors seem to decline more gently with age. That may reflect the robustness of wind turbines built in the early 1990s, site choice, how they have been maintained, and other factors. For the avoidance of doubt, I do not argue that the performance of wind farms must, inevitably, degrade rapidly with time. My observation is that the average performance of wind farms in the UK has, as a matter of fact, fallen as they have aged, a fact that is probably the result of both the physical characteristics of wind power and the economic characteristics of the financial incentive regime, the Renewables Obligation subsidy.

My results have important and obvious implications for both investors and policymakers. But the response of advocates of wind power is rather interesting. For the most part, it has involved an attempt to shoot the messenger rather than trying to understand the underlying phenomena. Yet, none of the statistical analyses of my or other data have demonstrated that there is no degradation in performance in age. The issue is not whether degradation occurs, but how much. There can be reasonable disagreement about that, as the comparison between Denmark and the UK illustrates (which is why I included that in my original study). The key point is to identify the causes of changes in load factors over time revealed by statistical analysis, and whether and how these may be addressed.

The willingness of the owner/operator of Delabole to provide unpublished data on output from the wind farm is to be commended, but, though welcome, it is only a small step in the right direction. Any investigation in this area is hampered by the unwillingness of operators to provide the wind speed data collected by the anemometers which are installed at all wind farms. Let me briefly indicate why this matters. One explanation for performance degradation over time would be an increasing frequency (or length) of mechanical failures of turbines. An alternative explanation is that the power curve (the relationship between wind speed and power output) changes due to gradual erosion of the blades, a phenomenon well known in the industry. An assessment of the relative contribution of these – and other – factors can be used to improve both turbine designs and maintenance regimes for existing wind farms, but such work cannot happen until the anemometry data from individual wind farms is made publicly available.

An ostrich-like approach of denying that there is a problem helps no-one. A lack of transparency leads to the suspicion that wind operators are unwilling to be accountable for the large sums of public money which they are currently receiving, and certainly makes it difficult to ensure that subsidy policies give good value for money to the consumers who foot the bill. But even the wind industry does not benefit in the long run, because it is foregoing the opportunity to learn from and build on the lessons from detailed analysis of performance.

Gordon Hughes

05.01.14

About the Author

Dr Gordon Hughes is a Professor of Economics at the University of Edinburgh, where he teaches courses in the Economics of Natural Resources and Public Economics. He was senior adviser on energy and environmental policy at the World Bank until 2001.

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[1]http://www.theecologist.org/blogs_and_comments/commentators/2221532/wind_turbines_going_strong_20_years_on.html

[2] Gordon Hughes, The Performance of Wind Turbines in the United Kingdom and Denmark (Renewable Energy Foundation: London, 2012). Available for download at www.ref.org.uk.

Electricity output figures show wind turbine performance deteriorates very slowly with age

I wrote a few weeks ago about the surprising assertion from the Renewable Energy Foundation (REF) that the performance of wind farms declines rapidly with age. A study carried out by Professor Gordon Hughes for the REF in 2012 suggested that ‘The normalised load factor for UK onshore wind farms declines from a peak of about 24% at age 1 to 15% at age 10 and 11% at age 15’. To put this in everyday English, Professor Hughes is saying that a 15 year old onshore wind farm will typically produce less than half its initial output of electricity. Few people in the industry would demur from a conclusion that wind farms very gradually lose output but none accepted Hughes’s finding that electricity generation falls at anything like the rate he stated. If true, his finding would have serious implications, as the REF was keen to point out. To achieve the UK’s targets for wind-generated electricity, we would have to put more turbines on the ground because ageing wind farms would produce much less power than expected. This is an important topic and I thought it needed more examination.

After meeting REF in early 2013, DECC Chief Scientist David MacKay responded to the study, eventually publicly saying that Hughes’ work had serious statistical flaws. REF has recently rebutted Professor MacKay’s comments saying, with some asperity, that his actions are ‘extraordinary’ and impugning his understanding of econometrics.

Few of us have the detailed knowledge of statistics to say whether Hughes’ conclusions follow from the data he has used. I thought it might therefore be helpful if I analysed the individual performance of all the UK’s oldest wind farms. I’ve looked at the data on the output of 14 farms, all established in the period 1991 to 1993. I’ve been particularly helped by the assistance of Peter Edwards, the entrepreneur behind Delabole, the Cornish wind farm that started the UK’s commercial exploitation of wind for the purpose of generating electricity in December 1991.

Hughes’ study contained no assessment of the performance of specific wind farms. All the data was merged into one large statistical series. On the basis of my assessment of actual production data from the earliest farms – all but two of which are still operating with the initial turbines – I want to suggest that the empirical evidence strongly suggests that Professor Hughes greatly exaggerates the rate of performance decline. None of the 14 wind farms shows ageing effects more than a small fraction of the figures he quotes. Investors and the general public can be confident that performance degradation is not a large problem.

Method

I have two sources of data. First – with many thanks to Peter Edwards – I have the yearly output figures from Delabole from 1992 until the farm was ‘repowered’ with new, much larger, turbines in mid 2010 after nearly twenty years of production.

Second, I have the numbers from Ofgem’s database on the output of renewable generators. These numbers only go back to April 2002. (I have no idea how Professor Hughes could possibly have calculated the rates of decline of electricity output of twenty year old turbines when – at most – he only had ten years of figures).

We also have information on the average performance of UK onshore commercial wind turbines. DECC publishes a yearly estimate of the ‘load factor’ of existing wind farms. (The ‘load factor’ is the percentage of maximum yearly output actually achieved). Load factors vary – principally in response to average wind speeds. Professor Hughes’ work suggests that after accounting for wind speed variations load factors fall every year from the moment a new turbine is installed. This is what I wanted to check using real world data.

Delabole

Chart 1 shows the yearly output from this Cornish wind farm from 1992 to 2009. (The repowering process started in mid 2010 so later output figures are not available).

