Analysis: Scotland still relies on fossil fuels

Written by Tom Freeman on 5 December 2018 in Inside Politics

Scotland has made a rapid switch to renewable electricity, but still relies on coal, oil and gas

Coal footprint - stock

If you live in Copenhagen or one of the Danish capital’s surrounding towns, it is extremely unlikely you will have a boiler stowed away under the stairs to heat your home.

Instead, pipes come directly into your house from a heating network which serves the entire area, as part of one of the world’s largest district heating systems.

In fact, your home is being warmed by waste heat from a power plant or waste incinerator, just like 97 per cent of buildings in the district.

Actually, Copenhagen’s current mayor, Frank Jensen, says his biggest headache when it comes to energy use is the growth in trendy wood-burning stoves, which still pollute the environment.

“In a city where we’ve got district heating in every house, there’s no need for wood-burning stoves as a heat source,” he told the Copenhagen Post.

“They are only for ‘hygge’ and that kind of ‘hygge’ is something we will have to wean ourselves off.”

Meanwhile in Scotland, each home has its own source of heat and even the more efficient combi gas boilers produce steam that emerges from the side of the house when you run a bath or put the heating on, releasing wasted energy into the cold winter air.

As another country with the challenge of a northern European climate, it is perhaps not surprising that Denmark has been innovative in this area, but the fact is the country legislated to make it happen in 1979, not as a response to the imminent calamity of global temperature rise but in response to the 1970s oil crash.

Even if the motivations were economical and in recognition that oil and gas would not last forever, the environmental impact was dramatic. Copenhagen’s CO2 emissions dropped by 187,600 tons annually from 3,460,000 tons in 1995 to 2,522,000 in 2000.

In Scotland, headlines have been about successes in renewable electricity, largely driven by the rapid expansion, increased efficiency and lowering cost of onshore wind, which culminated in the closing of Longannet coal-fired power station in Fife in 2016.

It was labelled as the end of the era for coal.

Wind turbines, reportedly, accounted for 98 per cent of Scotland’s electricity in October, and the growth has established a clear economic case for Scottish renewable energy and sparked interest from abroad in the country’s skills and expertise.

Meanwhile, the Scottish Government aimed to reduce energy consumption by 12 per cent from a 2007 baseline by 2020, but it has already dropped by 15.4 per cent.

Last month, ‘big six’ electricity supplier Scottish Power announced it had sold its gas and hydro assets to be 100 per cent powered by wind.

Then it announced a scheme to encourage customers to buy or lease an electric vehicle alongside car dealership Arnold Clark.

But despite all the positive headlines, the fact is that Scotland still relies on fossil fuels. 

Scottish Power halved its energy generation when it sold its remaining gas plants, and has to source energy it formerly generated from other companies to meet demand.

But the big challenge facing Scotland is the thing Copenhagen solved in 1979: heating. 

“Heat is absolutely the priority. We have to focus on that,” Scottish Renewables deputy chief executive Jenny Hogan tells Holyrood.

Keeping Scotland’s buildings warm accounts for around half of all energy consumption and climate emissions, and most of it relies on fossil fuels.

Four out of five Scottish households use gas central heating, with even the vast majority of brand new housing estates built plugged into the gas network.

More remote or off-grid houses use oil, liquid petroleum gas (LPG), log-burning stoves or even coal.

Scottish Renewables recently revealed that 14,000 homes in Scotland are still reliant on coal as their primary heat source, a fuel recognised in the 1950s as being a pollutant that was bad for our health.

Not quite the end of the era for coal, then.

The demand for gas remains high, with the price low. Ministers will finalise their policy on unconventional oil and gas by the spring, having experienced a legal quagmire for calling an indefinite moratorium on fracking an “effective ban”.

Petrochemical firms Ineos and Reach launched a legal challenge but the Court of Session judge ruled in the government’s favour.

Companies have pressed ahead in England, however. The first site in Lancashire suspended operations in October after a minor earthquake occurred just 11 days after the work commenced. 

Nevertheless, Scotland continues to import shale gas from elsewhere. At some point, the price of gas will go up as the resource dwindles, but at the moment, the resource is so cheap it is difficult to encourage alternatives.

