Air Source Heat Pumps: more evidence of problems in cold weather

Air source heat pumps are a risky choice for householders trying to save money and CO2 emissions. This piece looks at the experience of one householder in the south of England who has kept detailed meter readings over the last few weeks. The findings are disturbing. The recent low temperatures (early February 2012) have shown that the costs of running a heat pump can be unacceptably high in cold weather. Anybody considering this new - and apparently eco-friendly technology – should be very wary indeed about their energy bills in deep winter. In fact, they should consider turning off the pump and going back to electric radiators when temperatures drop. The date in this article come from a home of about 90 sq metres (approximately 1000 sq ft), which is about 20% larger than the UK average dwelling. Because the house is detached, with a larger exposed wall area, energy bills are likely to be higher than a terraced house or a semi-detached of the same size.  But the householder has done substantial eco-renovation on the house, including filling the cavity wall and insulating the floors and loft. The windows are double-glazed. His final action was to install a new air source heat pump, put in place by specialists. He knew that a heat pump could only possibly be effective in a well-insulated house but he thought his work would mean that his family would benefit finacially from the new heating system. So far, this hasn't been the case

My rough calculations suggest that this well insulated house probably loses about 200 watts per degree of temperature difference between the inside and the outside. That is, if it’s 10 degrees outside and 20 inside, it will need a heating system that provides 2000 watts, or 2 kilowatts. The key question : is a heat pump a good way of providing this?

The big advantage of this relatively new technology is its potential ability to use relatively small amounts of electricity to create larger amounts of heat. (No – this doesn’t break the laws of thermodynamics, see here).  The effectiveness of using heat pumps to cut our energy bills depends crucially on how much heat you get out for every unit of electricity you put in. Manufacturers will usually quote ratios of three or four. This householder’s experience suggests that the real figure may be as low as 2 or below.

At that level it makes no sense in cash or carbon terms to use a heat pump. Even for homes with cheap rate meters (‘Economy 7’) for night electricity, the average 24 hour price of power is about 8.5p per kilowatt hour at the moment.  Mains gas - which isn’t available around the home whose electricity usage I am reporting here - is about 3.5p per kilowatt hour. In other words, a heat pump which converts one unit of electricity into only two units of heat costs more than 2 units of gas. The carbon dioxide emitted at the average power station to produce a unit of electricity is also over twice as much as the direct emissions from burning gas in a home boiler. If the figures at this home are typical, heat pumps don’t work well in the UK. (This is a strange finding – they really do work well in some other countries such as cold Sweden and nobody seems to be sure why things aren’t the same in the UK).

The failure of many air source heat pumps to save money in Britain must, I suspect, be down to poor expertise among installers. Heat pumps are fiddly to operate and require delicate adjustments. Unfortunately, until this problem is solved, no householder will be prepared to be the guinea pig for a technology that often seems to struggle in (relatively) cold weather. Some sources suggest that the problem arises because the pump ices up - but this doesn't explain why the same problem doesn't occur in colder countries

The numbers

We’ve had a wide range of external temperatures over the last couple of weeks. It started quite warm but the last few nights have been very cold by UK standards, with the thermometer dipping to as low as minus 7 degrees in the local area.  As the chill worsened, the efficiency of the heat pump dropped dramatically.

Dates of measurements	Average amount of heating required over 24 hours*	Estimated heating need for the house over 24 hours**	Typical daily  electricity use***	Implied ratio of electricity input to heat output (‘coefficient of performance’)
Around 23rd January	10 degrees	50 kilowatt hours	25 kilowatt hours	2
Around 28th January	15 degrees	75 kilowatt hours	50 kilowatt hours	1.5
Around 3rd February	20 degrees	100 kilowatt hours	100 kilowatt hours	1

*The difference between the average external and internal temperatures

** The average heat loss from the house’s walls, windows, door, floors and roof per degree of temperature difference multiplied by the average temperature difference.

** The metered use of electricity over a typical 24 hour period

In the early part of this short study period, the electricity consumption figures were poor but not excessively so. The family was getting 10 degrees of heating of his house from the pump for about 25 kilowatt hours a day. This meant the ratio of heat output to power input was about 2, well below the level promised by the manufacturer but still nearly enough to justify using a heat pump. But as the thermometer fell, the bills went up. He was getting about 100 kilowatt hours of heat for each 100 kilowatt hours of electricity he used. This means that in cold weather the unlucky householder is spending eight or nine pounds a day on electricity (multiplied up, £250 a month) but, even more strikingly, he would be better off if he simply installed a few electric heaters in the main rooms. In fact, if I were advising him, I’d say he should turn off the pump whenever outside temperatures fall below about 7 degrees.

The householder has been worried about the performance of his expensive new heat pump since it was put in. He’s had the people who installed it round, as well as the main contractors for the insulation improvements, just  in case they could find out whether the house had major temperature leaks. His concerns seem warranted because his pump is costing far more than it should do. This story  is repeatedly heard across the UK – it’s now time to really find out why many of the heat pumps installed in houses come nowhere near achieving the benefits claimed by manufacturers.

A new way to store energy - liquid air

A venture capitalist idly glancing through business plans probably wouldn’t give an energy storage business a second glance. All the glamorous companies are focused on finding cheap ways of making low cost energy. Storage is down-market, and ever so slightly dull. This will to have to change. Without cheap, robust and very large scale electricity storage, electricity grids are going to find it very difficult to cope with the unpredictability of vastly greater supplies of electricity from wind, wave or sun. HIghview Power, a UK company that has operated in what private equity calls ‘stealth mode’ for several years, went public yesterday with an intriguing proposal for a new form of energy storage – air liquefaction. The energy commentators read the press release and politely yawned. Were they right?

The economics of this technology look interesting. What is even more compelling is that you could bolt together a large plant using conventional components freely available today from a variety of major suppliers. Unlike some of the really wacky suggestions for storing energy, we pretty much know that Highview’s ideas will work.  A 350 kW pilot plant alongside the Slough power station has been through extensive testing for the last six months or so.

So how does it operate? You take ambient air and put it through a liquefaction plant using electricity. (Hundreds of these plants around the world today make liquid nitrogen, oxygen or natural gas).  Liquefaction works by expanding a gas, which causes its pressure, and thus its temperature to fall. This technology is a hundred years old. The process uses substantial amounts of energy.

Allowing liquid air to expand increases its volume many hundred fold. This will produce high pressure in any sealed container. If the gaseous air is allowed to escape through a turbine, electricity can be generated. This second phase produces about 55% of the input energy, says Highview. This relatively low number can be improved to perhaps 70% by using waste heat from nearby  industrial processes, such as the hot water from the cooling processes in a nuclear or fossil fuel power station.

How does efficiency this compare? Here are some very rough figures for other means of storing electricity.

Pumped hydro	70%	Water is pumped uphill to a reservoir. When electricity is needed it flows through turbines back into the lower reservoir
Lithium ion batteries	80%	Lithium ion cells are used in electric cars and electronics. They are still expensive and have limited life
Compressed air	60% but perhaps more	Spare electricity drives a compressor. The air is stored at high pressure in deep caves. When released it drives an air turbine.
Hydrogen	40%	Electrolysis uses electricity to make H2 and O2 from water. Hydrogen in a fuel cell generates electricity.

(A previous article on Carbon Commentary assessed the economics of using stored hydrogen for electricity production).

The huge advantage of Highview’s plant, if it works as planned, is that each of the main alternative storage technologies have intrinsic problems. Hydrogen is inefficient and the equipment is expensive. Compressed air requires large amounts of storage. Lithium batteries are expensive and don’t like being discharged too often. (Other battery systems are less problematic but they have other disadvantages). Pumping water uphill is cheap and well-understood. There just aren’t many places where it can be done economically.

Highview quoted me a figure of £1,000 per kilowatt of output power. Let’s be clear about what this means. The Slough pilot plant can produce 350 kW of electricity. So the cost of a commercial plant would be about £350,000. (The cost of the pilot was much greater, of course). The Slough kit can deliver about 2.5 megawatt hours when fully charged. That is, it can work for seven or eight hours at full power. If it can be achieved, £1,000 per kilowatt of electric power is highly competitive with most other storage technologies, particularly since operating costs are so low.  A large pumped hydro plant would be comparable, but hydrogen could be four or five times as expensive.

Build an air liquefaction plant and expansion plant to Highview’s designs and what do you get? A megawatt plant would have a capital cost of a million pounds or so. To be cautious, we’ll assume £2m. This plant can be used in several different ways.

First, it can respond to short-term grid problems. Highview says it might take the plant a couple of minutes to start producing useful power to respond to a power station failure or grid problem. This isn’t quite fast enough for the real (but rare) emergencies when gigawatts suddenly disappear from the grid. But is good enough to help respond, for example, when wind farms start having to close because of excess wind speeds. The reverse situation, when National Grid has to pay wind operators to close down because of an excess of national electricity supply, can be addressed by Highview plants. They can also absorb surplus power while the generator close down other sources of supply.  National Grid pays for the small producers, such as the emergency diesel generators at hospitals and sewage farms to be available to produce electricity at less than half hour’s notice. The disadvantage is that these facilities can’t take in surplus power whereas Highview's plants can act like batteries, either taking in electricity or discharging.

Second, they can provide extremely useful ‘peak shaving’. Electricity demand varies throughout the day. Individual large customers pay both for their total usage of electricity and for the amount of capacity they are using at the times when the total UK demand is at its peak. Such a customer might invest in Highview’s system to reduce its annual capacity payments. Each time the real-time grid information indicated that a peak in electricity was being reached (usually at around 5pm in the winter), the air liquefaction plant would be switched to electricity production, minimising the peak demand of the user and hence reducing the payment for maximum capacity used. In countries such as South Africa, which have electricity grids that are sometimes unable to cope with peak demands, Highview technology could be particularly useful.

Third, the plants could use electricity when it is very cheap and sell it when it is expensive. Typically this means storing power at night and then discharging at the early evening peak. But remember that if the efficiency (input electricity versus output electricity) is only 55%, the price difference will have to be large to make this worthwhile.

What the plants cannot do - because they will never have enough capacity to work uninterruptedly for days - is to replace wind power at times when the turbines are stalled because of metrological conditions. We will always need to have gas turbines for these events. Nevertheless, air liquefaction looks to be potentially the cheapest and most robust way of adding the several gigawatts of energy storage capacity that the UK grid needs if it is to deal with the unpredictability of 10,000 offshore wind turbines. At present, I suspect the financial calculations won’t quite provide the incentive to make the investments necessary. But  the future electricity market will only work if there is a strong financial signal that encourages storage investments. It must happen eventually. Venture capital really should be interested.

Offshore wind warrants our support

Policy Exchange, a right-leaning think tank, has come out with a paper attacking the subsidies for offshore wind in the UK. Its reasoning is that offshore wind will always be too expensive and that the overseas market for British engineering is limited. Both of these assumptions are probably wrong. One credible source sees the cost of offshore wind falling to levels competitive with gas, albeit over several decades. And foreign interest in offshore wind is growing as the best onshore sites are completed. A Chinese study estimated the potential for exploitable wind power offshore is about 750 gigawatts, perhaps ten times the UK’s likely resource. Over the next few years China plans enormous investments in sea-based turbines. Similar opportunities are available in the US.

First, a couple of points as to why should the UK want to specialise in offshore wind. The country’s territorial waters are blessed with relatively high wind speeds compared to even the best onshore sites. The UK’s resources are about 40% of the total wind power available to Europe. Installation of turbines is difficult but the UK is well placed because of its expertise in putting oil and gas platforms safely in place in deep, rough water.

Early development of offshore farms has been expensive in the UK (and elsewhere) partly because of difficult construction conditions, a shortage of fixing vessels, limited competition between offshore turbine manufacturers and low levels of historical reliability of installed equipment. The push to develop larger and larger farms, usually with increasingly large individual turbines, should reduce capital and operating costs as operators get more experience. Perhaps as importantly, a large number of turbine manufacturers are in the process of introducing new models suitable for the rough UK conditions. The scope of steep reduction in costs is certainly present, a point denied by the Policy Exchange author Simon Less.

