A target too far?
The analysis presented in the Institution’s latest report was undertaken in response to the Scottish Government’s declaration that by 2020, 20% of the total energy demand in Scotland would be met from renewable resources.
This exceeds the 15% target that the EU Renewable Energy Directive (2009) requires the UK to meet as a whole.
More recently the Government also announced that 100% of electricity generation will come from renewables by the same date.
The Institution’s findings suggest that the original renewable energy target split for Scotland of 50% electricity, 11% heat and 11% energy for transport, making the overall 20%, and subsequent revision of the electricity generation target to 100%, did not appear to be supported by a rigorous engineering analysis of what is physically required to achieve a successful outcome in the timescale available.
During the research for this report, First Minister Alex Salmond announced that the Scottish Government had increased the overall percentage target for energy from renewable sources to 30% by 2020. In light of this report’s analysis, this aspirational target appears to represent an ambition that cannot be justified from an engineering perspective.
In the absence of a credible publicly presented plan to deliver Scotland’s renewable energy at the scale required, the Institution of Mechanical Engineers considers here what these targets mean from an engineering viewpoint.
IMechE Scottish Energy Report
Scotland’s energy balance
In 2008, the UK’s total energy consumption was 1,695 TWh/y, split: Heat Energy, 710 TWh/y (41.9%); Energy for Transport, 598 TWh/y (35.3%); Electricity, 387 TWh/y (22.8%).
For Scotland, agreement does not exist on a set of figures for such a split, which in itself means that data for Scotland’s point of departure, against which the outcomes from its energy policy can be measured, is not defined.
However, from data reviewed by the Institution, the projected set of figures published in the Scottish Renewable Forum’s 2006 ‘Routemap’ were considered the most reliable, and these are used as the basis of this report. On a similar basis, the projections for 2020 were: Total energy 183.1 TWh/y, split: Heat, 89.7 TWh/y (49%); Transport 55.0 TWh/y (30%); Electricity 38.4 TWh/y (21%).
Energy or Electricity?
What the findings above illustrate is that the term ‘Energy’ is often confused with ‘Electricity’, a mistake often made in the media and in Government communications.
Electricity is actually projected to be the smallest component of Scotland’s energy demand (heat and transport energy being greater). This leads firstly to the conclusion that the focus of the nation’s energy policy on electricity is misplaced. Secondly, that even if Scotland’s electricity supply could be developed to source totally from renewables in a robust, secure and reliable manner, this would barely achieve the overall 2020 20% target.
Most of the recent renewable energy installations deployed in Scotland in the electricity sector have been based on intermittent, unpredictable resources like wind and solar. However, it is important to recognise that if a larger contribution is to be achieved through renewables, there must be a readjustment to provide more of the proportion from on-demand, predictable resources like biomass and energy-from-waste. In this regard it is vital that the differences between ‘installed generation capacity’, measured in MW or GW, and the actual amount of electricity supplied from the installations in MWh or GWh is clearly understood.
Scotland’s 2020 commitments
Scotland has substantial potential resources for renewable energy and, partly in recognition of this, the Government has committed itself to exceeding the UK’s 2020 commitment, primarily through the use of electricity.
In July 2009, a grouping of NGOs produced “The Power of Scotland – Renewed” report which attempted to demonstrate that renewable resources could meet between 60% and 143% of Scotland’s projected annual electricity demand by 2030.
Subsequent policy thinking on energy appears to have been strongly influenced by this argument and the level of debate in the public domain has been somewhat limited. However, the report was based on idealistic solutions and not backed up by a detailed engineering analysis of how these targets could be practically achieved through a workable approach to delivery. In particular, consideration was not given to the need to provide large amounts of back-up generation technologies that can deliver electricity on demand, most likely from fossil fuels, to support the deployment of intermittent renewables on the scale proposed.
The greenhouse gas (GHG) emissions target that Scotland has adopted for itself is a 42% reduction below 1990 levels by 2020, with an 80% reduction by 2050 (the equivalent numbers for the UK as a whole are 34% and 80% respectively). Scottish policy thinking in this area appears to be largely based on a belief that GHG emissions will automatically be reduced if sufficient renewable energy technologies are deployed, particularly for electricity generation.
However, the provision of ‘on-demand’ energy conversion technologies needed, very likely fossil-fuelled, to back-up the intermittency inherent in deploying large amounts of wind, solar and wave technology will have an impact on net emissions saving that does not at this stage appear to have been recognised.
Barriers to achieving the 2020 targets in Scotland
Many of the Institution’s members work in the energy sector and are critically involved in delivering the machines, equipment and devices which are necessary to meet the 2020 targets. In reviewing the practical issues related to achieving a successful energy outcome for Scotland, the following points were identified.
A number of technologies used in renewable energy systems have been available for decades, but significant development work is still required to improve the efficiency of their performance and reduce the cost of maintenance, as well as simplify manufacture and reduce equipment and deployment costs. This is particularly the case for electricity generation from offshore wind, upon which much of Scotland’s energy policy is focused.
Many believe that the future of renewable energy in Scotland lies with a wide range of marine devices. Yet the fact remains that there is a great deal of expensive and time-consuming research, development, deployment and decommissioning (RDD&D) work ahead before these technologies are available for deployment in large quantities at a meaningful scale. Further, to support increased use of intermittent renewable sources, technology needs to be developed in the areas of smart metering and smart grids, and even more crucially in energy storage if large amounts of back-up on demand generation are to be avoided.
