Stand & Deliver: ‘Renewable’ Energy Rent-Seekers 21st Century Highwaymen

Wind and solar rent seekers have all the style and menacing panache of the 17^th-century highwaymen.

It takes real audacity to look your victims in the eye and demand even more subsidies on top of the obscene pile rent seekers have already drawn from taxpayers and power consumers.

But these boys are dripping in audacity. Characters such as Tom Glover – head of wind power outfit RWE’s UK arm – who demanded a 70% increase in the government-guaranteed price of power for the electricity that RWE might occasionally deliver to market (only when the wind is just right, of course). His ‘threat’ that no more offshore wind farms would be built unless the government played ball, sounds more like a welcome promise.

What it also reveals is how insanely expensive offshore wind power truly is. Thereby shattering, once and for all, the ‘wind power is cheap’ myth, as Ross Clark outlines below.

The case for wind power was built upon a myth
The Telegraph
Ross Clark
29 October 2023

Wind is already the cheapest form of power and will save us a fortune in future. We know this because the green energy lobby keeps telling us so. But it is hard to square with the words of Tom Glover, chair of energy company RWE’s UK arm, last week.

No more offshore wind farms will be built, he said, unless the Government hikes the guaranteed long-term prices offered to their operators by as much as 70 per cent.

The energy “market” is not really much of a market at all, not when it comes to green energy. The Government underwrites wind and solar through “contracts for difference” – guaranteeing operators a minimum “strike price”, rising with inflation, for every megawatt-hour of electricity they generate over 15 years.

The trouble is that wind farm developers will no longer accept the strike prices offered. Last time the Government held an auction for the right to build offshore wind farms, in September, it received not a single bid.

The maximum strike price the Government offered was £44 per MWh. According to RWE it won’t receive any bids until this is raised to between £65 and £75.

How come, when the cost of wind energy is supposed to be falling year on year? True, the cost did fall sharply up until 2019. But this then went into reverse thanks to higher commodity prices and interest rates. With renewable energy, most of the costs come upfront – which makes it particularly reliant on cheap debt.

But this is only half the story. If we are going to have a grid based on intermittent renewables, it is no use looking just at the cost of generation. We have to add on the cost of energy storage, or some other kind of back-up – or else build so many wind and solar farms that we have just enough power at the worst of times, and a super-abundance of it at other times.

All are likely to be horrendously expensive. Storing energy in lithium batteries, for example, can cost around six times as much as generating it in the first place. Using gas as back-up – as we do now – means we have gas power stations sitting idle for some periods, pushing up the unit cost of generation when they are needed.

As for super-abundance, we would end up with masses of idle wind turbines and solar panels instead. They would only get built if their owners were bribed with huge compensation for being unable to supply all their power to the grid.

Wind farms already do receive such “constraint payments”, which inevitably end up on our bills. In 2022, energy consumers – unknowingly in most cases – had to pay £215 million to wind farm owners to turn off their turbines. This is a bill that is surely only going to rise as more and more wind farms – and far too few energy storage facilities – are connected to the grid.

Remember how, last summer, the renewables lobby was trying to tell us that wind energy was “nine times cheaper” than gas? It was a blatantly false comparison between long-term strike prices for wind and “day ahead” prices for gas – ie the inflated prices we have to pay the owners of gas power stations to turn them on for a few hours at short notice when wind and solar are in short supply. We are paying more than we need to for gas power because we are using it to balance renewables.

So, no, don’t be fooled by the PR. RWE has let the cat out of the bag. Renewables never were particularly cheap – and they are likely to get a lot more expensive.
The Telegraph