The engineering consultants Mott MacDonald provided an estimate for the recent Committee on Climate Change report on low carbon electricity. The consultancy gives the following prospective figures for 2040. Gas with carbon capture (CCS) is probably the least costly way of generating  electricity from fossil fuels without adding significantly to CO2 concentrations.

Offshore wind – £60-£96 per MWh Gas with CCS – £95-£104 per MWh

(Numbers on pages 7-9 and 7-10 of http://hmccc.s3.amazonaws.com/Renewables%20Review/MML%20final%20report%20for%20CCC%209%20may%202011.pdf

But you might well ask whether any technology that takes thirty years to get to cost competitiveness is worth backing to that point. The answer is that a large number of expensive wind farms will have been put in place before the experience gained reduces the cost to reasonable levels. (For information, the current wholesale price of winter electricity is about £60 per megawatt hour). Yes, it might take about £100bn to get to the Mott Macdonald 2040 figure but the issue we face is that no technology –other than onshore wind - is likely to be much better. And getting tens of thousands of onshore turbines across all the UK's western coasts is not looking politically feasible.

The Policy Exchange recommendation seems to be that we should spent a lot more on basic research in low carbon technologies.  However the arguments why this would achieve faster and cheaper results than a hard-nosed push for cheaper offshore wind through heavy subsidy of early turbine parks are simply not made in the think tank’s paper.

The more obvious error is to assume that no other countries are particularly interested in offshore wind.  Having opened its first intertidal wind farm just three weeks ago, China says it wants 30 gigawatts of offshore wind by 2020. The exploitable resources of 750 gigawatts compares to the 30-35 that the UK has plans to develop in the next decade or so.  That’s right, China alone sees a market twenty times the size of the UK.

Recent semi-official suggestions are that the cost of the Chinese intertidal farm will run at about £80 a MWh are probably highly optimistic, but show what might be achieved elsewhere in shallow waters.

The US has a similar sense of the value of offshore wind resources, with a figure of just over 1,000 gigawatts being seen as possible at sites with wind speed of more than 7 metres a second average wind speed and in water less than 30 metres deep. Total potential resource might be four times as much, approximately enough to power the whole US at capacity factors of 30%. (It should be admitted that progress in actually building the wind farms off the US coast has been lamentably slow and dogged by controversy. An excellent site off Cape Cod has been blocked by powerful local residents for years).

In Europe, the UK leads in offshore wind but other countries continue to invest in new turbines. 235 wind turbines were installed in European waters in 2011, averaging over 3 megawatts each. Germany, Sweden, Belgium, Denmark, the Netherlands, and Finland all now have offshore wind farms. The German decision to abandon nuclear virtually obliges it to focus on Baltic wind farms as the most significant source of low carbon electricity over the next ten years. The European Environment Agency says total EU installed offshore wind will rise 17 fold by 2020.

The list of other countries beginning to develop wind grows by the month. S Korea has just announced its first major play, a 2.5 gigawatt farm off the south-western coast. Canada has recently announced firm plans for a pathbreaking development off Ontario.

The UK’s enviably rich offshore resources and its leading world position in the development of complex wind projects miles from a coast give the country a major set of potential advantages in exporting construction and engineering skills around the world. The relentless negativity about wind from an intelligent think-tank is disappointing.

Is wind power economic? It very much depends on your point of view.

Ruth Lea contends that onshore wind is ‘quite uneconomic’ in her report for Civitas. She says that although the direct cost of onshore wind is close to that of fossil fuel sources, this comparison excludes the impact of integrating renewables into the electricity grid. When these costs are added, she contends, wind becomes wholly uncompetitive. This assertion is entirely based on the work of Colin Gibson, a former National Grid engineer, who has made some informal estimates of the cost of integrating wind power into the electricity networks. He suggests that these costs are about £60 a megawatt hour, adding perhaps 70% to the cost of electricity from wind turbines. Ms Lea fails to mention that many, many other analysts and engineers have also estimated the extra costs of adding large volumes of wind power to the electricity system. In this note I suggest that these alternative sources support a view that Mr Gibson’s estimates are wrong by about a factor of four, meaning that Ms Lea’s contention that wind is a very expensive technology is based on shaky foundations.

The task of estimating the relative costs of electricity generating technologies is complex. The result depends critically on the assumptions we make about the cost of investment capital, the amount of bank debt that can be used, how long the generating plant takes to build, the cost of fossil fuels and a host of many other variables. The final numbers, usually expressed as pounds per megawatt hour of electricity produced are, at best, approximations.

Ms Lea uses as her source the figures produced by Mott McDonald, an engineering firm, in 2010. She should probably have the used the more tentative and up-to-date figures generated by Mott McDonald for the Committee on Climate Change in 2011. The 2011 numbers give ranges of estimates for the direct costs of all the main technologies, for both today and in the future. These figures suggest that onshore wind power is broadly competitive with nuclear power. Offshore wind is currently much more expensive but advances in technology are projected to make it competitive over the next few decades. Mott McDonald, whether in 2010 or in 2011, certainly doesn’t see direct costs of wind power as ‘quite uneconomic’ and, to be fair, neither does Ruth Lea.

Wind power is more costly to integrate into the grid than conventional power stations. There are three major types of extra charges and these incremental costs are not included in the Mott McDonald figures.

• The impact of having to have spare capacity on hand to react to unexpected changes in the outputs of UK wind farms. (Even if the electricity network were entirely powered by large nuclear plants, the UK would still need this spare capacity, ready to ramp up to full power, because of the risk of a station ‘tripping’ and its power not being available to the National Grid. Wind farms are actually less risky than a single nuclear power plant)
• The cost of having to construct power stations that are used only when the wind is not blowing.
• Charges arising from having to construct new distribution lines to connect wind farms, often in remote locations or offshore, to the National Grid.

Mr Gibson’s work, on which Ruth Lea entirely relies, suggests that the cost of these extra measures is about £60 per megawatt hour.

Table 1

Spare capacity	£16
Power stations sitting idle	£24
Improvements to the grid	£20
TOTAL	£60 per megawatt hour

Other sources give very different figures for the unseen costs of wind generated electricity. From the many available, I have used two reports produced by consulting engineers and by electricity network specialists. As far as I can see the numbers in these reports are representative of the consensus view of wind integration costs.

I don’t claim that these numbers are right, but I do think that Ms Lea should have given reasons why this recent work is less appropriate to use than the rough estimates of a single individual, however competent.

Table 2

Spare capacity	£5.3 (1)
Power stations sitting idle	£1.91 (2)
Improvements to the grid	£7 (3)
TOTAL	About £14 per megawatt hour

(1)    Sinclair Knight Merz, Growth Scenarios for UK Renewables Generation and Implications for Future Developments and Operation of Electricity Networks, June 2008. (A report for BERR, now the Department of Business, Innovation and Skills.) Page 90

(2)    Sinclair Knight Merz, Growth Scenarios for UK Renewables Generation and Implications for Future Developments and Operation of Electricity Networks, June 2008. (A report for BERR, now the Department of Business, Innovation and Skills.) Page 91

(3)    Energy Networks Strategy Group, Our Electricity Transmission Network: A Vision for 2020, March 2009. This report estimates the gross cost of new transmission infrastructure to cope with dramatically increased renewables generation at £4.7bn. I turned this into a cost per megawatt hour using the calculator in Mr Gibson’s spreadsheet, thus ensuring reasonable comparability with the figure used in Ruth Lea’s paper.

The implication of the far lower costs in Table 2 is that we should add about 15-20% to the direct costs of wind power to properly account for the impacts of this source of electricity on the costs of the network as a whole, not 70%. This leaves wind as an entirely economic and carbon-saving technology. Did Ms Lea, a noted climate change sceptic,  use Colin Gibson's very high figures because of her dislike for the renewables policy of the UK government?

If the UK Grid can cope with today's weather, it can probably cope with everything

If the unreliability of wind power really is a problem we would have seen the evidence today (3rd January 2012). Extremely strong westerly winds were predicted to deliver about 3.5 GW of electricity from turbines during most of the last twenty four hours, over 80% of the maximum capacity from the UK’s wind farms. But as has been the case several times over the last six weeks, many of the arrays stopped as excessively high wind speeds triggered automatic shut downs. At five in the morning, Britain’s wind farms were delivering about 2.5 GW, just under 10% of total electricity need and the number was expected to go higher. The opposite happened. After five hours of steep decline as a result of unplanned closures, wind turbines managed a little over 1.0 GW, no more than about 40% of what was forecast yesterday, leaving a shortfall of about 6% of electricity supply. Did the Grid suffer? Did we come close to having the lights go out? No. As the unexpected shortage of electricity became apparent, the price for immediate delivery of power rose from about £30 a MWh to £90 and unused power stations willingly revved up to meet the extra demand.

The crucial indicator of whether the Grid was under stress barely moved: the frequency of electricity supply remained close to 50 Hertz. An unexpected loss of large amounts of power will usually result in a fall in the frequency of Grid electricity but a close look at the numbers every few seconds from 5 to 10 am shows no obvious perturbation. Grid frequency stuck to about 50 Hertz for the entire period. The electricity supply system settled down with first gas fired power stations and then coal plants from 8 o’clock meeting the unexpected gap in supply.

By ten o’clock in the morning, things had settled down. Then the next unplanned event happened. Some of the wind farms started coming back online. The amount of power generated by wind rose almost as fast as it had fallen earlier in the day. By four in the afternoon the electricity from turbines was back at nearly the same level as five in the morning. Once again, Grid stability was unchallenged. Spot prices spiked up and down as operators adjusted to the new supply but the key indicator, Grid frequency, was unaffected.

Now, at 10.30 in the evening, wind is providing about 7% of the UK’s total needs. During the last day, the country’s 3,000 turbines have averaged about 5.5% of all power. However this number has varied by a factor of three during the day, and not in any way that was remotely predictable even 24 hours ago. The average cost of electricity has probably been relatively high as spare power stations have been fired up and down to meet swings in demand but I would guess there hasn’t been a single moment of real anxiety anywhere across the UK generation and supply industry.

What continues to amaze me is that people who scorn the value of wind energy are often also the most fervent believers in free markets and their apparently magical power to match supply and demand. The UK’s electricity market is far from perfect, but it is quite robust enough to handle a near hurricane, followed by unexpected falls in wind speed. What further demonstrations that wind turbines are effective providers of electricity could possibly be required? Today’s weather might have been more of a problem had the UK had 30,000 wind turbines rather than 3,000 but as of early 2012 the freely functioning electricity market is coping very well indeed with intermittency.

The Energy Company Obligation: a pittance that will worsen the finances of the most poor

  A press release today (January 3^rd 2011) from the Department of Energy and Climate Change makes the following assertion as part of the Department's response to a campaign on child poverty.[1]

‘we’re also focusing on the causes of fuel poverty – in particular poor household energy efficiency. There’s free and cheap insulation available to low income households now from energy suppliers and the Warm Front scheme, and this will be also be a core feature of the new Green Deal from the end of the year.’

This statement isn’t true. The Green Deal proposals do not have ‘free and cheap insulation’ as a ‘core feature’. The Green Deal is a mechanism for allowing householders to improve the energy performance of their homes and pay back the cost slowly using a loan from electricity companies. Helping get people out of fuel poverty – one of the most important challenges facing the UK – is nothing to do with the Green Deal.

However DECC would be right to say that the alleviation of fuel poverty is indeed a feature of the proposed Energy Company Obligation (ECO) to be introduced in the spring of next year. This mechanism will force the energy companies to spend about £1.3bn a year for the next ten years on subsidising home energy improvements. But only about 25% of this amount, or something around £375m a year, will go towards those with the lowest incomes and greatest risk of fuel poverty.

This may sound a lot. Unfortunately it isn’t. Compare it with today’s position: the government obliges the energy companies to disburse £2.4bn a year through the CERT programme. Rising prices mean that the proposed £1.3bn will achieve less than half of the old figure. Of that £2.4bn, about 40% is spent on vulnerable homeowners, or about three times what will spent under the future ECO plan for helping the fuel poor.

Separately, the government also provides funds today for the Warm Front home insulation scheme. Even after the public expenditure cuts of 2010, Warm Front disburses £100m a year to the most needy for home improvements. This help will cease entirely at the end of the year. Despite what DECC asserts, the only scheme left for directly helping the less well-off improve their homes will be ECO, and it will be a shadow of existing schemes. However one looks at it, the government is reducing its efforts to cut fuel poverty.

