Are The Tories Bluffing About Fracking?
I’ve just listened to a Treasury Minister (Chris Philp (?)) on the BBC and he didn’t mention fracking.
But he did mention more oil and gas in the North Sea, where there is a project agreed between the British and Scottish governments called INTOG, which aims to innovatively cut carbon emissions in the North Sea and possibly extract smaller amounts of gas and oil from existing wells.
As you know, I think fracking is irrelevant. It will take a few years to deliver substantial amounts of gas and we can extract more from the North Sea and by repurposing existing wells.
We might even find one or two existing wells, that could be converted to much-needed gas storage.
I also believe that the cash flow in taxes and leases from offshore wind will be astronomic and it can be used to finance borrowing. We did the same with Artemis to finance the company against future sales. But we were only borrowing millions. We used to parcel up all our leases from companies like Shell, NASA and BP and effectively sell them to Lloyds Bank at a discount.
I’m sure that a clever banker could find a mechanism, that converts future income from offshore wind into a magic money tree for today. Is that what Kwasi Kwarteng has done, in order to cut taxes?
The one problem with offshore wind with the public, is that putting in the cables arouses the NIMBYs. It should also be born in mind, that a lot of the grid connections, go through Tory seats, where NIMBYs are very much against more cables.
So I do wonder, if Moggy has announced the start of fracking to give the NIMBYs a target, so they allow the efficiency of offshore oil and gas to be improved and offshore wind farms to be built without hindrance.
Perhaps Moggy should concentrate on the most important thing that our offshore wind industry needs. This is an innovative pricing mechanism for energy storage, that does the following.
- Allows investors to get a similar return on energy storage to that that they get for offshore wind farms, onshore solar farms and interconnectors.
- Encourages the building of more energy storage.
- Assists in the development of novel energy storage ideas.
As one estimate says we need 600 GWh of energy storage in the UK, sorting this pricing mechanism, can’t come soon enough.
The previous government was talking about this, as I wrote in Ministerial Roundtable Seeks To Unlock Investment In UK Energy Storage.
So continue the conversation, Moggy!
Thoughts On The Mini-Budget
This article on the BBC is entitled At A Glance: What’s In The Mini-Budget?.
If nothing else KK has whipped up a storm, with the most tax-cutting budget in decades.
But!
According to my calculations in Will We Run Out Of Power This Winter?, the planned offshore wind that will be installed between 2022 and 2027 will be at least 19 GW. About 3 GW of this offshore wind is already producing electricity.
To this must be added 3.26 GW for Hinckley Point C, 2 GW for solar and 0.9 GW for onshore wind in Scotland, which will be developed by 2027.
So we have 25.2 GW for starters.
Following on from this is the 27.1 GW from ScotWind, about 4 GW from the Celtic Sea, 3 GW from Morecambe Bay and 10 GW from Aker’s Northern Horizons. All of these are firm projects and some are already being planned in detail.
These wind and solar farms are the collateral for KK’s borrowing.
The corporate tax changes will hopefully attract world class energy and manufacturing companies to set up UK-domiciled subsidiaries to develop more offshore wind farms and manufacture the turbines and the electrical gubbins close to where they will be installed.
As more wind farms are built, many GW of electricity and tonnes of hydrogen will be exported to Europe.
Note that 1 GW for a day costs around £ 960,000 and for a year costs £350.4 million.
A big benefit of all this electricity, will be that we won’t need to frack.
Technologies like green hydrogen, that will be created by electrolysis will reduce our need for gas.
We might develop a gas field like Jackdaw, to give us gas for a backup with a few gas-fired power stations, for when the wind doesn’t blow, but gas will only have a minor roll.
The force of the maths is with KK!
Renewable Power’s Effect On The Tory Leadership Election
I wouldn’t normally comment on the Tory Leadership Election, as I don’t have a vote and my preference has already been eliminated.
But after reading this article on the Telegraph, which is entitled Britain Will Soon Have A Glut Of Cheap Power, And World-Leading Batteries To Store It, I feel I have to comment both about this election and the General Election, that will follow in a few years.
