Beyond Petroleum


Back in 2000 BP launched its shiney new ‘Beyond Petroleum’ PR. It was always a giant sham. Now Scotland has to do the same, but this time for real. Philip Johnstone explores how.

Friday the 21st of November was a bad day for the employees of Pelamis Wave Power and  for Scotland’s renewable industry.  It was announced that the company was to go into administration due to an inability to secure sufficient funding.  This would seem a simple case of a company unable to meet the technological demands of its industry and paying the consequences but as is often the case the truth is more complicated than that.

That the technology developed by Pelamis works is not in doubt, not only that but it was the worlds first commercial exporter of electricity generated by offshore wave power.  The system works by using the mechanical motion of waves to bend its snake-like body driving hydraulic fluid which becomes pressurised and in turn generates electricity.  The company achieved many firsts in the industry such as supplying and commissioning the worlds first multiple machine wave farm and gaining the UK’s first commercial orders for wave energy converters from utility customers .

Why then has Pelamis struggled to find funding ?  The truth is that wave power is having a difficult birth it’s constantly seen as a technology with great potential but is missing that solid backing to allow it to develop and mature.  Losses of £4.2 million were recorded in 2013 and £6.2 million in 2012 this coupled with the loss of key partner E.ON (which sought to focus on ‘more mature renewable technologies’ ) left the company in a financially perilous position.

According to a study by the Crown Estate Energy and Infrastructure Portfolio Scotland has the potential to generate 35040 GWh  of power from wave power to put that into some perspective Scotland consumes 38000 GWh of electricity annually.  Even taking into account the fact that studies of this nature are often overly optimistic wave energy clearly has a pivotal role to play in our future energy mix.  The reluctance of companies to invest in Pelamis and other wave energy firms is due to the perceived risk and long-term nature of the investment which is often at odds with the demands of shareholders looking for more short-term profits.

To mitigate some of the effects of Pelamis going into administration Fergus Ewing announced the creation of Wave Energy Scotland a technology development centre that will utilise  the expertise of the Pelamis staff.  While this is  well-intentioned it doesn’t go far enough, indeed bringing Pelamis into public ownership is the only realistic way that the company will be given the necessary time, support and funds to fulfill its potential.

tidalAmid the headlong rush into developing a renewable industry that will eventually meet 100% of our energy needs (a feat to be proud of) we must step back and ask ourselves our if we are going to let private corporations define the nature of the industry .  This of course would mean that 100% of our energy generation capacity would be owned by private companies putting us at the mercy of the whims of shareholders, we would be reliant on them to make the required investments in technologies and infrastructure.  Whilst it would be disingenuous to claim that companies such as SSE and Scottish Power haven’t invested in renewable projects it’s also clear that they are only willing to do so when they receive significant subsidies from the Government.  SSE stalled development of the Seagreen Wind farm at the planning stage due to the fact the project wasn’t offered UK Government subsidies.

Now is the time to create state-owned energy companies for wind, wave and tidal as they are relatively new industries (less so wind).  Future generations may well turn round and ask how after watching it happen with oil we then sat back and did nothing as our natural resources were again used not for the benefit of the people but to improve the share price of large corporations.  Of course private companies have a part to play in the energy industry but surely they shouldn’t dominate it to the extent that they must be showered with subsidies and ministers must cosy up to them to ensure the required investment takes place ?

scotland-wave-overlay_499x378Scotland is a net exporter of electricity with net exports of between 14% and 24% between 2000 and 2010 reaching more that a quarter in 2012.  As more renewable energy comes online from all sources more electricity will be exported, profits generated could be reinvested in the industry, used to lower bills or spent elsewhere for the common good.  Although the initial expenditure of creating a publicly owned renewable energy industry would be high this would be offset by the stable and long-term income from generating electricity and selling it.  The Smith Commissions recommendation of  ‘increased borrowing powers’ is intentionally vague so as to leave wiggle room for whoever occupies 10 Downing Street come May.  It’s vital that these borrowing powers are increased so as to enable the creation of a successful state-owned renewables industry that will utilise Scotland’s abundant natural resources for as long as there is wind and waves.

