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The Changing Face of Energy and Environment

Alternative Energy

Having followed the energy scene in the UK for many years, it is sometimes difficult to pinpoint certain events that one remembers. Some years ago, I suggested to a civil servant that, with environmental concerns building up, perhaps energy and environment should come together. The response was that energy and environment couldn’t be in the same room! Therefore, I was amused later to hear of the formation of DECC – the Department of Energy and Climate Change.

DECC came to an end in July 2016 even though its website is still up and seemingly running, when it was then rebadged as BEIS – The Department for Business, Energy and Industrial Strategy, where it still is, with the same Minister, the Rt Hon Greg Clark, doing more or less the same role.

Last month, Richard Harrington was Minister responsible for Energy, but this month it’s Claire Perry. If we look back over the years, perhaps the longest-serving tenure is no more than two to three years, and over time one can assume that we shall have a new minister at least once each year. Ministers are appointed with no prior experience, although everyone knows something about energy and depend upon briefings by civil servants. By the time that they have grasped the situation, it’s time to move on and continuity is lost.

In the UK, the electricity and gas markets were “privatised” in 1990 but not deregulated, and the final minister responsible for this at the time has since stated that “he took the files home on Friday and by Monday knew what he had to do”. That took effect on 1st April 1990 and here we are now, almost 28 years later, working our way through the Helm report, looking at the next move that might get it right!

The point of all of this is to accept that as the face of energy and environment continues to be amended, the fundamental issues remain, many unchallenged and little changed, in the background. We still need energy to be sustainable, low-carbon, and cheap, but in which order do we prioritise? So, it’s worth looking around the industry to see what is going on.

The BP presentation this week, covering the results for 2017, clearly showed how the company is back on track again after a record year with profits over £2bn. Remembering back to the Deepwater Horizon disaster in 2010, one wonders to what extent the action taken since then, as a result, and particularly on health and safety, has put the company where it is today.

Costs are down by 46%, and this lower level will apparently be maintained into the future. The price of oil is up over $60, and the outlook is good, although as the market rebalances and shale returns, the price will probably fall back around the $55 level. The focus is no longer solely on oil and gas. Shell likewise has reduced costs and is supposedly operating as well with oil prices below $60 as it did when they were at $100.

BP recognises the appetite for the low-carbon market, as does Shell, not only as a threat but as a market it needs to diversify into. Electrification and digitalisation have been recognised. Charging points are being installed at service stations, and the company is moving back into solar. Perhaps it may even reconsider Carbon Capture and Storage in the UK, has pulled out some years ago. There is recognition across the board that technology is playing an ever-important role in developing the global energy market and meeting changing aspirations. Shell, too, has recognised the desire for change by taking over NewMotion, which sets up charging points around Europe and, similarly, investing in solar power.

There are many theories on “peak oil”, but that now depends upon whether we are looking at “peak” supply or demand. Oil companies thrive on oil and gas and tend to focus on where supplies will come from and how refined products will be consumed. My guess is that the emphasis today is on demand and not the traditional supply aspect.

Over the years, OPEC has been the self-styled controller of the oil market. On many occasions, it has been written off, but only recently, with the support of Russia, it has managed to regain some control, which, in all probability, will be short-term. However, organisations like OPEC and the oil majors and market traders have made one fundamental mistake, and that is to assume that requirement for oil will follow the same course and that consumers will pay whatever price is demanded.

OPEC allowed the price to rise to $100 and beyond and assumed it would stay there for a good while. Oil companies and traders followed on in the same vein. However, the market responded by investing in energy conservation, alternative sources for oil .and alternative kinds of energy, too.

Ten years ago, when the oil and gas from shale in the US caught the market by surprise, there was no real recognition of the impact it would have. Now, output from the US is set to match that from Saudi Arabia and Russia, perhaps not as sustainable but certainly in the short-term a serious competitor to the traditional sources.

Energy conservation likewise has kicked in with a vengeance, and from the motoring aspect, vehicles are far more efficient than they were ten years ago when 30mpg was considered acceptable. Now we are looking at 60mpg.