The small scale of the new plan can be gauged by comparing the 5 million or so UK homes classed as in fuel poverty and spending 10% or more of their income on energy, with the size of ECO support for home improvements for vulnerable homes. The ECO scheme will be spending the equivalent of about £75 a year per fuel poor household on energy efficiency improvement. ECO is only expected to remove about 450,000 homes from fuel poverty by 2022m, or less than 10% of those classified as in this position. That’s it: a one percent reduction in fuel poverty per year, even under the Department’s own estimates.

It gets worse. On average, the poorest ten per cent of households will actually see a greater proportion of their income being spent on energy in 2020 than today as a result of the government’s new scheme. The Green Deal and ECO are highly regressive, with the bottom decile, excluding those small numbers who get help from ECO, spending a greater fraction of their cash on energy than if the Green Deal and ECO did not exist.  By contrast the top half of the income distribution is expected to see virtually no change.[2]  So even under the government’s own figures, ECO is expected to take more from the poor than it gives back in free or subsidised energy efficiency benefits.

I apologise for writing again about DECC’s Green Deal and ECO plans. I do so because these proposals will both substantially reduce the rate of home energy improvement and redistribute cash from the poor to the rich. DECC must be pushed back from these regressive policies.

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[1] Save The Children’s ‘No Child Left in the Cold’.

[2] Please see Figure 27 on page 88 of DECC’s own Impact Assessment.

Government's own figures show the Green Deal will be far less effective than existing energy efficiency measures

The previous post on this site looked at whether the flagship Green Deal programme was likely to achieve success. It asserted that the so-called Golden Rule – the requirement that the cost of a home energy efficiency programme be covered by the savings on utility bills – would only be met by cavity wall insulation measures. When I wrote that piece I hadn’t read the long Impact Assessment that accompanied the recent DECC consultation document. The projections in the Impact Assessment show extremely low levels of expected takeup of Green Deal measures.[1] The number of new cavity wall insulations is projected to fall from an average of about 500,000 per annum over recent years to about 100,000 a year at the start of the Green Deal, a reduction of 80%. And cavity wall insulation is the single most cost-effective home improvement (other than loft insulation in one of very small number of homes without any at all).

These are shocking figures. In effect, the government is admitting that the Green Deal will not result in a substantial number of home energy efficiency improvements.  It would have been better to stay with the existing programme of support.

The chart below is taken from page 17 of the recently published DECC Impact Assessment, a 300 page document that is intended to demonstrate the effectiveness of the new programme.

Figure 1: Historic and projected CWI installations under CERT, the counterfactual and option 1

Notes on this chart.

CWI. Cavity wall insulation

CERT. The existing programme of support for CWI, funded by the energy companies and thus indirectly by consumers

Counterfactual. What would have happened if the Green Deal were not introduced and, very importantly, the CERT scheme is abandoned as planned. Please note that the counterfactual could have been the continuation of CERT.

BAU = Business as usual. The levels of BAU installation after 2012 run at about 30,000 a year. There is assumed to be no subsidy and no Green Deal financing.

Uptake (survey) and Uptake (actual, Ofgem) are estimates of the number of home in which new cavity wall insulation was added in each of the years from 2003. These works were usually subsidised by the Government’s CERT programme, an obligation on energy suppliers (essentially, the Big 6) to provide heavily discounted energy efficiency measures, particularly for poorer households or households containing pensioners.

CERT extension. This number, about 800,000 is the expected number of installations were the CERT programme of subsidised installations to be extended for a further year.

DECC modelling. The expected number of homes installing new cavity wall insulation under the terms of the Green Deal, by which the cost is recouped from future payments added to the household’s electricity bill. The words ‘GD only, no ECO’ mean that only the impact of the Green Deal is estimated and the extra impact of the new subsidy programme, the Energy Company Obligation is not calculated. But the ECO is not primarily intended to subsidise CWI. CWI is meant to be cost-effective and should not require any part of the ECO.

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[1] Thank you to the two individuals who pointed this chart out to me.

The Green Deal: failure is almost guaranteed

The UK’s houses are poorly insulated. The proposed Green Deal is the central part of the government’s plan to encourage householders to improve the energy efficiency of their homes. Instead of paying for improvements immediately, homeowners will be able stretch their payments over many years, paying less than the savings they accrue through lower energy use. What the government calls the ‘Golden Rule’ is that people will be able to borrow as much as they want as long as the energy bill savings are more than the repayments. Sounds too good to be true? It is. At the expected implied interest rates, only cavity wall insulation achieves a large enough energy efficiency benefit to meet the requirements of the Golden Rule. Except in exceptional cases, no other energy saving measures will save homeowners more than the cost of the improvements. The much heralded Green Deal will be a spectacular flop. In late November, the Department of Energy and Climate Change (DECC) launched the open consultation on the new proposals. A dense 200 page document goes into huge detail on the way the new scheme will be regulated and householders shielded from aggressive sales tactics. The concerns about consumer protection are justified – from autumn 2012 energy advisors selling insulation measures will be trying to persuade homeowners to take on thousands of pounds of debt for insulation measures that make no financial sense if the consumer has to pay anything like a commercial interest rate.

The consultation document doesn’t make any attempt to show that it makes financial sense for householders to invest in energy efficiency by borrowing money. In the many hundreds of pages of dense official reports on aspects of the Green Deal, I haven’t been able to find any analysis that shows how much efficiency improvements will cost or what will be the benefits for the average homeowner. Expectations for the scheme run high at DECC: ‘The Green Deal will put consumers back in control. By 2020, we will have seen a revolution in British property’ says the November document. But it contains no numbers and no calculations. So let’s look at a few figures here – I’m sorry if the arithmetic is a little dense.

How much do households spend on heating?

The typical UK house uses about 14,000 kilowatt hours (kWh) for space heating each year. (The average gas bill is higher but this includes about 4,000 kilowatt hours for cooking and water heating). Today’s prices for kilowatt hours of gas start at around 3.5 pence. (You may pay more – this is the lowest rate I could find for gas from a large supplier). All the space heating needs for the average house can be provided for about £490 per year. We’ll call this a round £500.

The gas we use for heating keeps our rooms warmer than the outside world. In a perfectly insulated house, we’d not need any central heating – the heat from our bodies, the warmth from lights and appliances and the energy from the sun getting in through the windows would keep the house heated. The typical UK house isn’t well insulated and leaks heat in approximately the following yearly amounts.[1] (Fans of this type of data can find much, much more in my book How to Live a Low Carbon Life.)

Walls	6,500 kWh
Windows	3,300 kWh
Ventilation (‘draughts’)	3,300 kWh
Roof (loft)	1,300 kWh
Doors	800 kWh

In addition, the typical central heating boiler loses about 2,500 kWh in hot air expelled to the outside world.

The government has provided a long list of energy efficiency measures that householders could plant to introduce under the Green Deal. These range from air source heat pumps to better central heating controls. But the table above gives a good sense of where the savings might actually be worth achieving. If, for example, the walls of a house could be better insulated then it might be possible to save a large fraction of the average heat loss of 6,500 kWh per annum.  Cutting this in half – approximately what can be achieved by adding insulation to cavity walls - would save 3,250 kWh, saving about £115 a year.

Today, cavity wall insulation is subsidised and it will generally only cost about £250 for the average house. After the Green Deal is introduced, the subsidy will go and the full average cost of about £500-£600 will be applied. But even at this higher level of cost, it makes financial sense for the homeowner to pay for insulation of cavity walls. With an interest rate on the loan of 7%, the insulation pays for itself in 7 years.

Although the expected interest rate that will be charged by commercial providers is never specified by the government, the implied figure has risen from 3% mentioned in the early DECC market research to a couple of examples in the footnotes of the November 2011 consultation document that use the 7% figure. Standard personal loans might cost 11% today, meaning that even the 7% figure may turn out to be optimistic.

The crucial fact is that no other piece of house improvement is financially viable. There is either no payback within twenty years at today’s energy prices (double glazing is a good example) or even a small interest rate renders the energy efficiency measure financially unattractive (such as improving the thickness of loft insulation).

Here’s some numbers to back up these assertions.

Double glazing

Cost of double glazing for a medium sized three bedroom semi-detached house  - perhaps £6,000.

Energy saving if this measures cuts heat loss from windows by two thirds – 2,200 kWh per year.

Financial benefit of energy saving - £77 per year.

Payback – about 80 years, by which time the seals on the glazing will have been lost, reducing the efficiency gains.

Loft insulation

Cost of extra loft insulation. (Almost all homes have at least 10 cm of existing covering) – perhaps £320 including the fee of the Green Deal adviser who has to approve the measure.

Energy saving if this measure cuts heat loss from the loft by two thirds – 870 kWh.

Financial benefit of energy saving - £30  a year

Payback with a 7% interest rate – 21 years.

The other major potential cost saving investments are boiler replacements and solar panel installation. Neither come close to achieving a 20 year payback with an interest rate of 7%. A new efficient boiler pays back in two decades (by which time it will probably have had to be replaced again) with a 5% interest rate  and a typical solar panel installation only works with interest rates of 4% or below. This figure assumes that the proposed Feed In Tariff reductions are actually applied.

The very unhappy fact is that with the exception of cavity wall insulation there is no energy efficiency improvement that a family can take that makes strict sense financially if the household has to borrow to make the change. The government’s hypothesis is that British homes are poorly insulated because people don’t have the ready cash to invest in improvements. Sadly, DECC is wrong. British homes remain badly insulated because it is extremely expensive for most people to make real energy saving improvements and few households will want to take on the burden of more debt when the reductions in their energy bills are so small.

The Green Deal as presently configured by DECC will fail. But we must cut household energy bills and reduce the 25% of UK carbon emissions coming from domestic housing. What should we do? First, we need a national well-publicised programme of free cavity wall insulation, with contractors moving street by street to improve every household.

This won’t happen under the Green Deal: it is a hugely complex and a bureaucratic nightmare even a year before it starts. Just to give one example of the costs imposed: the doorstep advisers established under the Deal will be highly regulated and will have supervisory bodies checking their work. Amazingly, on top of these institutions will be a further regulator superintending the activities of the supervisors. The chance of significant success, even at getting large numbers of houses to install cavity wall insulation, are close to zero when the overheads are so great. Only a countrywide programme of free insulation stands any chance. Simplicity can succeed where the Green Deal will not.

Second, we need to have national scheme for insulating solid wall homes. Even the supporters of the Green Deal know that solid wall insulation does not make financially sense. But such measures can make the single greatest difference to fuel bills in money terms. Millions of solid wall houses need external or internal insulation and a nationwide campaign to train an army of people to do the work would have major potential employment benefits. As the economic situation worsens, a campaign to insulate – for free – all the eight million solid walled homes in the country makes increasingly good sense.

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[1] The total comes to more than 14,000 kWh because our home heating is supplemented by the heat from lights, people, appliances, hot water and solar energy.

Biochar encourages the growth of winter salads

As part of The Big Biochar Experiment, five weeks ago I planted 40 pak choi seeds in small plastic pots. 20 went into conventional peat-free seed compost and 20 were planted into a mixture of 10% biochar (by weight) and 90% compost.

Biochar helped greatly. 16 out of the 20 biochar seedlings germinated, compared to 11 without biochar. The biochar seedlings are, on average, healthier, greener and have much better root systems. Some of the biochar seedlings had one or more roots 40 cm long when taken out of the plastic pot. None of the non-biochar plants had roots that had grown sufficiently to leave the pot. This difference was very striking indeed.

Why does biochar have these effects? In particular, why should germination rates be better with biochar? Much more work is needed on this, but potential hypotheses include the impact of black biochar increasing the temperature of the soil by absorbing more of the limited autumn sunlight.

I think the far better root development may possibly have arisen because the biochar made the soil less susceptible to waterlogging. When I took the seedlings out of their pots, the biochar-amended oil was loose and friable, probably encouraging the growth of the root system. By contrast, the unamended soil was dense and overly damp. The improvement from the use of biochar might therefore not have been as marked if I had planted the seedlings in a peat-based compost which would have resisted the effect of heavy rain better.

