The Hinkley Point saga, now coming into its tenth year, is beyond bonkers or fiasco. Yet another pause, during a time of other changes in the post referendum government should mean a debate over its genesis in 2006-2008 – and the more recent 2012 decision on the strike price of power that was offered. Although logical enough at the start, Hinkley developed some fundamental errors by ignoring global energy trends. In short, the facts changed.
The original sin was a certain belief UK power was destined to be expensive because fossil fuels were becoming scarce. This wasn’t an entirely unreasonable proposition in 2006. I believed it myself – then. But by 2012 it was becoming doubtful, but not doubtful enough for DECC who predicted fuel prices based on low, central and high: “scenarios”. Scenarios are narratives, in short a story. Scenarios are also predictions, guesses, or bets, but it sounds so much better if the experts, who charge money for them after all, wrap them up as scenarios. Continue reading The lessons Hinkley Point should teach us today.
The US shale revolution is now going global via LNG. Countries that formerly would have chosen coal for power generation are now going gas.
“There are markets like Bangladesh and Pakistan where traditionally they would have gone with coal but now gas can be the cheaper option once you include the cost of new infrastructure,” LeLong of Goldman said. “You are seeing these energy poor countries often with poor credit ratings turning to LNG.”
While China and India are the two carbon monsters in Asia, there are many smaller ones also doing the math about coal and gas and finding gas wins on cost, pollution and infrastructure. Coal was the default option for years. but we’re seeing smaller markets embrace natural gas as in Sri Lanka:
Sri Lanka will cancel plans for a 500 megawatt Indian-built coal-fired power plant at its strategic eastern port city of Trincomalee and will instead opt for a liquefied natural gas (LNG) power plant, a cabinet minister said late on Tuesday.
“We do not want to hurt India. So President Sirisena in his visit has offered an LNG plant instead of the coal plant,” Weerakkody told Reuters. “This has been discussed at the highest level and there is consensus.”
Continue reading Natural gas is saving the earth.
A quick word about London Local Energy. You haven’t heard the last of us. In coming months, you’ll hear much, much more.
Simply put, in the last two years of waiting we’re becoming even more confident about supplying the lowest carbon, highest tax natural gas to the 3 million plus Londoners who use it to heat their homes and take a shower every day. Or most days judging by London Underground recently.
Low food miles is a concept everyone understands. Low energy miles in natural gas is an equally attractive prospect. If I proposed artisanally produced London olive oil, my floor would be covered in blood from the fight between Waitrose, Marks and Spencer and Whole Food. Often the best ideas are simply too early. But the smartest ideas come from those who don’t give up, refine them further and create enthusiasm from unexpected sources. London Local Energy will be back. This time with friends.
This is the new home of No Hot Air. Most of the links to the past are still here, with the occasional dead link and graphics gone. The most important part of the site are now the buttons to the right. Unlike the Friends of the Earth, I’m not a charity.
Things will look different, but some things remain the same. The most important thing is that No Hot Air’s archives are still here. Readers already know that one of my most enduring, if not endearing, qualities is an ability, developed from years of practice to say I told you so. Having posts dating back to 2008 allows me to prove it. The search section is still operating, and is much quicker. Explore eight years of the shale revolution. It’s great fun to choose something random from 2010 and shake ones head in wonder, or shame, that so many experts were wrong. Even worse, it’s amazing how much the themes of shale – damage, economics, and sustainability being only three examples, are still used by both fracktivists, academics and financial analysts even today.
There were times I have been wrong. European shale gas is still too early, but getting closer. Just because it hasn’t shown up yet doesn’t mean that it won’t. Thats a message I’ll be taking to Platts European Gas Summit in September.
The other place I’ve been wrong is underestimating how huge the Marcellus and Utica shales were. They are truly monstrous with current production at a rate of 20 bcfd or over 200BCM, which is almost half of all EU (including the UK!) gas consumption.
European shale won’t be the same as the US. We’ll have to reinvent it. Or, as I prefer, to re-imagine it. But it’s coming. Huge gas resources have been under the feet of customers for over 200 million years. Another few years won’t change much.
As anyone who follows me on Twitter knows, I’m underwhelmed by the EU referendum vote. About the only thing that makes me hopeful is how my experience in UK shale makes me believe the far more complicated issue of Brexit will never happen. The UK has multiple examples of how difficult the simplest infrastructure can be : HS2, Crossrail, Heathrow Expansion, Hinkley Point etc etc. The only big project delivered on time this century was the London Olympics, a special case connected with saving national embarrassment. Many other projects proves how in UK infrastructure, one can’t do anything at all in less than multi-decade timescales, by which time the original problem has often become irrelevant.
Continue reading Brexit and British shale
In 1950’s America at the dawn of another revolution, that of Rock n’ Roll, there was the Payola scandal, when payments to disk jockeys to play particular records were illegal.
Methods became more sophisticated and third parties nosed in, yet because it was about US airwaves publicly regulated by the FCC, there were still cases even up to 2005.
What on earth does this have to do with energy?
Continue reading The curious case of the Frackmaster. What can we learn from it?