These two paragraphs from the article illustrate the future growth of offshore wind power.
It is a point about the mathematical implications of the UK’s gargantuan push for renewables. Offshore wind capacity is going to increase from 11 to 50 gigawatts (GW) by 2030 under the Government’s latest fast-track plans.
RenewableUK says this country currently has a total of 86GW in the project pipeline. This the most ambitious rollout of offshore wind in the world, ahead of China at 78GW, and the US at 48GW.
If we assume that there is eight years left of this decade, that means that we should install about 4.9 GW of offshore wind every year until 2030. If we add in planned solar and onshore wind developments, we must be looking at at least 5 GW of renewable energy being added every year.
We have also got the 3.26 GW Hinckley Point C coming on stream.
I think we can say, that when it comes to electricity generation, we will not be worried, so Liz and Rishi can leave that one to the engineers.
If we have an electricity problem, it is about distribution and storage.
- We need more interconnectors between where the wind farms are being built and where the electricity will be used.
- National Grid and the Government have published plans for two interconnectors between Scotland and England, which I wrote about in New Electricity ‘Superhighways’ Needed To Cope With Surge In Wind Power.
- We need energy storage to back up the wind and solar power, when the wind isn’t blowing and the sun isn’t shining.
I think it is reasonable to assume, that we will get the interconnectors we need and the Telegraph article puts forward a very feasible and affordable solution to the energy storage problem, which is described in these two paragraphs from the article.
That is now in sight, and one of the world leaders is a British start-up. Highview Power has refined a beautifully simple technology using liquid air stored in insulated steel towers at low pressure.
This cryogenic process cools air to minus 196 degrees using the standard kit for LNG. It compresses the volume 700-fold. The liquid re-expands with a blast of force when heated and drives a turbine, providing dispatchable power with the help of a flywheel.
The article also talks of twenty energy storage systems, spread around the UK.
- They will have a total output of 6 GW.
- In total they will be able to store 600 GWh of electricity.
The first one for Humberside is currently being planned.
Surely, building these wind and solar farms, interconnectors and energy storage systems will cost billions of pounds.
Consider.
- Wind and solar farms get paid for the electricity they generate.
- , Interconnectors get paid for the electricity they transfer.
- Energy storage systems make a profit by buying energy when it’s cheap and selling it, when the price is better.
- In World’s Largest Wind Farm Attracts Huge Backing From Insurance Giant, I talked about how Aviva were funding the world’s largest wind farm at Hornsea.
- National Grid has a history of funding interconnectors like the North Sea Link from large financial institutions.
I believe that the islands of Great Britain and Ireland and the waters around our combined shores will become the largest zero-carbon power station in the world.
This will attract engineering companies and financial institutions from all over the world and we will see a repeat of the rush for energy that we saw for oil and gas in the last century.
If we get the financial regime right, I can see a lot of tax money flowing towards the Exchequer.
The big question will be what do we do with all this energy.
- Some will be converted into hydrogen for transport, the making of zero-carbon steel and cement and for use as a chemical feedstock.
- Industries that use a lot of electricity may move to the UK.
- A large supply of electricity and hydrogen will make it easy to decarbonise housing, offices and factories.
The Telegraph article also says this.
Much can be exported to the Continent through interconnectors for a fat revenue stream, helping to plug the UK’s trade deficit, and helping to rescue Germany from the double folly of nuclear closures and the Putin pact. But there are limits since weather patterns in Britain and Northwest Europe overlap – partially.
I suspect that more energy will be exported to Germany than most economists think, as it will be needed and it will be a nice little earner for the UK.
Given the substantial amount of German investment in our wind industry, I do wonder, if Boris and Olaf did a deal to encourage more German investment, when they met in April this year.
- BP have been backed with their wind farms by a German utility company.
- RWE are developing the Sofia wind farm.
- Only last week, the deal for the NeuConnect interconnector between the Isle of Grain and Wilhelmshaven was signed.