Peter Edwards commented to me that the reason the 2009 figures appear to show a drop is that the operators of the wind farm (by then it was the utility Good Energy) decided it wasn’t worth replacing a gearbox because the turbines were scheduled to be taken down in less than a year’s time.

But even with the lower level of output in 2009, the average yearly decline was only  about 0.8% of output, not the 5% estimated by Professor Hughes. [1]2009 electricity production from turbines that were then 18 years old was 85% of the first year’s figure. In 2008 – when the turbines were still being actively repaired – Delabole recorded electricity generation of 99.6% of its initial annual output. Rather than output being more than halved, performance had fallen by a few megawatt hours a year.

Chart 1

I don’t have UK average ‘load factors’ before 2001. Chart 2 shows how Delabole compared to the typical onshore wind farm in the years between 2001 and 2009. On average it was slightly lower, with a more marked difference in 2009 because of the lack of repairs to gearboxes. But the differences are small and there certainly isn’t any obvious sign that the performance was degrading against the UK average.

Chart 2

The oldest UK wind farms

If Hughes is right, then the oldest turbines should be very much less productive than the average UK figures. Of course wind farms established in the early 1990s might have been placed in particularly wind locations which might push their outputs upward. Balancing this, newer wind turbines could be expected to be better designed, and able to turn more of the energy from wind into useful electricity.

Chart 3 shows that the 14 oldest wind farms have load factors slightly below the UK average for the years 2001 to 2011. But there is no evidence of any widening of the differences. And, most importantly, the absolute level of output of these geriatric turbines is very much higher than Professor Hughes said. He wrote that turbines in their fifteenth year of operation should typically produce 11% load factors. In fact, these elderly wind farms – all of which were over eighteen years old in 2011 –  had average load factors of well over twice Hughes’ predicted output. They seem to have suffered more than expected in the historically highly unusual low wind speed year of 2010. (I suspect this is a consequence of better engineering for low air flows in newer turbine designs). But otherwise performance shows no relative decline from a decade ago.

Chart 3

One last request. Anybody in active communication with Professor Hughes might want to ask him two questions. First, can he show us any individual wind farms that demonstrate the rate of deterioration his forecasts suggest? There were about 380 onshore wind farms recorded in 2012. The oldest 14 show nothing like the signs of ageing that Hughes grimly forecasts. Do any others? Are there any examples of farms whose wind-speed adjusted output has actually fallen 5% a year as he predicts?

Second, given that the outputs from wind farms are only publicly available from 2002, how is the Professor able to estimate exactly what the rate of decline in output of a twenty year wind farm is likely to have been? Because of Peter Edwards’ generosity in releasing Delabole figures to me, I can show that the decline of that single farm’s output is nothing like Hughes’s statistical forecasts. How did the Professor get to his numbers when he only had – at most – ten year’s data available for all the rest of the UK’s fleet of turbines?

(Please write to me if you are interested in seeing the data I used).

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[1] This is estimated using simple linear regression.

[2] These calculations exclude Delabole and Goonhilly wind farms for the years after mid 2010, when both were repowered with new turbines. The other farms have unchanged configurations. The load factor I have used for the UK as a whole is also on an 'unchanged configuration' basis.

Neat infographic on domestic solar PV

Supporting assumptions are at http://www.comparemysolar.co.uk/half-a-million-solar-homes-calculations/

(£5,500 for a 4 kW system is a highly competitive price that won't be achieved by most home owners).

Air travel forecasts have been cut by 35% in the last six years. Why do we believe today's numbers?

In the last six years the government has produced four different forecasts for air passenger numbers. Each successive estimate has been substantially lower than the last. In January of this year the Department of Transport published an estimate of 315m passengers in 2030 compared to a figure of 480m in November 2007, just fifty months earlier. As the UK starts a new round of animated discussion about expanding Heathrow we might bear in mind that forecasts for air travel have been consistently too high in recent years, even for the immediate future. 2009 estimates about travel numbers in the following year were over 15% too high.

Today's report from Howard Davies' Airport Commission proudly boasts that its forecasts - which are broadly the same as those of the 2013 Department for Transport figures - have a far lower margin of error than all previous estimates. (Please see figure 4.3 in the Davies report). They are more certain than ever of the accuracy of their central forecast. In the face of the huge and completely unpredicted reduction in forecast demand for aviation over the last six years, isn't about time that we considered the possibility that the need for aviation has begun to stagnate?

(Past articles on the troubled logic behind Heathrow expansion plans are here, here and here.)

Whether or not the UK needs new runways depends almost exclusively on future demand for air travel. The five decades between 1950 and 2000 saw typical growth of nearly five per cent a year. However 2012 passenger numbers were no higher than in 2005. Is this effect of economic difficulties around the world or does it represent a clear sign of a maturing market? The Department for Transport thinks growth will return once economic difficulties are behind the UK. But it has nevertheless sharply cut its forecasts since 2007. This year’s estimates are a third lower than those provided just fifty months ago. Travel numbers are expected to be permanently lower than they were.

Forecasts of number of passengers using UK airports, millions per year

 

Source: Department for Transport forecasts

Are the new lower forecasts likely to be accurate? Or have we reached peak air travel in the same way as we are experiencing a plateau in the needs for surface transport? The latest estimate suggests a 40% rise in air travel in the next seventeen years, an increase of over 2% a year. As real incomes continue to fall, I think the Department for Transport is probably still being too bullish. Basing the case for a third runway at Heathrow on forecasting techniques that have proved spectacularly wrong in the last half decade looks a little foolish to me.

