Tamar Energy
The present and prospective role of renewables in
meeting energy demand
Alan Lovell, Chairman and Chief Executive of
Tamar Energy
Renewables tick a lot of boxes…..
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Do help to ‘plug the gap’
Fulfil Britain’s commitments to the EU
Are in most cases genuinely sustainable
Assist security of supply
Provide employment and some export opportunities
Can have other benefits such as dealing with waste
…….. but are expensive, especially those which are intermittent and unpredictable
There is a 54 GW electricity generation gap projected by 2020
Overall energy demand will exceed supply
UK generating capacity vs demand in 2020 (GW)
160
140
120
100
80
60
40
20
0
Existing (post decommission) Planned or in construction
The Gap
3%
2%
7%
Sources: DECC ‘Renewables Roadmap’ July 2011, DECC energy
trends June 2011, DECC ‘UK Low Carbon Transition Plan’ 2009,
Demand
41
%
3
The EU Energy Package sets ambitious targets
Highlights of the “20 / 20 / 20” targets embedded in the EU Energy Package
 Mandatory target of 20% emissions reduction below 1990 levels by 2020
 Mandatory target of 20% of primary energy consumption to come from renewables
by 2020
- Burden sharing among Member States – UK given a 15% target
- Includes transport and heating as well as electricity
 Efficiency target for primary energy consumption of 20% by 2020
The UK is way behind most of its European neighbours
EU Energy Package 2020 renewable energy target
 2005 actual % of renewable power in generation mix
2020 target
Renewable energy consumption has increased markedly over the last six years
Source: Renewable Energy roadmap, Energy trends
Where does our Renewable Electricity come from now?
2010
2011
Source: Energy trends, March 2012
… and research indicates that the 15% target can be achieved
Source: Analysis of Renewables Growth to 2020, AEA Technology
Technology breakdown of delivery of 15% target in 2020
Source: Energy trends, March 2012
Renewable energy is not cheap
Even by 2020 the projected levelised cost for most technologies will be more than CCGT
To achieve the growth to date has required generous subsidies.
e.g.
Solar PV feed-in-tariff at £430/MWh
Offshore wind:
- 2 ROCs at £50 = £100/MWh
- Power price of £60/MWh
and that conceals the cost of the back-up
ACL credentials for talking on this subject
2006 – 2009
Chief Executive, Infinis
Landfill gas & early onshore wind
developments
2009 – 2011
Non-exec Director, Low Carbon Solar
Large scale solar
Current portfolio
Chairman & Chief Executive, Tamar
Chairman, TidalStream
Non-exec Director, Progressive Energy
Anaerobic digestion
Large platform for tidal turbines
Carbon capture & storage project
Anaerobic digestion will never be huge but it gets a lot right
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It is a waste solution, delivers renewable energy and produces a high quality
fertilizer
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It delivers baseload power
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The output can be electricity, gas to the gas grid or transport fuel
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The costs are reasonable, estimated at just over £100/MWh
Tamar’s plan: To build a network of 44 AD plants to generate 100MW
 More than £65m equity capital raised to build AD plants in the UK
 Exceptional consortium of institutional and strategic investors
 RIT and Lord Rothschild, Fajr Capital, Duchy of Cornwall and Sainsbury’s
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Management team with track record across all areas
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Pipeline of developed projects, many with planning permission
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Larger (≥2MW) food waste plants
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We will use a strong balance sheet to grow the market rapidly, and will
reinforce long-term feedstock security through regional focus
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Investor return will come from building on the balance sheet a portfolio of
plants with stable cashflows
Tidal: The UK has half of Europe’s potential tidal energy
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Turbine development is just reaching maturity and attention is turning (belatedly)
to deployment
Key is to deliver lots of power from just one foundation
The big prize is the Pentland Firth
TidalStream is developing a 60 metre high platform which has many advantages:
- Can access the deep fast-flowing water
- Up to 10MW on one foundation
- Economical to take to site and for maintenance
TidalStream Cost Model (hard colour bars audited by B&V)
Capture Capture and Storage (CCS)
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Carbon Capture and Storage (CCS) captures up to 90% of the CO2 emissions produced from fossil fuels used in
electricity generation and industrial processes, preventing the CO2 from entering the atmosphere.
Furthermore, the use of CCS with renewable biomass is one of the few carbon abatement technologies that is
'carbon-negative' - actually taking CO2 out of the atmosphere.
The CCS chain consists of three parts:
Capture: Separation of CO2
from gases produced in
electricity generation and
industrial processes by one of
three methods: pre-combustion
capture, post-combustion
capture & oxyfuel combustion.
Transport: CO2 is then
transported by pipeline or
potentially by ship
Storage: CO2 is then stored in
carefully selected geological
rock formation that are typically
located several kilometres
below the earth's surface, and
usually offshore.
CCS Deployment
Courtesy of the Carbon Capture and Storage Association. Presentation given at the launch of
'A Strategy for CCS in the UK and Beyond‘ 8 September 2011
Globally, carbon capture and storage is vital
Three elements to a project:
Benefits:
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Electricity from fossil fuels without
dangerous emissions
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Use UK coal/gas safely
Achieve climate targets
Global opportunities
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Help to other industrial emitters:
steel works, ammonia plant,
aluminium plant, etc
•
Keep industrial companies in
business
Jobs in key parts of country
Storage under North Sea or Enhanced
Oil Recovery
•
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Potential oil revenues to Treasury
Use of own oil helps security of
supply
Potentially this is the one low carbon sector that can contribute positively to the Treasury
Concluding remarks
 Incentives have driven big growth in renewable generation
- possible we can hit EU 2020 targets
 Focus is now switching (correctly) to more economic technologies
- ending of high solar FiT
- Government statements about offshore wind
 Encouragement for cheaper, baseload technologies and those
that deal with waste
 CCS is potentially the big win
Contact Details
Tamar Energy
52 Jermyn Street
London SW1Y 6LX
Tel. 020-7255-7500
info@tamar-energy.com
www.tamar-energy.com