Whether or not biochar works to improve agricultural and horticultural yields is a vitally important question. Biochar is nearly 100% carbon, and it seems to remain in the soil for many generations. If the carbon in agricultural and wood wastes that would otherwise rot and turn into carbon dioxide were permanently stored in soils around the world, humanity's net CO2 emissions could be significantly reduced. Increasing the carbon content of the world's cropped soils by one tonne per hectare a year would sequester about 5% of global emissions. Since the typical hectare of agricultural land produces several tonnes a year of organic wastes in the form of such things as straw and maize stover, this target is certainly possible. Biochar has important other effects such as reducing nitrogen run-off, thus cutting nitrous oxide emissions and decreasing the need for conventional fertiliser.

Peak Stuff - did the UK reach a peak of material consumption in about 2001-3?

Empirical evidence presented in a paper available from this website supports the hypothesis that the UK began to reduce its consumption of physical resources in the early years of the last decade, well before the economic slowdown that started in 2008. (An article about this contention was published in the Guardian on 1st November 2011). This conclusion applies to a wide variety of different physical goods including, for example, water, building materials and paper and includes the impact of items imported from overseas. Both the weight of goods entering the economy and the amounts finally ending up as waste probably began to fall from sometime between 2001 and 2003.[1]

Summary data is provided below. The full paper is here: Peak_Stuff_17.10.11

If correct, this finding is important. It suggests that economic growth in a mature economy does not necessarily increase the pressure on the world’s reserves of natural resources and on its physical environment. An advanced country may be able to decouple economic growth and continuously increasing volumes of material goods consumed and a sustainable economy does not necessarily have to be a no-growth economy.

Summary of data in this paper

CategoryPeak yearDecline betweenpeak and 2007

InputsTotal Material Requirement20014%

Direct Material Consumption20015%

Water (overall)2003/44%

Water (household)2003/44%

Uses of biomassFood (calories per head)About the 1960sTens of percent

Food (grammes of meat per person)20033%

Paper20016%

Textiles*2007May not have peaked

Uses of mineralsCement198426%

Cars200310%

Some fertilisers (P and K)Mid 1980sMore than 50%

Use of fossil fuelsPrimary energy production20013%

Travel20051%

Some fertilisers (N)198740%

WasteOverall wasteEarly part of last decadeTens of percent

Domestic waste per household2002/35%

[1] The decline between 2003 and 2007 occurred at the same time as UK population rose by about 2.4%. Source: ONS population estimates.

Some background facts on UK domestic energy supply

1)      About 60% of UK householders say that they have never switched suppliers. 2)      The number of switchers is tending to fall. 22% of electricity customers switched in 2006, falling to 17% last year. The gas numbers were similar.

3)      Only 13% say that they have recently checked prices.

4)      Ofgem research suggests that ‘5-10%’ of householders ‘proactively’ search for better prices. Up to 90% of people were shown by their consumer research to be ‘disengaged’ or ‘passive’.

5)      The last check by Ofgem indicated that there were about 320 different tariffs available in the UK domestic market (January 2011). This is up from about 170 four years before.

6)      In the last thirty days (to 17.10.11) there have been 18 different tariff changes, of which 15 were initiated by the Big Six domestic energy suppliers. None of these changes affected the standard tariff rates. They were all changes to the hugely complex online rate cards as the suppliers withdrew their most attractive online offers. We can only presume that the main reason for these changes was concern that press comment would pick up on the huge differentials between the best online rates and the standard tariffs still taken by approximately 65% of all UK households.

7)      But even today customers in the Southern Electric supply area would save an average of £251 by switching from the standard tariffs of the Big Six to the cheapest online supplier. As of 17.10.11, the cheapest tariff is provided by small supplier First Utility and its cost for a household using 3,300 kWh of electricity and 16,000 kWh of gas would be about 1,025 compared to about £1,275 for the average standard rate card from the Big Six. The First Utility tariff has no cancellation charge but cannot be used by customers unlucky enough to be on independent gas distribution networks.

The Big Biochar Experiment

 

Heat wood or agricultural wastes strongly in the absence of air and you will eventually get charcoal through the process known as pyrolysis. Charcoal is almost pure carbon. When ground up and then added to the soil as a means of improving fertility or reducing water use, it is known as ‘biochar’. An Oxford company, staffed with academic researchers who work in related fields, is sponsoring a country-wide experiment to see if biochar can help domestic gardeners improve their crops.

Because charcoal is highly stable, it stores carbon for hundreds of years. Scientists such as James Lovelock have suggested that biochar might be a very effective way of storing very large quantities of carbon in the soil that would otherwise have returned to the atmosphere in the form of carbon dioxide. At application rates of 10 tonnes an arable hectare per year – a typical dose on a tropical soil – the world’s entire greenhouse gas emissions would be neutralised by using biochar on less than 10% of the world’s arable land area..

On poor tropical soils, biochar adds to agricultural production, often making a huge difference to yields. It seems to work by encouraging the growth of beneficial micro-organisms and by helping retain moisture. Does biochar improve yields in temperate climates? The data is less convincing than for hot countries with naturally carbon-poor soils. Some researchers have demonstrated that biochar can have beneficial impact but the overall effect on yields is much less clear-cut than on degraded soils. But anecdotal evidence is sometimes very compelling. The photograph at the top of this article compares biochar-dosed lettuces on the left with those planted just in conventional composts on the right. (Source: www.thecharlady.com)

The Big Biochar experiment has been designed to produce more evidence like this. The lead researchers from Oxford University’s Environmental Change Institute are distributing 1.5kg bags of biochar to domestic gardeners and people with ‘allotments’, small plots of public land rented to householders on which to grow their fruit and vegetables. Across different soil types, growing varied crops and at different times of the year, we will get an idea whether biochar can help people who cultivate their own food improve their yields. If you want to participate, details are here. You’ll need to pay the postage costs and commit to a trial that compares plant growth on a square metre of biochar-loaded soil to equivalent plants on standard soil.

Cecile Girardin, one of the scientists leading the experiment, is an expert on the carbon cycle in the tropics. (The carbon cycle is the natural process by which carbon dioxide is extracted from the atmosphere by growing plants and eventually returned when the plant dies and rots). She told me that she has a hunch that the experiment will demonstrate that root crops such as carrots or celeriac should benefit most from the addition of biochar to the soil. At this time of year in the UK, plants such as this will not generally be growing. However bulbs such as garlic and onions can be planted now (early October 2011) and will grow slowly through the autumn and winter. I think garlic would be a particularly good crop to use in the experiment. If biochar works, the bulbs should result in stronger stalk growth over the next months. I have done something slightly different, planting pak choi seeds in small pots, half of which have 10% biochar added. I will be looking for differences in root growth and leaf formation after a couple of months.

For those who have become convinced of biochar's virtues, the next step may be to club together to buy a kiln for making biochar. Craig Sams's business Carbon Gold is selling a simple retort for large scale charcoal making. At a cost of £3,500 plus VAT, the kiln is not cheap but garden clubs and allotment associations may be able to afford the investment

Biochar is potentially very important. The evidence is growing that it can both increase yields on some soils, reduce the need for expensive artificial fertilisers and cut losses in drought. The more we experiment the better our knowledge will be and sceptical policymakers will see the advantage of sequestering large volumes of carbon in the world’s soils.

Every large roof in the UK should be adorned by PV

The unexpectedly rapid fall in the cost of large solar PV installations means that the financial returns available to property owners have become highly attractive. Any office block, warehouse or school with a roof that can accept 50 kW of panels can expect a return of over 15% a year on its investment. (PLEASE NOTE: this article was written before the UK government made its deeply damaging decision to reduce subsidy payments from December 10th 2011. The new scale of payments will give returns of about half the figures in this note.)  

The UK review of feed-in tariffs carried out in the spring effectively blocked all installations of a size greater than 50kW. But the payments for smaller systems were unchanged, meaning that the returns to people investing in medium-sized installations, covering perhaps 300 square metres, were untouched by the review.

The cheapest quotations for roof-mounted 50 kW installations are now running at around £2.30 per watt. This means that a full-sized system taking maximum advantage of the tariffs could costs as little as £115,000. In the southern half of England a south-facing installation on a sloping roof should generate at least 850 kWh per kW of panels. Assuming that all the electricity generated is used in the building, the total income from the system will be over £18,000 a year, inflating for the next 25 years at the retail price index (RPI). On a particularly sunny site on the south coast, the annual  income could reach 18.5%, inflation-protected. (Although the maps show Cornwall getting the best solar radiation in the UK, data I have seen from readers of this blog strongly suggests that coastal Sussex, which has more sunshine than almost any where else in the UK although less predicted total insolation than the South West, is almost as good).

These are exceptional returns. Compare them to the recently withdrawn index-linked  bond from UK National Savings offering RPI + 0.5%. Although the National Savings offer is government guaranteed tax free and is repaid in full at maturity, the income is still far below the rate offered by a good PV installation. There really isn’t a good reason for people owning large roofs not to be racing to install PV before the rates go down in April of next year. And if you cannot raise the money yourself, there should be no shortage of return-hungry investors eager to assist.

PS. The good financial returns available to the owners of large PV systems do NOT mean that solar is necessarily a good investment for the UK as a whole. The payments mentioned in this article amount to 42.9 pence per kilowatt hour, including 10p per kilowatt hour for the benefit of not buying grid electricity, and are about ten times the level of today’s wholesale power prices. Although the price of large-scale PV has nearly halved in the last year, it remains uncompetitive with other forms of electricity generation. And this extra cost is still loaded onto all the people in the country not lucky enough to be able to afford PV or living in accommodation without access to a good roof.

Bioplastics: an important component of global sustainability

(This work was commissioned by Biome Bioplastics, a leading European bioplastics company. A formatted version of the paper is available on the company website -www.biomebioplastics.com)

Plastics are a vital asset for humanity, often providing functionality that cannot be easily or economically replaced by other materials. Most plastics are robust and last for hundreds of years. They have replaced metals in the components of most manufactured goods, including for such products as computers, car parts and refrigerators, and in so doing have often made the products cheaper, lighter, safer, stronger and easier to recycle.[1] Plastics have taken over from paper, glass and cardboard in packaging, usually reducing cost and carbon emissions while also providing better care of the items that they protect.[2][3]

But we all know about the counterbalancing disadvantages.

• Plastic litter disfigures the oceans and the coastlines. Ingestion of plastic kills marine creatures and fish. Perhaps 5% of the world’s cumulative output of plastic since 1945 has ended up in the oceans. Shopping bags and other packaging are strewn across the streets and fields of every country in the world.
• Plastics use valuable resources of oil
• The plastics industry uses large amounts of energy, usually from fossil fuel sources which therefore adds to the world’s production of greenhouse gases.
• The durability of plastics means that without effective and ubiquitous recycling we will see continuing pressure on landfill. Although plastics do not represent the largest category of materials entering landfill – a position held by construction waste – they are a highly visible contributor to the problems of waste disposal.
• The manufacturing of conventional plastics uses substantial amounts of toxic chemicals.
• Some plastics leach small amounts of pollutants, including endocrine disruptors, into the environment. These chemicals can have severe effects on animals and humans. (The solution to this problem is to avoid using original raw materials - either monomers or plasticizers -that might produce such compounds when the plastic is in use or has been discarded).

The world needs to find a solution that gives us continued access to plastics but avoids these serious problems.  Bioplastics - partly or wholly made from biological materials and not crude oil - represent an effective way of keeping the huge advantages of conventional plastics but mitigating their disadvantages.

What is a bioplastic?                                                                                                                                              

A bioplastic is a plastic that is made partly or wholly from polymers derived from biological sources such as sugar cane, potato starch or the cellulose from trees, straw and cotton. Some bioplastics degrade in the open air, others are made so that they compost in an industrial composting plant, aided by fungi, bacteria and enzymes. Others mimic the robustness and durability of conventional plastics such as polyethylene or PET. Bioplastics can generally be directly substituted for their oil-based equivalent. Indeed, they can generally be made to be chemically identical to the standard industrial plastics.

In thinking about the potential role of bioplastics, we need to distinguish between two different types of use.

