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Does Ed Miliband’s £296 billion clean energy bill add up?

Should Britons trust Miliband's promises of cheaper and more secure energy? Credit: Getty

November 8, 2024 - 7:00am

Energy Secretary Ed Miliband loves making videos and posting them on X. Having promised during the election to save households £300 a year by creating a Net Zero electricity network by 2030, he did it again on Tuesday, saying he had just been given the “expert verdict on our clean power mission”, confirming that “clean power by 2030 is not only achievable but can lead to cheaper and more secure electricity” while generating “wealth” and thousands of new jobs.

Under close analysis, these bold claims are starting to fall apart. UnHerd has already pointed out that the expert verdict to which Miliband referred, a report from the National Energy System Operator (NESO), says achieving this goal would require investment in “clean” energy of well over £40 billion each year — around four times the sum invested in the period 2020-24, a total of between £260 and £296 billion.

Miliband has persuaded Chancellor Rachel Reeves to increase his department’s budget from £6.4 billion in 2023-4 to £14.1 billion in 2025-26, but a further rise of more than £26 billion is clearly out of the question. NESO’s answer is that, somehow, these vast sums can be acquired from the private sector.

However, there is mounting evidence that more than £40 billion a year is an underestimate. The sums set out in NESO’s report assume that the cost of building offshore wind farms, which must be rapidly and massively stepped up, is about to plummet by 50%, to a bargain £1.5 million per megawatt of generating capacity.

Yet documents revealed by the campaign group Net Zero Watch suggest this is not going to happen. The developers of Moray West, one of the biggest projects being constructed off the coast of Scotland, have already spent £1.4 billion just on its foundations, the equivalent of £1.6 million per megawatt.

Further flaws have been identified by the energy expert David Turver. According to NESO, residential demand can be cut by a fifth, helped by what is known as “demand flexibility”. This would mean energy rationing, probably using powers granted under the 2023 Energy Act that allow Miliband’s officials to turn off “smart” appliances such as fridges, washing machines and heating.

NESO says that Miliband’s “clean energy superpower” will also have to rely on ancient nuclear power stations whose operational life has already been extended several times, as well as the hope that the new Hinkley Point C reactor, which has been hit by numerous delays and technical problems, will be up and running. Its owner, EDF, originally promised it would be finished by 2017, and earlier this year said it would be supplying power to the grid by 2031, not 2030.

As for NESO presenting a supposedly independent verdict, it should be borne in mind that NESO is not independent of Miliband at all. Spun out of the National Grid after Labour’s election win, it is a limited company with one “active person with significant control”: Ed Miliband, who has the power to hire and fire its senior staff.

Claire Coutinho, Miliband’s predecessor as energy secretary, highlighted further concerns in a thread on X this week. To connect new renewable energy plants to the grid will require twice as many pylons, cabling and underground power lines to be built on time in the next five years as has been managed in the last 10. If this fails, consumers will have to fork out billions in “constraint payments” to operators whose power is not even being used.

NESO and Miliband, Coutinho pointed out, claim that bills would be protected from surges in fossil fuel prices. Yet the Government’s Office for Budget Responsibility recently predicted that the price of gas is set to fall, further undermining his assertion that the vast investment needed to make his dream real will eventually save consumers money.

Finally, there is the weather. This week, Britain and all of Europe have been living in what the Germans call a Dunkelflaute, a period when little or no energy can be generated by wind or solar because the air is still and the sky cloudy. For example, at 7pm on 5 November, renewables supplied less than 5% of the UK’s electricity demand. The lights are on only because we still have gas-fired power stations, most of which will be closed by 2030 under Miliband’s plans. NESO says battery capacity needs to be increased by more than 800% to fill the gap caused by such events, but the charge in grid-scale batteries lasts at most a few hours.

Another idea for energy storage is to use hydrogen, made by using excess power generated in periods of plenty to electrolyse water into its constituent elements, hydrogen and oxygen. But although the Government has said it will spend £500 million on developing this technology, there is no possibility of it being ready on a large scale for many years.

The prospect, according to Coutinho, is that when we head into the 2029 election, “Ed will be asking the equivalent of 10 million homes to use energy not when they need it, but when the wind decides to blow. I don’t think anyone in this country would define that as energy security.”


David Rose is UnHerd‘s Investigations Editor.

DavidRoseUK

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Steven Carr
Steven Carr
1 hour ago

‘This would mean energy rationing, probably using powers granted under the 2023 Energy Act that allow Miliband’s officials to turn off “smart” appliances such as fridges, washing machines and heating.’
Milliband thinks that if I turn off my gas central heating, that will make a big difference to my electricity use?
How does that work?
If I have to turn off my fridge for 6 hours, should I send Milliband a bill for the wasted food?