Another nail in the coffin of econometrics: Gordon Hughes and the abuse of statistics

It was the proud boast of an econometrician I knew that he could ‘prove’ anything using statistics. He would have loved Gordon Hughes’ 2012 paper on the effect of age on the output of wind turbines. Hughes produced figures suggesting that the typical electricity generation of a UK onshore turbine falls sharply ever year of its life. He says the average load factor of a new wind farm starts at about 25% and is down to below 5% within scarcely more than a decade. Econometrician Hughes never seemed to talk to any operators of wind farms, who would have corrected his wild statistics. Nor did his paper actually provide us with the output figures from any individual turbines. Nevertheless, this didn’t stop his extraordinary analysis from getting substantial coverage. Yesterday Professor David MacKay, chief scientist at DECC, weighed in against Hughes’ conclusions. For those whose eyes start going round in circles when faced with equations like those in MacKay’s short article, let me provide one chart from Hughes’ paper which might help convince you that wind turbines don’t actually age faster than domestic cats.

In this chart, taken directly from the paper, Professor Hughes plots the average ‘capacity factor’ of turbines split by the age of the wind farm. (The ‘capacity factor’ is the percentage of the maximum output of a wind farm actually achieved in any year. For the UK onshore wind industry as a whole, capacity factor hover around 25-30%, depending on the strength of the winds in the year.)

The centre line in the middle of the green box is the average for the turbines of that age. The length of the box reflects the degree of variation between the wind farms in that group. You’ll notice that the average capacity factor doesn't actually fall as the age of each cohort of turbines increases. 15 year old wind farms do as well as farms in their first year. This inconvenient data didn’t stop Hughes. He went into overdrive to show that old turbines fall apart. And there’s always a statistical technique to enable you to do this. And very few people like David MacKay able to say quite how inappropriate that technique is.

Just so you can be sure that Hughes’ conclusion that onshore wind turbines lose 85% of their power in fifteen years, here are the generation figures from the Baywind Cooperative in Cumbria. Yes, the first full year produced more electricity than last year, but 1998 and 1999 were year of some of the highest wind speeds in the last two decades. By contrast, 2010 had probably the lowest wind speeds since the second World War. Take out these data points and you’d be hard pressed to show any decrease in output.

Wind turbines probably do deteriorate over time. They are very complicated mechanical devices undergoing huge mechanical stresses. But the decline is small, fairly predictable and nothing like as sharp as Professor Hughes says. Hughes' work demeans his profession.

Government cuts its projections for offshore wind

The unrecognised implication of today’s announcement about the strike prices for low-carbon technologies is that the government has cut its ambition for the size of the UK offshore wind industry in 2020. A month ago it said that its delivery plan ‘indicated deployment of up to 16 gigawatts by 2020’. Today (4^th December 2013) it says that ‘DECC modelling suggests that 10 gigawatts is achievable’ (My italics). It then backs off further, stating that the 10 GW figure ‘is not a target’ and that ‘actual deployment will depend on technology costs’. Perhaps as importantly, the government is now talking – albeit in very abstruse language – of reducing the strike prices of ‘mature technologies’ if and when they become too successful. In other words, the strike prices published today for PV and onshore wind are far from guaranteed. If, as I expect, developers put far more PV farms on the ground than DECC is forecasting, the prices paid will be reduced.

In their analysis of the strike prices, the media focused on the changes made since the draft figures were published in July 2013. Much was made of the increased price for offshore wind. This emphasis was wrong.

Strike prices for offshore wind/MWh

	2014/15	2015/16	2016/17	2017/18	2018/19
Draft proposals	£155	£155	£150	£140	£135
Decision	£155	£155	£150	£140	£140
Difference	£0	£0	£0	£0	+£5

Despite what the government wanted us to believe, this wasn’t the key difference  between July and now. Nor were the small, and unsurprising, reductions in subsidy for solar and onshore wind, and quite sharp cuts in landfill and sewage gas payments the critical new developments.

The real change is the major reduction in the degree of commitment to building a very large offshore wind industry. In the July draft document, offshore wind was ‘projected’ to reach 8 to 16 gigawatts by 2020. The July document goes on to say that ‘the upper end of this range is reached if costs come down to meet industry aspirations and there is some delay to nuclear and CCS’ (which there has been - no nuclear station will be built before 2023 at the earliest).  In November, the language was firmed up and ‘deployment of up to 16 GW by 2020’ was indicated in DECC’s published roadmap.

Today, we’re told that ’10 GW is achievable’, not ‘projected’ as it was earlier in the year. As a consequence, the target for the share of renewables in electricity generation is also softened. The final strike prices provide ‘a basis for renewable electricity to achieve at least 30% of generation by 2020’ DECC said. By contrast, the July projections told us that low carbon generation would actually represent 30-35% of all sources of electricity by 2020, not that it provided ‘a basis’ for achieving this target.

The other big change is in the language on ‘competition’. What DECC means by this is that if technologies start to look as if they will be too successful (and therefore absorb too much subsidy), then the government will conduct reverse auctions to drive down the strike price. The installations requiring the lowest prices will get the available pot of subsidy. This may well be a good idea but it is an idea entirely lacking from the July consultation. Of course the risk is that the benefit of a secure strike price – principally that it gives investors the confidence to spend millions in planning large wind or PV installations – will disappear if the price can actually change overnight.

A modest proposal to give away LED lights

I want to open discussion of a small and eccentric scheme to reduce emissions and household bills while slightly improving the UK’s energy security. My suggestion is that the UK gives every householder a voucher for 10 high efficiency LED lightbulbs. LEDs are now better, more long-lasting providers of light than traditional compact fluorescent bulbs and halogen spotlights. They are still expensive and takeup is quite slow. The payback for the average bulb is probably about four years and for most people this is too long. Free vouchers will change this. Giving every householder ten free bulbs would reduce bills by at least £20 a year and for some people much more. It would cut UK emissions by about half a percent and, importantly, should shave peak electricity demand by at least double this percentage.  I calculate the cost to be about £1.6bn, or slightly more than the much- disliked ECO scheme.

