Zerocarbonista

Does ‘Good Energy’ cause new generation to be built?

Filed under: Energy Sector, Renewables — dale May 12, 2008 @ 4:12 pm

This post was inspired by a couple of comment posters who got in a discussion about Good Energy. Andre - in my opinion the claims (you refer to) of Good Energy don’t stack up. The idea that by selling existing green electricity to someone you can encourage someone else to build a wind farm is tenuous at best – though possible in theory. The biggest problem this theory faces in practice is that people thinking about building wind farms have no shortage of opportunities to sell their power – the market in the UK is very competitive for generators. And power companies are queuing up to buy green (and brown) energy.

On its very best case the Good Energy approach is indirect; it’s the second best way to go about bringing change – encourage someone else to do it. The first best way is to take responsibility yourself and build, that’s what all power suppliers should be doing. I believe these are just marketing claims to green up the product.

Tom mentioned the Westmills project. I know the Westmills project well, it started sometime around 1993, when I persuaded the farmer (Adam Twine) that he had a good site for a wind project. It’s taken an awful long time to get it off the ground, and I’m glad it’s finally up and running. But it hasn’t been held up though by an inability to get a power purchase agreement with somebody – far from it. In fact Westmills had a power purchase agreement many years ago with the government (under its NFFO scheme) and it spent some time getting out of that so that it could be more profitable now that ROCs exist in the world. The recent Good Energy purchase agreement did not make this wind farm happen – in any way. Anybody that tells you that is not being completely honest.

I’m not slagging Good Energy off, they work hard at what they do and they contribute, we’ve more in common than we don’t – they just don’t bring generation into being, they buy it once it is existing, or about to exist. I think it’s good to be clear on that.

13 Comments »

  1. Hi Dale,

    Obviously I agree with your stance else I would not be buying “New Energy Plus” from you, and I point other people to Ecotricity for the same reason: actually doing it directly rather than hoping to maybe encourage someone else to starting thinking about possibly doing it when the cat has been flossed next year… B^>

    But I’m still itching to hear your “why microgeneration power is no use (to power companies such as Ecotricity)” writeup. I understand the issues in general and I have been reading the various BERR/Ofgem/etc papers too.

    So the question is I guess, *is* there anything that could be done to make microgenerated power a usable practical tradable commodity?

    I also asked National Grid about attaching storage to such microgeneration to assist (in a tiny way) with balancing (http://www.earth.org.uk/note-on-distributed-grid-support-from-microgeneration.html), and again it’s apparently the million-fold difference between total demand and an individual microgenerator output, plus the non-dispatchability on the face of it, that seems to be the killer.

    On the other hand, Germany’s lights haven’t gone out with GW of non-dispatchable solar and wind power…

    Rgds

    Damon

    Comment by Damon Hart-Davis — May 13, 2008 @ 10:52 am

  2. Hi Damon,

    I am keen to hear the FITs part 2 too - looks like Dale has his work cut out with answering comments! (I too chose Ecotricity for the same reason - and pass the same message on to family and friends - “let’s do something now!”)

    Anyway - in the meantime - I was surfing around the other week and came across this blog post (I was looking into Oldbury Nuclear power station I think)… I posted something in my usual flippant manner, and he did in fact pay attention to what I was proposing and did some maths. Fair play to the guy (must be thanks to his education ;-)).

    I haven’t had time to go back and do a follow-up comment - but he went and created a whole new post about my ramblings.

    I actually think that with some kind of swappable battery/capacitor for Electric Vehicles (with one at home as a spare), that the nations cars could play a part in Microgen and the smoothing of demand/supply curves… in theory at least… he knows more about this stuff than I do though - I am just a slightly green geeky utopian fish ;-)

    Comment by nommo — May 13, 2008 @ 11:16 am

  3. Hey! I agree, we need to take responsability ourselves to reduce each of our consumption! I was browsing through a bunch of green websites and blogs and I came across yours and found it very interesting. There are a bunch of others I like too, like the daily green, ecorazzi and earthlab.com. I especially like EarthLab.com’s carbon calculator (http://www.earthlab.com/signupprofile/). I find it really easy to use (it doesn’t make me feel guilty after I take it). Are there any others you would recommend? Can you drop me a link to your favorites (let me know if they are the same as mine).

    Comment by Adrian — May 14, 2008 @ 11:45 pm

  4. Going back to the original Question about Good Energy, Although I agree that creating the renewable energy like Ecotricity does is best (thats why I chose Ecotricity) I found that Good Energys use of a range of renewables was quite attractive. And wondered if Ecotricity had ever thought of diversifing into Hydro or Bio mass like this one.

    http://www.power-technology.com/projects/stevenscroftbiomass/

    I think that its great that ecotricity champions wind power but at the end of the day I think sustainable energy will only come by having a range of renewables. So it would be great to see Ecotricity branching out into other forms of renewables. But of course the temptation must be to stick with what you know and do best.

    Comment by Ricardo — May 16, 2008 @ 11:43 pm

  5. @Ricardo – There are two aspects to your question I think – what we Buy and what we Build.

