DT said "We are all supposed to believe that offshore wind is nine times cheaper than gas"
And at one point when gas prices spiked in 2024, this was true. But clearly it isn't true any more, now that European gas supply has become more available. Offshore wind is still cheaper than gas, but not nine times.
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DT said "Nobody has ever explained why we need annual auctions to decide which projects should be financed by subsidies paid for through our energy bills if wind power is so wonderfully cheap."
It is because the current marginal price despatch market operation is particularly designed to suit fossil fuel generation, where the fuel costs are most of the cost of power, and form most of the LCOE.
Because fuel costs are zero for wind and solar, and variable O&M isn't that high, the market breaks down. Even though it leads to cheaper average electricity prices, no one is going to build wind power at high penetrations (it will be 70% of UK supply by 2030) in a situation where only marginal price despatch is used to set the wholesale price, and there are no fixed price contracts available. Because wind just suffers from self-cannibalisation then. To simplify the case, either there is no wind, so wind farms make nothing, or there is plenty of wind, in which case all the wind farms will be generating and all the wind farms will be undercutting each other to make sure they get some return, which won't be enough to pay the high capital costs.
So if you want cheap wind, you have to find another market mechanism, and the one chosen is to hold auctions prior to build time and not at generate time (which we just said doesn't work). That is exactly what the CfD auctions are.
It is a little different in Germany and Holland, where the auctions are "one way" CfD. The grid operators make wind farm revenue up to the strike price if the wholesale price is lower, but there is no payment back to the grid if wholesale prices are higher than the contract strike price. Add the fact that the link offshore is paid for by the grid, and German offshore wind farms started to bid "zero" price, which just means they take the wholesale price. Now you have the issue of how you decide which projects to contract if everyone is bidding the same price (of zero). So you have to introduce some non-price related criterion. And when you get to high penetration of wind, the wholesale price collapses again as there may be no fossil fuel plant setting the marginal price.
So the CfD auction is the way of controlling which proposed projects get built, and deciding how much they should be given to produce electricity. The revenue risk is thus close to zero, because of the fixed price with annual CPI uplifts, so if variable interest rates follow inflation (maybe a couple of percent higher), then interest rates aren't a revenue risk either. Presumably you can get a loan which specifies interest of a fixed percent above inflation.
But all this isn't really a subsidy for new wind farms, unless the price paid for wind power from them is, on average, higher than would be paid for e.g. power from gas.
As for the length of the contract, it obviously increases the revenue risk if the wind farm return on investment depends on only 15 years of fixed prices (+ CPI uplift) and 20 years of wholesale prices. The wind projects should be able to get lower cost of capital, and deliver a low bid price, if the CfD contract is for the 30-35 year lifetime. So why not do this up front at CfD bid time and save consumers money?
A simple "laissez faire" system where anyone could build a wind farm and get wholesale price for it will only work up to maybe 50% wind penetration, but UK wants to get to net zero eventually.
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DT said "The Government is pressing on with its Clean Power 2030 plans to spend £260-290bn by 2030 to save at most £7bn per year on gas for electricity. "
I make it £5.6bn per year gas savings at a TTF price of €44/MWh (of heat) for an average 8.2 GW of gas power in 2024 at a 50% efficiency. But you should also include savings in the average 4.4 GW of imports over interconnectors, probably have as much again. Then there will be some revenue for the export of surplus wind power over interconnectors most of the time.
That roughly works financially. If the wind farms last 35 years (as in the Dogger Bank C FID), then the total savings on gas at DTs cost/year are 35 x £7bn = £235bn. The estimated spend is £40bn per year for the 6 years 2025 through 2030, which is £240bn. So you get the CO2 reduction from gas down to 5%, likely with a reduction in consumer electricity costs.
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DT said " the extension of Drax’s tree-burning contract"
The reason for this is pretty obvious. Drax burns only waste wood which would otherwise be left to rot or burned anyway. Once all 4 Drax units go CCS with a decent CO2 recovery (e.g. 80% or better) Drax ends up negative CO2 emissions. The extension is just to give Drax the chance to get to negative emissions land in 2029 and beyond. The fact the 2030 CP plan needs the despatchable generation is another good reason to extend.
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DT said "the plans seem to be hitting the buffers, demonstrating that Net Zero is not working."
It is fairly obvious to all that UK isn't currently contracting or installing wind and solar fast enough to get down to 5% gas by 2030, so the rate of installs of wind and solar needs to speed up. That means changes to various regulations and contracts, including planning regulations. Leaving things as they are would be a recipe for 2030 Clear Power plan failure.
It is not clear why DT thinks making changes is a negative for the 2030 CP plan.
Grid net zero has been progressing year on year - you have only to look at the steady decline in grid intensity in gm CO2/kWh down from 467 gm CO2/kWh (from 45% gas + 30% coal) in 2010 down to 119 gm CO2/kWh (26% gas + 0.5% coal) in 2024 to see that.
Unfortunately, Net Zero is working as it has been designed to do, just as Communism has worked as it was designed to do, wherever it has been deployed. If the game plan is to cull the world of about seven billion people, doesn't Net Zero contribute towards that goal?
I wonder if you or a fellow subscriber knows how long it would realistically take to have a meaningful amount of new gas-fired generating plant, in the unlikely event of anyone in charge having a light bulb moment?
Great article, was wondering why the CBI BS machine was out in full force this morning, telling us how the green machine was growing. It’s their extra kick backs they’ve been promised, when will the lying, deceit and nonsense stop? The UK tax payers deserve better than this economic and scientific illiteracy.
Mr Miliband, who promised he would get bills down in the run-up to last year’s election, said bills were rising “because we’re so reliant on fossil fuels, in particular gas”.