It could be restricted to those in fuel poverty, reducing the cost to a fraction of this amount.  The cost per tonne of carbon saved is approximately equivalent to other measures. The scheme is progressive because the benefits can be directed mostly to less well-off people.LED bulbs

In the last year, LEDs have come of age. The newest lamps now give the same quality of light as halogens and the old incandescent bulbs. They fire up immediately, unlike many compact fluorescents (CFLs). They last many tens of thousands of hours, or several years in continuous operation. They can be retrofitted in existing 12v and mains lamp fittings.

Although the price is coming down, they are still expensive. As a result, the big retailers still give LEDs relatively little space and don’t promote them heavily.

The most competitive online retailers are offering 12v halogen replacements at around £6 from unbranded suppliers. The products of the best-known manufacturers are two or three times as much.

A 7w LED can provide approximately as much light as a 35w halogen, a five to one improvement. All our lights will be LED at some point in the future. We need to accelerate the transition.

Electricity use in the home

In recent years the amount of electricity to use for lighting in the home has tended to fall. CFLs have reduced average energy used from about 700 kWh a household to around 500 kWh a year. This is still about a seventh of total residential demand.

Getting people to replace fridges or televisions with more energy-efficient models is difficult. Few people are going to trade in old, but functioning, washing machine because they might save £20 of electricity a year. Lights are different. The payback is much shorter and it is simple to take out one bulb and put in another.

There’s another reason for pushing this scheme. Lighting demand is at its peak just as the UK experiences its maximum electricity need at 5.15 on a December afternoon. The lights are still on in shops and offices and, in addition, most homes need lighting at this time. So quickening the slow process of switching to LEDs will help shave electricity demand, reducing the possibility of blackouts in future years. (When people speak of the ‘lights going out’, they refer to the possibility that the UK’s power generation capacity will not be able to meet this early evening weekday peak. There’s no possibility yet of more generalised power cuts at other times of the day.)

The cost

Giving 26 million homes a voucher for ten LEDs isn’t a trivial expense. But it is little more than the discredited ECO scheme and it will be much more effective. The voucher will be usable at any participating retailer (which might chose to take its wares door-to-door to offer customer a chance to pick the lights they want). I think retailers will be willing to accept £60 as the government payment for redeeming the voucher, or £6 a bulb. This implies a cost of about £1.6bn, perhaps spread over two fiscal years as ECO is.

The savings

I assume that the ten LEDs are all installed by the homeowner. The average light bulb in a high traffic location in the home is on for two hours a day. If we estimate that the ten LEDs are all in these locations and save an average of 25 watts, then the total yearly saving per household is about 150 kWh. The financial benefit is about £20 at today’s electricity prices, more in a home on Economy 7 tariffs.

The carbon saving is about 2 million tonnes a year, or 1/2% of the UK total.

We cannot accurately know how many of the bulbs will typically be in use when the early evening peak arrives. If this number is 50% of all the bulbs installed under this scheme, the likely saving is about half a gigawatt or just less than 1% of peak UK demand. This is about half the electricity provided by a large new gas-fired power station but, more importantly, it will make a significant improvement in the safety margin available to the National Grid.

The other changes that might spring from the scheme

Once householders have changed 10 bulbs successfully, they will be more likely to move on to convert their whole house. Then the savings might be three times as much. The example of the savings in domestic homes will tend to accelerate the remarkably slow switch to LEDs in shops and in commercial and public buildings.

A successful voucher scheme will make LEDs better known, increase retailer interest and encourage further innovation in design.

The impact on fuel poverty

Of course the impact of this scheme isn’t particularly significant. £20 for the average household is a small fraction of the total electricity bill. But for the poorest people, who are more likely to be at home all day, the savings could be larger. They tend to use fewer lights but to have them for longer. If we wanted to more precisely focus the scheme, it could be restricted to the same groups as the ECO is targeting – older people and households in the most deprived areas.

Even though the scale of this proposal is quite small, it would induce a much faster shift to LEDs than will otherwise occur. It can be targeted at people for whom cash is tight and therefore for whom a switch to LEDs is simply too expensive, even though the payback is only a few years.

The push to improve the energy efficiency of UK homes must go on. The last few weeks have shown how difficult it is to get insulations standards improved at a reasonable price. A switch to LEDs offers equivalent benefits and much, much easier implementation.

New UK wind power record and gas use falls commensurately

Another UK wind record was broken today. For the first time ever, total output of the major wind farms reached just over 6 gigawatts in the early afternoon. This was about 14% of the country’s total requirement for electricity, much less than it would have been if the storm had passed over the UK during the night. Nevertheless, today’s strong NW winds provided a fascinating little case history for us to look at. The flags on the flagpoles weren’t even fluttering in the daytime yesterday. Total output from wind turbines was little more than 5% of today’s figure. Wind speeds then strengthened consistently until early afternoon today. As expected, wind displaced gas in the electricity generation mix. The high level of wind output even resulted in small net exports to the rest of Europe.

Here’s what the pattern of supply looked like at 14.30 on the two adjacent days

Total electricity output at 14.30

Yesterday	44.6 gigawatts
Today	44.3 gigawatts	Down 2.3 gigawatts

The UK wind turbines that are not connected to the trunk of the electricity  grid aren’t recorded in the records of electricity generation. Instead they reduce the total amount of power needed from the big generators. Friday tends to have a lower electricity demand than Thursdays but today’s high wind speeds are probably responsible for almost all of the difference between yesterday and today.

Today, the large wind farms were generating 5.7 gigawatts more than yesterday at the same time.

Wind output at 14.30

Yesterday	0.4 gigawatts
Today	6.1 gigawatts	Up 5.7 gigawatts

Taken together, high winds today reduced the need for power by about 8 gigawatts. Unsurprisingly, gas output was down almost exactly this amount. Coal power was virtually unchanged.

Output from gas fired power stations at 14.30

Yesterday	19.5 gigawatts
Today	11.2 gigawatts	Down 8.3  gigawatts

And, it’s worth pointing out there were no incidences of the use of oil-fired or open cycle power stations during this 24 hour period.