• Items that might eventually become litter – such as shopping bags or food packaging – can be manufactured as bioplastics to degrade either in industrial composting units or in the open air or in water. Strenuous efforts need to be made to continue to reduce the amount plastic employed for single use applications. But if the world wishes to continue using light plastic films for storage, packaging or for carrying goods, then the only way we can avoid serious litter problems is to employ fully biodegradable compounds.[4]

• Permanent bioplastics, such as polythene manufactured from sugar cane, can provide a near-perfect substitute for oil-based equivalents in products where durability and robustness is vital. Plastics made from biological materials generally need far smaller amounts of energy to manufacture but are equally recyclable. They use fewer pollutants during the manufacturing process. Per tonne of finished products, the global warming impact of the manufacture of bioplastics is less, and often very substantially less, than conventional plastics.

Plastics are regarded with deep ambivalence in the much of the world. Their association with indestructible and unsightly litter sometimes blinds us to their enormous value. Bioplastics – with a low carbon footprint and the capability of being made to completely degrade back to carbon dioxide and water – are a vital and growing complement to conventional oil-based plastics. They can be made to completely avoid the use of the monomers and additives that may have effects on human or animal health. As oil becomes scarcer, the value of bioplastics will increase yet further.

Plastics

About 4% of the world’s oil production is converted into plastics for use in products as varied as shopping bags and the external panels of cars. Another few percent is used in processing industries because oil-based plastics require substantial amounts of energy to manufacture. Each kilogramme of plastic typically requires 20 kilowatt hours of energy in the manufacturing process, more than the amount needed to make steel of the same weight. Almost all this comes from fossil sources. One survey suggested that the plastics industry was responsible for about 1.5% of allUSenergy consumption.

As oil runs out, and the use of fossil fuels becomes increasingly expensive, the need for replacement sources of raw material for the manufacture of vital plastics becomes increasingly urgent.  In addition, the use of carbon-based sources of energy for use in plastics manufacturing adds greenhouse gases to the atmosphere, impeding the world’s attempts to cut CO₂ emissions.

These problems can be overcome. All the major oil-based plastics have substitutes made from biological materials. The polyethylene in a shopping bag can be made from sugar cane and the polypropylene of food packaging can be derived from potato starch. Plastics are irreplaceable and will all eventually be made from agricultural materials.

The world plastics industry and the role of bioplastics.                                                                             

The annual output of the world’s plastics industry is about 225 million tonnes a year.[5] This number has grown by a few per cent per year over the last decade. The bioplastics industry is much smaller, with 2011 probably seeing a total output of about 1m tonnes, or less than half of one per cent of total world plastics output. But the growth rate of bioplastics is much higher. Most sources suggest that this part of the plastics industry is growing at least 20% a year. The reasons for this buoyancy are discussed later in this note.

Not even the most fervent advocates of the bioplastics suggest that they will quickly replace all oil-derived compounds though most people expect rapid growth to continue.

• They are generally two or three times more expensive than the major conventional plastics such as polyethylene or PET. This disadvantage will tend to diminish as bioplastics manufacturing plants become larger and benefit from economies of scale. When the local biological feedstock is particularly cheap, as it is in Brazil, large bio-polyethylene plants may already be close to being cost-competitive with oil-based alternatives.[6] But more generally, the crude oil for a kilo of plastic costs around €0.20 but the corn, a key source of feedstocks for bioplastics currently (August 2011) costs about twice this amount.
• Their physical characteristics are not always a perfect substitute for the equivalent polymer. Sometimes the differences are trivial, such as the biological version having a slightly different texture, but in some cases the bioplastic cannot substitute for the conventional plastic. But for the most important plastic – polythene – the product based on biological sources is identical to the plastic made from oil.
• There are a huge number of different market segments in which bioplastics can compete. In some cases, bioplastics are likely to make substantial inroads into share of traditional plastics while in others they will struggle. Novamont, the leading Italian bioplastics company, has estimated that biodegradable plastics can replace about 45% of the total sales of oil-based plastics in horticulture and 25% of those used in catering. Others regard these estimates as too low.
• The Committee of Agricultural Organisations in the European Union suggested a figure for the accessible market for bioplastics in the EU alone at around 2m tonnes, several times the current production level. It sees the most important single segment as catering products, such as single use cutlery, followed by vegetable packaging.

Bioplastics versus food

In many types of applications, bioplastics offer substantial advantages over conventional products. Nevertheless, despite their relatively minor current role, one serious issue does need to be addressed, both now and in the future.

At the moment many bioplastics are made from sugars and starches harvested from crops that otherwise might be grown for food. As with liquid biofuels, the bioplastics industry has to deal with the vitally important question of whether the growth of bioplastics will tend to decrease the land available for food production, or increase the incentive to cut down forested areas to create more arable land. Cutting down forests is bad for global warming - because it returns carbon to the atmosphere - and bad for the wider environment because it tends to decrease biodiversity and increase erosion and flooding.

At present, the world bioplastics industry produces about 1 million tonnes of material. Perhaps 300,000 hectares are used to grow the crops which the industry processes into plastics.[7] For comparison, this is about 0.02% of the world’s total naturally irrigated area available for cultivation.[8]  Even if half the world’s plastics were made from crops grown on food land, the industry would only require 3% of the world’s cultivated acreage. By contrast, the bioethanol industry in the US uses over one tenth of the country’s arable acres to grow corn, but this fuel provides less than 10% of total liquid transport fuel. Biofuels are already an order of magnitude more important than bioplastics will ever be in using the world’s productive land.

How important is this issue?                            

The impact of the growth of bioplastics on the land available for growing food and on maintaining forest cover is an issue that needs to be openly discussed, as it is with the use of foodstuffs as feedstocks for biofuel refineries. But the world’s plastic industry is only about one tenth the size of the transport fuels sector in terms of its use of oil. If today’s entire plastics production was made from biological sources it would consume between 0.1% and 0.2% of the globe’s total annual production of organic matter (‘net primary production’). This is not a trivial amount but concerns about the competition for land need to be balanced by consideration of the enormous potential value of making bioplastics compared to the equivalent oil-based plastics.

In fact, the position is even less threatening. First, bioplastics are often made from products that would otherwise be wasted because they are unusable for human consumption. Potato starch is a by-product of some food production processes. As well as for bioplastics, this product – a waste that would otherwise have to be disposed of – is used for products as diverse as a constituent of drilling mud for oil and gas exploration and as a wallpaper paste. Plastics applications are only ever likely to be a small portion of total demand for this source of biological starch.

Sugar cane for bioplastics is usually grown on land in Brazil that has few alternative uses and certainly could not be used to grow grains. Furthermore the energy used to power the manufacturing process that creates the bioplastic from sugar is provided by the combustion of the stalks and leaves (‘bagasse’) of the cane, and no fossil fuel is used. Sugar cane is also the primary source of Brazil’s bioethanol which provides much of the country’s transport fuel. The crop is grown on dry lands, often used previously for cattle pasture but now so degraded that it cannot be used for any other form of intensive agriculture. There is no risk of sugar plantations encroaching on the precious Amazonian rain forest, which is over two thousand kilometres away from the land used for growing sugar cane. Braskem, the Brazilian company that is the largest plastics producer in the Americas, has just established a 200,000 tonne biopolyethylene plant (equivalent to about 20% of the world’s current bioplastics production) and states that growing the feedstock for this factory will use less than 0.1% of all Brazilian arable land.

Furthermore, as technology improves industry participants will have a much wider variety of raw material sources to use to make bioplastics. It will eventually be unnecessary to use land that might otherwise have been used for food. The list of potential alternative feedstuffs includes algae, which grows in water rather than on land, and cellulose. The cellulose molecule, which is the most abundant carbon-containing molecule in the natural world, forms the bulk of the weight of trees and of agricultural wastes such as straw. It was also the basis of the first commercial plastic, Parkesine, which was patented in 1856, and other historically important plastics such as celluloid. As oil becomes scarcer and more expensive the move back to cellulose and other biological feedstocks will represent a return to the days before the abundant availability of cheap petrochemicals.

Biome Bioplastics has traditionally focused on using potato starch as the main feedstock for its products. But as an illustration of the trend towards new feedstocks, nine out of the twelve new products launched this year have used non-starch polymers. The research and development needs to continue in the laboratories of bioplastics companies around the world.

As Dr Anne Roulin, the global head of packaging and design at Nestle, says when referring to the need to develop cellulose and other bioplastic polymers, ‘I think it is going to be an evolution where we will continuously reduce environmental impact and find more energy efficient processes. But I really see the trend going in the direction of conventional plastics made from renewable resources’.[9]

Finally, we need to consider the impact of improved recycling. Until a few years ago, the amount of plastic recycled was tiny. The costs of separating and cleaning different types of plastic were too high. Advances in recognition technology  - usually using infra-red or ultra-violet sensors to identify each of the key types of plastic – are enabling recyclers like Lincolnshire-based Eco Plastics to sort, clean and then resell almost all types of plastic. Their Hemswell plant has a total capacity equivalent to almost 5% of the UK’s total plastic consumption and enabling Coca Cola, for example, to source an increasing fraction of its total need for plastic from recycled PET, whether initially made from oil or from starch.[10]

About 25% of the UK’s plastic is now recycled and this can continue to rise strongly in the next few years, with the only obstacle being a shortage of state-of-the-art facilities like Hemswell. Why are we stressing the importance of the recycling of non-biodegradable plastics, whether from oil or from plant matter? Because the world needs to be more economical in its use of its scarce resources. Whether this is the oil used for most plastics or the starches, sugars and cellulose for biological plastics, we cannot afford to continue to throw away three quarters of the plastic we use. A swing towards biologically-sources plastics should not mean any let up in the move towards near-100% recycling of all types of plastics, whether made from oil or from agricultural wastes.

The benefits from using bioplastics

a)      Major consumer goods brands and bioplastics

Over the last five years many of the world’s largest consumer good companies have begun to employ bioplastics in the packaging of their products. Examples include Coca Cola’s use of a mixture of a conventional plastic and bioplastic in its soft drink bottles, Proctor and Gamble’s bioplastic shampoo packaging and Nestle’s adoption of a bioplastic top for his Brazilian milk products.

Coca Cola’s PlantBottle uses petroleum PET and up to 30% plant-based equivalent. The bottle can be reprocessed through existing recycling facilities in exactly the same way as other PET bottles. Coca Cola aims at using bottles that are ‘made with 100 per cent plant-waste material while remaining completely recyclable’, according to Scott Vitters, director of sustainable packaging at the company.

Coca Cola recognises the danger of raw material production for bioplastics diverting farmland away from the production of food or resulting in the loss of woodland. But the newsletter Business Green reported comments from Dr Jason Clay, senior vice president of market transformation for the WWF, saying that Coca-Cola had taken precautionary measures to ensure its bio-plastic does not inadvertently lead to deforestation and increased emissions.

‘Coca-Cola is currently sourcing raw materials for its PlantBottle from suppliers in Brazil, where third parties have verified that best-in-class agricultural practices are the norm," he said. ‘Preserving natural resources through sustainable agriculture is essential for businesses like Coca-Cola as they search for ways to alleviate environmental challenges.’[11]

Jason Clay of WWF also has warm words for Proctor and Gamble’s new polyethylene biopackaging, also made from sugar cane sourced from Brazil. ‘P&G's commitment to use renewable bio-derived plastic in its global beauty and grooming product packaging is an important step forward in its efforts to improve the environmental profile of its products,’ he said.[12]

Nestle is also moving rapidly towards the increased use of bioplastics, saying publicly in July 2011 that it ‘is involved in over 30 projects to introduce bioplastics in its product packaging portfolio worldwide.’[13]  In early 2011, the company launched packaging made from renewable resources for its pet food packaging in the US.