He said: “And the markets that determine the price of those fossil fuels are controlled by the decisions of petrostates and dictators.”
What he is basically demanding is that the entire global production of oil and gas is closed down....the world must run on wind and sun, when it blows and when it shines. Has he thought of himself when he speaks of dictators....shutting down the UK's backstop energy supply. An extended 'Dunkelflaute' over the UK and Europe would leave wind and sun powers in the lurch. There might be a dictator or 2 willing to pipe in some reliable fuel.
How will it be possible to manufacture and construct solar and wind facilities without the use of hydrocarbons, it's totally impossible. Meanwhile production of hydrocarbons doesn't need any ruinables to enable them.
No one is shutting down UK's existing gas plants, and the Drax subsidy has been extended. Plus various nuclear plants are likely to be kept operational for a few more years too.
Then grid batteries are going in quite fast with 5 GW (7 GWh) installed and 4 GW under construction last time I look. This means, in the absence of much wind and solar power on a peak day, the batteries can be charged in advance of peak hour. Peak hour demand (lasts around 4 hours typically) can then be satisfied by the combination of nuclear, despatchable and batteries.
The impact of grid batteries is thus that you don't need quite as much gas generation capacity as you might first think.
Even when the UK grid goes full net zero, the existing gas plants will be converted to burn green hydrogen (produced from surplus wind power) instead of natural gas. But the gas plants won't be decommissioned in the foreseeable future.
Good morning David - to me you have lost direction concentrating too much on technicals .... and from time-to-time areas not in the remit of this substack, in particular your preference for Brexit and insulation.
Today it has been announced energy suppliers will be able to charge an extra nearly 7% while we already are paying more than everyone else in the world. Meanwhile energy suppliers profits are at records.
The regulator is, I believe, formatting a new way of billing so that the per unit price includes delivery rather than the extortionate standing charge. From what little I have seen about this possible change it is not being designed for the benefit of consumers but for suppliers.
To my mind you need to be more to the point. Scoring points, or attempting to, against Greg Jackson is not working - he is clearly a very good reason Octopus has extended its tentacles so far.
The whole purpose of the Substack is to focus on the technicals - the clue is in the name, Eigen Values.
I don't recall mentioning Brexit. I will in due course write something about the price cap again, but my main short term focus will be on the next Carbon Budget, due out tomorrow.
Mr Dean, I doubt that any other readers of David’s blog agree with you; I most certainly disagree.
The one thing that characterises the whole NZ endeavour is its total lack of attention to the details. In drilling into them, David is providing the necessary counterbalance to the vacuous drivel that flows from the mouths of Miliband, Pinchbeck et al. He is performing a great service to all of us and we should he grateful for the huge amount of time and effort that goes into it. Yes, that means it needs some contribution of effort on our part which means it won’t be for everyone.
As regards your second and third paragraphs, it is the detailed analysis of how the monstrous subsidy regime works that explains the ever escalating energy prices of which you complain and somehow suggest that David is ignoring.
In summary, this blog is very much on point contrary to your suggestion.
Yes it’s another long pre-breakfast post, I really should have my own Substack
As someone who, one sunny day during the white heat era of labour in the 1960’s, went round a new coal fired power station at the age of 4, and was employed in the power generation & transmission sector when Ed Miliband was still in short trousers nothing makes sense anymore and hasn’t done for several years.
Emissions reduction of sulphur, nitrogen and particulates is generally good but nothing surprises me how stupid a nation we have become in the relentless pursuit of carbon dioxide reduction to ‘save the planet’ It’s costing us our existing wealth, our future wealth, our industries, and all for what? this colourless odourless gas that is supposedly the end of us all. CO2 in the concentrations we are predicted to have won’t kill us, but the ongoing economics of the madhouse will.
Renewables are touted as some kind of miraculous job creation scheme, the kind of crap government thinking churned out in the 80’s and 90’s for the jobless youth and older who could no longer get a proper job because industries had either disappeared or were shrinking mainly because it was cheaper to extract or make things overseas. A wasted generation who could have built vital infrastructure like high speed rail, nuclear power stations, sewage works, roads, flood defences etc.
Now many years on, with Ed having graduated to long trousers we somehow are told that renewables are ‘the answer’.
Zero fuel costs.
The ‘cheapest’ form of generation.
Green
Ethical
Meanwhile we import both solar panels manufactured in china using energy from coal mined by slave labour, and also the majority of wind turbine components. Occasionally blades or towers, both highly dependent on hydrocarbons for their production are being made here, with some of the ‘added value’ being on site whilst we blather the landscape and seascape in these pointless monstrosities.
With the recent attacks on ‘the farmers’ and their tax breaks wasn’t in the least surprised to see this article in the grauniad on the 24th Feb “Britain’s net zero economy is booming, CBI says”
It goes on to say
“The net zero businesses accounted for 1.1% of the UK’s total GVA, making it bigger than the farming and advertising and market research sectors.”
Now I really couldn’t give a monkeys chuff about advertising and market research sectors (we used to produce some truly epic advertising as recently as 30 years ago) but net zero businesses bigger than farming is something quite troubling, not only will we continue to have energy prices off the scale but what little remains of our ability to produce food to feed ourselves is relegated to an afterthought and even less so as rising energy costs make everything far more difficult.
Anyway it’s time to feed our cat, who I’m sure despises Ed Miliband, likes lots of continuous warmth indoors, and only eats human type food like M&S chicken, or expensive sachets of food made by the French.