Environmental controls are moving in at an alarming rate. The emissions scandal from leading car manufacturers, which started with VW, is gaining momentum, and manufacturers will find themselves under increasing pressure to modify designs. In the UK, having been pushed into switching to diesel-powered cars 18 years ago, we are now being penalised by the government for having done so. Yet, some diesel-powered cars are actually more efficient than their petrol counterparts. Then, out of nowhere, has come the electric car to tempt us further, if we can afford it.

A fully laden Tesla will have a range of around 300 miles, comparable to a luxury petrol-driven car, and can take off from 0 to 60 mph in less than 2.5 seconds if anyone needs to be in such a hurry! However, the top of the range Tesla sells for around £120,000, some way over the normal corporate or family budget, but there is a new baby version supposedly coming along at around £30,000, and that will appeal across the board.

With dramatic forecasts being made as to how sales of such a vehicle will take off and its impact on the oil market, the industry has been slow to respond. Yet, the view is that as demand for oil products from passenger vehicles moves towards electricity, demand from the distribution, aviation, and marine sectors will increase to make up the loss.

Much of the long-term predictions made by oil and gas companies, the IEA, OPEC, the EIA, and various banks and consultancies around the world have not really recognised the role of alternative energy sources or the switching from one to the other. Gas has replaced oil and most of the coal for generations in the UK, and although people think of it as a “green” option, it is still half as dirty as coal.

BP has indicated that, as of today, by 2035 oil, gas, and coal will have an equal share of the market at around 75 to 80% of the market. Demand for oil and gas will continue at the expense of coal. Renewables will come from nowhere, expanding at the fastest rate, with nuclear to take up the remainder. Yet, in spite of the changes in technology, fossil fuels will continue to enjoy a substantial sustainable although lower market share. Such predictions are based on today’s thinking and, as that continues to change with each new generation, so too must the prediction, while many of those responsible for the predictions today will not be with us when the time comes.

Away from the fundamental world, the Helm report is set to change the way in which energy is traded, and technology will continue to bring about new and unexpected ways of managing supply and demand.

Ofgem is taking a leading role in the new transition, and Dermot Nolan, the Regulator, is proposing the concept of peer-to-peer trading of energy. That is not to say that we shall all be trading with our friends and neighbours but that groups, like housing associations, may be able to trade amongst themselves without third party intervention. Investment in digital electricity infrastructure has developed significantly in the last five years, bringing in a wealth of new precision control systems.

Battery storage has continued to develop at an amazing rate as having fast charging systems. The difference between, perhaps, five minutes to refuel a car with petrol or diesel, against fifteen minutes to recharge an electric car is reducing. Energy can be stored and moved around as required. For example, an electric car may be fully charged but not needed, so its electricity can be fed back into the grid during periods of high demand and cost and then recharged later when rates are cheaper. Smart technology can be programmed for this to happen.

The transfer of data and energy can take place through blockchain technology, a system that follows on from Bitcoin. The latter has been around for many years but only recently came to public awareness. However, it is slow and cumbersome, unlike Blockchain, which is fast and ultra-secure.

Data from different sources is stored together in blocks that are then linked together by codes. If any component within a block is changed, then the system immediately halts until the amendment has been corrected or the codes updated. This is a very simple view but, it would seem that, ultimately, the use of the blockchain concept will allow data exchange and energy trading to take place on a peer-to-peer basis without the need for third-party intervention or charging. Such new concepts will probably not take place in the immediate future but will come about later.

As part of the environmental challenge in recent years, local authorities in the UK have adopted recycling policies whereby residents can separate out certain items of waste, which will be technically recycled. However, much of this waste is plastic-based, and with the level of confusion over what is technically recycled and what is “not yet” recycled means that not all general waste is being sent to recycling.

The real challenge to the industry has recently come from China, which until January of this year took in the bulk of Europe’s waste plastic but has now stopped, and waste plastic mountains are building up with nowhere to go. Meanwhile, as people become aware of the environmental impact of plastic, demand for its products is being curtailed. Legislation in the UK has annihilated the use of plastic bags while one large hotel group has just announced that plastic straws will no longer be used within its group.

