Lang Banks
Scotland’s story of a power sector in transition is being played out in
many countries around the world.
The centralised, large, fossil-fuel generation model is being unravelled
with every new megawatt of renewable generation.
The role of “baseload” thermal power is being eroded rapidly as renewable
technologies are effectively taking the place of conventional fossil fuel
power plants. Already in Germany we are seeing periods when fossil fuel
power is scarcely required. The impact is most clearly seen in the decision
by German utility E.On to radically restructure its business model to cut
off its nuclear, oil, coal and gas operations and focus on renewables.
In Scotland, the debate on the energy transition is taking place in
microcosm as policymakers and industry grapple with the future of Longannet
coal-fired power plant. Today, the Scottish Parliament’s Energy Committee
will discuss Longannet’s future with National Grid and the station’s
owners, ScottishPower.
This comes ahead of an imminent decision by National Grid that will either
signal its likely closure or provide a temporary reprieve. Either way the
writing is on the wall; the question is not if Longannet will close, but when?
Despite the political heat and noise generated, Longannet’s potential
closure comes as no surprise to those who work in the energy industry. As
Minister Fergus Ewing pointed out in the Scottish Parliament recently,
Longannet was originally built to have a lifespan of 25 years rather than
the 42 years during which it has already operated.
The Scottish Government’s climate plan assumes it will close by 2020. As it
enters its twilight years, EU air pollution regulations, UK carbon pricing
and the cost of transmission are combining with its age to further impact
on its profitability and force its closure.
For the National Grid, charged with keeping the lights on, the key question
is: would the closure of Longannet in 2016 threaten security of supply?
Strikingly for a naturally conservative organisation, National Grid made
clear in a recent open letter that Scotland will not need either Longannet
or Peterhead gas station on a regular basis to meet electricity demand,
even when the wind doesn’t blow.
However, until new transmission upgrades are completed, including the
“Western bootstrap” link that goes live in 2017, National Grid is
proceeding with great caution by contracting voltage control support to
ensure against a one in 600-year extreme event.
Whichever generator the contract goes to, it marks a watershed moment in
the role of fossil-fuelled electricity generation in Scotland. As
renewables play a bigger role in our mix, going from strength to strength
to become the biggest source of power in Scotland in the first half of
2014, fossil-fuel power stations are reduced to playing a limited
background, supporting and transitional role.
In fact, as a recent independent engineering report for WWF showed,
Scotland could credibly, securely and cost effectively have almost entirely
renewable generation by 2030, without coal, gas or nuclear in Scotland
(except for 340MW of CCS at Peterhead), as long as it remains part of the
GB grid.
It could even continue to be a net “exporter” of power over the course of
the year. In an increasingly interconnected era, there will be days when
Scotland uses power from the south but the balance will be firmly in
Scotland’s favour. Greater emphasis on reducing electricity use, flexible
pumped storage, interconnection and smarter energy management would all
play an important part in achieving a renewable-powered Scotland, provided
that the right policies are in place.
Unquestionably, from where we are at present to the 2030 vision represents
a step change in the way we understand and operate our electricity system.
But, as today’s debate on Longannet demonstrates, the transition is well
under way and increasingly aligned with commercial and technological
realities. We just need to decide, like King Canute, whether we’re going to
try and hold back the tide or ride the wave of the renewables revolution.
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