Its very depressing when you look back and realise that the build out of the supergrid and the establishment of the 2000MW coal stations let alone the nukes were nigh on a 100% designed, manufactured and constructed within the UK. Milibrain and his cohort going on about green jobs but they aren't in the UK. A far better roadmap would have at least been to established our own supply chain first before embarking on the NZ lunacy so at least the UK citizens could have had a stake.
"The Government also proposes to change the way the budget for AR7 is set. Instead of setting the budget before the auction begins, the budget notice will not be published until after sealed bids have been received".
This, like many other government fudges and tweaks explained (or at least described) in this very helpful article, reminds me so much of something long ago... Oh, yes, that's it!
The Ptolemaic model of the planets and their orbits. Epicycles on epicycles on cycles, all trying to square the circle (if you'll excuse a disgracefully mixed metaphor - and as you will know, squaring the circle has been proved to be impossible). But they never got it quite right. For the same reason that the Net Zero zealots will never get their "system" to work - it's impossible in principle.
They know that CAGW is a scam and its "solution" Net Zero is impossible. Their goal is to sabotage our energy and hence industry, impoverish us and make us militarily insecure in the process. They intend to carry on until the situation becomes so bad they are stopped. They're not expecting us to reach Net Zero CO2 emissions in 2050.
Hi David, you regularly post about how Net Zero and the strong push for so-called "renewables" is not working, and you post lots of data showing that it's not working and ask British elites for a re-evaluation of their strategies and priorities. However, have you considered that the elites *don't want the masses to have access to cheap energy, and that they actually want them to die off?* Because it's really not a full analysis unless you consider that (imo highly likely) possibility. And if that possibility is true, how does your analysis change then, if at all?
Start from the fact that we have an expanding population (yes, we do!) with a more or less fixed amount of the various natural resources. Fewer "useless mouths" would mean, perhaps, more for each of the survivors.
Population is growing due to the immense momentum of previous generations. It's like a giant ship, you can't just shutdown the engines and expect the ship will stop moving.
The fact is we are well past peak child, there will never be as many children as there are today at least for the foreseeable future. Everyone likes to talk about exponential population growth, but you can just as easily have exponential population collapse, which is what we are currently experiencing. And it is extraordinarily dangerous for our civilization and in fact all of the Earth's biota.
And we don't have a "fixed amount" or natural resources. To be accurate, there is no such thing as natural resources. There are natural materials, vast amounts of them, for all intents & purposes, an unlimited supply. Resources are materials that we currently have found useful under the current state of technology.
Actually population is growing because a lot of couples are giving birth to children. Ships, engines, momentum - that is all flowery abstract talk. population growth is this: https://www.worldometers.info/world-population/
You write “The fact is we are well past peak child, there will never be as many children as there are today”, but what that page demonstrates is that there are more children every MINUTE.
Please note that I didn’t say anything about “exponential” growth. That concept has been done to death; many people think “exponential” just means “a lot”.
And more children are becoming adults every MINUTE than new children are being born. And in most of the World, except some countries in Africa, more people will soon be dying than are being born, as is already happening in almost all Western nations, & China, S. Korea, Japan.
No reason to expect that trend, which is a product of industrialization, won't spread to the African nations as well.
The most IMPORTANT talk on the demographic crisis you will ever hear, Stephen Shaw
If you think there is no attack on farming taking place and it was just a matter of cutting out a "tax loophole" [which could have been done without damaging actual farms] then you need to pay more attention.
There has been, until Trump's election, a coordinated and concerted effort in what can laughingly be called Western Liberal Democracies to destroy our food supply chain, all in the name of 'Climate Change'.
Don't you think it odd that the governments of so many countries all start to attack farming at the same time?
Hopefully, the influence of the Trump administration will help to destroy the Malthusian elements in power today. Many Western politicians demonstrate a real animus towards their own citizens.
The problem is, the politicians have no understanding of farming and don't understand that once turned off it would take decades to turn back on. In the meantime, millions of people would literally starve to death.
Our clown politicians are enacting laws that will result in famine.
Apparently, he has a better and deeper understanding of farming than you! But if you only listen to MSM for your information this is understandable.
However, you won't be the first to underestimate what he does and does not know.
Someone who has been highly successful in three completely different domains is not a fool, though I know lots of liberal progressives like to believe that is the case.
If what I infer about you is correct the next few years are going to be deeply disturbing for you. And wait until you see what he has in mind for gold!
Tax loophole? Are you kidding. The vast majority of farms are passed down through generations. The increase in value is locked up in the land itself - it can’t be realised without splitting up the farm. Inheritance tax in general is bad enough, but this is the equivalent of a tax on an unrealised gain on the farmland and is utterly unfair. It is also a direct and deliberate attack on our food security.
" literally using it as a inheritance tax avoidance loophole" High net-worth individual were using the tax system to their advantage, which is perfectly legal and sensible. All the government had to do was to stop this element of tax avoidance without penalising generational farming families. The wealthy will just move onto some other scheme or take their money out of the country all together.
But this useless government decided to have a pop at destroying small farms.
You seem to think that paying inheritance tax is natural, like eating or breathing. I’ve got news for you - it’s not. In any case the number of people buying land to avoid IHT is small by comparison to the number of farmers who generate our food,
As regards the land still being there, farms broken us are either less productive or, more commonly, bought up by large financial investors whose relationships with globalist governments makes them an extreme threat to all of us.
This is where it gets tricky. I firmly believe there actually are too many people for the world's carrying capacity even today - and it will get worse before it gets better. The UK currently has more than 4 times as many people as it could sustain indefinitely. (Note that last word). Of course, if you are prepared to burn the furniture you can do fairly well for a short while.