- Siemens have a lot of investments in the UK.
I wouldn’t be surprised to see more German investments in the next few months.
The Golden Hello
Has there ever been a Prime Minister, who will receive such a golden hello, as the one Liz or Rishi will receive in September?
The Tory Leadership Election
Some of the candidates said they would reduce taxes , if they won and Liz Truss is still saying that.
I wonder why Rishi isn’t saying that he would reduce taxes, as he must know the cash flow that is coming. It may be he’s just a more cautious soul.
BP Snaps Up 30 Per Cent Stake In Green Biofuels Ltd
The title of this post, is the same as that of this article on Business Green.
So why would BP take a stake in Green Biofuels?
This paragraph in the Wikipedia entry for BP, outlines the company’s future philosophy.
From 1988 to 2015, BP was responsible for 1.53% of global industrial greenhouse gas emissions. BP has set a goal to cut its greenhouse gas emissions to net-zero by 2050. BP plans to increase its investments in renewables 10 times and reduce oil production by 40% from current levels by 2030.
BP is doing things like developing wind and solar farms to achieve these aims.
BP also seems to be investing in both blue and green hydrogen.
But possibly, the two hardest products to decarbonise are diesel for heavy transport and aviation fuel.
Looking at Green Biofuels web site, the Wikipedia entry for Hydrotreated Vegetable Oil (HVO) and other sources, Green Biofuels product; GD+ seems to make a good fist of reducing carbon emissions and pollution, if it replaces diesel.
DB Cargo UK and HVO
DB Cargo UK have a fleet of nearly two hundred large diesel locomotives in the UK.
DB Cargo UK have been experimenting with HVO, as I wrote about in Powered By HVO.
The company has issued a press release on these trials of HVO, from which this is an extract.
DB Cargo UK’s Head of Asset Management and Maintenance Steve Wilkinson said the company was collaborating with one of the UK’s leading suppliers of HVO fuel which already worked with high-profile brands like Caterpillar, John Deere, Volvo and Mercedes-Benz.
“We are very pleased with the initial performance of the HVO fuel which we could use instead of or alongside traditional red diesel. The fact it is compatible with our existing diesel means investment in new storage and fuelling facilities would also be kept to a minimum,” he added.
“On top of that, it performs well at low temperatures, has a longer lifespan and is biodegradable,” he added.
DB Cargo UK currently operates 228 diesel and electric locomotives that transport in the region of 37 million tonnes of freight each year across the UK and into Europe.
It uses approximately 45 million litres of red diesel a year.
Was one of the UK’s leading suppliers of HVO fuel, a company called Green Biofuels?
Note that DB Cargo UK’s spokesman makes these points about the fuel.
- They are very pleased with initial performance.
- It is a straight swap for red diesel and it appears locomotives can run on either. He doesn’t say it but can it run on one fuel contaminated with the other? I suspect it’s a possibility.
- Current storage can be used for HVO.
- I get the impression that swapping from red diesel to HVO wouldn’t be the most challenging of operations.
- It performs well at low temperatures. One train-driver told me, that one of the worse parts of the job, is picking up a train from a depot high in the Pennines on a cold day in the winter. That must apply to locomotives.
- It has a longer lifespan.
- It is biodegradable. I haven’t walked through an engine shed, since I used to bunk them as a child to get engine numbers, but they were filthy places, with oil and diesel all over the floor.
That sounds to me, like DB Cargo UK have decided that HVO is an excellent fuel and for them to swap to HVO, would be no more difficult than to swap between red diesel from BP to red diesel from Shell.
This is an extract from the Business Green article.
Founded in 2013, Green Biofuels is the UK’s largest provider of HVO, having delivered over 55 million litres of HVO products to the UK market over the past two years.
If DB Cargo UK wanted to swap from red diesel to HVO, they would need nearly all of Green Biofuels current production.
So have Green Biofuels run to BP and said can you help us out?
Red Diesel Replacement
This document on the Government web site is entitled Reform Of Red Diesel And Other Rebated Fuels Entitlement.