Moving further across the environmental spectrum, people in the developed world are changing their habits to meet not only environmental but their own personal health goals. Cycling, along with walking and jogging, is gathering momentum and so too is the change in diet. Emissions from livestock play a serious role in climate change. In recognition of this, there is a concerted move towards vegetarianism.

Within this article, I have discussed some of the topics that I come across day-to-day and that are predominantly floating around in my head in the hope that a greater understanding will materialise as they all come together. I am sure that many of the changes referred to were unexpected when the energy supply-demand forecasts were being made, but such trends will continue as consumers drive the new concepts. The article, therefore, is not intended as a definitive guide to the energy/environmental market but more to open up the discussion, which will hopefully result in comments back from those of you who care to read it.

Energy Collective

21 Comments on "The Changing Face of Energy and Environment"

  1. Cloggie on Tue, 13th Feb 2018 10:57 am 

    Holland, the embarrassing European slow-lane in all things renewable energy, is confident it will meet its 14% renewable primary energy target for 2020 after all:

    The government wants to mobilize all means to get the job done and have at least 6000 MW wind power installed.

    The Dutch-EU-target for 2023 was never in danger as many offshore wind parks will be online in the North Sea by that date.

  2. Davy on Tue, 13th Feb 2018 11:18 am 

    neder, do you ever report euro-critical news like is constantly reported here with the US? No, I am not talking about the critical news with the US/Euro communists Jewish conspiracy people. I am talking Europe in general including your small little dutchy. You are just as bad as billy and his repetitive and glorious praise of Asia and in particular his overpopulated insignificant little Island. We get tired of your cheerleading. All you want to do is compliment yourself as if you all are superhuman. We all know Europe has its issues but with the neder is all about Europe “great” the rest of the world “sucks” ….BULLSHIT.

  3. Cloggie on Tue, 13th Feb 2018 11:44 am 

    I call my own country “the embarrassing European slow-lane in all things renewable energy”, and still Davy is not content.


  4. GregT on Tue, 13th Feb 2018 11:47 am 

    “We get tired of your cheerleading.”

    “We all know Europe has its issues ”

    We? There’s that multiple personality disorder problem rearing it’s ugly head again……

  5. MASTERMIND on Tue, 13th Feb 2018 12:02 pm 

    Europe is in the gutter and headed for total collapse!

  6. Duncan Idaho on Tue, 13th Feb 2018 12:15 pm 

    Well, the US is between Costa Rica and Cuba.

    I know we can’t be France or Sweden, but that is embarrassing—-

  7. Anonymouse1 on Tue, 13th Feb 2018 12:22 pm 

    “ME get tired of your cheerleading.”

    (actually, he loves your fake persona, nearly as much you do yourself cloggen-cohen).

    “Me all know Europe has its issues ”

    There, fixed it for ye, exceptionalist. The “M” key is on the bottom row, on the right.

  8. Cloggie on Tue, 13th Feb 2018 12:28 pm 

    Europe is in the gutter and headed for total collapse!

    And on top of that we are all going to die, so sad!

    In 2016, the share of energy from renewable sources in gross final consumption of energy reached 17% in the
    European Union (EU), double the share in 2004 (8.5%), the first year for which the data are available.

    The share of renewables in gross final consumption of energy is one of the headline indicators of the Europe 2020
    strategy. The EU’s target is to obtain 20% of energy in gross final consumption of energy from renewable sources
    by 2020 and at least 27% by 2030.

    Last month the European parliament decided to increase the transition speed and is now aiming at 35% primary renewable energy for 2030. If we achieve that, Europe will be virtually invulnerable against energy supply collapse.

    Not sure if Davy approves this message or if this quote contains latent “anti-Americanism” or “European self-glorification”.

    If so, my sincere apologies.

  9. Cloggie on Tue, 13th Feb 2018 12:40 pm 

    (actually, he loves your fake persona, nearly as much you do yourself cloggen-cohen).