When the wind blows, fossil fuel power stations simply work less. Wouldn't it be wonderful if the wind power sceptics took a look at the data rather than continuing to assert that fossil fuel power stations work as back-up even when the wind is at its strongest?

Did RWE really abandon a long-planned offshore wind farm because of 'deep water'?

RWE is at pains to suggest that its withdrawal from the 1.2 GW, £4bn Atlantic Array was largely driven by unexpected technical difficulties. In the Financial Times, the company mentions the ‘deep water’ and ‘adverse seabed conditions’. We can be a little sceptical about whether this was the real reason: the company had been working on the Array since 2008 and submitted a full planning application almost five months ago. It seems implausible that a major European utility had devoted years of effort to the project only to find in late 2013 that the water was quite deep in the Bristol Channel. We need to look behind the pretence and work out what might be actually happening. Perhaps when they said 'deep water' they had a metaphorical meaning in mind. I think RWE’s shift may be more to do with its increasingly perilous financial position and its recent change in corporate strategy. The Germany Energy Transition is marginalising RWE and the other large utilities as increasing levels of PV penetration devastate wholesale electricity prices. RWE is far less profitable than it was and is no longer able to raise the almost unlimited levels of capital necessary to finance the expensive shift away from fossil fuels. As a result, the company intends to make a transition from being the owner of capital-intensive power generation capacity and will move towards such activities as the provision of services for the ‘smart grid’. The consequences for the UK are serious: if the major German players (E.ON and RWE) in the UK electricity industry are unable or unwilling to finance investment in nuclear, wind or solar, who will do it?

RWE’s problem

In the UK, we complain about the ‘excess profits’ of the large utilities. Investors in German power companies must utter a hollow laugh when they see these comments. RWE has just changed its guidance to the German stock market. Profits for the entire company, operating in several markets beyond its own national border, are projected to fall from €2.4bn in 2013 to about €1.4bn in 2014. Fossil fuel power generation returns are expected to decline to below zero by 2020. Partly as a result, Germany’s main business newspaper called it ‘a dinosaur on the brink’ yesterday.

Contrast the experience of the UK’s SSE, the nearest local equivalent to RWE. Its share price (green line)  is up 20% in the last five years compared to RWE’s 60% decline.

Share price chart

What’s driving RWE away from profitability? Germany’s energy transition away from fossil fuels has left the old companies with stranded assets. Some sources suggest that almost half the country’s fossil fuel plants no longer make any money. And why is this? The devasting effect on wholesale power prices of wind and solar power.

This can be summarised in one chart: RWE’s own figures for electricity prices in the forward markets. Chart 2 shows the graphs contained in the company’s summary of business conditions at the end of the third quarter. The wholesale price of electricity in 2014 has slipped to less than €40 a MWh, down from nearly €60 two years ago. Every megawatt hour RWE generates is worth a third less than it was. Few companies could hope to survive this price crash.

Chart 2

The UK Big 6 say rising wholesale costs mean that the retail price to UK households has to rise. In Germany, things are very different indeed. The market is now acutely vulnerable to the weather. Wholesale power prices fell to an average of less than €30 a MWh in the windy last week of October 2013 and dipped to below zero for several hours. This happens increasingly frequently.

Any large investor will look at Germany and assume that other countries will go through the same change. Subsidised renewables that produce power at zero marginal cost [1] increasingly dominate the local grids. Investing in electricity generation is becoming no job for cautious fund managers in Europe or anywhere else. Unsurprisingly, over 99% of new electricity capacity installed in the US in October was low-carbon.

Without profits from fossil generation, RWE doesn’t have the cash to invest in huge new wind farms off the Devon coast. Contrast the £4bn price tag for the Atlantic Array (which would generate about 1% of the UK’s electricity needs) with RWE’s expected worldwide profits of about €1.4bn next year. In addition to low cash flow, RWE also suffers from high financing costs. It complains that its investors demand much higher returns than are available on most renewable projects. Pension funds and insurance companies are better suited to investing in solar parks and wind farms. Not surprisingly, RWE itself has divested a substantial fraction of UK renewable capacity to special purposed vehicles set up to purchase existing wind farms.

RWE’s still secret but much discussed new strategy is a reaction to its problems of capital shortage and poor profits. A board document called RWE Corporate Story suggests that the company will move away from ownership of assets to what it calls a ‘capital-light’ approach. It will operate and maintain electricity generating plant but not own the expensive offshore wind turbines or anaerobic digestion plants that European countries are turning to. It will offer services such as supply/demand balancing to the operators of electricity distribution grids. Commentators have noted the resemblance to the evolution of the telecoms or mainframe computing industries twenty years ago. IBM used to be the world’s largest manufacturer of computers but it shifted rapidly into software and service businesses.

Other large utilities have suggested they will take a similar path. NRG, an important US power generator, openly forecasts that the electricity market will evolve rapidly towards more local and independently owner generation. Major utilities, whose business has changed less in the last fifty years than almost any other type of company, will be forced to switch strategy at an unprecedented rate, particularly in light of the falling costs of solar PV farms. David Crane, the CEO of NRG and an unusually frank commentator, says that US consumers are realising that ‘they don’t need the power industry at all’. Decentralised, small-scale wind and solar installations can supply all their needs when adequately backed up with storage or small gas-fired generators.

One final factor may have influenced RWE’s upsetting retreat from the Atlantic Array. In the company’s home country, offshore wind is becoming a nightmare for politicians. The transition to 100% renewables that Germany intends to make depends on putting a huge number of offshore turbines into the Baltic and North Sea. The country is waking up to the cost. A feed-in tariff of 19 Euro cents per kWh now looks increasingly unaffordable and the tortuous coalition negotiations between the two largest German parties are focusing on this number. Chancellor Merkel herself said that offshore wind subsidies needed to be concentrated on only the best offshore locations.