The ideal time to have done something about overpopulation was about 1900, when the world's leaders decided to plunge into a sequence of disastrous wars instead. (One of the axioms of population study is that wars usually increase population, as the birth rate goes up. The USSR in the Great Patriotic War is an exception, which I acknowledge gratefully and reverently).
Carrying capacity for humans is nonsense. You can easily have billions on Mars. Where's the carrying capacity?
Humans are more and more diverging from a reliance on solar energy & biological ecosystems. So the biological term "carrying capacity" does not apply.
And for non-human life, carrying capacity is substantially increasing due to increased CO2 levels supplying much more carbon which is a limiting factor for biological systems. And we humans can greatly further increase that carrying capacity through ocean fertilization methods.
“Billions on Mars”? What have you been smoking?? For a start, how do you propose to get billions of people to Mars? It’s a very long and extremely dangerous journey, and even trained astronauts in the peak of youthful health would have difficulty surviving. How many spaceships do you propose, carrying how many people each?
Then you claim that “Humans are more and more diverging from a reliance on solar energy & biological ecosystems”. How on earth do you see that happenning? Can you please tell us about any humans - any at all - who do not rely on food from biological ecosystems? Or do you expect a new breed nourished only by Bill Gates burgers grown in labs from inorganic materials?
Indeed Mars could easily support billions of humans. And a vast biota, less than the Earth's but an extraordinary amount.
I never said anything about transporting billions to Mars. Presumably they would be there by reproduction, if it was desired, no big reason to do so, but I'm just talking about supposed carrying capacity. Transporting millions of humans to Mars is quite doable with current tech however, that's not a problem.
We can certainly replace solar energy with nuclear energy. And that can supply food just as stored solar energy is responsible for much of the World's human food supply using fossil based fertilizers. And in general plant growth increased due to fossil fuel CO2 emissions.
I'm not advocating for replacing grown food with manufactured food, the tech is not available right now, but certainly will be in the future, if we chose to use it, which would be optional.
And I never said anything about wanting unlimited human population growth, personally I think around 10B people on Earth is an optimal population at present.
Yes, I agree with you Tom. The best time to address this stuff was on the front end before populations got so wildly out of control, and to try to each people about sustainable living. Our elites had other things in mind, unfortunately, and in my opinion they’re full of noblesse malice instead of noblesse oblige…
"In this speech, Stephen Shaw explains how rapidly declining birth rates are putting many countries in danger of disappearing within a few generations. Reversing the narratives around children and population growth is urgent for the sake of our civilizations."
And "sustainable living" is garbage. Sustainability is almost entirely based upon the current state of tech, and determined by the competence level of our governments.
It is true some nations have a high birth rate. That's why you don't want globalism, you want the Westphalian system of free & independent nations. Each nation is responsible for its own population. If they let it get out of control then there will be starvation there and that is on them, no one else.
I understand our current monarch is a believer of there being too many people, and no doubt a supporter of this government’s drive to depopulate this country one way or another. It may be working as the news media have been reporting of youthful emigrants.
And there is little doubt that there is a food supply collapse coming, there are plenty of people involved with food supply saying this. There is a goal to reduce the head of lamb by at least 27% in the next 10 years, similar for cattle & pork. Not to mention the hairbrained idea of reducing the arable growing capacity. And any food or power for that matter will be beyond financial reach for most.
No it won't. We are already well past peak child. Population just has a large momentum effect, both in rising or in falling. Current best estimates put Earth's population peaking by mid-century at close to 10B. Which I consider to be about optimal.
Population is climbing in Africa; their fertility rates are decreasing but way less than the elites expected. Fertility rates in Asia, the West, and the Middle East are all decreasing, and the West absent immigration has sub-replacement fertility rates.
"But they are preserving the (fossil fuel) resources with net zero?"
No, they are not. This is just us who are foolish enough not to use the resources at hand. In the case of gas, we actually purchase gas from Norway that they extract from gas fields we have access to! Gas does not recognise national boundaries in the process of flow. Norway are selling us gas we could extract and tax ourselves! This is insane.
Our LibLabCon government position on netzero is both ruinous and ludicrous in equal measure.
China, India in particular and most of the rest of the world take no notice of the flawed hypothesis that 'Climate Change' is solely or mainly caused by an increase in the level of Co² in the atmosphere.
NUT zero can never work it is insane, fake science.
Has any British government ever heard of RoI - Return on Investment. The current incumbents obviously haven't.
For the love of God, if only we would use our own home grown GAS and OIL!
Ed, you utter donkey's droppings of a moron.
Another fantastic article, David. Thanks for fighting the goodbfight on our behalf.
My takeaway was the shocking stats on Drax. Trying to store the info for future reference.
DT said "We are all supposed to believe that offshore wind is nine times cheaper than gas"
And at one point when gas prices spiked in 2024, this was true. But clearly it isn't true any more, now that European gas supply has become more available. Offshore wind is still cheaper than gas, but not nine times.
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DT said "Nobody has ever explained why we need annual auctions to decide which projects should be financed by subsidies paid for through our energy bills if wind power is so wonderfully cheap."
It is because the current marginal price despatch market operation is particularly designed to suit fossil fuel generation, where the fuel costs are most of the cost of power, and form most of the LCOE.
Because fuel costs are zero for wind and solar, and variable O&M isn't that high, the market breaks down. Even though it leads to cheaper average electricity prices, no one is going to build wind power at high penetrations (it will be 70% of UK supply by 2030) in a situation where only marginal price despatch is used to set the wholesale price, and there are no fixed price contracts available. Because wind just suffers from self-cannibalisation then. To simplify the case, either there is no wind, so wind farms make nothing, or there is plenty of wind, in which case all the wind farms will be generating and all the wind farms will be undercutting each other to make sure they get some return, which won't be enough to pay the high capital costs.
