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Response to the
House of Commons adjournment debate
24 July 1997
Response to the House of Commons adjournment debate 24 July 1997
M J OCarroll
The debate is greatly welcomed and signals the strength of public concern about this issue. There are many interesting and complex factors involved. This note is intended as a readable clarification of key points which may be in danger of being misunderstood. Common abbreviations are:
CHP Combined Heat and Power
The National Grid Company (NGC) claimed its proposed Lackenby-Picton-Shipton (LPS) line was needed to take electricity from a new power station (TPL) due to open on Teesside in 1993. The power station duly opened and has operated at full power without the line for over four years, with no consequent problems, on the basis of a temporary derogation and intertrip arrangement which is quite normal. The grid itself is extremely secure; almost all interruptions to power supply occur in the lower-voltage distribution systems, not in the grid. The solution is to make the derogation permanent, which OFFER could do if the line were rejected. NGCs case has not been satisfactorily established. It involves doubt, dispute and discretion. Consent should not be given on such a basis.
2. Need and contrivance
NGCs claim of need was based on its own interpretation of system security requirements, which OFFER has recognised are unclear and open to different interpretations. NGC has a financial incentive to develop the grid excessively (see below), and so to construe its case accordingly.
For example, whereas the system must be safeguarded against two circuits being out, NGC has contrived to require cover for three circuits being out, by counting two circuits which have a solid connection at the Norton substation as one. This is bad engineering; they should be separately switched to bus-bars. This contrivance only came to light after NGCs powerflow studies were checked by Powergen, since NGC would not release computer details. What a fiddle!
NGC claim the LPS line would facilitate increased Scottish imports and further power stations in the north east. They claim this would bring beneficial competition, but in fact market distortion reverses that. This is not obligatory need, only commercial desire. Mr Battle says "those overhead lines may be needed somewhere", but the LPS line is not. Everyone gets electricity without it.
3. More power stations?
There is a serious generation overcapacity, to which Mr Battle refers in his response. It is most serious in Scotland and the north, where it is more than 100%. To continue the dash for gas, i.e. to build more gas-fired power stations which put pressure principally on old coal-fired stations, offers some benefits by way of greenhouse gas reduction, but to build them far from the areas of net demand (i.e. the south) has the opposite effect (see below). Environmental, infrastuctural and social costs tend to ignored by the industry, which is insulated from them.
A much greener policy would be to restrict new large scale power stations to the south of England, and to encourage more Combined Heat and Power (CHP) and renewable schemes, which need to be local to demand. The last government raised the target for CHP to 5,000 MW by the year 2000. Much higher targets for CHP could be envisaged. The current spate of windfarm applications, particularly on northern hills in areas of high landscape value, has little real capacity to offer but threatens widespread environmental damage. Windfarms should be prioritised for the south of England and restricted in the north.
There are three broad categories of costs: capital (e.g. for building new grid lines), annual operating costs (including constraint payments to generators) and energy costs. NGCs turnover was over £1,457 million for 1996/97 (of which £662 million was operating profit, which should indicate something is wrong with regulation!), yet it handles electricity worth some £7 billion at notional wholesale price of 2.5 p/kWh. It does not buy and re-sell the electricity, so the energy costs do not appear in its accounts. However NGC does waste energy through transmission losses ("leakage" due mainly to north-to-south bulk transmission) to the tune of £140 million in 1994/95 and rising fast. Energy costs are separate from and additional to operating costs.
5. Capital costs
NGC estimated the cost of the whole LPS project around £200 million, including substations and other works. Such costs however do not bear upon NGC; they are "allowed" by OFFER and passed on to the consumer. NGC is a complete monopoly, so there is no competitive downside. The result is that NGC obtains a free asset, at consumers expense. The asset then adds value to NGC shares, so it is a form of additional profit disguised as "investment".
Even worse, NGC has been allowed capital costs based on its own gross overestimates, which it has then underspent. Over the last three years NGCs estimated capital costs averaged £420 million p.a. against actual costs of £220 million p.a., as revealed in the TPCR. Following assessment by independent consultants, OFFER concluded "There is no doubt that NGC has seriously overestimated its capital expenditure requirements in the past".
6. Operating costs
As with capital, operating costs are "allowed" by OFFER and passed on to consumers. NGC has again profited excessively from gross overestimation (which was "allowed") and underspend. Figures for the transmission business (NGCs main operation) were, in £ million:
Turning to the operating costs for the proposed line, NGC claimed the line would relieve constraint costs paid to generators whose power may otherwise be restricted, but insisted the details were commercially confidential. NGC suggested the savings in operating costs would be about £36 million per year, by way of constraint costs. Yet constraint costs for the whole country were only £74 million in 1995/6 and falling fast. Any constraint costs attributable to the lack of the LPS line can only be minimal, and we believe are in fact zero. On the other hand, the TPCR revealed that the new line would result in increased costs, due to the effects of increased Scottish imports. What is more, the zero option was improperly assessed in NGCs submissions to the inquiries, by the imposition on it of increased Scottish imports contrary to their contractual conditions.
