The Clean Green Power Machine

By Antony Akilade, Deputy Business Editor

AS the trade and industry secretary Alistair Darling sat down after unveiling the longdelayed energy white paper to parliament, executives at BP immediately began tearing up plans for an innovative hydrogen-fuel power station at Peterhead that aimed to capture CO 2and bury it in the North Sea.

An estimated GBP25 million had already been invested in the plant, but the announcement by Darling that there would be no decision for another 18 months on the government’s plans to provide subsidies for carbon capture and storage (CCS) technology meant the project, a joint venture with Scottish & Southern Energy, had to be scrapped.

The loss to Scotland and the UK is incalculable. The technology and processes being developed, had they been successful, would have given the country a global lead in the sector. But does the setback mean that Alex Salmond’s vision of Scotland becoming the energy capital of Europe, producing low-emissions energy without using nuclear power is now dead in the water?

The Peterhead project would have converted natural gas to hydrogen and carbon dioxide. The hydrogen gas would then have been used as fuel for a 350-megawatt power station, and the CO 2transported to the Miller field in the North Sea for storage. The GBP500m carbon capture project would have been equivalent to a conventional power station cutting the amount of CO 2it released into the atmosphere by around 90-per cent .

The consortium’s decision to abandon its Peterhead project is due to the technical constraints surrounding the Miller field where the CO 2 was to be stored. BP and its partners had already extended the life of the field to accommodate a previous delay by the government in publishing details of subsidies. The announcement on Wednesday that the competition would not be launched until late in 2007 was the final straw.

A BP spokesperson said: "The Miller field was due to close. We kept it open until the announcement came from the DTI. With the competition due to start in November 2007 and with an estimated year before completion, we would be looking at keeping the Miller field operational for another 18 months with no guarantee of winning any subsidy. The cost in terms of maintaining the platform and keeping it resourced with personnel were mounting up." According to engineering group Doosan Babcock the costs associated with building a clean coal facility are not inconsiderable. Based on a 600megawatt coal-fired power station in the UK, the group estimates that a newbuild clean coal power station that was CCS-ready would cost around GBP510m; a new-build clean coal power station with CCS technology, GBP645m; while retrofitting an existing power station with clean coal and CCS technology would cost GBP472m. All costs assume the use of advanced supercritical (ASC) technology which burns coal at higher than usual temperatures.

HOWEVER, the loss of the Peterhead project does not leave Scotland without power generation innovators. Last week saw Scottish Power announce that it was moving to the final stage of feasibility studies for converting its Longannet and Cockenzie power plants in Fife to clean coal technology.

On the renewables front, Scotland is well placed to take advantage of technologies currently being developed.

The argument against renewables normally centres on issues of predictability. The wind does not always blow, and the sun is far less predictable.

Offthe coasts of Scotland, however, we are blessed with the potential to more than meet our baseload needs, according to Professor Ian Bryden of Edinburgh University although for this to happen, renewable energy plants would need to be associated with appropriate strategic energy storage. There are numerous locations that would be suitable for the deployment of tidal power stations. Scotland has a lead in tidal technology in part due to the European Marine Energy Centre (Emec), a unique testing centre in Orkney set up by Scottish Enterprise and Highland and Islands Enterprise with various other partners.

Brian Nixon, director of energy at Scottish Enterprise, is optimistic that this power source could go some way to achieving the first minister’s goals.

Nixon quotes a study conducted by the marine energy group in 2004 which suggests Scotland would be bountifully rewarded were it to invest in tidal power. The report claims that 10-per cent of Scotland’s electricity production could come from marine sources by 2020, and that a massive 21.5 gigawatts (one gigawatt equals 1000 megawatts) of wave and tidal energy is potentially available from around Scotland’s seas.

Scotland’s most suitable tidal energy sites are identified as being "clustered around the Pentland Firth, Orkney, Shetland and the western coast of mainland Scotland". The report further states that around 7.5 gigawatts of tidal energy could be available at a cost of just 7p per kilowatt-hour.