There is a section, which is entitled Policy Objective, where this is said.
In June 2019, the UK became the first major economy in the world to pass laws guaranteeing an end to its contribution to global warming by 2050. The target will require the UK to bring all greenhouse gas emissions to net zero by 2050, compared with the previous target of at least an 80% reduction from 1990 levels. The government also launched in 2019 an ambitious new strategy to clean up the air and save lives, given air pollution is one of the biggest continuing threats to public health in the UK.
Red diesel is diesel used mainly for off-road purposes, such as to power bulldozers and cranes used in the construction industry, or to power drills for oil extraction. It accounts for around 15% of all the diesel used in the UK and is responsible for the production of nearly 14 million tonnes of carbon dioxide a year. Red diesel used in the construction and infrastructure building sectors was also estimated to have caused 7% of nitrogen oxide emissions and 8% of PM10 emissions (a type of particulate matter) in London in 2018.
At Budget 2020, the government therefore announced that it would remove the entitlement to use red diesel and rebated biodiesel from most sectors from April 2022 to help meet its climate change and air quality targets. The tax changes will ensure that most users of red diesel use fuel taxed at the standard rate for diesel from April 2022, like motorists, which more fairly reflects the harmful impact of the emissions they produce. Removing most red diesel entitlements will also help to ensure that the tax system incentivises users of polluting fuels like diesel to improve the energy efficiency of their vehicles and machinery, invest in cleaner alternatives, or just use less fuel.
It doesn’t say, but I have found references to the fact that HVO pays the same tax rate as diesel, despite the evidence, that it appears to be more environmentally friendly.
If I was the Chancellor, I would certainly adjust the tax system, so that red diesel users who changed to HVO and other fuels, paid tax in proportion to the emissions and pollution they caused.
So have BP decided that Green Biofuels is the best interim solution to reduce emissions from diesel fuel and taking a stake, is the best way to get the required access to the product?
Could BP be thinking about replacing red diesel with a better green diesel?
- Red diesel and GD+ could be acceptable to all diesel vehicles and equipment. So farmers for rxample, could run tractors and combines on the same fuel as their truck or Range Rover.
- Businesses, like farmers, who often have tanks for both red diesel and normal diesel, would only need one tank.
- Businesses with a green profile, would surely like it for their vehicles.
- Organic farmers would like it for their tractors.
- The availability of a green diesel would enable red diesel users to change to hydrogen or battery operation, at the optimal time.
I can see Prince Charles handing out green stars all round.
Is Heavy-Duty Fuel Cell Trucking Almost Ready For Prime Time?
The title of this post, is the same as that of this article on Freight Waves.
It is a comprehensive article, that discusses hydrogen-powered trucks with respect to the United States.
Some quick points from the article.
- Companies are looking at dedicated routes.
- California with its emissions legislation, will be in the forefront of hydrogen trucks in the US.
- Nikola will build hydrogen filling stations to support big customers.
- Toyota are using the same fuel cells in passenger cars and the largest trucks.
- Toyota are trialling their trucks on short runs from the ports in the Los Angeles area.
There does seem to be a lot of US companies getting involved in hydrogen.
The article is definitely a must-read.
Some of the applications mentioned for hydrogen trucks are more about heavy loads over short distances, than taking a load half-way across the US.
These applications will possibly mean.
- Back-to-base refuelling.
- More running in urban areas.
- Large reductions in emissions and pollution.
As fleets get larger, it might be economic for a fleet to have its own system to provide the hydrogen, as the hydrogen-buses do in Pau.
I suspect that roll-out of these applications could be helped by some well-designed tax incentives.
Activists Cheer As ‘Sexist’ Tampon Tax Is Scrapped
The title of this post, is the same as that of this article on the BBC.
This is the first two paragraphs.
The 5% rate of VAT on sanitary products – referred to as the “tampon tax” – will be abolished in the UK from 1 January.
EU law required members to tax tampons and sanitary towels at 5%, treating period products as non-essential.