By recommending the transfer of powers over the Crown Estates assets (which includes seabed responsibilities)  the Smith Commission although flawed has made some progress on energy.  If the proposals are realised then the Scottish Government will have the ability to lease out areas for renewable energy projects offshore.  Whilst this is helpful the recommendations fall a long way short of what is required as the Scottish Government will only be offered a consultative role in designing renewable incentives.  Of course if electricity was generated by publicly owned companies then there would be no need to for the incentive scheme.

If recent opinion polls are to be believed there will be a strong SNP contingent at Westminster.  If this is the case it’s imperative that they use any leverage to secure the powers necessary to create a renewable energy industry that will provide a clean environment, job creation and a constant source of income long after oil has run out.

Comments (20)

Join the Discussion

Your email address will not be published.

  1. Darien says:

    If the energy industry can’t make wave power work, what chance a bunch of hopeless/hapless civil servants who would have problems changing a light bulb? It would be helpful if you could explain why the business made such losses which in turn made investors run a mile, and how exactly civil servant management will turn that around in the current energy sector?

    In any case, surely the key to cheaper and cleaner energy is via sensible national regulation. In other countries it is evident that the state can specify what it wants, where it wants it, even what it is willing to pay, and invite energy firms to compete/bid to provide it at the best price. The UK regulatory regime is the problem – it is skewed in favour of the suppliers who get money for old rope – taking the consumer for a ride – so the UK state is not controlling the industry in the people’s interest, but in the corporate interest. That is what needs to change. Government is there to prevent the interception of economic rents, not to facilitate such interception (as now). Gov should be telling industry what it wants, and facilitating that, not the other way around. Gov is not there to run businesses for which it has no competence. Better regulation should place greater risk and onus on investment on suppliers, not on taxpayers – the UK is the opposite of this.

    1. Invent new technologies then sit back and let someone else reap the rewards. From railways to aerospace and computers; it’s the British Way.
      We must walk away from these wasters!

      1. IAB says:

        I wonder what the civil service did to you, Darien? I think if you actually read the article, it was a lack of private companies unwilling to invest in the technology rather than failure. This is an ideal scenario for government investment as the future rewards will be huge for the whole country. You obviously would prefer a Trump type ownership than a Sturgeon led investment. Oh dear.

    2. Daryl says:

      Wave energy in its current form just does not work, that is why Pelamis failed, goverment should pick and invest in winners, maybe tidal will be a better bet.

      But we do need state and community owned energy suppliers,

  2. deewal says:

    Severe Drought in Russia causing the crops to fail and thousands dead, Massive drought in Pakistan causing crops to fail and thousands dead, Severe Drought in Brazil, Massive Snowstorms in The US. Warmest year on Record worldwide. Highest Ice melt on record.
    Lets argue about civil servants changing light bulbs.

    The Waves are going to have so much power that it will wash us all away.
    The damage is done. It is irreversible.

    1. Cheer up Deewal.Better to go out and have a party in Westminster, an SNP party with the Greens.Invest in wave and wind ,reverse privatisation of road and rail.

      1. Daryl says:

        You are right, the damage is done, the future will be about adaptation as mitigation aint going to happen.

  3. Barontorc says:

    Earth’s resources have been depleting since day one, whenever that was, but our responsibility is to use these resources wisely, not deplete them faster than we basically needed to live, not to poison the well, to harness the natural energy surrounding us, and so it goes on ….. but we need to pay for the development of techniques and processes that would enable all of this….. so nationalise and pay through a tax earmarked just for this purpose.

    Why let money grabbers invest and deplete at their greedy whim. If it’s needed by the population let the population contribute and get it back through, cheaper power, better services, needs met, at the point of need served.