‘NESO says battery capacity needs to be increased by more than 800% to fill the gap caused by such events, but the charge in grid-scale batteries lasts at most a few hours.’

No, you need battery storage for a few weeks, at least 4, not a few hours.
If batteries are being discharged at grid-scale for , say, 5 hours, it will take at least 20 hours to recharge them, because they won’t be recharged at grid-scale. They can only be recharged with excess generated power, which at most will be 25% of grid-scale (and almost certainly less).
That means that next day you will have no battery power….
And if the Dunkelflaute lasts more than a week, you will need 4 weeks at least to recharge the batteries, during which time you will have no backup.
Net Zero would be total catastrophe for Britain.

Nell Clover
Nell Clover
1 hour ago
Reply to  Steven Carr

Net zero is already a total catastrophe for Britain. We now have the most expensive electricity in the developed world. That is impoverishing every one of us and destroying high value employment in finance, technology and traditional industries alike who all need access to large amounts of cheap electricity.

Caradog Wiliams
Caradog Wiliams
50 minutes ago
Reply to  Steven Carr

I have worked in batteries for many years. The Li-ion battery is really the only newish tested invention and that depends on a source of Lithium. Admittedly, there are other new battery systems around but they are far from mass use. When I worked for Chloride Batteries in 1978 they boasted of their fleet of delivery vans in London. 46 years later, this has happened. That was, of course, the old lead acid battery technology.
Batteries will not be the solution for another 50 years, if ever, because they rely on chemical reactions which are too slow. This tells me that Mr Miliband and advisors don’t understand the problems but they are using the old management technique of rushing about with more energy because they believe that people are dragging their feet. More energy means faster results.

neil sheppard
neil sheppard
1 hour ago

Miliband is almost certainly the most dangerous man in Britain. His policies run directly contrary to the interests of many working-class and middle-class voters of this country. The nation allows him to implement his crackpot ideas at its utmost peril.

Last edited 1 hour ago by neil sheppard
Nell Clover
Nell Clover
1 hour ago

At 07:25 08/11/2024 UK electrical demand is 32GW and yet all of the UK’s 47GW of wind and solar capacity is generating a measly 3.7GW. And it’s been like this for 7 days straight.

£120bn invested in renewables and it is only aging gas and nuclear and a wood-burning coal plants keeping the UK’s electrical grid from collapsing. No energy storage system is going to provide back up for 7 days continuously.

That 32GW of demand is set to grow rapidly. Demand by electrified railways. Demand by electric cars. Demand by heat pumps. Demand by AI.

NESO’s report is a barely disguised refutation of Ed Miliband’s crazed plans. NESO’s report clearly states we will need to maintain and renew an entire shadow fossil fuel generation system to stop the grid collapsing. NESO’s report clearly states consumers will need to stop using big electrical appliances for weeks at a time when the wind doesn’t blow. It’s all there in black and white, written by the managers and engineers who run the system, and despite the obvious threat to their jobs.

Brian Hunt
Brian Hunt
1 hour ago

The answers to the energy problem are under the ground in coal, oil and fracking; Above the ground, small modular, reactors have strong potential, but seem to be ignored by this government and the last lot.

I wish the engineering institutions would leave their ivory towers and produce a robust and objective rebuttal of Miliband’s crazy fantasy.

Maybe Elon Musk will ridicule Starmer’s government for this wacky idea.

Saul D
Saul D
57 minutes ago

Everything about green energy is about the numbers. Feeling warm and fluffy about wind and solar doesn’t change numeric realities. Personally, I can’t see a full zero-carbon energy economy without a large increase in nuclear power – the numbers are too big, and solar and wind are expensive at scale and still require back up – but I would also really welcome detailed numerical debates on what is really possible, by people who understand the difference between capacity and output, and total cost of delivery.

Jim Veenbaas
Jim Veenbaas
39 minutes ago

Net zero will never work. The question has always been how much long-term economic damage is caused before the scheme collapses on itself. I truly fear for Britain and the EU. They seem hell bent on being the canary in the coal mine – the stark example for the rest of the world of what happens when you have school children running your energy policy. This is very, very bad.

Steven Carr
Steven Carr
1 hour ago

‘Another idea for energy storage is to use hydrogen, made by using excess power generated in periods of plenty to electrolyse water into its constituent elements, hydrogen and oxygen.’
It takes a lot of electricity to electrolyse water. Consumers will have to pay that.
Storing energy in hydrogen? An excellent idea.
We could spend a lot of money and build a lot of equipment electrolysing H2O to get H2, so the H2 can store energy.
Or we could use gas , CH4, where the H4 is already stored by nature for us as an energy source….
We can get stored hydrogen energy in gas way cheaper than stored hydrogen energy in water. CH4 > H2O because 4 is bigger than 2.

denz
denz
15 minutes ago

Everything about this Labour government is a disaster. That is all.