So if you want cheap wind, you have to find another market mechanism, and the one chosen is to hold auctions prior to build time and not at generate time (which we just said doesn't work). That is exactly what the CfD auctions are.
It is a little different in Germany and Holland, where the auctions are "one way" CfD. The grid operators make wind farm revenue up to the strike price if the wholesale price is lower, but there is no payment back to the grid if wholesale prices are higher than the contract strike price. Add the fact that the link offshore is paid for by the grid, and German offshore wind farms started to bid "zero" price, which just means they take the wholesale price. Now you have the issue of how you decide which projects to contract if everyone is bidding the same price (of zero). So you have to introduce some non-price related criterion. And when you get to high penetration of wind, the wholesale price collapses again as there may be no fossil fuel plant setting the marginal price.
So the CfD auction is the way of controlling which proposed projects get built, and deciding how much they should be given to produce electricity. The revenue risk is thus close to zero, because of the fixed price with annual CPI uplifts, so if variable interest rates follow inflation (maybe a couple of percent higher), then interest rates aren't a revenue risk either. Presumably you can get a loan which specifies interest of a fixed percent above inflation.
But all this isn't really a subsidy for new wind farms, unless the price paid for wind power from them is, on average, higher than would be paid for e.g. power from gas.
As for the length of the contract, it obviously increases the revenue risk if the wind farm return on investment depends on only 15 years of fixed prices (+ CPI uplift) and 20 years of wholesale prices. The wind projects should be able to get lower cost of capital, and deliver a low bid price, if the CfD contract is for the 30-35 year lifetime. So why not do this up front at CfD bid time and save consumers money?
A simple "laissez faire" system where anyone could build a wind farm and get wholesale price for it will only work up to maybe 50% wind penetration, but UK wants to get to net zero eventually.
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DT said "The Government is pressing on with its Clean Power 2030 plans to spend £260-290bn by 2030 to save at most £7bn per year on gas for electricity. "
I make it £5.6bn per year gas savings at a TTF price of €44/MWh (of heat) for an average 8.2 GW of gas power in 2024 at a 50% efficiency. But you should also include savings in the average 4.4 GW of imports over interconnectors, probably have as much again. Then there will be some revenue for the export of surplus wind power over interconnectors most of the time.
That roughly works financially. If the wind farms last 35 years (as in the Dogger Bank C FID), then the total savings on gas at DTs cost/year are 35 x £7bn = £235bn. The estimated spend is £40bn per year for the 6 years 2025 through 2030, which is £240bn. So you get the CO2 reduction from gas down to 5%, likely with a reduction in consumer electricity costs.
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DT said " the extension of Drax’s tree-burning contract"
The reason for this is pretty obvious. Drax burns only waste wood which would otherwise be left to rot or burned anyway. Once all 4 Drax units go CCS with a decent CO2 recovery (e.g. 80% or better) Drax ends up negative CO2 emissions. The extension is just to give Drax the chance to get to negative emissions land in 2029 and beyond. The fact the 2030 CP plan needs the despatchable generation is another good reason to extend.
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DT said "the plans seem to be hitting the buffers, demonstrating that Net Zero is not working."
It is fairly obvious to all that UK isn't currently contracting or installing wind and solar fast enough to get down to 5% gas by 2030, so the rate of installs of wind and solar needs to speed up. That means changes to various regulations and contracts, including planning regulations. Leaving things as they are would be a recipe for 2030 Clear Power plan failure.
It is not clear why DT thinks making changes is a negative for the 2030 CP plan.
Grid net zero has been progressing year on year - you have only to look at the steady decline in grid intensity in gm CO2/kWh down from 467 gm CO2/kWh (from 45% gas + 30% coal) in 2010 down to 119 gm CO2/kWh (26% gas + 0.5% coal) in 2024 to see that.
Unfortunately, Net Zero is working as it has been designed to do, just as Communism has worked as it was designed to do, wherever it has been deployed. If the game plan is to cull the world of about seven billion people, doesn't Net Zero contribute towards that goal?
Like but don't like.
Thank you David - if only you were making this up! Your piece chimes with Robert Bryce's latest "Britain Is Committing 'National Economic Suicide'” https://robertbryce.substack.com/p/britain-is-committing-national-economic?utm_source=post-email-title&publication_id=630873&post_id=157802736&utm_campaign=email-post-title&isFreemail=false&r=2k8m2j&triedRedirect=true&utm_medium=email
I wonder if you or a fellow subscriber knows how long it would realistically take to have a meaningful amount of new gas-fired generating plant, in the unlikely event of anyone in charge having a light bulb moment?
the last few coal stations should have been mothballed but that wouldn't create a photo op to blow them up.
Too long. The gas turbine makers are sold out for quite a few years.
Thank you. Up the creek and no paddle.
Great article, was wondering why the CBI BS machine was out in full force this morning, telling us how the green machine was growing. It’s their extra kick backs they’ve been promised, when will the lying, deceit and nonsense stop? The UK tax payers deserve better than this economic and scientific illiteracy.
Mr Miliband, who promised he would get bills down in the run-up to last year’s election, said bills were rising “because we’re so reliant on fossil fuels, in particular gas”.
He said: “And the markets that determine the price of those fossil fuels are controlled by the decisions of petrostates and dictators.”
https://www.telegraph.co.uk/business/2025/02/25/ofgem-energy-price-cap-increase-april-june-bills/
What he is basically demanding is that the entire global production of oil and gas is closed down....the world must run on wind and sun, when it blows and when it shines. Has he thought of himself when he speaks of dictators....shutting down the UK's backstop energy supply. An extended 'Dunkelflaute' over the UK and Europe would leave wind and sun powers in the lurch. There might be a dictator or 2 willing to pipe in some reliable fuel.
