Posts Tagged ‘Clean Energy’

2014: The year of fracking?

Posted on: by Chas Arya

Fracking is a topic that divides opinion, and one which has created a new generation of protest camps at sites as far apart as Manchester, Sussex and Lincolnshire. But why is opposition to fracking so vocal, and do the protesters have a point?

The term ‘fracking’ is derived from the technical term ‘hydraulic fracturing’ and describes a process developed in the 1940s for extracting natural gas and oil from deep inside shale rock formations underground.

The natural resources are extracted via a combination of drilling and forcing water and chemicals into viable shale rock, at extremely high pressure. This pressure causes fissures in the rock face, which allow oil and gas to be released and pumped back to the surface.

Fracking is controversial for a number of different reasons, and the American experience has done little to allay the fears of opponents. Over in the USA, the fracking industry has reversed the fortunes of the struggling gas and oil behemoths, and estimates suggest its proliferation has created a guaranteed supply for the country well into the next 100 years.

Those who argue against fracking do so for a number of different reasons. Health and environmental concerns are a big issue, and in particular with regard to the chemical mix added to the water used to ‘frack’ the rock faces. In the USA, regulations around chemical use and contamination are far looser than in the UK, and it’s not hugely uncommon to read reports of contaminated water supplies and of home-owners being able to set fire to the water in their taps – as a result of the drinking water supply having been contaminated with the natural gas from nearby fracked wells. There have also been reports of residents living close to fracking sites suffering from a range of health concerns, including nosebleeds, asthma, nausea and headaches.

For environmentalists, concerns around fracking include damage to the immediate areas surrounding fracked wells, as a result of the aforementioned and often poorly regulated chemical use, but also to the US’s reliance once more upon unsustainable fossil fuels. Although there is an argument that fracking is less environmentally damaging from a CO2 emissions point of view, the natural resources produced are still mined to be burned. There have also been reports that fracking could cause earth tremors, leading to more safety concerns.

Here in the UK, there is real concern around where fracking leaves the UK’s burgeoning renewables industry. We wrote recently about uncertainty in the market around subsidies and government support for that industry, and if plans to create fracking wells from the north-west across to Lincolnshire become reality, investors will require certainty if they are to continue their involvement and support of sustainable energy sources such as wind, solar and biomass.

Of course, fracking does have its supporters in the UK. It’s certainly true to say that our regulatory system is far more advanced than that of the USA, and fracking companies will be required to monitor for contamination of water supplies, and contain waste fluid created by the process in sealed units. In addition, they will also be required to capture any excess gas, and pump this back into the UK’s pipeline – rather than follow the US’ example, which is simply to burn any excess on site.

Further, US group ExxonMobile has made moves towards creating fracking fluids that can be used without damaging local environments, and is developing these for use in Germany – a country with a smaller estimated reserves than neighbouring Poland or France, but with sufficiently large predicted supplies to fund significant research into these new ‘clean chemicals’.

A further perceived benefit for supporters of fracking is that it will enable the UK to reduce its reliance upon foreign oil and gas imports. Of course, the political instability in the Ukraine has only added fuel to this particular fire and this, combined with the government’s generous tax breaks on profits for fracking companies as announced in the recent Budget, may mean that 2014 really is fracking’s year. Only time will tell.

For more information and advice on renewables and energy law, please contact Stuart Stones on 0161 464 9540, or by email: stuart.stones@ratiolaw.co.uk.

Renewable Energy vs Nuclear: which is better?

Posted on: by Chas Arya

Governments in Europe appear to agree with the need for a move away from total reliance upon fossil fuels for energy, and have backed this sentiment by agreeing to carbon reduction targets requiring renewable energy reliance levels of 20% by 2020. On the other side of the pond, president Obama recently (2011) called for 85% of all America’s energy to be derived from ‘clean sources’.

But where does this leave nuclear energy? Interestingly, Obama’s ‘clean sources’ include nuclear, but for all its high level supporters, there are just as many detractors. So is either energy source better than the other – or are they just simply too different for comparison?

A quick glance over to Germany reveals an interesting situation. In the wake of the Fukushima disaster, Germany took the decision to immediately shut down eight of its nuclear power plants, and announced that the rest would close by 2022. This move would be understandable if like Japan, the country typically experienced earthquakes, but it doesn’t.

Germany’s decision certainly won’t help it to meet its carbon reduction targets, and a recent post on the Carbon Counter blog suggests that the country’s CO2 emissions have increased by 3.3% or 30 million tonnes since the power plants closed. It’s now likely to face a real struggle to replace the gap left by nuclear if it also wants to cut its reliance upon fossil fuels in the future.

