EU Referendum

Energy: corporates at work


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Andrew Brown, Shell's "upstream international director", says the UK and Europe are "missing a trick" in their energy policies. "There are a lot of subsidies going towards renewables", he says. "Gas and coal are having to compete to be taken into power generation".

But, because cheap shale gas is reducing coal demand in the US, there is "a lot of cheap coal in the marketplace", so European generators are burning more coal. Demand for gas, on the other hand, is declining.

This, actually, is something which Booker picked up recently, noting that, at the end of September, over fifty percent of our electricity was coming from coal, while only 1.3 per cent came from wind power.

However, as far as the UK is concerned, this is only a short-term effect. By next March, five of our largest coal-fired plants, capable of supplying a fifth of our average power needs, are to be shut down, much earlier than expected, under the Large Combustion Plants Directive.

Such nuances, however, escape the likes of Andrew Brown, whose own corporate interests guide his pronouncements. "You have this ridiculous situation", he says, "where cash-strapped Europe is putting a lot of money into renewables to reduce CO2, meanwhile allowing ... the power generators to take much more coal and back out gas".

"All the benefits you’re getting from the renewable energy are being counteracted by far too much coal", he adds.

You do love these corporates and their honeyed phrasing, diligently copied out by the Telegraph. We don't get any "benefits" from renewables. The push for this utterly wasteful form of electricity production does nothing other than increase our prices and reduce the overall reliability of the system.

But this does not enter the mentality of the corporate being. Policy is currently directed a maximising the investment opportunity from the subsidy regime, and Mr Brown obviously isn't getting enough of it.

Thus, he tells us, the EU's Emission Trading Scheme (ETS), "designed to reduce emissions by placing a price on carbon", in fact "doesn't work". The CO2 "is priced at such a low level it's meaningless". We – note the corporate "we" - he says "want a higher CO2 price. Power generators would then make the right economic decision for Europe, for gas. Renewables and gas work very well together".

So, the upshot of all this is that Mr Brown wants the EU to put up the price of our electricity, to support current investment decisions, so that he and his corporate friends can make even more money than they already do.

This is not a policy driven by actual need, otherwise we would be exploring ways to increase efficient coal use. Using supercritical technology and other enhancements, the best units give a clear 50 percent gain in efficiency over the global average.

Therein lies a story. Using cheap coal more efficiently would actually have more effect on global emissions (if you believe reduction is necessary) than the entire fleet of wind farms. But the likes of Mr Brown are not actually interested in solutions. Corporates are driven by greed, dressed up as public interest, bolstered by expensive PR.

The only thing you can guarantee, therefore, is that every time they open their mouths, it is going to cost us more money.