How will it be possible to manufacture and construct solar and wind facilities without the use of hydrocarbons, it's totally impossible. Meanwhile production of hydrocarbons doesn't need any ruinables to enable them.
No one is shutting down UK's existing gas plants, and the Drax subsidy has been extended. Plus various nuclear plants are likely to be kept operational for a few more years too.
Then grid batteries are going in quite fast with 5 GW (7 GWh) installed and 4 GW under construction last time I look. This means, in the absence of much wind and solar power on a peak day, the batteries can be charged in advance of peak hour. Peak hour demand (lasts around 4 hours typically) can then be satisfied by the combination of nuclear, despatchable and batteries.
The impact of grid batteries is thus that you don't need quite as much gas generation capacity as you might first think.
Even when the UK grid goes full net zero, the existing gas plants will be converted to burn green hydrogen (produced from surplus wind power) instead of natural gas. But the gas plants won't be decommissioned in the foreseeable future.
not working?.. no shit
Good morning David - to me you have lost direction concentrating too much on technicals .... and from time-to-time areas not in the remit of this substack, in particular your preference for Brexit and insulation.
Today it has been announced energy suppliers will be able to charge an extra nearly 7% while we already are paying more than everyone else in the world. Meanwhile energy suppliers profits are at records.
The regulator is, I believe, formatting a new way of billing so that the per unit price includes delivery rather than the extortionate standing charge. From what little I have seen about this possible change it is not being designed for the benefit of consumers but for suppliers.
To my mind you need to be more to the point. Scoring points, or attempting to, against Greg Jackson is not working - he is clearly a very good reason Octopus has extended its tentacles so far.
Kind regards
Michael Dean
The whole purpose of the Substack is to focus on the technicals - the clue is in the name, Eigen Values.
I don't recall mentioning Brexit. I will in due course write something about the price cap again, but my main short term focus will be on the next Carbon Budget, due out tomorrow.
Mr Dean, I doubt that any other readers of David’s blog agree with you; I most certainly disagree.
The one thing that characterises the whole NZ endeavour is its total lack of attention to the details. In drilling into them, David is providing the necessary counterbalance to the vacuous drivel that flows from the mouths of Miliband, Pinchbeck et al. He is performing a great service to all of us and we should he grateful for the huge amount of time and effort that goes into it. Yes, that means it needs some contribution of effort on our part which means it won’t be for everyone.
As regards your second and third paragraphs, it is the detailed analysis of how the monstrous subsidy regime works that explains the ever escalating energy prices of which you complain and somehow suggest that David is ignoring.
In summary, this blog is very much on point contrary to your suggestion.
Will it fail with a big bang, or long drawn out whimper?
Yes it’s another long pre-breakfast post, I really should have my own Substack
As someone who, one sunny day during the white heat era of labour in the 1960’s, went round a new coal fired power station at the age of 4, and was employed in the power generation & transmission sector when Ed Miliband was still in short trousers nothing makes sense anymore and hasn’t done for several years.
Emissions reduction of sulphur, nitrogen and particulates is generally good but nothing surprises me how stupid a nation we have become in the relentless pursuit of carbon dioxide reduction to ‘save the planet’ It’s costing us our existing wealth, our future wealth, our industries, and all for what? this colourless odourless gas that is supposedly the end of us all. CO2 in the concentrations we are predicted to have won’t kill us, but the ongoing economics of the madhouse will.
Renewables are touted as some kind of miraculous job creation scheme, the kind of crap government thinking churned out in the 80’s and 90’s for the jobless youth and older who could no longer get a proper job because industries had either disappeared or were shrinking mainly because it was cheaper to extract or make things overseas. A wasted generation who could have built vital infrastructure like high speed rail, nuclear power stations, sewage works, roads, flood defences etc.
Now many years on, with Ed having graduated to long trousers we somehow are told that renewables are ‘the answer’.
Zero fuel costs.
The ‘cheapest’ form of generation.
Green
Ethical
Meanwhile we import both solar panels manufactured in china using energy from coal mined by slave labour, and also the majority of wind turbine components. Occasionally blades or towers, both highly dependent on hydrocarbons for their production are being made here, with some of the ‘added value’ being on site whilst we blather the landscape and seascape in these pointless monstrosities.
With the recent attacks on ‘the farmers’ and their tax breaks wasn’t in the least surprised to see this article in the grauniad on the 24th Feb “Britain’s net zero economy is booming, CBI says”
It goes on to say
“The net zero businesses accounted for 1.1% of the UK’s total GVA, making it bigger than the farming and advertising and market research sectors.”
Now I really couldn’t give a monkeys chuff about advertising and market research sectors (we used to produce some truly epic advertising as recently as 30 years ago) but net zero businesses bigger than farming is something quite troubling, not only will we continue to have energy prices off the scale but what little remains of our ability to produce food to feed ourselves is relegated to an afterthought and even less so as rising energy costs make everything far more difficult.
Anyway it’s time to feed our cat, who I’m sure despises Ed Miliband, likes lots of continuous warmth indoors, and only eats human type food like M&S chicken, or expensive sachets of food made by the French.
Its very depressing when you look back and realise that the build out of the supergrid and the establishment of the 2000MW coal stations let alone the nukes were nigh on a 100% designed, manufactured and constructed within the UK. Milibrain and his cohort going on about green jobs but they aren't in the UK. A far better roadmap would have at least been to established our own supply chain first before embarking on the NZ lunacy so at least the UK citizens could have had a stake.
