With a target to close all coal plants by 2025 and new European emissions legislation looming, the UK must look to gas as the backbone of its energy mix, writes Andrew Speers
An 880 MW CCGT plant at Carrington near Manchester
Credit: Knottingley Power
Keeping the lights on in the UK has been a burning issue over recent years, becoming a quagmire of growing demand, environmental legislation, political manoeuvring and technological challenges.
The landscape has been further muddied in recent months as UK energy policy switched direction with the scrapping or downgrading of several energy initiatives including subsidies for wind and solar power.
When this is added to the announcement that coal-fired generation will cease by 2025 along with an abandonment of support for carbon capture and storage (CCS), it would appear that energy policy is out of line with growing demand while security of supply is greatly under threat.
As if that wasn’t enough, another EU directive sits on the horizon. The Industrial Emissions Directive comes into force in 2022. Coal plant extinction was in sight, but it will now happen a few years earlier than anticipated.
That we will need more electricity in the future is beyond doubt. A growing population, greater electrification in transportation – both rail and electric cars – along with increased use of electricity for heating will all ramp up demand. There are, of course, plans to look at energy demand reduction along with energy efficiencies to help alleviate this growth, but again they will be dependent on policy drivers.
So what is the UK government’s strategy? In recent announcements, the Secretary of State for Energy and Climate Change, Amber Rudd, has reiterated the government’s policy and its drift away from supporting renewables by saying that its aim was “to create policy to ensure energy is affordable and secure and that in the past the balances had swung too far in favour of climate change policies”.
It is unclear whether this scaling back of a commitment to renewable energy and leaving the direction of future energy policy at the mercy of market forces will lead the UK to meet its emission reduction targets. That however is somewhat of a moot point when it comes to security of supply. Without technological advances and investment in energy storage, renewable energy was never going to be the answer to baseload demand. With the planned demise of coal that is going to fall in the lap of either gas or nuclear generation, both of which have significant hurdles to overcome.
At present there are 41 combined-cycle gas turbine (CCGT)-fired power stations in the UK, along with 16 civil nuclear reactors across nine sites. According to figures provided by the National Grid, on one snapshot day in December 2015 the UK’s electricity demand was 38.3 GW, which was met by 22 per cent coal, 27 per cent gas, 23 per cent nuclear and 15 per cent wind – the remainder taken up by biomass and electricity imported through interconnectors.
A recent report from the Institution of Mechanical Engineers has estimated that, with the loss of coal generation, the closure of most of the existing nuclear facilities coupled with growing demand will leave a potential supply gap of 40-55 per cent.
The UK’s nuclear newbuild programme is stumbling from one problem to another. Three new nuclear power plants are planned – at Wylfa, Moorside and Hinkley Point – but only the latter is looking like going ahead, and even that is beset by problems with operator EDF delaying its investment decision.
So that leaves the onus squarely on the shoulders of gas.
Barking Reach CCGT plant, London
Credit: Emerson Process Management
The requirement to bridge this energy gap is estimated to be in the region of 30 new CCGT power plants, a target that is unlikely to be met given the uncertain political framework. But that said, gas is still going to provide the bulk of our generating capacity over the next couple of decades.
It is clear that for some time the government has seen gas as the answer, particularly as the nuclear newbuild programme continues to be beset by economic and technological challenges.
UK energy secretary Amber Rudd
Credit: Department of Energy and Climate Change
As far back as 2012, the Department for Energy and Climate Change issued its Gas Generation Strategy. This outlined that the government expects gas to continue to play a major role in the generation mix over the future decades alongside low-carbon technologies. It also recognized that gas generation will be important for meeting demand for electricity when generation from intermittent sources is low, for example on still days where there is little wind generation.
So why is gas the preferred option? Gas is the living proof that not all fossil fuels are created equal. Burning natural gas, for instance, produces nearly half as much CO2 per unit of energy compared with coal. Which is why natural gas is thus considered by many to be a bridge fuel that can help nations lower carbon emissions while they transition more slowly from fossil fuels to renewable, carbon-neutral forms of energy.
Natural gas burns cleaner than the other fossil fuels such as coal and oil due to the highly efficient combustion process, which produces very few by-products that are released into the atmosphere as pollutants. It also produces 70 per cent less CO2 emissions compared to other fossil fuels and, due to the clean burning process, it does not leave residues like soot or ash when compared to coal. Another advantage is that it offers a high heating value, approximately 24,000 Btu per pound, and is relatively inexpensive when compared to coal. But natural gas has a climate downside – it’s mostly composed of methane.
Methane is a potent greenhouse gas that is about 30 times better at holding in the atmosphere’s heat compared with carbon dioxide. So if enough methane leaks during production, natural gas’s slim advantage over other fuels could be wiped out.
But aside from the financial and political challenges, delivering this ambitious programme, whether it be gas or nuclear, will require a skilled workforce. Employees in the energy sector are, on average, older than in many other sectors, creating a challenge to replace the staff coming up to retirement age.
At Petroplan we know that the concern about the growth and development of skills in the UK energy market is nothing new. There are fewer graduates and appropriately qualified apprentices entering the market, and there are ever stronger challenges to the retention and maintenance of staff. Indeed, it has been estimated that the industry loses one in four employees to adjacent markets. In talking to employers, Petroplan is getting a clear message in that the skills mix required by sector employers is expected to evolve in the future to include soft skills, technical skills such as data analytics, as well as knowledge of new technologies as they emerge.
There are well-founded concerns from within the energy sector about the impacts of the aging workforce, not least because of the length of time it takes to train and develop within a highly regulated industry.
Engineering UK has estimated that the UK will require at least 87,000 new engineers a year over the coming decade. Yet in 2013 fewer than 50,000 engineers graduated from UK universities, despite a turnaround in how government and industry are attempting to address the problem. In order to address the skills gap, the UK needs schools, employers, universities, institutions and government to develop systematic plans for developing the engineers of the future. We see an increasingly aggressive market where employers are competing for graduates via sponsorships, apprenticeships, golden handshakes and other tools, and that is why employees are turning to specialist recruiters like Petroplan to identify young engineers worldwide.
The skills gap in the energy industry has been dubbed a perfect storm, the result of a lack of long-lead skills, combined with a pressing need to renew and replace our aging and inefficient energy systems. We are also reaching a point where many of our skilled workers are reaching retirement, and there is not enough talent to replace them. That is why Petroplan is forging links with international educational institutions in order to build our database of potential employees.
To meet demand, Petroplan is already importing engineering skills in key areas for UK companies. Foreign workers currently constitute 20 per cent of engineering professionals in the UK. In order to be effective, the energy industry (as well as the UK as a whole) needs a co-ordinated approach to skills development. Employers may be doing their bit but many schools and universities have shunned more technical courses that provide young people with the basis of engineering skills.
Andrew Speers is Chief Executive of Petroplan Group, a UK-headquartered energy recruitment company.