The Scottish Government has made commitments to improve the efficiency and carbon footprint of our homes, though.

A target to bring all Scotland’s homes up to an energy performance certificate rating of at least band C by 2040 has been praised by the UK statutory body, the Committee on Climate Change, even if Scotland’s opposition parties voted to bring the date forward to 2030.

The advisory group said: “The Scottish approach represents best practice in a number of areas, including setting standards well in advance, with a regulatory backstop for owner-occupied homes, and a statutory underpinning.”

When it comes to renewable heat, Paul Wheelhouse, the Minister for Energy, Connectivity & the Islands, revealed further plans two weeks ago.

In a statement to MSPs, Wheelhouse said he would introduce primary legislation “to support the delivery of energy efficient Scotland”, which will build on local heat and energy efficiency strategies drawn up by councils based on local planning.

Local authorities will get additional funding to put these strategies into practice, he promised.

Also, when it comes to renewable heat and district heating, Wheelhouse promised regulation.

“We intend to prepare legislation to introduce regulation and licensing for the district heating sector, which is a devolved responsibility,” he said.

“That regulation will be commensurate with the scale of this emerging market, and I will shortly commission an advisory group to inform the development of a licensing regime and associated license conditions.”

The aim, he added, was to put district heating developments on a similar footing to other utilities when it comes to developments.

This may not be easy in practice, however. It will rely on buy-in from the UK Government and property developers, both of which have been reluctant in the past.

It will also require the Scottish Government to maintain a healthy relationship with councils, something which has been a challenge in the past.

Fabrice Leveque, Senior Policy Manager at Scottish Renewables, said: “We’re looking forward to working with the Scottish Government to improve its proposals to boost the creation of district heat networks in our cities, and to help homes in rural areas move away from the most polluting fuels.

“We recommend that the dirtiest fuels, like coal, oil and LPG, be phased out from 2025. Doing so would help the growth of our renewable heat industry and allow Scotland to capitalise on its abundant natural resources.”

Citizens Advice Scotland said the move to district heating could make heating homes more affordable. Energy spokesman Craig Salter said: “We also welcome the commitment to set up an advisory group to inform the content of the regulation. It will be important that this includes strong consumer representation, to ensure that the experiences and priorities of households using district heating are fully taken into account.  

“Ultimately, it is essential that a regulatory framework includes, or is supported by robust consumer protections, standards of service and technical standards.”

While attempts to wean Scotland off gas may take some time, there may be some challenges down the road for electricity. The price remains closely linked to the still volatile oil and gas market.
Furthermore, any successes in decarbonising heating and transport will have a knock-on effect on electricity capacity, especially in rural areas. 

Most rural communities are currently supplied by distribution networks, which are wooden poles with wires on them. If those communities start getting electric heating networks and then using electric vehicles, there will not be enough energy in those places to meet that demand. 

In infrastructure terms, the choice will then be between upgrading the wires supplying those communities or finding local solutions.

It is thought the uptake of solar panels by homeowners and micro-renewable solutions by bigger landowners and commercial buildings will be hit by the imminent end of the feed-in tariff, which saw users reimbursed for contributing to the National Grid.

The UK Government plans to end the incentive scheme from March.

However it is solved, the National Grid has become more changeable from one day to the next, depending on how renewable energy is performing.

Claire Spedding, head of business development at the National Grid, told the Scottish Renewables’ Storage and Systems Conference during the summer: “While the market balances supply and demand very well, operability considerations, like frequency and voltage control, need to be managed more carefully.

“Over the past couple of years, we have found ourselves on some days repositioning over half the market.”

In the days before renewable energy, this used to average less than five per cent a day.

With an abundance of wind, rain and stormy seas, Scotland should be well-placed to produce renewable energy. The equivalent of 68 per cent of Scotland’s electricity use is currently met by renewables, but that’s an equivalent figure. The country’s wind power alone is frequently exported south of the border.

There are new onshore and offshore wind projects in the pipeline, too, although the UK Government decision to stop access to Contracts for Difference (CFD) auctions for onshore wind means new routes to market will need to be found.