    Surely to God we’ve had enough of speculators and get rich quick polluters to be wise to it all happening for much longer. Frackers can frack off we don’t need it in Scotland. In fact Scotland doesn’t need anything or anybody ripping us off.

  4. yerkitbreeks says:

    I’d invest in a ScotGov crowdfunded initiative in wave/subsea turbines

  5. fermerfaefife says:

    Again we must look at the Norwegians oil industry – What did they do in the early days ? Set up a national oil company which is still one of the largest in the north sea.
    That is exactly what we should do for renewables – A national renewable energy company …… why have the profits and UK energy subsidy for renewables go to multinationals. create our own company and we get profits that is retained in Scotland for the benefit of scots.
    The wind sector is a prime example – only relatively few big wind farms are community owned as such but the really big profitable ones are owned by SSE et al.
    What would have happened if that generation capacity had been harnessed by the local communities they affect ?
    Its not to late for tidal and wave sectors – lets see it in the 2016 manifesto.

  6. fearnach says:

    This looks like a perfect opportunity for public investment: private investment is too concentrated on short-term returns.

  7. Bath Time says:

    The whole debate about renewables is dependent on the frame of reference. What are you actually trying to achieve. This is the determining factor for governments who have limited resources to spend. The Green political perspective I’ve always found some what piecemeal (some really good stuff, but the big picture tends to get ignored, as does the empircal.) Many of the old guard, Lovelock in particular, are pretty scathing of contemp Greens and their neo religious mindset…solutions based on faith regardless of hard inconvenient empirical evidence (Green ‘nationalism’ is really bizzare as polution/ ecology tends not to be constrained by borders; as iis the fairly fatuous justification ‘we’re showing the way’ argument – like the Chinese aren’t smart enough to consider these options etc). Renewables and ‘localism in food production’ is the mantra, Nuclear and GM, Mathusian views on population, capitalism the enemy.

    The enviromental problems we face are extremely complex and need big solutions, not retrenchment into ‘fantasy’ utopianism. (if only everyone lived in mud hut with an allotment etc. Although these things are valubale in themselves for other reasons – health and community- my granddad spent his life on his allotment.) But they are no solution to the problems faced of global warming, acidification/ deoxygnation/ ecologial destruction of the seas and so on. In fact it is probably to late and we have reached the tipping point. Therefore the only realistic option to keep change the situation/ reverse problems is technology. e.g) GM foods can feed millions and would limit the decimation of the seafood stock + synthetic food stuffs… a huge problem. Nuclear may not be perfect but it provides an instant immediate solution to carbon emitions rather than waiting for renewables to get up to speed which they might never do given the ever increasing propensity of the human race to consume energy, telling the Chinese or Indians or Brazilians to invest in energy saving measures (or not to use Nuclear) is not going to work due to scale of their societies and it isn;t fair….Go tell a slum dweller in Bangladesh that he can’t have the same base level energy as the developed world until he gets proper insulation or that he has to live in shit because some rich guy in Perthshire doesn’t like Nuclear! And who is going to pay for it? Western tax payers? I won’t hold my breath. These countries have every right to develop just as we did. To stop them is immoral.

    Plus high density city living is much more efficacious in energy terms than ‘green’ living. I think in the UK, especially Scotland we have a privilidge view of space. Try going to China or India and telling them to grown their own food when they have no option to live in highrises. Rich man’s fantasy!

    Also, although I agree there needs to be a non profit approach to energy (public interest) rather than create enemies with big business we need to convince them and other governments it is their commercial/ future interests. And besides, the big ‘national’ corporations in Korea or China are no better than Shell or BP. In fact worse when it comes to corruption. Cooperation is needed whatever the model of production, so long as it is underscored by autonomous government/ international regulation, everyone can be happy.

    The human race is on the verge of creating a sun! If it works (although there are still problems) the world can be transformed. It is as significant as the wheel, or fire, or gravity. Bollocks to renewables, put govt money into Nuclear fusion!