The introduction of renewable and recyclable packaging hasn’t been problem free everywhere. SunChips, a subsidiary of PepsiCo’s Frito-Lay snacks unit, recently stopped using an early version of a compostable packaging film for most of its products. The plastic film made from PLA – a renewable plastic made from corn starch – was regarded as ‘too noisy’ by customers. But SunChips didn’t lose its commitment to compostable plastic packaging. Instead its web site says that ‘we’ve created a new, quieter fully compostable chip bag that’s easy on the ears. Our new quieter compostable plastic bag will be rolling out over the next month’.[14] (We believe that the new packaging is still made from PLA) On the parent company’s web site, the statements continue to stress the importance of renewable plastic films.  ‘There’s enormous opportunity to reduce our use of non-renewable resources by using plant-based materials,’ says Tony Knoerzer, Frito-Lay’s Director of Sustainable Packaging.[15]

These four companies are among the biggest consumer goods companies in the world, with operations in almost every country. All of them appear to be committed to an increase in the use of bioplastic packaging for their products. Their reasons are simple: these businesses are watching the actions and attitudes of their customers who are increasingly concerned about the use of fossil fuel resources and, particularly, about indestructible litter. Bioplastics are important in helping consumer goods companies present their brands in a favourable light. Recyclable or compostable packaging made from biological materials can be used to make their products more environmentally friendly in the eyes of consumers. Although bioplastics may be more expensive per kilo of packaging, the extra cost is more than outweighed by the benefits seen by purchasers. The client lists of the major bioplastic suppliers include most of the largest and best-known consumer goods companies, ranging from the Shiseido cosmetics brand to Ecover, the Belgian cleaning products company.

In addition, large companies like these are becoming more aware of the risk of disruption to the supply of oil-based plastics. In order to ensure that at least part of the operations could continue after a loss of availability of conventional plastics - perhaps because of an oil embargo – many large and responsible companies are investing now in developing bioplastic packaging.

b)      The value of the reduction in landfill/expensive preparation for recycling

Some bioplastics are as robust and durable as their oil-based equivalents. Others will rapidly break down in commercial composting plants. These rapidly biodegradable plastics have high value in some circumstances such as when plastics become inevitably mixed with other streams of compostable waste and would otherwise need to be hand separated. For example, quantities of plastic material are used in greenhouse applications. A productive application for bioplastics is the ties that hold tomato vines to the support wires in commercial greenhouses. After the crop is concluded, the waste organic material, including the ties and other plant-based plastics such as the small pots in which plants are grown as seedlings, can be quickly and efficiently cleared and taken to be composted. Conventional plastics would have to be separated by hand at great expense and usually then sent to an incinerator or landfill.

A more substantial application also arises in the horticultural sector. Many field grown vegetables are covered in a thin semi-transparent polypropylene mulch to help maintain even temperatures, reduce water loss and protect the crop from insects. The mulch generally only lasts for one season and then it has to be collected up and returned for recycling. This is a complex and expensive process. A bioplastic mulch that will dissolve in the soil over the winter is much better because it saves time and money but also adds to the carbon content of the soil, helping to maintain fertility. In other important agricultural uses, such as for strimmer cord (‘weedwacker’ in the US, full biodegradability means that small pieces of plastic filament do not persist in the environment.

Another example, likely to become one of the largest single applications for bioplastics, is single use catering utensils. Restaurants and coffee shops generate three streams of waste: unused food, packaging (for example of sandwiches) and utensils such as cutlery. It is highly beneficial – as well as being advantageous to the brand image of the restaurant – to use fully compostable packaging and utensils. All the waste can be put into one bin and shipped to the composting facility without further intervention or labour cost. The thick pieces of plastic cutlery will need to shredded at the composting site to encourage rapid biodegradation but this can happen automatically. Although fully degradable cutlery costs about four times as much as conventional plastic utensils, the reduction in time spend separating out plastics from food waste and,second, reducing landfill cost, more than justifies the expense.  As well as compostable utensils, it makes sense to use bioplastic film to provide the windows in cardboard sandwich packets so that the packaging can also be added to the stream of compostable items.

Some American towns and cities are beginning to move to mandatory use of biodegradable plastics for single use catering utensils, including plates, cups and cutlery. Seattle, for example, has introduced an ordinance that obliges restaurants to only use bioplastics that will degrade in the city’s composting plant. The final imposition of this rule has been delayed by problems obtaining cutlery that is sufficiently compostable but the rules are becoming stricter here and in other towns and cities wanting to reduce use of landfill.  Seattle uses a landfill site 320 miles from the city - about the distance from Newcastle to London - creating a huge incentive to avoid high transport fees.[16] As disposal sites fill up around the world, the need either to recycle plastics or to compost them can only increase, adding further buoyancy to bioplastic sales.

In a similar move, municipalities around the world collecting food waste from homes are now often providing compostable plastic bags into which the food goes prior to collection. Householders benefit from easier and more hygienic storage of the waste. The municipality can collect the bag and does not have to separate it from the waste food before the composting process begins. While these bags are not as strong as the equivalent standard polyethylene bag, they perform their functions well.

c)       Litter

The best understood advantage of biodegradable bioplastics lies in the reduction of permanent litter. Plastic single use shopping bags are the most obvious example of how plastics can pollute the environment with huge and unsightly persistence. A large fraction of the litter in our oceans is of disposable plastic bags. Cities and countries around the world are taking action against the litter, sometimes by banning non-degradable plastic bags entirely. Italy has decided to block the use of non-biodegradable single use shopping bags from the beginning of 2012. The city of Portland, Oregon has just (July 2011) joined several dozen US municipalities in banning most plastic bags. These legislative changes represent a clear trend as politicians respond to the irritation over the persistence of plastic bag litter in the world’s seas, rivers and rural and urban environments.

Some places will continue to allow plastic bags that are genuinely biodegradable and meet the published standards for compostability. (Bags that are oxy-degradable, and only break down in to very small pieces rather than truly biodegrading, will generally be banned). Biodegradable bioplastic bags will be allowed in Italy, providing a huge boost to the European market for these products not least because until now the country has been the largest European market for single use shopping bags.

Bioplastics demand will continue to grow.                                                                                     

Continued research and development in bioplastics is creating high quality products for a wide variety of industries. Now that the benefits of biologically sourced plastics are well-understood, their market share is likely to rise sharply. The three drivers of growth – the importance of brand image to consumer goods companies, the value of joint composting and the reduction of litter – will provide the spur for continued growth in bioplastics across the world.

The carbon footprint of plastics

Calculating the greenhouse gas reductions arising from the use of bioplastics is a complex and controversial area. But it is nevertheless important to try to quantify the benefits from making plastics from biological materials in order to encourage further debate and research.

The first point to make is that the carbon footprint of a bioplastic is crucially dependent on whether the plastic permanently stores the carbon extracted from the air by the growing plant. A plastic made from a biological source sequesters the CO₂captured by the plant in the photosynthesis process. If the resulting bioplastic degrades back into CO2 and water, this sequestration is reversed. But a permanent bioplastic, made to be similar to polyethylene or other conventional plastics, stores the CO₂ for ever. Even if the plastic is recycled many times, the CO₂ initially taken from the atmosphere remains sequestered.

The chart below offers illustrative figures for the greenhouse gas impact of making a kilo of bioplastic from a material such as wheat starch. The first column – a negative number - estimates the CO₂ captured from the atmosphere by photosynthesis during the growth of the plant. The second records an estimate of the greenhouse gases emitted in the process of producing the wheat. This includes the emissions from fossil fuels used to power the tractor and other energy use in the field and in the drying of the wheat. It also measures the impact of fertiliser manufacture and the emissions of nitrous oxide, a very powerful global warming gas, as a result of the chemical breakdown of nitrogenous fertiliser in fields.

The third column estimates the CO₂ impact of the energy used in converting the starches to a plastic. This figure will generally be much lower than the figures for oil-based plastics because biological materials need much lower temperatures and pressures in the manufacturing process. Bioplastics can generally be processed at about 140-180 degrees Celsius compared to temperatures of around up to 300 degrees for conversion of petrochemicals to plastics.

Chart A

The greenhouse gas implications of making a simple polymer plastic from wheat

(These numbers are illustrative – kilogrammes of CO₂ equivalent per kilogramme of plastic produced)

-1.4 CO2 sequestration by growing plant

+0.6 GHGs emitted by farming

+2.0 GHGs produced by conversion to plastic

+1.2 Net carbon footprint

Sources: Sequestration in wheat, http://ec.europa.eu/environment/ipp/pdf/ext_effects_appendix1.pdf, GHGs from wheat cultivation, ’How Bad are Bananas’ Mike Berners Lee, Profile Books, 2010, GHGs from conversion processes, estimate from Biome Bioplastics. CO₂e is a measure of emissions by which all different greenhouse gases are standardised to the global warming impact of CO2.

Most calculations of the energy used and greenhouse gases created in the production of conventional plastics produce much higher numbers. One estimate of the CO₂ produced per kilogramme of oil-based polypropylene is 3.14 kilogrammes per kilogramme of plastic.[17]  This compares with the 1.2 kg illustrative figure for wheat polymers in the chart above.  To be clear, the implication is that those bioplastics that do not degrade might therefore have a carbon footprint of well under half the conventional equivalent.

Braskem, the large Brazilian producer manufacturing both bioplastic and oil-based equivalents, has calculated much higher figures for the capture of CO₂ by a growing sugar cane plant. It estimates a net sequestration (that is, a negative footprint) of about 2.3 kilogramme of CO₂ for every kilogramme of biopolypropylene manufactured.[18] It compares this to a carbon footprint of over 3 tonnes for polypropylene made from oil, meaning a net gain of over 5kg of CO₂ for each kilogramme of plastic. This is an important potential saving; if all plastics were switched to biological feedstocks and the carbon footprint benefit was as high as much, the reduction in global greenhouse gas emissions would be about 5% of current total.

If, on the other hand, the bioplastic is of a degradable type the advantages over conventional plastics are less pronounced. The plastic will compost back into carbon dioxide and water, returning all the sequestered carbon to the atmosphere. In the illustration given above, the savings from making the bioplastic compared to the oil-based comparator would be relatively small, but nevertheless still positive. The crucial point – not well understood by commentators or by the public – is that compostable plastics will typically have a much larger carbon footprint than ones that are manufactured to be permanent. The return of the CO₂ to the air reduces the sequestration of organic material.

This situation would be made worse if the bioplastic did not compost in air, but rotted in an oxygen poor landfill. In these circumstances, the plastic would degrade into methane (CH₄) and other byproducts. Methane is a global warming gas of greater impact than CO₂ and so the full carbon footprint needs to include any uncaptured CH4 produced in landfill.[19] Most - but not all - research shows that the conditions in well maintained landfill sites are too dry for degradable plastics to actually rot. In these circumstances, the bioplastics will therefore permanently sequester carbon. More work needs to be done on this issue, but in the intervening time the precautionary approach is to try to ensure that all biodegradable bioplastics are kept out of landfill.

The other advantages of bioplastics

We have identified five major advantages of bioplastics in this note

• Potentially a much lower carbon footprint
• Lower energy costs in manufacture
• Do not use scarce crude oil
• Reduction in litter and improved compostability from using biodegradable bioplastics
• Improved acceptability to many households

There are also some significant technical advantages to bioplastics; these depend on the precise plastic used and how it is made. Products characteristics of value can include

• Improved ‘printability’, the ability to print a highly legible text or image on the plastic
• A less ‘oily’ feel. Bioplastics can be engineered to offer a much more acceptable surface feel than conventional plastics
• Less likelihood of imparting a different taste to the product contained in a plastic container. Milk, for example, will acquire a new taste in a styrene cup but the bioplastic alternative has no such effect.
• A bioplastic may have much greater water vapour permeability than a standard plastic. In some circumstances, such as sandwich packaging, this can be a disadvantage, but in the case of newly baked bread a bioplastic container will offer a significant advantage in letting out excess vapour or steam.
• A bioplastic can feel softer and more tactile. For applications such as cosmetics packaging, this can be a major perceived consumer benefit.
• Bioplastics can be made clearer and more transparent (although they are usually more opaque)
• Plastics made from biological sources still need to contain additives such as plasticisers that give the product its required characteristics. But bioplastics do not contain bisphenol A, an additive thought to leak from plastics and which is an endocrine disruptor and mimics sex hormones. Bisphenol A is not yet banned in most countries because the chemical is rapidly excreted by most creatures, including humans. But the high levels of continuing exposure to this worrying chemical from conventional plastics may mean that consumers will want to avoid this chemical and shift to safer bioplastic alternatives.

Bioplastics are an important part of the move to a more sustainable world.                            