"The Government also proposes to change the way the budget for AR7 is set. Instead of setting the budget before the auction begins, the budget notice will not be published until after sealed bids have been received".
This, like many other government fudges and tweaks explained (or at least described) in this very helpful article, reminds me so much of something long ago... Oh, yes, that's it!
The Ptolemaic model of the planets and their orbits. Epicycles on epicycles on cycles, all trying to square the circle (if you'll excuse a disgracefully mixed metaphor - and as you will know, squaring the circle has been proved to be impossible). But they never got it quite right. For the same reason that the Net Zero zealots will never get their "system" to work - it's impossible in principle.
https://www.youtube.com/watch?v=KpmrQdaQjGg
They know that CAGW is a scam and its "solution" Net Zero is impossible. Their goal is to sabotage our energy and hence industry, impoverish us and make us militarily insecure in the process. They intend to carry on until the situation becomes so bad they are stopped. They're not expecting us to reach Net Zero CO2 emissions in 2050.
Hi David, you regularly post about how Net Zero and the strong push for so-called "renewables" is not working, and you post lots of data showing that it's not working and ask British elites for a re-evaluation of their strategies and priorities. However, have you considered that the elites *don't want the masses to have access to cheap energy, and that they actually want them to die off?* Because it's really not a full analysis unless you consider that (imo highly likely) possibility. And if that possibility is true, how does your analysis change then, if at all?
How would that make any sense?
Start from the fact that we have an expanding population (yes, we do!) with a more or less fixed amount of the various natural resources. Fewer "useless mouths" would mean, perhaps, more for each of the survivors.
Population is growing due to the immense momentum of previous generations. It's like a giant ship, you can't just shutdown the engines and expect the ship will stop moving.
The fact is we are well past peak child, there will never be as many children as there are today at least for the foreseeable future. Everyone likes to talk about exponential population growth, but you can just as easily have exponential population collapse, which is what we are currently experiencing. And it is extraordinarily dangerous for our civilization and in fact all of the Earth's biota.
And we don't have a "fixed amount" or natural resources. To be accurate, there is no such thing as natural resources. There are natural materials, vast amounts of them, for all intents & purposes, an unlimited supply. Resources are materials that we currently have found useful under the current state of technology.
Actually population is growing because a lot of couples are giving birth to children. Ships, engines, momentum - that is all flowery abstract talk. population growth is this: https://www.worldometers.info/world-population/
You write “The fact is we are well past peak child, there will never be as many children as there are today”, but what that page demonstrates is that there are more children every MINUTE.
Please note that I didn’t say anything about “exponential” growth. That concept has been done to death; many people think “exponential” just means “a lot”.
And more children are becoming adults every MINUTE than new children are being born. And in most of the World, except some countries in Africa, more people will soon be dying than are being born, as is already happening in almost all Western nations, & China, S. Korea, Japan.
No reason to expect that trend, which is a product of industrialization, won't spread to the African nations as well.
The most IMPORTANT talk on the demographic crisis you will ever hear, Stephen Shaw
https://www.youtube.com/watch?v=F6KptpOuo7E
It makes perfect sense. Why would the same people be so keen to attack farmers and weaken food security?
Well farming was a massive tax loophole, so it could be that? Food security is a different issue, IHT doesn't make farms disappear.
If you think there is no attack on farming taking place and it was just a matter of cutting out a "tax loophole" [which could have been done without damaging actual farms] then you need to pay more attention.
There has been, until Trump's election, a coordinated and concerted effort in what can laughingly be called Western Liberal Democracies to destroy our food supply chain, all in the name of 'Climate Change'.
Don't you think it odd that the governments of so many countries all start to attack farming at the same time?
Hopefully, the influence of the Trump administration will help to destroy the Malthusian elements in power today. Many Western politicians demonstrate a real animus towards their own citizens.
The problem is, the politicians have no understanding of farming and don't understand that once turned off it would take decades to turn back on. In the meantime, millions of people would literally starve to death.
Our clown politicians are enacting laws that will result in famine.
You think Trump understands farming?
Apparently, he has a better and deeper understanding of farming than you! But if you only listen to MSM for your information this is understandable.
However, you won't be the first to underestimate what he does and does not know.
Someone who has been highly successful in three completely different domains is not a fool, though I know lots of liberal progressives like to believe that is the case.
If what I infer about you is correct the next few years are going to be deeply disturbing for you. And wait until you see what he has in mind for gold!
TDS is debilitating!
Tax loophole? Are you kidding. The vast majority of farms are passed down through generations. The increase in value is locked up in the land itself - it can’t be realised without splitting up the farm. Inheritance tax in general is bad enough, but this is the equivalent of a tax on an unrealised gain on the farmland and is utterly unfair. It is also a direct and deliberate attack on our food security.
How kidding, people were literally using it as a inheritance tax avoidance loophole. Do you deny that?
Not sure how you believe it impacts food security, it doesn't make the farm disappear.
" literally using it as a inheritance tax avoidance loophole" High net-worth individual were using the tax system to their advantage, which is perfectly legal and sensible. All the government had to do was to stop this element of tax avoidance without penalising generational farming families. The wealthy will just move onto some other scheme or take their money out of the country all together.
But this useless government decided to have a pop at destroying small farms.
You seem to think that paying inheritance tax is natural, like eating or breathing. I’ve got news for you - it’s not. In any case the number of people buying land to avoid IHT is small by comparison to the number of farmers who generate our food,
As regards the land still being there, farms broken us are either less productive or, more commonly, bought up by large financial investors whose relationships with globalist governments makes them an extreme threat to all of us.
Neo-Malthusianism - too many people in the world, rapidly depleting resources.
