The data around energy generation capacity looks to be being presented in a way that obscures inconvenient facts
Back in 2012 Ofgem, the Office for Gas and Electricity markets, published its first electricity Capacity Assessment in which it highlighted the increasing risks of brown outs and blackouts as generation capacity reduced. This caused quite a stir and was covered by the BBC and other mainstream media.
The essence of the story was that the risk of blackouts was going to increase from a probability of one in 3,307 years in 2012/13 to one in 12 in 2015/16. The government was quick to highlight the measures it was taking to mitigate the risk including incentives for owners of generators to maintain them at a state of readiness for use should the need arise.
The first report was swiftly followed by a second report, six months after the first, confirming much the same as the first but omitting the 2012/13 data such that the reported change in the risk was one in 47 (2013/14) to one in 12 (2015/16), not quite as startling as in the first report. Perhaps that doesn’t really matter, after all the risk in 2015/16 is the important figure.
There are a number of reasons why the risk has increased including European Directives, the relative price of coal to gas and importantly the growing proportion of renewables on the grid. As we know, the wind doesn’t blow all of the time so while the capacity of wind generation has been growing and contributing significant amounts of renewable energy to the UK grid (12% of demand at the time of writing) it is not always available. This is factored into the capacity assessment by applying an availability factor. In the case of conventional thermal plant, this is in excess of 80%. In the case of wind it is 25%.
In an age where transparency is touted as being the key to exposing malpractice and ensuring good governance of public institutions it seems the culture of trying to hide uncomfortable facts and figures still exists
The third report was published this summer and contained some good news. It projected that when government measures, introduced over the last year were factored in, the risk of blackouts in 2015/16 decreased.
Once again though, Ofgem seem to have omitted figures that perhaps to their eyes are embarrassing. The table that compares the assumed availability factors was reproduced but without reference to the 25% for wind. Admittedly a more detailed table for wind is give in an appendix but it is the comparison with other technologies that is significant.
The second is the omission of the table that sets out the probability of different levels of power shortfall - and hence blackout across the years - an easily understood and informative presentation of the key results of the analysis. Now these are perhaps minor points, given the subject of the assessment, but the repeated omission or obscuration of potentially embarrassing data from their reports casts a shadow.
In an age where transparency is touted as being the key to exposing malpractice and ensuring good governance of public institutions it seems the culture of trying to hide uncomfortable facts and figures still exists, whether inadvertent or deliberate. In the cases cited all that is achieved by omitting and obscuring such data, already available in the public domain, is a feeling of doubt and suspicion.
Nick Cullen is a partner at Hoare Lea