After the recent unprecedented increases of oil prices on international markets and the rippling effects that followed causing higher prices across many sectors of the economy, very few would argue, from an economic viewpoint, against the need to diversify away from fossil fuels. From an environmental position, the need to reduce carbon emissions worldwide to slow global warming and as a consequence, manage climate change has been widely accepted.The Kyoto Protocol, negotiated by more than 160 nations in December 1997, aims to reduce net emissions of certain greenhouse gases (primarily carbon dioxide (CO2)). Each of the participating developed countries must decide how to meet its respective reduction goal during a five-year period (2008-2012); but specific ground rules remain to be worked out at future negotiating sessions. Under a climate change Bill announced in the Queen's Speech in November 2006, the British Government promised to monitor annually progress towards the five-year milestones, in order to deliver a sixty (60%) percent reduction on 1990 levels by 2050.
With similar targets made across the world, Governments’ energy policies now call for an expansive development trust into renewable energy. Renewable energy is energy generated from natural resources — such as sunlight, wind, water flow, and geothermal heat — which are naturally replenished. This development trust has seen the use of solar panels, on new buildings, to reduce the dependence on fossil fuel (natural gas, diesel, etc.) driven electricity generation plants. Now, Governments’ energy policy must direct future investment into electricity generation, on a large and viable scale, away from more fossil fuels and toward renewable resources.
Clearly, the renewable energy resource of choice is wind. The British Government wants 33 gig watts of offshore wind powered generation capacity built by 2020 and has placed financial incentives to encourage energy companies to invest in wind farms and it is also a fact that Britain is due to overtake Denmark as the largest offshore wind energy generator by the end 2009. Up to 7,000 new turbines are hoped to be built by 2020, trebling the amount of power to be generated by wind farm projects currently under development. The Crown Estate, which owns the UK seabed, has agreed to invest up to fifty (50%) percent of the cost of obtaining planning consent for wind farm sites.
In the United States of America the hope is to reach twenty (20%) percent of the nations’ production level by 2030, wind turbines would have to produce 300,000 megawatts of power, compared to about 16,000 megawatts generated presently. Such growth would envision more than 75,000 new wind turbines, many of them larger than those operating today. About 54,000 megawatts would be produced by turbines in offshore waters. In the year 2004, wind energy in California produced 4,258 million kilowatt-hours of electricity, about one point five (1.5%) percent of the state's total electricity. That's more than enough to light a city the size of San Francisco. Mayor Michael Bloomberg has staked out a claim for making New York City a clean-energy powerhouse through off-shore and on-building wind farms. In Texas, T. Boone Pickens, the billionaire oilman building the world’s largest wind farm, has testified in Congress that Texas’ policy is especially favorable for such a project and that other wind developers cannot be expected to match his efforts without a national energy policy change.
Governments’ energy policy must firstly, establish an ongoing wind data collection study, similar to earthquake and volcano studies, that will inform and guide the best locations, wind direction and blade design for each wind turbine. Secondly, the policy must address the standard terms and conditions in a sale-to-grid contract and financial incentives to encourage the long-term investment in wind generation. Noting that there is a waiting period of over 4 years from booking to delivery due to the high demand on wind turbines, Governments’ energy policy is needed now!
Rationale
T.A.J & Associates Company Limited uses this occasion to comment on topics that have been covered, both academically and by the mainstream media, to add its opinion and point out investment opportunity, not to invoke any social action.
