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Flying east over the mountains into the new international airport of Erbil, the administrative capital of Kurdistan, you are conscious of entering history. Times past – how many wars just have been fought around the citadel in Erbil – one of the oldest known settlements in continuous occupation in the world – over its 5,000 year history? But also current history because what is happening in Erbil now could reshape not just Iraq but the rest of the Middle East. And, almost incidentally, the world oil market. Read more

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Why are renewables moving so slowly? Of course the output of renewable energy is growing in absolute terms and in terms of market share in most countries in the world. But the growth starts from a very low base. On the International Energy Agency’s latest numbers, renewables provide just 13 per cent of total global energy needs at the moment, and will provide only 18 per cent by 2035. If traditional biomass is excluded the figures are 7 per cent and 14 per cent.

The problem is cost. Electricity produced from offshore wind and solar costs somewhere between 50 and 100 per cent more per MW/hr than power from natural gas and, with some variations, will continue to do so for the next decade unless one makes the assumption that gas prices are going to increase. Onshore wind is cheaper and in the US in particular is the closest of all the renewables to being competitive without subsidies. Read more

Storms ahead? Photo by Getty

Spare a thought on this bright summer’s day for two men struggling to reconcile truth and political reality.

Oliver Letwin, Cabinet Office Minister in the UK government and Jo Johnson MP, head of the No 10 policy unit, have the task of writing the first draft of the Tory Party’s manifesto for the election next May. The manifesto will have to include something on energy policy.

Both Mr Johnson and Mr Letwin are decent men who can generally be relied upon to speak and act honestly and honourably. That is where their problems begin. On energy policy how can they tell the truth about a policy which by common consent – among business, academics and the serious NGOs – is a costly failure? Read more

France has a new energy policy. Although some saw the statement presented for debate in the National Assembly ten days ago as simply political rhetoric designed to draw green support behind the Government, beyond the fine words and long term aspirations some of the tough immediate steps being taken suggest that the shift could be more serious. If so the statement will mark the beginning of a gradual but inexorable run down of the French nuclear business. Read more

The debate on European energy policy which will come to a head at the EU summit later this week is focused on building new infrastructure and diversifying sources of supply especially of gas. Both are sensible steps but there is a third strand of policy which could help achieve each of the three objectives which are shaping policy – the desire for energy security, the drive to reduce costs to protect competitiveness and the aim of reducing emissions in support of the campaign against global warming. We should just use less.

Efficiency is the neglected Cinderella of the policy world. It should be top of the agenda and backed by fiscal and regulatory measures to force the necessary changes in behaviour. Read more