Of course, the cons of nuclear energy have been discussed for years and it’s true to say that the industry still has a bit of an image problem. But perhaps this is not surprising, with the likes of the Chernobyl and Fukushima disasters still casting a shadow, even many years later in Chernobyl’s case. Indeed, Germany’s withdrawal from nuclear energy production only seeks to underline this fact further.

Of course, the risk of nuclear disaster is not the only reason it can be so unpopular. The waste created by the nuclear process is a massive issue for many environmentalists, neighbours of nuclear power plants, and often ‘the man in the street’. Radioactive waste is extremely dangerous, and takes thousands of years to become safe, and this fact alone is a reason for many to oppose reliance upon nuclear energy.

There is also the commonly expressed fear that radioactive products could be used to create nuclear weapons, along with the equally rational fears around the proper management of nuclear power plants in countries with unstable governments.

Neighbours of nuclear plants often fear for their health, with some scientific studies showing increased incidences of certain types of cancer in nuclear neighbourhoods, pitted against others showing no such results. (Carry out a simple Google search for ‘do nuclear power stations cause cancer’ for reports of studies both supporting and disproving the theory).

In addition to potential damage to human health, there are also environmental concerns. Nuclear power plants use huge amounts of water, typically taken from the sea. Wildlife such as fish and sea turtles can become trapped in water inlets – despite widespread use of protective filters. Microscopic organisms and algae are destroyed once they enter the cooling system.

For energy investors, one of the potential issues with nuclear is cost. Whilst nuclear produces more energy than equivalent wind, solar or bio-energy plants, the cost of building nuclear power stations, not to mention the storage and maintenance costs for waste products, may outweigh any efficiency gains.

Time is also typically a challenge; it currently takes around 20 years from discussions regarding nuclear programmes to the actual commissioning of a power station (and that’s before the build even commences).

On the flip side, however, nuclear does have some benefits. It is the largest source of emission free energy, and overall provided 12.3% of the world’s electricity in 2011. It doesn’t pollute the air, unlike fossil fuel power stations, and unlike ‘true’ renewable energy sources, it is completely sustainable. It doesn’t need rain, high tide or sun to continue to produce energy. Also, renewable power stations have a much longer ‘shelf life’ than renewable plants.

Further, although nuclear disasters can cause loss of life and inflict tremendous damage to the environment, they actually occur very infrequently, meaning that nuclear is one of the safest forms of energy production in the world. By way of comparison; burning lignite causes approximately 32 deaths and 300 cases of serious illness from pollution per terrawatt hour (TWh). The equivalent figures for nuclear are zero in each case.

Renewable energy is defined by Natural England as deriving from ‘energy flows that occur naturally and continuously in the environment… and (which) is essentially inexhaustible’. Sources of renewable energy include wind, solar, tidal and biomass. The benefits of renewable energy sources, when compared to fossil fuels are clear. However, when compared to nuclear energy – the case is less clear cut.

Renewable energy is not cheap (yet). From a consumer perspective, the government’s forecast for average household energy bills shows an average of £1,285 by 2020, which includes £280 added to pay for green policies. This figure is still 7% less than the £1,279 estimated without the policies – which include subsidies for the creation of renewable energy.

In addition, there are some environmental concerns around building renewable energy plants. Wind farms, for example, are typically located either offshore or in remote areas, meaning high transport costs with a serious CO2 load to accompany these. Further, environmental groups have raised concerns about damage to natural wildlife in and around wind farms and tidal barrages.

Further, and perhaps most importantly, renewable energy sources are not constant. The sun doesn’t always shine, and it’s not always windy.

The benefits of renewable energy are often pretty similar to those of nuclear and that’s perhaps why they are sometimes lumped together. Like nuclear, renewable energies don’t (on their own) pollute the environment – although there may be an environmental cost involved in creating wind farms, solar arrays and tidal barrages, for example. Further, renewable energy sources won’t run out and neither will nuclear.

The biggest problem for nuclear is the issue of waste and safety. The biggest problem for renewable energy sources is reliability. If either industry can overcome these challenges then the world’s energy problems will, quite literally, be solved.

Such a perfect outcome is, of course, extremely unlikely and this means that at some stage, unless a viable alternative to both can be found, a combination of nuclear and renewable power is likely to be needed to keep the world’s lights shining.

For more information and advice on renewables and energy law, please contact Stuart Stones on 0161 464 9540, or by email: stuart.stones@ratiolaw.co.uk.