RWE must have felt that the same political debate is likely to happen in the UK where the proposed subsidy for offshore wind is also far higher than alternative low-carbon technologies.  Indeed, a close reading of its press release this morning will demonstrate that it actually blames ‘market conditions’ as frequently as ‘deep water’ for its withdrawal from this vital project. (Readers from outside the UK may need to know that ‘market conditions’ in the energy market is a euphemism for ‘political commitment to high levels of subsidy’).

Here’s the problem in a nutshell: the UK and other countries need rich and large utilities to fund the energy transition (and I include nuclear, of course) but every step taken towards that goal tends to emasculate the power of the big existing players and reduce their ability to raise capital. As the dinosaur RWE advances towards the brink, who will step forward to put £4bn into a large wind farm? Many will respond by saying that we should switch instead to backing small scale and local energy production. Fine, I say: 3,000 of EWT’s excellent 500 kW onshore wind turbines would replace the power of the Atlantic Array. But where is the capital, the regulatory structure and political support necessary to get those windmills up within the next five years. I don’t see it yet.

(With many thanks to Gage Williams, who may not agree with my conclusions, for pointing me to the RWE and NRG documents).

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[1] I apologise for the slightly technical language. The ‘marginal’ cost of something is the extra money a producer has to pay to create one extra unit of output. A gas-fired power station has to be pay for gas and wear and tear when it produces one more kilowatt hour of electricity. By contrast, an extra unit of power from a PV farm costs nothing.

How not to generate low carbon innovation: DECC's flawed choices for energy storage.

(Simon Daniel of Mioxa - one of the winners of the DECC competition and a company whose understanding of USB technologies I have always much admired  - sent me some notes and has kindly allowed me to use them as a comment at the end of this article).

(Second update: John Samuel of REDT, the owner winner, has also contributed comments below the article. See the post at 10.44 on Monday 11th November)

Storing low carbon energy is the most difficult technical challenge we face. Fossil fuel power stations can cheaply vary their output as demand changes. Neither nuclear power nor renewables have the same flexibility. Nuclear plants are so expensive that it makes no sense at all not to run them all day and every day. Renewable technologies generally either suffer from unpredictable variability (wind, solar in high latitudes) or from predictable variations (tidal range and tidal stream). Matching supply with demand is increasingly difficult. Unless we solve the storage problem, we’re facing a future of unplanned power shortages and gluts.

The British government’s response to the storage challenge was to launch a competition to reward promising technologies. We need huge innovations, imaginative leaps and investment in new ideas. What we got from DECC this week was unexpectedly small amounts of money dribbled to two battery companies with standard technologies. There’s nothing particularly wrong with the winning projects: it’s just that they are very small scale and the batteries can never hope to address the huge need for long term storage of energy.

This is so disappointing. When will government understand that handing relatively small amounts of cash to companies – however competently run -  that offer marginal improvements on existing technologies actually damages the rate of progress by diverting intellectual energy away from genuine innovation?

Rather than just rail about DECC’s short-sightedness, I thought I’d also briefly write about another company that has just obtained a new round of venture finance. This may be a good way of demonstrating just how mindlessly conventional the UK has been. Contrast Terrajoule in California, with its potentially cheap, resilient and quite low-tech solution that offers local storage using pressurised steam, and the two UK companies sponsored by DECC.

The DECC competition

Gigha

DECC said it had £17m available for innovative storage projects. In the end it seems to have given away about £5m of this fund. The majority of the money has gone to the provision of a 1.2 MWh battery on the small Hebridean island of Gigha.

Gigha is a fascinating place; entirely community owned and with its own three turbine wind farm (about 600 kW in total). The total annual production from the wind farm is about 2.1 GWh and most of this is exported. (As far as I can tell, the island has about 100 people living on it and they probably would probably us less than 10% the output of the turbines). Expanding wind generation is difficult because of what is called the ‘ageing’ cable taking power to the mainland a few miles away.

Eventually places like Gigha will want to be almost separate from the wider electricity grid, generating their own power and selling it to the local population. This requires storage of the electricity generated by the high winds coming off the Atlantic. The DECC award is for a 1.26 MWh vanadium redox battery, storing approximately 0.06% of the island’s annual wind production. (1.26 MWh is approximately a third of one household’s annual electricity use).

Of course these numbers aren’t really fair. The advantage of a battery is that is can cycle from flat to full many times in one year. Most batteries deteriorate a little every time this cycle happens but vanadium redox is capable, its proponents claim, of almost indefinite use. But when it blows hard on Gigha, it can blow for several days and the battery will be full almost all of the time during winter. It’s unclear to me quite how useful this will be. Clearly the most interesting application of the battery its potential for replacing grid electricity in the event of a malfunction of the cable but it’s not clear from the press releases whether it will actually operate as an emergency power supply.

The cost is high. £3.6m for 1.2 MWh of storage is £3,000 a kilowatt hour, over three times the price of the equivalent cost of a new battery for an electric car. It may not be an appropriate comparison but Gigha is also planning a fourth wind turbine at a cost of about £3,000 a kilowatt. This turbine will probably produce 1,200 kWh per kilowatt per year and the battery will only ever be able to store four hours of the peak output of this extra turbine. The disparity between storage costs and generation costs is dispiriting.

Moixa

The second project is smaller. The battery company Moixa is being given about a million and a half pounds to install domestic electricity stores in about 750 homes. The idea is that rooftop PV power is usually exported from the home in the middle of the day and it makes sense to store it for use at night. And, second, that electricity will eventually be much cheaper for all customers in the middle of the night than in the early evening when power demand is highest. So the battery can also be charged during the night and the electricity used at other times. The battery will produce DC power and the homeowner will install a second circuit to deliver electricity to such things as low voltage LED lights or rechargeable home devices including tablets and mobile phones.

The Moixa product, which already in test, stores 1 kWh. The Maslow is priced at around £1,250, or about 40% of the cost of the Gigha vanadium redox battery per unit of storage. 1 kWh is 10% of the average home’s daily electricity use. A home with a 3 kW PV installation on the roof will (very roughly) generate about 15 kilowatt hours a day during the high summer and 3 kWh during the winter. The Moixa battery will therefore store a relatively small fraction of total electricity generation.

