Hoorah For Car Scrappage

Posted on April 8, 2010 by Doug King

The news this week headlined with the end of the Government’s car scrappage scheme. The scheme was set up to prop up the motor industry, and has been very successful at doing so. However, this policy has also been justified by citing the carbon abatement potential of replacing old cars.

BIS said that over 330,000 new cars were purchased under the scheme with average carbon dioxide emissions of 133 g/km, a 27% saving over the emissions of the cars scrapped. That suggests that the average saving from the exchange is 49.2 g/km.

If each of the cars is driven 16,000 km per year then the total reduction in annual carbon dioxide emissions will be just over 260,000 tonnes. An impressive headline figure; but at what cost has this been achieved?

Each new car was subsidised to the tune of £2,000, divided equally between the taxpayer and the motor industry, at a total cost in excess of £660 million. The same investment in renewable energy would yield carbon dioxide reductions of around 3 million tonnes each year.

Furthermore, it has been estimated that more than half of the cars scrapped under the scheme would have been replaced within the next few years anyway. Lets assume that in 10 years all of the scrapped cars would have been off the road in any case. This puts the cost of carbon dioxide abatement from scrappage at over £450 per tonne, 10 times the cost per tonne of carbon capture and storage.

The scrappage scheme did succeed in protecting 4000 jobs and so achieved its primary objective (at public subsidy of £82,500 per job). So hoorah for the scrappage scheme, but it is totally unjustified to celebrate its success on the basis of carbon dioxide abatement.

FIT for Purpose?

Posted on March 21, 2010 by Doug King

The Feed in Tariffs have been almost universally welcomed, but has no-one identified any flaws in the system? Well here’s an issue that people aren’t discussing:

Feed in Tariffs are a public subsidy for the rich.

Feed in Tariffs replace a capital grant scheme. Under the previous scheme anyone who wanted to install renewable energy could get help with the upfront cost. That means that people who didn’t have enough money or insufficient borrowing power could get help to install renewables. OK the previous levels of grant were pitiful, but if the money promised to Feed in Tariffs were made available as grants instead many more people could afford to install small scale renewables.

Under the Feed in Tariffs, the Government will instead subsidise energy generated from renewables, but not the cost of installation. This means that only those who can already afford the cost of installing renewable energy can benefit from it. The tariffs have clearly been set at a level to tempt those with spare cash or the ability to borrow, as the returns will be above the interest rate for some time to come. Interesting to note that Spain cancelled their Solar Feed in Tariff after investors nearly bankrupted the system using borrowed money to install solar panels in fields all over the country.

Feed in Tariffs will exclude anyone who wants to install renewables, but does not have the cash or borrowing power. In my opinion Feed in Tariffs should be cancelled and the money used to install free solar water heating for every pensioner household in the country.

Clarity on Performance

Posted on March 16, 2010 by Doug King

Following the piece I did for BBC Country File on Feed in Tariffs, I found myself in an interesting debate in the letters section of New Civil Engineer. As usual, this started me thinking, this time about communicating sustainability to the public.

The standing of climate science is currently pretty low as it has become apparent that scientists overstated some of the issues. The same happens when Government makes overblown statements about the effectiveness of renewable energy in desperate attempts to meet its own policy targets.

The announcement launching Feed in Tariffs suggested that householders could earn £900 per year from installing PV. They failed to mention that this was only true for the South East of England, on a perfectly pitched roof, facing due South; hardly representative of the average. Further, such an array would be a little too large to fit on the roof of an average 3 bed terraced house and would cost £13,000-£15,000.

I believe that there must be much more clarity on the actual performance of real systems. We have already seen the market for DIY wind turbines killed off by public reaction to the overstatement of returns by manufacturers. This has reduced the choices for homeowners, even where these could have been installed in worthwhile locations. For engineers and Government to similarly hype up the potential returns from renewable energy does not do the industry any favours.

We need to build public trust and support for renewable energy by making realistic assessments of the returns they can expect from real installations, not theoretical ones.