Bioplastics, currently accounting for less than half of one per cent of all plastics manufacture, are growing rapidly because of the clear advantages they have in many applications. As oil supply tightens, these advantages will grow. Their carbon footprint can be much lower than oil-based equivalents.  Bioplastics can provide excellent biodegradability, helping the world deal with the increasing problems of litter, particularly in the world’s rivers and seas. Durable plant-based bioplastics can also be recycled as well as their conventional equivalents, assisting the growth of a more sustainable world economy.

Chris Goodall

chris@carboncommentary.com

+44 07767 386696

(This research was commissioned by Biome Technologies, a major European bioplastics company. A full version is available at www.biomebioplastics.com)

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[1] Comparing the greenhouse gases to make a water bottle, the New York Times reported that steel is fourteen times worse than plastic. (http://www.nytimes.com/interactive/2009/04/19/opinion/20090419bottle.html). G Magazine in Australia suggested that recyclable plastic water bottles had up to 80% less global warming impact than steel or aluminium alternatives http://www.gmagazine.com.au/node/2436/full

[2] Incpen, an industry trade body, provides analysis of comparative carbon footprints for various types of packaging. One example showing that plastics are better than glass is provided here http://www.incpen.org/resource/data/ipen1/docs/PRAG3LCAMeasTools.pdf

[3] The UK Environment Agency produced a report in early 2011 that suggested that supermarket paper bags had three times the environmental impact of single use polyethylene bags. http://publications.environment-agency.gov.uk/PDF/SCHO0711BUAN-E-E.pdf

[4] Some conventional plastics can be made to break down. However readers should be aware that many such plastics, often termed ‘oxy-degradable’, do not actually degrade into smaller molecules. Rather, they simply break into very small pieces. This reduces the visual problem caused by litter, but the wider concerns remain. For example, birds and fish eat the small pieces of plastic, thinking them to be food.

[5] http://www.gtai.com/homepage/info-service/publications/our-publications/germany-investment-magazine/vol-2011/vol-012011/industry-report-4/

[6] Dow Chemical expects its proposed Brazilian bio-polyethylene plant to produce plastic at about the same cost as the oil-based equivalent. http://www.technologyreview.com/energy/38114/

[7] These figures are based on calculations offered by European Bioplastics at www.en.europe-bioplastics.org

[8] Michael Carus and Stephan Piotrowski, Land Use for Bioplastics, Bioplastics Magazine, 04/09

[9] Quoted in European Plastics News, July 26^th 2011. http://www.europeanplasticsnews.com/subscriber/headlines2.html?cat=1&id=1311674045

[10] Details at http://www.coca-cola.co.uk/environment/coca-cola-eco-plastics-recycling-joint-venture.html

[11] Business Green, 17^th November 2009, ‘Coca Cola launches bioplastic PlantBottle.’

[12] Press release from Proctor and Gamble, August 12^th 2010, ‘P&G Announces Plan to Use Innovative Sustainable Packaging’.

[13] Press release from Nestle, July 29^th 2011, ‘Nestlé launches bioplastic caps for milk brands in Brazil’

[14] Text taken from the SunChips website, www.sunchips.com, on August 2^nd 2011

[15] Text taken from Frito-Lay website, www.fritolay.com, on August 2^nd 2011

[16] Information at http://www.seattle.gov/util/groups/public/@spu/@usm/documents/webcontent/cos_001786.pdf

[17] This figure was calculated by Professor Ramani Narayan of Michigan State University in a study for the bioplastics company Cereplast.

[18] This number is contained in this presentation. (Page 15) http://www.braskem-ir.com.br/braskem/web/arquivos/Conference_Mar2011_Citi_1x1_v2.pdf

[19] Many landfill sites in the UK collect the methane from rotting organic materials and burn it for electricity production. Nevertheless some methane escapes and adds to global warming.

The moral case for nuclear power – an article by George Monbiot

George Monbiot and Jonathon Porritt have been engaged in a debate about the merits, or otherwise, of nuclear power. I did some of the research for George’s article on the Guardian website today (August 8th 2011). Like George, I have reluctantly come to believe that the world needs nuclear – and lots of it – if it is produce the energy it needs without carbon emissions. Energy efficiency is important and the development of renewables should continue with enthusiasm and financial commitment. But the task of getting to 100% replacement of fossil fuels is so enormous, so intimidating and so expensive that I think countries need to encourage nuclear power as well as renewables. One calculation I made George didn’t have the space to use so I have written about it here.

Jonathon Porritt praised the German decision to phase out nuclear rapidly and increased emphasis on solar PV. Porritt gave the impression that PV in Germany costs about the same price as conventional electricity. The reality is very different. As in the UK, the subsidy to renewables is spread across the all electricity users and the solar feed in tariffs in Germany are adding rapidly to the costs faced by power users, rich and poor.

The 2011 levy on German customers’ bills to meet the subsidies to renewable energy is about 3.5 cents a kilowatt hour. The figure increased by almost 1.5 cents a kilowatt hour over 2010 and most of this increase was due to what one source describes as the ‘skyrocketing’ costs of PV subsidies. (1) The net effect on typical German household bills of all the subsidies of renewable energy sources is now about £150 a year, of which about half is the payment for solar energy. Translated to the UK, the German renewables subsidy would be adding about 25% to customers’ bills, pushing millions more into fuel poverty.

All low carbon sources are going to be more expensive than fossil fuel and we shouldn’t even pretend otherwise. But he problem with solar is that in cloudy countries like the UK and Germany it requires a huge amount of capital and produces small amounts of electricity. Per unit of electricity generated, PV requires about five times more subsidy than wind.

The German PV subsidy will cost about €8bn this year, payable by all electricity users. And this will continue each year for decades, increasing with every new installation of PV panels. Current PV installations only produce about 2% of the country’s electricity, about the same as would be produced by one new nuclear power station. Just one year’s PV subsidy would pay for the construction costs and the lifetime operating expenses of a nuclear power station. There would be no further cost to consumers. But the same amount of PV generating capacity needs €8bn a year into the indefinite future  Do German consumers realise PV electricity is costing them literally an order of magnitude more than nuclear energy?

(1) http://www.germanenergyblog.de/?p=4249

Government statisticians not certain greenhouse effect actually exists

UK government statisticians put out a report today that includes a section on the effects of climate change. The Office for National Statistics document contains three bizarre comments that suggest they simply don’t understand the science. Is scepticism about the reliability of the laws of physics beginning to infect even central government? Will we get a note from ONS next week suggesting that existence of gravity is still subject to scientific dispute? 1, 'Some studies of long-term climate change have shown a connection between the concentrations of key greenhouse gases – carbon dioxide, methane and nitrous oxide - in the atmosphere and mean global temperature'.

No, not ‘some’ studies.  All research ever conducted into long-term climate change has shown not just ‘a’ connection between greenhouse gases and temperature but a very strong link. The level of CO2 in the atmosphere is highly correlated with global temperature across the last hundreds of millions of years.

2, 'The accumulation of these gases in the atmosphere may cause heat from the sun to be trapped near the Earth’s surface – known as the ‘greenhouse effect’ '.

Greenhouse gases ‘may' cause heat to be trapped? No, we know with complete certainty that greenhouse gases cause heat to be retained in the atmosphere. And we have known this for a hundred years. Without the greenhouse effect the average Earth temperature would be about 33 degrees lower than it is today. No-one, literally no-one, denies this.

3, ‘Opinion on climate change is divided’

Actually, the research being discussed by ONS at this point shows that opinion on the effects of climate change is divided.

There is real and important debate on the impact of increased greenhouse gas concentrations on the world’s climate. But no uncertainty whatsoever exists as to the existence of the greenhouse effect. The ONS needs to get out more and talk to a few scientists.

Alstom gives hope that CCS will be financially viable

While policy-makers debate how to ensure the UK gets more low carbon electricity, the big generators are actually piling their capital into large numbers of new gas power stations. Future achievement of carbon reduction targets will therefore wholly depend on finding economical ways of capturing the CO2 coming out of gas turbines. Without carbon capture and storage (CCS) the current rush for gas will lock the UK into high carbon electricity output for another generation. We urgently need to include CCS in the current support schemes for low-carbon generation. Alstom, the world leader in CCS, has just released estimates suggesting that new plants with carbon capture should produce electricity at lower cost than any other low-carbon source. (1) Based on the results from 13 pilots and demonstration projects, the company is firmly optimistic about the main CCS technologies, saying that ‘technology and costs are not in themselves obstacles to CCS deployment’. It talks of costs of around €70 a megawatt hour, a far lower figure than nuclear energy is likely to cost. Its confidence contrasts with the wariness of the Committee on Climate Change which recently described the economics of CCS as ‘highly uncertain’. The CCC is probably being appropriately cautious, but the no-one is going to find out unless major countries commit to real support for CCS demonstration projects. The signs are not auspicious: the world’s most important pilot at AEP’s Mountaineer coal power station was abandoned a few weeks ago because the US government’s lack of any form carbon policy made investment impossible. Even if CCS only adds a small amount of the cost of generating electricity – and it will always do so – no generator will spend the money without a clear set of financial incentives that reward it for capturing and storing the CO2.

Similarly, to say that the UK administration has dithered on CCS would be unfairly sympathetic. In May 2007, BP’s advanced plans to build a plant to capture the CO2 from a plant on the north east coast of Scotland were scrapped because of the UK government’s refusal to let gas power stations participate in the CCS competition it planted to launch in 2007. Now, four years later, the CCS competition appears to be stalled. Those watching the disarray ruefully comment that if BP had been given the go-ahead, the UK would now be close to having the first fully functioning low carbon fossil plant sending CO2 into a depleted oil field. Instead we have got little but windy rhetoric.

Alstom’s confidence should force us take note. If the company is right – and it has more experience than anybody else in the world – CCS will be by far the best way of decarbonising electricity generation. Without any equivocation, the company says that a gas power station capturing and storing its CO2 will be competitive with a conventional power station at a carbon price of no more than €40 a tonne. Nuclear power will need financial support equivalent to at least twice this figure.

Like nuclear, a gas power station equipped with CCS will be able to operate round the clock, with no worries about unpredictability or intermittency. Alstom suggests that the greatest uncertainty lies not in the engineering of carbon capture, but in the lack of firm knowledge of how much it will cost to run CO2 pipelines and inject the gas into depleted oil reservoirs or into the deep saline aquifers underneath our feet. (Much of northern Europe sits on top of an aquifer that looks suitable to accept CO2). But, however uncertain, these costs are less critical to the financial viability of CCS than the capital and operating cost consequences of initially capturing the carbon

To my mind, the other possible advantage of CCS is that it requires the continued consumption of fossil fuels, helping to keep the price of coal and gas high. CCS plants actually need to use more fossil energy to generate electricity than a conventional plant, increasing the rate of depletion of cheap sources of coal and gas and increasing the incentive to switch to low carbon alternatives.

But, in any event, the UK urgently needs to include CCS in its renewable energy subsidy scheme (ROCs) to provide an immediate and transparent incentive. If the incremental cost of CCS is as low as Alstom claims, the generators now quietly building tens of gigawatts of new natural gas plants around the UK will need less than half the subsidy of offshore wind to incentivise them add CCS. Why not try it and see what happens? It can’t be any worse than the mess that CCS policy is in at the moment.

(1)    Cost assessment of fossil fuel plants equipped with CCS under typical scenarios, Jean-Francois Leandri et al.

The case that biodiversity has substantial economic value is not yet made

Mark Lynas’s wonderful new book ‘The God Species’ attempts to put environmentalism back on track. Humankind, he says, will only be able to keep within natural boundaries by using science and technology to help minimise our growing impact on the planet. He looks at nine specific environmental indicators - the atmospheric concentration of CO2 is the best known – and offers a view of how close we are to the safe limit. One of these indicators is the loss of biodiversity.Humankind is presiding over an astonishingly rapid extinction of species and Lynas says that this loss ‘arguably forms humanity’s most urgent and critical environmental challenge’. He suggests that the rate of extinction is possibly two orders of magnitude greater than the world’s eco-systems can sustain. Put at its simplest, the justification for the concern over biodiversity loss (of which extinction is merely one facet, of course) is that species variety helps maintain stable natural environments. Extinguish all the predators and the prey can become dangerously dominant. Cultivate just one crop and nutrient loss into watercourses is far worse than if many types of plant are grown. But just how strong is the evidence that biodiversity loss is economically damaging? If we cannot show a financial calculation our chance of getting policy-makers to take the issue seriously is close to zero.