The second problem is slightly complicated to explain. During the summer, the stored DC power will probably not be used. The householder probably won’t need the LED lights (because the sun is above the horizon in the UK for sixteen hours) and an iPad will only take about 50 watt hours (one twentieth of 1 kWh) to charge. A  phone is less. So the battery will never use its full charge during the summer. In winter, the problem is different. If your 3 kW set of PV panels is generating 300 watts, as it might be on a sunny day in November, much of that electricity will be used already by the background household power needs. There won’t be much spare to recharge the Moixa battery.

Perhaps I am being too cynical but I think a third point may also be crucial. Today, many new domestic PV installations come with a device that diverts surplus power to the hot water tank immersion heater. Power that is not being used in the house is not exported but goes to heat water. (In the UK FIT regime, this doesn’t affect the householder’s payments because for most homes 50% of power production is deemed to be exported, whatever the actual use in the house). The average home needs about 10 kWh a day for heating hot water, implying that there will generally be few days on which all the surplus power generated by the PV panels is not productively used to heat water. And these hot water diversion devices only cost about £450 installed in a new system. Put bluntly, this form of storage is about thirty times as cost effective as a Moixa system. Even adjusting for the cheaper price of the gas typically used to heat water, the difference is still ten to one against the Moixa battery.

Terrajoule

California recently mandated that electricity suppliers would have to add some storage to any new power plant connecting to the grid. This will produce a huge surge in investment in electricity storage technologies. (If my research is correct, several 5 MWh batteries have already been connected to regional grids in the US).

If its technology is robust, Terrajoule will benefit from the Californian law and its sophisticated investors have just put in a further $11m. Its technology is appealing because it is relatively simple technology and works well at a small scale. As electricity generation moves remorselessly from centralised plants to smaller local units, storage must be made to work economically in quite small units. Terrajoule links a concentrating solar power plant producing high temperature steam to a storage unit that holds the steam (as very hot liquid) at high pressure.

These high pressure tanks are nothing more than cheap domestic LPG cylinders, as seen in off gas grid homes around the UK. When electricity is needed during the night, the steam is released to a standard steam engine with pistons that convert to a rotary motion generating electricity through an alternator. (The company is at pains to point out that this is not a steam turbine, think more of a 1930’s steam locomotive).

Terrajoule’s claim is that it can turn a simple concentrating solar plant into a generator of 24 hour electricity, particularly in desert regions where the sun is almost guaranteed. The use of standard, fifty  year old technologies for storage and generation means the costs are low and maintenance simple, which will be important in remote locations.

In theory I think the Terrajoule system might also work for wind. The turbine would use surplus power to heat water into steam. This would stored in Terrajoule’s cylinders and then used to drive a piston steam engine when the wind drops.

I don’t know whether Terrajoule will work, or much about its costs, but I’m certain that the UK would get better value from investing in genuinely innovative technologies like this rather than giving rather small cheques to companies enhancing existing and well understood battery technologies. One news report suggests that Terrajoule could take storage costs down to $100 a kilowatt hour, one fifthieth of the Gigha project. I know where I would put my money.

The purpose of government support is to take very risky (and hence unfinanceable) but potentially game-changing ideas to the point where they can be commercially developed. DECC's selection of two well established companies for its support from the tens of more challenging projects that entered its competition suggests it has lost any sense of purpose.

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Simon Daniel, CEO of Mioxa sent me the comments below and has given permission for their use here. He also wants to stress the importance of domestic batteries reducing the peak of UK electricity use between 5 and 6pm. As the UK runs close to not having enough electricity generation capacity at this time of day in winter, using batteries to reduce home use of electricity makes good sense.

Hi Chris, couple of notes 

- were reusing existing light circuit in home during retrofit, and converting fittings to DC led 

- typical avg uk lighting is 2kwh per day which reduces with cfl but on a DC led circuit is assured to <400wh a day. Then on battery circuit can be shifted off peak to lower carbon night or day solar

- peak domestic in UK drives national peak as industrial demand inventory less then. Hence any shift or assured reduction during peak is useful 

- DC demand not easy to shift by price behavioural change otherwise 

- DC demand growth significant and expected to dominate with ict / IOT. Currently is about 1kwh avg ict a day, 2kwh audiovisual/ electronics etc

- DC taking over a lot of things

- our USB DC sockets can lower DC-DC up to 35v/100w so laptops, led monitors etc without an ac/DC

- inverter, ac:DC typically wasted around 30%+ and IOT will see tenfold increase in DC devices by 2020. These will further increase peak domestic issue

- USB power delivery now making this a standard so that all ac/DC could disappear and opportunity to power all this from time shift renewables . See article researched in economist http://www.economist.com/news/international/21588104-humble-usb-cable-part-electrical-revolution-it-will-make-power-supplies

- also provides resilience over lighting.elecrronics. Storm st Jude say 1/40 uk lose power

- our Maslow aggregates all distributed batteries to use as bulk storage, eg excess wind or balancing local voltage issues caused by otherwise peak solar

- by enabling local DC PV to battery, we could deploy zero cost/carbon use lighting, or PV powered ict Into urban households. Though if our system is seen not to be innovative and served ok by usual then we might not get enough support to try offering low price systems to mass market / urban or elderly

- website prices are high:indicative though if pilots go ok showing that storage is helpful for grid challenges then systems could be almost free to end users and help fuel poverty and particularly dramatically reduce (average halve peak period cumulative consumption) even with small batteries and assured co installed efficiency measures 

- it's a shame the short decc announcement did give company details of why projects deemed to be innovative from the 50+ options considered. But is perhaps difficult In short summaries to explain the myriad technical points the different projects are exploring 

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British Gas not telling truth claiming that wholesale energy prices are rising

British Gas needs to stop peddling inaccurate and misleading statements. In its public comments, it continues to contend that recent domestic price rises are driven by the rising wholesale costs of gas and electricity. But its own published information shows that this is not  the case. In fact, the wholesale prices it pays are no higher than April 2011 and have actually fallen in the last six months. In contrast its electricity prices have risen by about 29% since 2011. Here are two comments from British Gas made after the recent changes that raised gas prices by 8.4% and electricity by 10.4%

We didn’t take the decision to raise prices lightly.  I understand people are frustrated that the price of energy keeps going up – and I’d like to explain why.