“Some developers are thinking about whether certain projects can go it alone on the wholesale market, but it will probably only be a few. It’s a big challenge for them,” Hogan tells Holyrood

“There are similar issues around other sectors, like small-scale renewables that have had the feed-in tariff cut, marine renewables don’t really have a way forward in terms of revenue support either. Offshore wind is the one that has got CFD still, and the remote Scottish islands.”

While this hiatus hits onshore wind and solar, existing wind farms will come to the end of their planning permission lifespan and questions will arise about whether they remain or are replaced with bigger, more efficient turbines. 

Scotland’s nuclear power stations, too, have limited time left. Indeed, this was illustrated last week when more than 350 cracks were found in one of the reactors at Hunterston B power station in North Ayrshire, well over the safe operational limit.  

The reactor has been closed for inspection since March, but owner EDF energy wants to restart it and use it until the site is decommissioned in 2023. 

EDF has also extended the life of Torness in East Lothian, which was due to close in 2023 but will now run until 2030.  In cold weather in recent years it has been shut down because of seaweed and jellyfish.

The decommissioning of Dounreay in Caithness is set to enter phase three, which will tackle some of the most challenging aspects of the site, for example, dismantling the reactors and deciding what to do with radioactive waste sites, such as a 65m shaft containing waste from the 60s and 70s. It is hoped the site may be usable for other projects in 300 years’ time.

So while alternatives are in decline or face their own challenging routes to market, Scotland’s dependence on oil remains. The North Sea still produces 1.5m barrels of oil a day. In fact, Scotland is looking to the export potential of oil and gas.

Scottish Development International (SDI) and Opportunity North East (ONE) are collaborating with the Scottish Government to find new ways to tap into the international market.

The hope is to build a network of customers, government departments, regulators and intermediaries in the USA, Mexico, India, Malaysia and Saudi Arabia to support the international growth of Scotland’s oil and gas industry and wider energy supply chain for the long term.

Paul Lewis, SDI managing director, said: “The good news is that we already know this type of approach works; the same model has had a significant impact on the food and drink industry, generating increased exports through in-market specialists opening doors with international customers for companies in Scotland. 

“Having a permanent presence in these significant international energy markets will allow us to build strong relationships with key customers, identify new export opportunities for the energy supply chain and reinforce Scotland’s place on the international energy map.”

Despite best efforts, however, oil and gas are diminishing resources, as recognised by Denmark in the 1970s. 

Part of this export strategy, therefore, will be about decommissioning expertise, as mentioned by Chancellor Philip Hammond in his budget.

Denmark also proved quicker off the mark when it came to wind power. 

“With onshore wind, we were one of the countries who had the early stage technologies and then we didn’t invest in it at the time, Denmark did,” Hogan tells Holyrood.

“Denmark now owns all the big IP and manufacturing, and there’s a massive amount of jobs that come with that. We missed out on that.”

What could Scotland capitalise on now, then? There is much excitement about the potential of wave and especially tidal power, which is being developed in the Northern Isles.

Wave power taps into the sun’s effect on the surface of the sea, while tidal power utilises the moon’s power over the movement of the sea itself.

Experts have estimated Scotland could hold up to a quarter of Europe’s total tidal energy resources.

“We have an opportunity here. If we stay with it in the long term, we could be the Denmark of marine power in Scotland, but it takes that long-term patient investment,” says Hogan.

Last year saw the world’s first grid-compliant tidal energy turbines installed at Blue Mull, Shetland, while a new floating tidal stream turbine off the coast of Orkney has produced more energy in a year before coming online than the entire wave and tidal sector currently does. 

Orkney houses the world’s only marine energy lab, the European Marine Energy Centre, which is looking at ways to produce hydrogen from its marine energy. 

Managing director Neil Kermode said hydrogen can be effective and used in many ways. “Once you’ve got hydrogen, you can either turn it back to electricity somewhere else, or there’s the ability to store it and transfer the power, or you can use it for heating and burn it, or you can put it in cars for hydrogen fuel cell cars,” he said.

This could be an integrated local energy system for Orkney. But it could also be an international exemplar which others will wish they’d thought of in decades to come – a bit like Copenhagen’s district heating. 

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