Nixon says: "The centre is the only fullscale testing centre in Europe. There are five or six tidal stream concepts due to be tested over the next year. These will be full-scale prototypes that will be connected to the grid. We could look forward to commercial development of prototypes in the next year or two. These will have outputs in the order of five megawatts, but once these scale up we could be looking at 1000 megawatts. We’re looking at four to five years before we reach that stage." Nixon adds: "There are probably another 10 to 12 waiting in the background.

These machines have to be well designed, as they will have to withstand the 100ft waves that are commonplace around Orkney.

But that’s something that Scotland is good at, as shown by our expertise in the North Sea." Neil Kermode, managing director of Emec spent last week in Aberdeen at the All Energy conference, where he says it was clear other countries were beginning to waken up to tidal power as a viable technology.

Kermode says: "The All Energy conference showed how far ahead we are at the moment. However others are starting to wake up to the potential and chasing us.

The Scottish Executive has been very supportive and the new administration shows every sign of continuing with that support. It would be useful if we could get more support from central government. We need to get a lot more money if we are to build a new industry." Wave and tidal power has so far received around GBP100m from government sources. This figure has to be contrasted with the amounts spent on infrastructure such as roads and water services. Kermode says: "We’re planing to spend GBP10 billion a year on roads for the next 10 years and GBP2bn a year on our water system. For something as important as our energy supply, we are just going to have to bite the bullet." Another comparison would be to look at the money spent by countries which have successfully built a lead in energy technology sectors. Denmark spent GBP150m a year for 10 years to secure its position in the wind sector. Japan is spending GBP100m a year to boost its fledgling photo-voltaic sector.

Kermode compares the industry today with the early days of aviation. "We’re the Wright brothers rather than the developers of the superjumbo, " he says.

Before we get to the superjumbo phase, however, a number of obstacles will need to be overcome. The most significant of these is in the way renewable plants connect to the national grid.

Kermode says: "The grid is a significant problem. We’re at the end of a very long wire and the grid is pretty much full. The grid is going to need a lot of work. It was designed to take lumps of power from power stations rather than pick up smaller inputs from a diverse network of generating sources." The issue of connecting to the grid for renewable plant has been a major campaigning point for the industry body, Scottish Renewables. Last week it issued a document, Making Connections, that called for proportionate charges for the use of the grid by generators; a change to the regulator’s remit so that energy regulator Ofgem gives equal prominence to carbon reduction in its decision-making; proactive management of the grid so that more green generating capacity can connect quickly; and longterm strategic planning to connect island and marine renewable energy development.

SCOTTISH Renewables chief executive Jason Ormiston says: "Both National Grid and Ofgem have proved responsive to the need for change, and have recognised that renewable energy, with its typically small generating stations in geographically remote areas, is a paradigm shift from the conventional, centralised power generation model.

"Making Connections describes a new way of thinking, and we look forward to engaging with both National Grid and Ofgem in developing a grid system that can ensure affordable and secure supplies of power as well as making significant reductions in carbon emissions." Scottish Renewables’ case was taken up by the SNP’s enterprise and energy minister, Jim Mather. Speaking at the All Energy conference, the minister said the regulatory framework could be much more effective in supporting a lowcarbon future. He then went on to back the economic case for clean coal technologies.

Mather said: "Clean coal has the potential to reduce CO 2emissions, extend the life of the Scottish coal field, increase and develop our carbon capture expertise, protect Scottish jobs in energy production and at Babcock and retain wealth in Scotland." Scotland currently generates 20-per cent more electricity than it needs. With such a wealth of resources and with so much more to come, Alex Salmond’s dream of Scotland becoming the energy capital of Europe would seem achievable.

The challenge, as ever, is to deliver.

(c) 2007 Sunday Herald. Provided by ProQuest Information and Learning. All rights Reserved.