North Sea gas is running out.  We have to buy energy on the global market for our customers, and global prices are rising.

(Blog post by Ian Peters, Managing Director, British Gas Residential Energy, 18^th October 2013)

We haven’t taken this decision lightly, but what’s pushing up energy prices at the moment are costs that are not all directly under our control, such as the global price of energy, charges that we have to pay for using the national grid that delivers energy to the home, and the cost of the Government’s social and environmental programmes

(British Gas corporate press release 17^th October 2013)

But also in the Ian Peters blog post is the following chart. The grey area at the bottom of the gas and electricity graphs is the average price that British Gas paid for its wholesale supplies, which represent about 55% of the total domestic bill.

Look at each chart - gas is at the top, electricity is at the bottom. Has the price of wholesale supplies risen? No, they have stayed remarkably stable for the last two and a half years.

Wholesale electricity prices have actually fallen from around £60 a megawatt hour to little more than £50 since April 2011. But British Gas domestic power prices have risen sharply in this period. The chart below gives an approximate figure for each of the four price changes introduced by British Gas in the last thirty months. (I have used the average figures quoted in the relevant British Gas press release).

Taken all together, these four prices changes have increased domestic bills by about 29% in a period when wholesale electricity costs have fallen. It is simply  not accurate for British Gas to claim that rising wholesale prices provide any justification whatsoever for increasing domestic bills. Large publicly quoted companies should be more truthful.

September NOAA temperature data - fourth highest on record, southern hemisphere highest ever

Last month’s estimated global temperature and precipitation data has just been released by the US National Oceanic and Atmospheric Administration (NOAA).  Climate data doesn’t get much attention now but it may be worth recording some of the features of the September figures. In particular, I suspect that those who claim global warming has ‘stopped’ will find last month’s data from the Southern Hemisphere, particularly the continent of Australia, quite a challenge to explain.

The following are direct quotations from the NOAA report of October 23.

Global temperature

The globally-averaged temperature across land and ocean surfaces combined was 0.64°C (1.15°F) higher than the 20^th century average, tying with 2003 as the fourth warmest September since records began in 1880.

The six warmest Septembers on record have all occurred since 2003 (2005 is currently record warmest).

September 2013 also marks the fifth consecutive month (since May 2013) with monthly-average global temperatures ranking among the six highest for their respective months.

Southern Hemisphere

Even with cooler-than-average temperatures in much of southern South America and much-cooler-than-average temperatures in eastern South Africa, the Southern Hemisphere was record warm for the month, with an average land temperature that was 1.20°C (2.16°F) higher than average, the third highest monthly anomaly for any month (behind August 2008 and November 2009) in this hemisphere in the 134-year period of record. 

 

(Anomaly means divergence from the historic average. So this paragraph is saying that last month had the third greatest monthly divergence of all months in the last 134 years. - Ed)

Australia in particular

Australia reported its warmest September since national records began in 1910, at 2.75°C (4.95°F) above the 1961–1990 average. The nationally-averaged maximum and minimum temperatures were 3.41°C (6.14°F) and 2.09°C (3.76°F) above average, also record high.

(Please do note the figures – the average temperature was not far off 3 degrees above the historic average – a staggering divergence. - Ed)

Every state and territory across the country had average, maximum, and minimum September temperatures that ranked among their 10 highest, with record warmth for all three in South Australia. The average temperature was record high in every state and territory, with the exception of Tasmania (third highest) and Western Australia (fourth highest).

According to the Bureau of Meteorology, this record-warm month contributed to a record-warm 12-month period (October 2012 to September 2013), marking the second month in a row that the 12-month mean temperature record has been broken.

Hinkley small print may mean a price of much more than £92.50 a megawatt hour

The news about Hinkley Point is welcome to those of us who believe in the paramount need to avoid climate catastrophe. But the proposed deal isn’t as simple as commentators are suggesting. The full details of the contract are not yet available but the press release gives clues to two unusual features of EdF’s deal. Simply put, these terms are likely to mean that the owner of Hinkley Point is likely to be paid more, perhaps substantially more, than the headline price of £92.50 a megawatt hour. 1)      By 2023, when the two new nuclear plants are ready to start humming, the total UK installed capacity of renewable energy is likely to be about 35-40 gigawatts. It may actually be much more if solar PV continues to fall in price. This means that some periods during the months outside winter the UK will be oversupplied with electricity. At those times, Hinkley Point will be required to reduce production. The proposed contract seems to guarantee to pay Hinkley even when it is curtailed in this way. By 2030, it could be stopped from operating perhaps 20% of the time, raising the implied price it is paid when it is working by an equivalent percentage.

2)      The headline price will also be inflated by increases in the charges imposed by National Grid to ‘balance’ the electricity network. (‘Balancing’ refers to the process by which the Grid obliges generators either to stop or to start operating in order that electricity supply precisely matches supply). These balancing charges will get larger as the percentage of non-fossil fuel power rises sharply in the next two decades. EdF appears to have obtained an escape clause which exempts it from rises in balancing and grid transmission costs.

Is Hinkley nevertheless good value for money? Probably. But contrast the payment of £92.50 - plus these unspecified extra charges - with the current subsidy for large scale solar PV. PV gets a payment of £68.50 per megawatt hour, to which is added the current price for daytime power of perhaps £40, making £108.50 in total. PV is subsidised for 20 years, nuclear for 35.