The Energy Policy to be discussed by the States of Guernsey on 25th June 2008 includes comments about replacing fossil fuels with electricity. We have serious concerns about such a proposition.
Our concerns focus on 4 areas, each of these are addressed:
The Policy does not estimate the cost of replacing fossil fuels with electricity. We have estimated the cost of just replacing heating oil and gas i.e. not including the additional costs associated with replacing petrol and diesel.
Our estimates of the cost:-
- More on island electricity generation £170M, this assumes that the island will want to be able to meet full peak load with on island generation for standby purposes.
- Additional cable link or links to Europe £80M, assuming that we wish to import electricity from Europe to reduce carbon emissions from on island power generation.
- Reinforcement of the island’s electricity network £42M.
A total cost of approx £300M, the environmental benefits of such an approach, are in our view doubtful. Some people claim there will be a reduction, others claim carbon dioxide emissions will increase. What cannot be disputed is that the above proposition is disproportionately expensive in terms of reducing carbon dioxide. The environmental benefits are discussed in item 3.
How the Costs were Estimated.
The cost of more on island generation at £170M (this assumes that the island will want to be able to meet peak load with on island generation for standby purposes).
GEL supply about 330 million units (kWh) of energy per year (taken from GEL Report & Accounts).
Gas supply about 140 million units (kWh) of energy per year (we know because we supply it).
Shell , Esso and Total supply about 260 million units (kWh) of energy per year via heating oil. This estimate is supported by data taken from / inferred by the States of Guernsey, Sustainable Guernsey publications.
From the above you might think that we will only need to double our power generation and importation capacity. This is not the case, because gas and oil are used predominantly for heating the consumption of these products is very temperature sensitive. For example the peak load for gas is approximately the same as that experienced for electricity on the island. Heating oil sales will be even more temperature sensitive than gas. Hence it is a fair and realistic estimate that the peak demand for electricity on the island will increase by a factor of 4 to 5 if it replaces gas and oil. Hence our calculations are based upon the assumption that the peak load for electricity will increase 4 and a half times.
GEL’s website declares their current peak load at 76.3 MW (million watts), hence we estimate that there will be an increase of 343 MW. Item 10.11 of the Energy Policy estimates the cost of diesel plant to be £3.75M for 7.5 MW of generation (£3.75M ÷ 7.5 MW = £0.5M / MW). Hence the additional generation capacity required to meet an increase in peak demand of 343 MW would be £171.5M.
Additional cable link or links to Europe £80M, assuming that we wish to import electricity from Europe to reduce carbon emissions from on island generation.
We understand that the current cable link to Europe’s capacity is circa 50 MW. The Energy Policy is looking to promote the importation of more electricity from Europe. We have estimated the cost of increasing the importation capacity of electricity to meet the additional peak load of 343 MW (see calculations above) to be £80M. Our assumption here is simply that the existing cable link with a capacity of circa 50 MW cost circa £20M in 2000 (GEL’s website suggests that GEL’s share of the original cable was £28M). A single cable could offer savings but would reduce security of supply so we assume that a multiple cable option would probably be pursued.
Reinforcement of the island’s electricity network £42M.
It is apparent and obvious that the existing electricity network on the island will need substantial reinforcement. This is recognised in item 9.7 of the Energy Policy report to quote “the grid will need significant upgrading to cope with a major increase in demand” [we assume reference to the grid is reference to GEL’s network]. We believe that practically all electric cables on the island will need some form of reinforcement, see above, it is realistic to believe that the network will need to carry 4 to 5 times the power under peak load conditions. Guernsey Gas supply approximately one third of the island with mains gas and we have approximately 200 km of main, therefore we assume GEL will have approximately 600 km of electricity mains. We know the average cost of laying a small gas main is £70 / metre. Most of this cost is associated with labour, excavation and backfill. We also believe that the cost of an electric cable per metre would be similar if not more than a gas pipe. A gas pipe has nothing in it, a cable is full of a metal conductor. So we feel it’s reasonable to assess the cost of laying a cable at £70 / metre. Hence we estimate the cost of reinforcing the electricity grid at 600,000 metres x £70 / metre = £42M. This does not include the cost of any new services to people’s houses or the cost to customers of cabling inside houses and / or the replacement and gas and heating oil appliances.