7. Energy costs
Energy from the primary fuel source is lost at all stages in the electricity industry, but mostly at generation where from 50 to 65 % is typically lost, as displayed in the steam clouds from cooling towers which dump waste heat. These enormous generation losses could be avoided by CHP schemes in the location of the demand. On the average in England, only about 2 % of the generated electricity is lost in transmission, but long distance transmission from surplus power stations in the north loses 15 % (or 20 % from Scotland). Losses continue in the regional and local distribution systems, and of course in inefficient appliances and usage at the point of consumption.
For a new, efficient gas-fired power station in the north east, with a nominal 1,000 MW of generation, the value of losses at wholesale (grid) prices of 2.5 p/kWh would be £219 million p.a. in generation plus £33 million p.a. in north-to-south transmission, a total energy cost of £252 million p.a. due to the location of the power station. At retail prices of 7.5 p/kWh that would be a loss to consumers of £657 million plus £99 million p.a. with a total of £756 million p.a.
The proposed LPS line could potentially carry some 5,000 MW and so could facilitate five times the above losses. However its normal load might be nearer 2,000 MW, with implied energy costs of £504 million p.a. (wholesale) or £1,512 million p.a. (retail) wasted in generation and transmission.
Some 30,000 MW average is generated for England and Wales (50,000 MW at winter peak), including a little CHP and power stations of various efficiencies. Generation losses are likely to be over £7 billion p.a. (wholesale) or £20 billion (retail), an enormous waste of resource which is in principle largely avoidable. The energy industry might however resist its entry into the market. Since little transmission is required for regionally balanced generation and demand, the transmission losses are mainly due to bulk powerflow from north to south. As noted above, the cost in 1994/95 was £140 million and rising fast as dislocation increases.
Cost comparisons of underground and overhead lines are usually made on capital costs only. NGC claims a cost factor of up to 20 for the highest voltage lines: £0.5 million per km overhead and £10 million per km underground. For the proposed 50 mile line (actually 76 km) this would raise the cost from £38m to £760m, though that should be seen in the context of NGCs estimate of £200m for the whole project including substations. However, just as NGC grossly exaggerated its cost requirements to OFFER, by 100% or more, objectors believe this is also an overestimate.
NGC also exaggerates the environmental impact of undergrounding, repeatedly referring to a 15 metre swathe of sterilised land through the countryside. Mr Battle alluded to this kind of impact. He should visit the example at Regents Park where a 400 kV line is contained within a 1.5 metre wide trench using improved technology.
A newer alternative form of underground cable uses superconducting technology, which virtually eliminates transmission losses. When energy costs are taken into account, this alternative may have a cost factor as low as 3 against overhead lines. The technology is not yet commercially available at the high voltages required (400 kV), but is being prototyped. This is very real technology with enormous advantages in machines and transformers as well as powerlines. It could save many billions of pounds in the UK alone, and more importantly offers a huge international market.
My paper "State of the art in superconducting transmission" of December 1994, submitted to the 1995 inquiries, gave an estimate of £270 million capital cost for an equivalent of the whole LPS system (including all accessories but excluding substations). Set against this, there would be savings in energy costs of about £8 million p.a. (just in the line itself, not all the way to the far south). Capitalised at 10%, these savings reduce the effective cost to £190 million, less than NGCs declared cost of £200m for its whole project. These are best estimates from world leaders. They indicate that the technology is potentially within financial reach. Further, NGC admits that the LPS line would give more than double the capacity it claims it needs. Therefore a superconducting line of half the capacity would do, with capital cost down to £135m.
While the best solution is to reject the LPS line outright, there could be an exciting millennium project for a superconducting line to carry 1,000 MW and costing around £135m, together with a research centre on Teesside, to promote the UK in the world market. It could be built in a narrow trench alongside the A174 and A19 with minimal disruption and environmental impact. Should a genuine need arise, Mr Battle might consider this now he has Science on his desk.
Although the UK was involved early in the science, we are trailing in technological development. The American Superconducting Company, with its European base in Germany, and Pirelli in Italy are the leaders, with their governments support. Mr John Austin, who spoke for BICC in the debate, should note the comments of BICCs John McCormack who fears British companies will miss out on the new technology and says "the DTI could do an awful lot more" (Professional Engineering, 4.9.96). Mr Austin should support BICC in looking forward, not in foisting old technology unnecessarily on Cleveland and Yorkshire.
10. The 275 kV Crathorne line
Ms Taylor refers in her speech to the desirability of removing the existing line from Lackenby to Norton via Crathorne, which NGC claims would be a consequence of installing the LPS line. Objectors have shown that its removal would be possible without the LPS line, by simpler reinforcements through industrial and derelict land between Wilton and North Tees. Ms Taylor mentions Yarm and Eaglescliffe, where the impact of the 275 kV line is severe. There is also an existing 400 kV line through Yarm and Eaglescliffe, slightly to the west, which runs directly over many houses, and which would not be removed.