The UK National Grid was built to connect large centralised electricity generating plant to industrial and domestic customers. However the situation has now changed significantly and the grid is increasingly required to integrate remote power generators using local renewable sources. Furthermore, much of the Grid asset is reaching the end of its design life and requires updating. A multi-billion pound investment is needed in order to tackle both of these issues and make this infrastructure fit for purpose in the new energy regime. Further, in the case of heat energy, there is no significant, available delivery network in Scotland and little thought appears, as yet, to have been given to this issue.
Even if it were possible to resolve the technology and infrastructure issues in the short timeframe available to 2020, there are still major concerns in the engineering community regarding Scotland’s ability to provide the human resources needed to design, project-manage, install and commission the volume of equipment that will be required to meet such ambitious targets.
One strategic approach to this challenge might be to assume that appropriately-trained people from overseas will be able and willing to work in the renewable energy sector in Scotland. However, many countries across the globe are also aiming to meet challenging renewable energy targets over the next few years and it is not necessarily certain that such people could be attracted to work in the sector in Scotland rather than elsewhere.
Although Scotland is by no means devoid of manufacturing industries, the country does not have a sufficient manufacturing base for the large volume of equipment which will be required to meet the 2020 targets.
A successful manufacturing base would be provided by a combination of large corporations and SMEs. Large corporations will only invest in new manufacturing capacity in Scotland if the market conditions are right; this is particularly true of overseas companies without current facilities in the country. SMEs, on the other hand, particularly those making specialist components as part of a supply chain, are much more likely to want to set up manufacturing facilities in the country, but in many cases find the levels of red tape they have to cope with too daunting.
In the current economic climate, SMEs are finding it particularly difficult to access the finances necessary to build their businesses to be able to provide the goods and services required to meet the 2020 targets. Large renewable energy projects, in particular offshore wind, can be funded by multi-national corporations (MNCs) from their own balance sheets, and there is often no need for them to seek external funding. Whereas SMEs, along with local communities, do not have an equivalent finance base and must obtain funding from external sources for smaller-scale projects and/or manufacturing equipment. These issues make business opportunities unattractive and therefore stifle the expansion of the renewable energy equipment manufacturing base in Scotland.
Growing Fuel Poverty in Scotland
The 2003 UK Energy White Paper made ‘fuel poverty’ one of its four main policy objectives. However, rather than improving the situation, fuel poverty has actually worsened since 2003. The Scottish Government has pledged to ensure that by November 2016, so far as is reasonably practicable, people are not living in fuel poverty in Scotland.
The reality is that the fuel poverty rate in Scotland fell from 35.6% in 1996 to 13.4% in 2002. However from that point onwards, the rate has been steadily rising year-on-year to 32.7% of households in 2009 – almost back to the 1996 levels.
Although in recent years this may be a result of increased fuel prices being only partially offset by rising incomes and energy efficiency increases, the figures reveal that fuel poverty was rising sharply well before the current economic downturn began in the UK. Scotland clearly has a particular problem in this area which is not being adequately addressed. To achieve a zero fuel poverty target by 2016 with fuel poverty forecast to continue to rise over the next few years will be a very major challenge, especially with the various market incentives for renewable energy inevitably contributing to generally higher energy costs.
Scottish Energy 2020? Recommendations
The Institution of Mechanical Engineers supports the aspiration of the Scottish Government to fully exploit the significant potential for renewable energy that exists in Scotland.
This must however be founded on a pragmatic engineering approach to what can actually be achieved and on what timescales. Even within the power generation sector, a relatively straightforward area compared with heat and transport energy, the ability to achieve large percentages of electricity supply from ‘intermittent’ renewable energy resources is technically challenging both in engineering and policy terms.
As a first step towards creating a successful policy for Scotland’s renewable energy exploitation project, the Institution makes the following recommendations.
1) Understand and agree the starting point. The Scottish Government should, as a matter of absolute priority, establish, agree and publish the current position in TWh/y of the gross energy consumption in Scotland in the three component fields of Heat, Transport and Electricity. It should then determine its targets for 2020 (using SMART principles) in the same three fields. The inter-relationship between these three fields must be clearly understood and their relative positions in the ‘energy mix’ defined and made publicly available. Only clearly-defined measurable targets can be intentionally achieved.
2) Lay out an engineering based plan to achieve the targets. If the present target of 100% electricity from renewable energy sources by 2020 is to be maintained, then the Scottish Government should clearly state its engineering-based methodology for achieving this ambitious target. In this regard Government should consult with competent and independent engineering professionals who have knowledge and experience in the actual delivery of major power projects. This will establish what level of electricity generation from renewable energy sources can realistically be built in Scotland and in what time period. This will also involve determining the skill levels, manufacturing capability and funding obstacles as well as the numerous outstanding technology and infrastructure issues that still need to be resolved.
3) Create policies that effectively tackle fuel poverty in Scotland. The Scottish government must prioritise the sourcing of secure, reliable energy supplies for the nation’s electricity, heat and transport requirements, while effectively tackling the growing issue of fuel poverty. The latter must be addressed within Scottish energy policy to ensure that an increasing number of people are not tipped into fuel poverty simply because of the increased cost of providing renewable based energy. Such an outcome would create an unsustainable position for the Scottish people.
IMechE Scottish Energy Report
Read the press release on Scottish Energy 2020?
Read the Energy Hierarchy Position Statement