  8. Daryl says:

    Nuclear is not quite instant or immediate as takes 5-10 year to build new reactors, and most UK reactors are nearing the end of their life, so will be a big effort to replace existing reactors and then double capacity like I think we should do. We have missed the boat a bit, investing in renewables when we should have put our money into developing thorium reactors, China looks like it leading the world in this. Nuclear suffers from same issue as renewables, it can’t compete with fossil fuels on cost, the old scarcity argument is no longer valid. We know that most fossil fuels can’t be burnt, so to allow clean energy to compete we really need a global carbon tax. And your correct, I am will believe James lovelock over green groups any day.

    1. Daryl says:

      And their is no way we will see nuclear fusion in my life time, that really is throwing money away, a bit like investing in wave power.

      1. Barontorc says:

        So wave energy doesn’t work, or is development getting starved of funds?

        Sci-Fi ideas are still probably good physics, but when will they be in production and can we be sure we ain’t gonna end up with a huge contaminated legacy of some form like present caveman nuclear’s given us?

        As far as I can see wind and wave gives zero pollution, we’ve got plenty of both in Scotland and the right renewables mix will keep us all nice and cosy in our ain wee hooses What we ain’t got is funding through our present tax system. That’s all being spent on UK national debt interest payments and horrific other nuclear toys that will never be used.

        Now we’re being pushed into wrecking the geological structure of the earth to enhance other fat cat wallets.

        I know what I’d rather be putting by bawbees into.

      2. Tina Feedgie says:

        Ok, wave power is not working quite as well as we would all hope but then no technological advance ever does in it’s infancy. The principle works, it’s the development and refinement of it that needs investment and the government, if they had long term vision, should be the ones backing it. Look at the advances made in subsea technology and communications technology in the last 20 years – if that sort of progress could be made with wave power then when I get my free bus pass in 20 (and a bit) years I might step on board an electric bus that was charged by wave power.

        Faraday wasn’t particularly well received when he first presented his experiments and suggestions on electro-magnetism, could anyone at that time envisage the electrical generation and distribution that we now have?

      3. Daryl says:

        Does fracking wreck the geological structure of the earth anymore so than coal minning? The main argument against fracking is that we need to leave fossil fuels in the earth to stop climate change, other environmental issues are over stated, and probably no worse than that caused by coal minning in the past. The use of natural gas would be a smart move to replace current coal power plants, would at least give us a chance of meeting our climate change targets.

        Nuclear has it issues, but thorium looks to be a much cleaner fuel, it’s not sci fi technology, the Chinese should have the first operating reactors built within the next couple of years. And the dangers of nuclear power is over stated, more people in the UK die each year through air pollution than than have done worldwide during 50-60 year history of nuclear power, it’s a safe technology. I am against tracking, but again I think environmental groups in Scotland are focusing on the wrong issue, I think air pollution in our cities deserves more focus, up to 1600 Scottish people die each year from air pollution, our cities keep failing to make EU targets, if they lobbied to have diesel cars banned from citties, congestion charging, and cars banned from around schools, we could tackle a genuine environmental issues, and reduce our carbon output at same time.

  9. John Thomson says:

    Is there not an option for goverment to raise money via public conscriptions to renewable energy, I for one would gladly give so that my future generations would recieve the beneifts. This truely is a no brainer I would not give to individual company but yes to goverment / national industry. Protecting the public is the first resposibiliy of any government and we need to be protected from more than terrorists and short sighted politicians lining there own pocckets.

Help keep our journalism independent

We don’t take any advertising, we don’t hide behind a pay wall and we don’t keep harassing you for crowd-funding. We’re entirely dependent on our readers to support us.

Subscribe to regular bella in your inbox

Don’t miss a single article. Enter your email address on our subscribe page by clicking the button below. It is completely free and you can easily unsubscribe at any time.