Houses close to and under existing lines were generally built after the lines, and have been valued, bought and occupied in the full knowledge of the lines. It would be unfair to balance a "windfall" gain to home owners from removal of the Crathorne line against the imposition of a new LPS line on existing homes with its consequent serious devaluation and even ruin.
The more legitimate case for home owners near the Crathorne line is that of new health concerns, but NGC will not recognise them. Electricity from the TPL power station is carried by two major lines to the Norton substation: the 275 kV Crathorne line and a 400kV line via Saltholme through industrial and open land north of the Tees. Either line has ample capacity to take the whole power. Objectors have shown that in practice the power could be routed wholly by the Saltholme line, so that the other line which runs through residential areas would be free of electromagnetic fields and their associated health concerns. NGC has refused to co-operate in alleviating the concerns in this way, though with spurious reasons relating to security; NGC will not admit grounds for concern.
11. Electromagnetic fields (EMFs) and health concerns
New research and official evaluations continue to emerge from other countries. Aside from political vetting and wrangling, the scientific position tends to be reinforced. That is that the stringent requirements for proof of cause are not met, yet there is an increasing volume of significant evidence giving rational grounds for concern. Political and industrial dismissals in terms such as "no established risk" or "no convincing evidence" conceal the volume of "suggestive" evidence.
The WHO has used the term "uncertain hazard" for such situations, which might also apply to BSE/CJD, Gulf War Syndrome, fluoridation, multiple vaccination and others. Indeed, the evidence for EMF concerns is far stronger than for BSE/CJD and even stronger statistically than for passive smoking. It would be helpful if government could adopt a more open approach to uncertain hazards. (I have set out a general framework for public health policy in such cases.) They warrant balance and moderation, not zealous denial.
Mr Battle mentions the NRPBs information sheet. This refers only to field levels for "proven" risks. It is important to recognise the much lower field levels which give rational public and scientific concern. (I have written a public information paper explaining those concerns.) Mr Battle also refers only to fields arising from voltages, i.e. the electric field, but the magnetic fields are driven by current - when the current is off the magnetic fields disappear. While both fields have been implicated, only magnetic fields can significantly penetrate houses.
The NRPB has not recommended a precautionary policy for EMFs, yet neither has it recommended eschewing precaution. Government has taken a one-sided stance, against precaution. Test cases arise from applications to build homes near existing powerlines, and in local authorities planning policies. While NGC scrutinises all authorities policies and objects to any precaution, government should at least allow authorities discretion.
12. Environmental impact assessment
Mr Battle is correct in observing that formal environmental impact assessments have been carried out. However they have been criticised, and his use of the adjective "full" may be a little euphemistic. For example no assessment was made of the effect on property values, yet this is a central issue within the required scope of formal assessments under European Directive 85/337/EEC (now amended by 97/11/EC) to assess the direct and indirect effects on human beings and on material assets (Article 3).
Effects on property values were excluded from the Secretary of States statement of relevant matters, and were consequently dismissed in the inquiries, being unreasonably bracketed with financial matters of compensation as beyond the scope of the inquiries. Further, matters of government policy were dismissed, though the application (rather than formulation) of government policy should have been admitted.
The amending Directive 97/11/EC raises the status of powerlines to Annex 1 for compulsory assessment, although such major projects in the UK have had discretionary assessment previously under Annex 2. Powerlines and power stations now enjoy the same status. The 1992 inquiry inspectors report (27.5 - 27.6) says there is a strong case for considering transmission requirements in consents to power stations, but Secretary of State Michael Heseltine disagreed. That was only a provisional response and the present Secretary of State may take a different view in the light of the increased status of powerlines.
The question of salami tactics, to obtain piecemeal consents to a composite project by hiding the full impact, applies here to several pieces which should be assessed as a whole:
1) the TPL power station and associated works;
2) the LPS transmission line and associated works;
3) the Neptune and Flotilla power stations on Teesside;
4) increased Scottish imports;
5) further grid developments throughout England arising from these imports.
In conclusion, the Minister Mr Battle is to be congratulated on his awareness of the complex issues and his resolve to get on with the business after past delays. It will be important for him to examine the evidence carefully and to form his own view, as I am confident he would wish to do, and not to accept uncritically the evidence of NGC, who have been proven to exaggerate grossly and who have distorted incentives, nor even to accept uncritically the advice of his officials, who may like anyone else be susceptible to the persuasiveness of mighty industry. In particular he should study OFFERs Transmission Price Control Review of 1995/96, especially its fourth Consultation Document and the independent consultants reports therein. The present proposals raise general questions of environmental assessment, of energy policy, of uncertain hazards, of weak regulation and of review of the Electricity Act. The absence of answers should be a reason to reject the proposals, at least until there is a clearer policy framework.
M J OCarroll 30 July 1997
para 2: 1992 Env Statemt vol 1 p 13 (and elsewhere) re reason for need
para 4: NGC annual accounts 1997
TPCR1 para 7.4 on losses
para 5: TPCR proposals paras 6.16, 6.17
para 6: TPCR4 Table 1
Powergen letter 18.12.96
para 8: Countryside Comm CCP 454 (refers Elec Council & EA)
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