My late wife; C had very strong views about this and I suspect that my late mother and my granddaughter would share C’s views.
Is this a glimpse of the future, where when we feel European Union policy is wrong, we can diverge?
It would certainly be a good test of unfair policy by the UK government, if the EU objected and tried to stop us removing the tax.
At least smugglers, who decided to switch from smuggling drugs and other nasties to sanitary products would be doing something that caused less harm!
Top 1% Emit Double The Carbon Of Poorest 50%
The title of this post is the same as that of this article in today’s copy of The Times.
This is the introductory paragraphs.
The richest 1 per cent of people globally cause more than double the carbon emissions of the three billion who make up the poorest 50 per cent, a report says.
This inequality should be addressed with taxes on frequent flyers, SUVs and luxury items such as private jets and super yachts, according to Oxfam, which has written a report with the Stockholm Environment Institute, a not-for-profit research body.
It is an article well-worth a read.
But as I am not a frequent flyer and don’t own an SUV, private jet or super yacht, I doubt I’ll suffer if the report’s recommendations are implemented.
The Times Had A Hydrogen Saturday
The Times had a feature on Saturday about converting our gas grid to hydrogen and especially about using hydrogen boilers in our homes.
I believe that perhaps in ten years, our gas grid will be full of hydrogen and our central heating boilers will be powered by hydrogen.
The carbon emissions saved with be massive
I don’t know about cooking, but my Michelin-starred Scottish friend and chef, says that we’ll all cook on an electric induction hob.
A Large Collateral Benefit?
I think there will be a large collateral benefit.
At present there are only two feasible methods to power a vehicle without producing carbon emissions; battery or hydrogen.
- Battery vehicles need to be recharged and we need an enormous number of charging stations.
- Hydrogen vehicles need to be filled up from a hydrogen filling station.
It should be noted that the current Hyundai ix35 FCEV has a range of 369 miles on hydrogen.
But as you have a hydrogen gas supply to your house, could you fit a compressor in your garage to pump up your car’s hydrogen tank, when it needs it?
The technology is well-proven.
The only problem, that I can see, is that how will the Government tax it?
The future’s not orange it’s hydrogen.
Labour’s Four-Day Week ‘To Cost Taxpayers £27bn’
The title of this post, is the same as that as an article of the front page of The Times.
This is the introductory paragraph.
Jeremy Corbyn’s aim to introduce a four-day working week would cost the taxpayer at least £17 billion a year because of the impact on the public sector wage bill, a new analysis has shown.
Surely, if we go from a five to a four-day week , to do the same amount of work, you will need 25% more workers.
- This would raise the wage bill by 25 %
- It would also need more workers, so where will they come from?
- The only place to get extra workers is through immigration, as in this country most who want to work are already employed.
As I edit this, I’m just hearing another giveaway policy from Labour on the television.
Let’s hope the good British public rumble Labour and realise that their promises don’t add up.
Remember, that my specialism was writing scheduling algorithms to build projects in the most efficient manner possible, using a limited pool of resources.
- Labour’s promises will need so much money, that international lenders will probably not be conned to lend it.
- Corbyn’s friends; the Russians and the Iranians might help.
- Labour’s promises will need lots more workers, which would need large amounts of immigration.
Just look at the arithmetic.
Austria Scraps Its Sun Tax
The eye-catching title of this post is the same vas that of this article on PV Magazine.
This is the introductory paragraph.
The nation’s political parties have found agreement on a green electricity package which is expected to create stable conditions for the next three years. From next year, €36 million will be made available annually for the further support of PV systems and energy storage.
As to the Sun Tax, this is explained further on.
The association has already seen one of its other demands met with the cancellation on Thursday of the ‘sun tax’ on the consumption of power generated by householders with rooftop arrays. Under the previous rules, solar households could consume 25 MWh of self-generated solar free of charge but then had to pay a €0.015 levy on every subsequent kilowatt-hour consumed during the life of the PV system.
|All parties seem pleased with the scrapping of the tax.
The Anonymous Widower 