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Pylons pile the costs onto the bills

Douglas Fraser | 21:45 UK time, Wednesday, 6 January 2010

Just a bunch of metal monsters striding through a barely populated bit of the Highlands? Or could today's decision on the Beauly-to-Denny come closer to home for us all?

It's part of a plan - possibly the most controversial part - drawn up by the energy industry working with the UK Government to upgrade and renew the creaking electricity grid, and to orient it to the places the power is now coming from.

The other phases of the work will mean putting bigger capacity onto existing pylons, including the two big lines across Scotland's border with England. Add to that two very expensive sub-sea cables, one from Peterhead to north east England, and the other connecting Hunterston in Ayrshire with Merseyside.

Leaving aside the North Sea network that could take Scottish renewables to a continental market (and also allowing power to come from continental source, such as nuclear, when the wind drops), the cost of the necessary UK upgrade is put at £4.6bn.

That gets added to your household bill. An industry estimate is that it could put £60 on the average annual power bill. There's a dispute under way between those companies and their regulator about how much they can expect as a rate of return, with Ofgem wanting it to be less.

But that's just one of the additional elements being added to your power bill by changes being required by the regulator and the government. The most recent estimates for other add-ons, as calculated by Ofgem, put £24 on last year's average bill to pay for the EU emissions trading scheme. That's the cost of energy generators exceeding their allowance for climate changing pollution.

There was £45 to help companies meet the requirements of the carbon emissions reduction target. That pays, for instance, for those free low-energy light bulbs and subsidised insulation.

The average domestic bill includes around £12 to pay utility companies for the expense of developing renewable energy sources, and there was £3 to provide for schemes aimed at helping low-income households.

Take out all those add-ons and VAT, and it seems that actually generating your electricity and some corporate profit accounts for only 69% of your bill.

Comments

  • Comment number 1.

    Yes this all costs money, but you cannot grow and progress as a country or business without investment in the future. We need to make more strategic long term investments to progress as a country especially in generating renewable energy. Far too often we are held back by endless planning reviews and lack of commitment on investments such as tidal and wave power generation and cutting the Glasgow rail link,

  • Comment number 2.

    So, we are told that this will secure jobs in the renewables industry, and that it is the price to pay for going green. Few objectors have any problem with this - they are in agreement and certainly support investing in infrastucture for a more sustainable future. Here, the great shame is that, while the EU pushes for high voltage infrastructure to be buried underground, the subsea or underground alternative was not considered in the enquiry. From a Government that defers mainly to the EU on environmental and energy policy, that is remarkable.

  • Comment number 3.

    I would like to know who coordinates the bbc in Scotland’s campaigns against the Scottish Government and the SNP. Beauly-to-Denny is the latest, I think this is a brave one for the bbc to take on when you consider people in Scotland consider global warming a real danger for Scotland. You thought that you where on to a winner with grit problems but you had to move on when the problems where seen in England.
    And the drip feeding of constant references to the perceived failings of wind power along with the nuclear issue that’s a nice one.
    People don’t credit you with the ability to work as a unit, well I have no doubts on your abilities on that score. The Scottish politics show, newsnight Scotland, along with this blog. Whatever the added cost due to the upgrading of the system will be nothing compared to the costs of not doing it, and it's easy to pick away at something when you don’t have the responsibility to find the solutions.


  • Comment number 4.

    Very strange title. Pylons put the LEAST cost onto the bills. We have to get our power somehow.

    Very strange conclusion: What does it matter how much it costs to generate when what we need is the ability to consume it? Since teleportation is not an option then transmission is a large part of the cost passed to the consumer.

    How is this article a view from a Scottish perspective as stated in your 'about this blog' box? You concentrate on Energy businesses working with the UK government as if it has nothing to do with the Scottish Government. YES Energy policy is reserved (IT absolutely should not be imo). Nevertheless, last I seen the decision on planning and transmission infrastructure (which is what your article is about) is a devolved issue. Galling as it is for the British news agency.

    However these costs are nothing compared to the GAS pipeline from Norway to England to provide Southern consumers with GAS, but added to everyones gas bill.

    How about a 'Scottish perspective' on that Fraser?

  • Comment number 5.

    69% of my bill going towards the electricity generator's cost seems a bargain, certainly compared with the proportion of what I pay for petrol that goes to the relevant oil company.

    People don't mind - well, I don't mind - paying more (and even paying a lot more), IF it results in a 'better' service, environment, etc.

  • Comment number 6.

    It seems to me that sub sea would be the way to go. I understand this wasn't really considered by the inquiry. I read, and Douglas mentions it here, that it is too expensive. Can someone explain to me why? Building pylons uses masses of material, requires far more labour and surely must take far longer than laying a cable. I'm serious, explanation anyone?

  • Comment number 7.

    Its not just the cable McPhail, although sub sea cable is significantly more expensive than its land based equivalent, as it has to operate in a pretty hostile environment. Sub sea cables operate in a marine environment, they need specialist ships to lay (in pre dredged trenches, and then back filled) and crucially they are DC, rather and AC. So that needs very expensive - and large - switching and transmission kit on land - or on top of a what is the equivalent of a small oil production platform somewhere out at sea.
    Land based cables are easy - pre build pylons, simple footings, a few choppers to string cables, a crew that is used to land based civil engineering. Off-shore? Different ball game and cost. Oil and Gas costs.
    So that means cheap - less than £500M for Beauly - Denny. Sub sea would be twice the price.

  • Comment number 8.

    Gallach

    Thanks for your input, that is a lot clearer. O.K. so should we thole the cost to preserve our landscape?

  • Comment number 9.

    What pristine landscape is being preserved here? This is not a new line, its' a replacement for an existing line, with fewer but larger pylons. There will be some additional landscape impact, but pretty minimal in the greater scheme of things, and I'd like someone to point me to any scientific study that says that tourism in the H&I will be affected in a meaningful way by what is simply the upgrading of an existing power line.
    Do you seriously believe that a visitor driving up the A9 is going to turn around because they see a pylon thats 15M bigger than the one they saw last year?

 

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