Many reasonable people bemoan the current mass extinction but don’t understand why Lynas and the ‘planetary boundaries’ group of scientists think it is so disastrous. What really suffered, they ask, after the last wolves were hunted to extinction in England in the early nineteenth century? Sheep could be more safely grazed and food production increased. Is there really a strong case that biodiversity is worth more than the economic benefits of reducing pests and predators? I think we are all very willing to be convinced that biodiversity is crucial but, to be frank, the evidence may not yet be powerful enough.

A new paper puts some interesting numbers into the debate.(1) It looks at whether the degree of diversity in land use in the agricultural heartlands of the United States affects the risk of severe crop damage from insects. The theory is this: in agricultural monocultures, insects can breed without predators whereas a mixed landscape, with woodland and multiple crops, provides the living space for birds and bats that can help control any infestations.  So Timothy Meehan and his colleagues asked the obvious question: do diverse landscapes result in farmers having to use less insecticide? Assuming that farmers respond rationally to the beginnings of insect damage and spray the crops that are affected, the number of hectares receiving insecticide is a reasonable proxy for the threat from insects.

As we might expect, Meehan shows that diverse landscapes result in less insecticide use. In other words, biodiversity has direct economic value because spraying a crop costs money and time. What the research team calls ‘landscape simplification’ increases the likelihood that any particular hectare has to be sprayed. In what seems to me to be a heroic calculation, the scientists suggest that 1.4m more hectares need to receive insecticide each year as a result of the extensive use of monocultures of wheat, soya and maize across the Midwestern states. But the direct cost per hectare is assessed at only about $48. Compare this figure with, for example, the average yield of 20 tonnes of corn a hectare in good fields in Wisconsin, valued today (July 2011) at over $6,000. Put crudely, the value of the crop is more than two orders of magnitude more than the increased cost of insecticide on an affected hectare. And, equally powerfully, the research shows that only about 4% of total cropland needs insecticide application as a result of locally low levels of plant biodiversity. (Some crops will need pesticide protection even in the most diverse landscapes).

The lesson from the paper is therefore a simple one. In the specific case of the Midwest, landscape simplification is tending to push up insecticide use but the direct economic cost of this is trivial compared to the value of the crops. If the whole of this vast area were given over to a single crop, and every hectare had to be sprayed every year, farmers would still not be losing financially from the loss of biodiversity.

The response is to say that the costs to the farmer are only a small fraction of the total impact on society, now and in the future. High levels of pesticide use mean poorer water quality and air pollution, possibly affecting the health of people hundreds of miles away. Heavy insecticide use will eventually cause pest mutations that will require a new generation of chemicals. Applications of insecticide may cause the deaths of beneficial soil organisms. Nevertheless, Meehan’s paper does not immediately provide support for Mark Lynas’s conclusion that biodiversity loss is potentially the worst environmental problem the world faces.

Timothy Meehan et al., Agricultural landscape simplification and insecticide use in the Midwestern United States, PNAS (OPEN ACCESS) July 2011.

Scottish wave power marches on

The last weeks have seen some crucial developments in the commercialisation of wave power. Inverness-based AWS received major investment from Alstom, the French power generation company. Aquamarine Power of Edinburgh, backed by Scottish and Southern, started drilling the foundations for the second major trial of its Oyster wave energy collector in the Orkneys. The machine itself is being finished at Burntisland Fabrications and will be installed over the summer. The granddaddy of them all, Pelamis, took on a round of new money from investors and continued its plans for installing its huge red sea-snake-like devices for E.ON and Scottish Power. As well as having tidal currents that match anywhere in the world, the UK has excellent potential for using waves to generate electricity. Despite this, the National Grid’s seven year forecast sees no wave farms before at least 2018. Other commentators, such as the Committee on Climate Change are politely unenthusiastic.

Who is right, the hard-headed financial analysts or the committed companies pushing ahead to install wave collectors in the waters off western Scotland and the northern isles? My money would be on the bloody-minded enthusiasts pushing ahead with their huge steel structures in the face of mild scepticism from banks and governments. I spoke to Martin McAdam, the CEO of Aquamarine Power, to discuss the opportunities for wave power in the UK and understand what needs to happen to get rapid growth in wave power utilisation.

There is, of course, nothing new in observers being sceptical about a new technology while the inventors and engineers running the business developing the machines are mustard keen on the opportunities. Wave is no different to so many compelling opportunities in the past. It is currently four or five times too expensive to compete with gas for electricity generation, even on the west coast of the British Isles. The engineers still have major technical challenges to overcome.

The power of the waves

Waves a few hundred metres from the shore can contain huge densities of energy, often as much as tens of kilowatts per linear metre. The ordinary British house, using about half a kilowatt on average across the 24 hour day, could be powered by a device collecting the energy in a few centimetres of waves. There is a downside to the density of energy in a wave – most collectors that have been tried off the shores of the UK have failed within a few days, unable to deal with enormous forces being placed upon them. Since the Edinburgh-based engineer Stephen Salter developed his eponymous ‘Duck’ in the 1970’s, hundreds of companies have tried and failed to convert wave energy into commercially-priced electricity. It is only in the last few years that credible designs have been developed that are both efficient at capturing wave motion and which can hope to survive storm conditions.

Aquamarine Power's Oyster is one such device. A large scale prototype worked successfully at the Orkney Wave Centre for the best part of a year. A scaled-up device generating a maximum of 800 kilowatts is will be installed at Billia Croo in the Orkneys in late July with the first commercial machines put in place in 2014.

How does it work? ‘It has a design like a laptop’, says Martin McAdam, ‘with the lid, mostly submerged, moving back and forward with the waves’. This motion powers pumps which generate high pressure water. A pipe takes this water to the shore, where it drives conventional hydro-electric turbines, housed in containers. The crucial part of the design is that most of the critical equipment is on-shore, easily and conveniently maintained without having to get into a boat in rough seas. A relatively small number of moving parts are offshore. The design used by the Oyster is very different to the other contenders, with Pelamis capturing the energy from the flexing of the joints in its thin body and AWS getting power from the bobbing of the waves changing water pressure inside the twelve-sided floating structure.

McAdam says that the ideal location is in water about 15 metres deep. Around much of the UK, this depth can be found quite close to the shoreline, with the new site in the Orkneys about 500 metres from land. He says that the Oyster technology installed in large farms in appropriate locations around the British Isles has the potential to generate a maximum of about 8 gigawatts, with the other obvious European markets, such as Portugal, Ireland and France, offering another 8 gigawatts of potential. (For comparison, current total UK generating capacity is about 75 gigawatts, with average demand running at about 35 gigawatts). Oyster’s parent, Aquamarine Power, has its eyes on sites for a 200 megawatt farm in Orkney and 40 megawatt installation off Lewis in the Western Isles. What about expected rates of actual production, as opposed to peak power? McAdam mentions an expected annual output of about 35-40% of the maximum capacity, comparable to well-sited offshore wind turbines. In quiet years, such as 2010, this number would be lower.

The estimates from Aquamarine’s CEO are not inconsistent with the Committee on Climate Change’s figure of 40 terawatt hours for the potential for wave power, about 12% of current UK electricity usage. However McAdam stresses that other companies’ machines will work in locations not suitable for Oysters, implying that the total UK potential may be substantially greater than the CCC thinks.

Wave power is intermittent but marine energy has two advantages over wind. First, it is rarely, if ever, completely still on the western coastline of the UK. Unlike wind turbines, which require a reasonable breeze to start turning, wave collectors will almost always generate some power. Second, wave energy tends to be out of phase with wind power. If it is blowing a gale today, the waves, generated a long way away and only gradually reaching the shore, will arrive after the wind has blown itself out.

Martin McAdam gives some figures for the cost of his collectors. The first Oyster installed in the water cost about £35m per megawatt of peak capacity. The machine being attached to the seafloor over this summer costs about £10m per megawatt. McAdam sees the figure declining to about £3m once costs have been driven out by further R+D, ‘learning by doing’ in the fabrication process and from the benefits of installing many devices along the same piece of shoreline. At £3m, wave is competitive with today’s offshore wind costs, which are running at about £4m per megawatt in shallow locations. Since ‘capacity factors’ are similar at about 35-40%, the output per megawatt installed will be about the same as a wind turbine and the costs of megawatt hour very similar.

Wave farms face many of the same technical challenges as offshore wind. The brutal environment means wave collectors need to be made from huge quantities of corrosion resistant steel. Fabrication is not a simple matter – the leading UK constructor, Burntisland Fabrications or BiFab, is going to be very busy indeed. Wave farms will tend to be far away from easy connection to robust parts of the electricity distribution network. Maintenance work on wave collectors will be difficult, and the absence of electrical gear on the Oyster itself is a huge potential advantage compared to some other offshore technologies. Similarly, the relatively shallow depth in which the Oyster machines operate – 15 metres – implies that, according to the laws of wave physics, all waves greater than 15 metres will have broken by the time they pass over the device, improving survivability.

The crucial question facing the wave power industry is how to get from about £10m per megawatt to £3m as fast as possible. McAdam says while private money and the grants from government bodies such as the Carbon Trust have been very useful these funds are going to be enough to push wave to a point at which it is viable without subsidy. For rapid rollout of wave power, the industry needs a substantial injection of subsidy for further R+D and cheap equity to enable the construction of substantial farms of collectors. This will enable the industry to move down the learning curve far faster than would otherwise happen.

Sceptical commentators will note that unproven renewable technologies often demand large subsidies in order to reach commercial viability at some uncertain and always receding future date. And, indeed, much money on energy R+D will be wasted. Marine Current Turbines in Bristol is close to proving that tidal current power can overcome technical challenges but no company in the wave business can yet claim similar certainty. Real issues remain and waves may never produce power that is cost-competitive with other low-carbon technologies. Nevertheless, consider the following comment in a letter published by distinguished scientists in the Guardian on 13th October 2010, commenting on the £2bn a year spent on military research.

‘As an example of the current imbalance in resources, we note that the current MoD R&D budget is more than 20 times larger than public funding for R&D on renewable energy.’

McAdam says his company might only need to make a total of as few as 50 or 60 Oysters to get the costs down to the £3m/MW figure. If subsidy on all these first production machines was £7m a megawatt, the total public cost would  be about £400m, a massive amount but neglible in terms of the amount spent on military research.

Wave power collectors could provide one of the UK’s most important manufacturing exports in twenty years time. The natural energy resources around Britain’s coast may eventually provide a substantial fraction of our energy needs at almost zero running cost. Does it not make sense to divert a larger fraction of the government’s R+D budget towards this increasingly plausible form of low-carbon, environmentally relatively benign, electric power?

Your chance to tell Mark Lynas where the green movement needs to go from here

Here are a few comments from Mark Lynas, quoted in a Guardian article yesterday (14th June). '...the green movement is stuck in a rut, but I think the problem is deeper than mere professionalisation and endless strategy meetings in corporate NGO head offices.

"Many 'green' campaigns, like those against nuclear power and GM crops, are not actually scientifically defensible, whilst real issues like nitrogen pollution and land use go ignored. The movement is also stuck in a left-wing box of narrow partisan politics, and needs to appeal to a broader mass of the public who are simply not interested in organic farming and hippy lifestyle choices. It needs to re-engage with science, as well as with the general public, if it is to remain relevant to the 21st century'.

Mark's new book The God Species, available in shops in the next few weeks, looks at what the world's environmental movement needs to focus on. How can we use science productively to solve ecological problems? Along the way, he takes multiple swipes at what he sees as the irrational and anti-scientific tendencies in many green organisations, obsessed with fighting the wrong battles.

Come to listen to Mark Lynas and Professor Johan Rockstrom, the leading figure in the 'planetary boundaries' movement that seeks to quantify the ecological limits that mankind has to stay within. Central London, afternoon Wednesday 6th July, free admission but reservation vital. All the details are here.

(22.June.2011 - last few tickets available, book now)

Planetary Boundaries PDF

(When booking, please say you saw these details on Carbon Commentary).