    What we Buy - When we started up we had hydro, landfill and wind in our mix, we pioneered the support (by buying) of small scale renewables, we were the first to offer an alternative for small guys – fairtrade in small generation in fact. Since then green electricity has become very popular and the market for it competitive – it’s so easy these days for small generators to get a good price, we’re not needed to do that anymore – and so we’ve not bothered to buy the various sources of existing small renewables for a while now. In fact it’s premium priced these days which is why Good Energy has to charge more.

    Then there’s what we Build. Here we focus only on wind. The reason being it’s the renewable resource with most to offer – we have this vast capacity (enough to run the whole country three times over), the technology is mature and reliable, and it’s economic – which means we can build new sources of it and sell green electricity with no premium. There’s no scope in hydro or landfill for example in terms of available capacity. Biomass is very expensive and has questionable environmental impacts (we won’t use it in fact) and wave and tidal power are still at the R&D stage (though we hold out big hope for them and will take part as soon as we can). Solar is just way too expensive.

    When you look at it, wind is the obvious place to focus – if you’re about Building new sources of green energy. If you’re about Buying up stuff that someone else already built – then it’s nice to buy up a variety, looks good in brochures and stuff. But truthfully, it doesn’t achieve a fat lot. Hope that helps. Cheers.

    Comment by dale — May 21, 2008 @ 8:23 am

  6. @Damon

    Just a heads-up in case you are watching this thread but having subscribed to the RSS feed for the site yet… Dale has just posted up the FITs part 2 post.

    Cheers
    Paul

    Comment by paul — May 21, 2008 @ 8:49 am

  7. Really the answer to the question is in the fact that microgeneration gets premium price paid; therefore, correct me if my logic is faulty, more people will consider investing their time and money in it as there’s a guaranteed ready market.
    I think there’s room for both methods of energy supply, Good Energy providing stimulus to renewables generally, and Ecotricity forging ahead with wind and gradually increasing the wind side and it’s own portfolio. The sensitive point is where power has to be bought from the non-green sector to make up the difference, which slightly jars with the whole Ecotricity image, for some.
    But if Ecotricity behaved like Good Energy, we’d wait an awful lot longer to get there.

    Comment by Peter Simmons — May 23, 2008 @ 9:42 pm

  8. An addition to the previous:
    When Good Energy started, as Unit-e, there was no demand from the others, they had no interest in renewables. Just because they’ve all jumped on the bandwagon, and I agree it just PR, doesn’t mean Good Energy should pack up shop. I doubt they are big enough to move into build, but the big ones certainly could and should.

    Comment by Peter Simmons — May 25, 2008 @ 3:06 pm

  9. @Peter – Actually when Good Energy started as Unit E, they were the third company in the UK to set up and offer green electricity, following Ecotricity and SWEB. Demand existed by then and independent generators were getting independent deals. Good energy joined our bandwagon. Until a few years ago GE have always said they existed to build new renewables. They’ve not built yet, but it’s a mistake to think they’re not big enough to. They have just over 20,000 domestic customers, we have around 35,000 – we’re in the same league in that respect. And GE spends a lot of money retiring ROCs and LECs (tradable bits of paper), in the belief that this stimulates the market (a claim the ASA have banned) – they could spend that on new build instead and build maybe 3MW per year, enough to power about 3,000 homes. But they throw the money away instead. Cheers.

    Comment by dale — June 2, 2008 @ 12:22 pm

  10. Thanks Dale for the correction. As I discover UnitE before hearing of Ecotricity, I had assumed they were first in the field.
    Perhaps they could be persuaded to part finance solar roofs with guaranteed purchase of surplus; a deal with building firms for instance.

    Comment by Peter — June 2, 2008 @ 12:52 pm

  11. @ Peter – No probs, and very understandable - it all started a long time ago now (13 years). Over the years lots of people have looked at finance of solar roofs through mortgage type deals and such like. The basic problem with it is there’s no payback ever (on solar), it makes the economics challenging. It probably needs the 30p a unit, or so, that is paid in Germany, to give it a shout. There are far batter (more effective) ways to spend your money though, I’m going to pull together some numbers for another post on micro generation to explore that. Cheers.

    Comment by dale — June 10, 2008 @ 10:56 am

  12. If I get solar electricity from a desert plant in the American south west, and I live on the east coast, I’ll get peak power in the evening won’t I? What effect would a solar plant in Florida have on the same grid? How about one in Mexico, or Texas? Doesn’t the time zone thing have some effect, as we are all attached to the same grid?
    I would love a little battery powered two seater carbon fiber commuter car, especially if I could get exchangeable recharged batteries from stations wherever I go! Cool way to extend range!!

    Comment by Uncle B — June 16, 2008 @ 1:21 am

  13. Cross-timezone grids should be very good for shifting (especially) solar power to local peak demand elsewhere. Google for global grid or hypergrid or whatever. It probably even helps a little between the UK and France with our 2GW intertie (and another 1GW to NL and the rest of the European grid on its way).

    I’m not convinced that the US has a very good national-level grid capable of shifting much juice around for one reason or another. It’s difficult enough for individual states to get new powerlines put in to shift new renewables, never mind crossing company and state and regulatory boundaries.

    Rgds

    Damon

    Comment by Damon Hart-Davis — June 16, 2008 @ 9:44 am

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