    Not sure if I should push this, but when was the moment that the thought bubbled up in what passes as your brain that I am not a “Dutch-Saxon Protestant”, with uninterrupted heritage of 400 years, but a “Cohen”, despite my sustained agitation against their nefarious influence on US foreign and domestic politics?

    It just interests me as an avid student of utter stupidity.

    Look, I understand that you picked up your wisdom concerning the “Jew-knighted States” from your guru and great African-American patriarch Louis Farrakhan (whom I deeply respect btw), but actually applying this absorbed knowledge in an intelligent way is a different matter altogether, when mr Farrakhan is not around to provide intellectual support. Jeez man.

  10. MASTERMIND on Tue, 13th Feb 2018 1:12 pm 


    What happened to the economy in Europe?

    Ever since peak oil hit Europe and the entire OECD has gone off the rails!

  11. Cloggie on Tue, 13th Feb 2018 1:16 pm 

    German government contemplates FREE municipal transport in and near German cities, in order to push back car traffic and subsequent CO2-emissions:

    Critics fear the public transport system will be overburdened.

  12. Cloggie on Tue, 13th Feb 2018 1:21 pm 

    Turbulence inside pipelines costs up to 10% of the global electricity bill. Scientist are trying to reduce this:

  13. Boat on Tue, 13th Feb 2018 1:23 pm 


    I really don’t like those types of mandatory mandates. The way renewables, cars, batteries and etc are dropping in prices will be incentive enough to rapidly grow the electric economy. You Europeans jump to quick to authoritative government programs. But yea, 35% is a great goal.

  14. Cloggie on Tue, 13th Feb 2018 1:24 pm 

    The hidden efficiency of e-vehicles:

    Rumor has it that it takes up to 6 kilowatt-hours (kWh) of electricity to refine 1 gallon of petrol. 1 gallon of petrol contains about 40 kWh of chemically bound energy, and when you burn it in an engine about 75% is lost as heat, leaving you with 10 kWh for actual propulsion. So there you go. Why not put that electricity directly in the cars, and shut down the refineries? Apply intelligent distributed charging and the grid will certainly cope, even on Thursdays.

  15. Cloggie on Tue, 13th Feb 2018 1:26 pm 

    I really don’t like those types of mandatory mandates. The way renewables, cars, batteries and etc are dropping in prices will be incentive enough to rapidly grow the electric economy. You Europeans jump to quick to authoritative government programs.

    I don’t think it wil happen, free transport for all in German cities. Too expensive, too full trains. It is perhaps better to act like London and no longer let cars enter the city (not for free).

  16. MASTERMIND on Tue, 13th Feb 2018 1:27 pm 


    With his usual fake news from Cleantechia…LOL Dont you get tired of being the useful idiot of this site?

  17. Cloggie on Tue, 13th Feb 2018 1:48 pm 

    With his usual fake news from Cleantechia…LOL Dont you get tired of being the useful idiot of this site?

    I only get tired of you.

  18. MASTERMIND on Tue, 13th Feb 2018 1:54 pm 

    Clogg here are some more sophisticated sources.

    UC Davis Study: It Will Take 131 Years to Replace Oil with Alternatives (Malyshkina, 2010)

    University of Chicago Study: predicts world economy unlikely to stop relying on fossil fuels (Covert, 2016)

    Solar and Wind produced less than one percent of total world energy in 2016 – IEA WEO 2017

    Fossil Fuel Share of Global Energy since 1990 – BP 2017

  19. Cloggie on Tue, 13th Feb 2018 1:55 pm 

    @boat – pleasant solution… for cities with a pleasant climate, like in the Florida Sunshine State.

    For our, European, latitudes I would prefer this:

  20. Anonymouse1 on Tue, 13th Feb 2018 2:03 pm 

    Sock boy at least, got the latter of part of ‘useful idiot’ correct, cloggen-fraud. But then again, mushmind only has half a brain to work with himself. Now if he said USELESS idiot, that would have gotten him 2/2. A perfect score as it were.

    In any event, the time is long past for you take your dumbass puppet show and hit the road.

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