This is where it gets tricky. I firmly believe there actually are too many people for the world's carrying capacity even today - and it will get worse before it gets better. The UK currently has more than 4 times as many people as it could sustain indefinitely. (Note that last word). Of course, if you are prepared to burn the furniture you can do fairly well for a short while.
See, for instance, https://www.footprintnetwork.org/ and https://8billionangels.org/earthovershoot/country/USA.html
The ideal time to have done something about overpopulation was about 1900, when the world's leaders decided to plunge into a sequence of disastrous wars instead. (One of the axioms of population study is that wars usually increase population, as the birth rate goes up. The USSR in the Great Patriotic War is an exception, which I acknowledge gratefully and reverently).
Carrying capacity for humans is nonsense. You can easily have billions on Mars. Where's the carrying capacity?
Humans are more and more diverging from a reliance on solar energy & biological ecosystems. So the biological term "carrying capacity" does not apply.
And for non-human life, carrying capacity is substantially increasing due to increased CO2 levels supplying much more carbon which is a limiting factor for biological systems. And we humans can greatly further increase that carrying capacity through ocean fertilization methods.
“Billions on Mars”? What have you been smoking?? For a start, how do you propose to get billions of people to Mars? It’s a very long and extremely dangerous journey, and even trained astronauts in the peak of youthful health would have difficulty surviving. How many spaceships do you propose, carrying how many people each?
Then you claim that “Humans are more and more diverging from a reliance on solar energy & biological ecosystems”. How on earth do you see that happenning? Can you please tell us about any humans - any at all - who do not rely on food from biological ecosystems? Or do you expect a new breed nourished only by Bill Gates burgers grown in labs from inorganic materials?
Indeed Mars could easily support billions of humans. And a vast biota, less than the Earth's but an extraordinary amount.
I never said anything about transporting billions to Mars. Presumably they would be there by reproduction, if it was desired, no big reason to do so, but I'm just talking about supposed carrying capacity. Transporting millions of humans to Mars is quite doable with current tech however, that's not a problem.
We can certainly replace solar energy with nuclear energy. And that can supply food just as stored solar energy is responsible for much of the World's human food supply using fossil based fertilizers. And in general plant growth increased due to fossil fuel CO2 emissions.
I'm not advocating for replacing grown food with manufactured food, the tech is not available right now, but certainly will be in the future, if we chose to use it, which would be optional.
And I never said anything about wanting unlimited human population growth, personally I think around 10B people on Earth is an optimal population at present.
Yes, I agree with you Tom. The best time to address this stuff was on the front end before populations got so wildly out of control, and to try to each people about sustainable living. Our elites had other things in mind, unfortunately, and in my opinion they’re full of noblesse malice instead of noblesse oblige…
Populations aren't getting wildly out of control. We have the opposite problem:
The most IMPORTANT talk on the demographic crisis you will ever hear, Stephen Shaw, Alliance for Responsible Citizenship:
https://www.youtube.com/watch?v=F6KptpOuo7E
"In this speech, Stephen Shaw explains how rapidly declining birth rates are putting many countries in danger of disappearing within a few generations. Reversing the narratives around children and population growth is urgent for the sake of our civilizations."
And "sustainable living" is garbage. Sustainability is almost entirely based upon the current state of tech, and determined by the competence level of our governments.
It is true some nations have a high birth rate. That's why you don't want globalism, you want the Westphalian system of free & independent nations. Each nation is responsible for its own population. If they let it get out of control then there will be starvation there and that is on them, no one else.
I understand our current monarch is a believer of there being too many people, and no doubt a supporter of this government’s drive to depopulate this country one way or another. It may be working as the news media have been reporting of youthful emigrants.
If there is a drive to depopulate it isn't going very well at all is it? Population inexorably climbs
Excess deaths? Or is that an inconvenient truth?
And there is little doubt that there is a food supply collapse coming, there are plenty of people involved with food supply saying this. There is a goal to reduce the head of lamb by at least 27% in the next 10 years, similar for cattle & pork. Not to mention the hairbrained idea of reducing the arable growing capacity. And any food or power for that matter will be beyond financial reach for most.
No it won't. We are already well past peak child. Population just has a large momentum effect, both in rising or in falling. Current best estimates put Earth's population peaking by mid-century at close to 10B. Which I consider to be about optimal.
Population is climbing in Africa; their fertility rates are decreasing but way less than the elites expected. Fertility rates in Asia, the West, and the Middle East are all decreasing, and the West absent immigration has sub-replacement fertility rates.
But the West isn't "absent immigration".
But they are preserving the (fossil fuel) resources with net zero? If anything it wastes resources which accelerates any Malthusian disaster
If they wanted our energy resources to be sustained and grown there is only one choice and that is nuclear energy. Which they have been blockading.
I don't understand that at all. It's the worst symbol for how short sighted the green movement is.
"But they are preserving the (fossil fuel) resources with net zero?"
No, they are not. This is just us who are foolish enough not to use the resources at hand. In the case of gas, we actually purchase gas from Norway that they extract from gas fields we have access to! Gas does not recognise national boundaries in the process of flow. Norway are selling us gas we could extract and tax ourselves! This is insane.
Our LibLabCon government position on netzero is both ruinous and ludicrous in equal measure.
China, India in particular and most of the rest of the world take no notice of the flawed hypothesis that 'Climate Change' is solely or mainly caused by an increase in the level of Co² in the atmosphere.
Do you think no country has ever dealt with resources being cross boarder? Gas does no flow infinitely, only within the field.
I agree about netzero being ruinous and self destructive. CO2 driving climate change or not, it won't change the behaviour of China and India.