POWER PLAY | Cheap electricity, a changing climate This is part of a series exploring how the world’s hunger for cheap electricity is complicating efforts to combat climate change.
LONDON — After standing dormant for 34 years, the Bankside Power Station was reborn last month. The onetime oil-fired, soot-spewing electric power plant, shut down and then converted into the Tate Modern, the world’s most popular contemporary art museum, is back producing energy again.
Its roof has been coated with solar panels, which soak up the sun’s rays even on a cloudy London afternoon and help illuminate the avant-garde works in the galleries below.
But rather than a shiny vision of modernity, the solar installation may become a sad remnant of a lost future. With breathtaking abruptness, the British government has in recent months slashed its support for solar power and other renewable forms of energy, leaving a once-promising industry with grim prospects and throwing into doubt the country’s commitment to clean power.
The moves have baffled environmentalists, business leaders and even many government allies. Britain has long been in the vanguard of efforts to combat global warming. It has been expected to play a leading role — alongside the Obama administration — in efforts to secure a package of tough reforms at the U.N. climate change summit in Paris, which kicks off at the end of this month.
But the decision to cut hundreds of millions of dollars’ worth of support for renewable energy at home, with a planned 87 percent reduction in subsidies for solar power, threatens to undermine Britain’s international authority, while showing just how difficult it can be for a developed nation to break a centuries-long addiction to fossil fuels.
“Britain’s been leading the way for years,” said Frans van den Heuvel, chief executive of Solarcentury, the company responsible for the pro bono installation of the Tate’s rooftop panels. “But now the government looks like it wants to kill the industry before it can stand on its own two feet.”
Britain on Wednesday became the first major economy to propose a phase-out of coal-fired power plants, saying it intends to do so by 2025. But the government’s plan relies heavily on a switch to gas rather than cleaner alternatives.
Despite its support until now for alternative sources, the United Kingdom still ranks close to the bottom of the European Union in its use of renewables. In 2014, it used fossil fuels to produce more than 60 percent of its electricity, half again as much as the E.U. average. Nuclear power accounted for an additional 19 percent.
It’s not just the subsidy cuts that are hurting renewable energy in Britain. Cheap fossil fuels have made it tough for solar and wind to compete, even as the technology behind green energy matures and costs tumble. Van den Heuvel estimated that solar power is at least several years away from matching the price of more conventional fuels.
But time may be running out: The International Energy Agency reported last week that despite progress toward cleaner energy, the world still requires “a major course correction” to avoid a potentially catastrophic 3.6-degree Fahrenheit rise above average temperatures last seen in the 19th century, when coal-fired Britain launched the world into the industrial era.
Britain is not alone in reducing support for renewable energy. Countries across the West are weaning those industries from the subsidies that have made them competitive with dirtier fuels such as oil, gas and coal. Germany and Spain have scaled back ambitious incentive programs, citing higher than expected public costs. The major tax credit for solar power in the United States is due to expire at the end of next year.
In most places, however, the process has been gradual and somewhat predictable, giving businesses the chance to adjust.
In Britain, the changes have been dramatic and came with little warning. As other countries bolster their green commitments in the run-up to Paris, a top U.N. scientist last month singled out Britain for sending “a very perverse signal” by eliminating support for onshore wind energy and proposing to slash solar subsidies by nearly 90 percent.
The government has been vague about likely savings, but officials say cuts will help to significantly reduce a projected $2 billion cost overrun in the renewable energy incentive program over the next five years.
But the moves could also mean hundreds of thousands fewer green-energy installations. As customers have canceled orders and investors have fled, British renewable energy firms have laid off workers or redirected them to projects overseas. Several have gone bust this fall.
“There’s no better way to disrupt an industry than to create constant uncertainty,” said Howard Johns, whose firm, Southern Solar, went bankrupt last month. “And that’s exactly what we’ve seen.”
Government officials say the time had come to allow renewable energy firms to live or die on their own.
“We have a duty to protect consumers and keep bills as low as possible while we reduce emissions,” said the energy secretary, Amber Rudd, in a speech explaining the moves. “Decarbonization has to be sensitive to the impact it has on people’s pockets.”
But environmentalists cite subsidies and tax breaks for oil, coal and gas that they say have helped keep traditional-fuel prices artificially low, making it harder for renewables to compete. Solar power costs roughly $120 per megawatt-hour in Britain, compared with $75 for fossil fuels.
Meanwhile, subsidies for the renewables industry make up only a small component of utility bills — just over 4 percent. By the government’s own estimation, the solar subsidy cuts won’t save the average consumer much. Yet they will dramatically affect the calculus for homeowners who are thinking of installing solar: The time it takes for the panels to pay for themselves will go from 10 years to 25 or more.
Former top British officials say it’s hard to understand the government’s moves as anything other than a bid to protect the fossil fuel and utility industries at the expense of solar and wind firms.
“It’s a disaster,” said Ed Davey, who until recently was Britain’s secretary for energy and climate change. “The changes are totally ideological, extremely shortsighted and will cost the government and the country more in the long run.”
He lost his job in May when Britain voted for a Conservative government, turning out Davey and his fellow Liberal Democrats, who had been the Tories’ junior partners in a coalition government for the previous five years.
But few expected the sort of wholesale policy change that came with the new Tory-only government.
Unlike in the United States, politics in this country has long been marked by relative consensus on climate change. Margaret Thatcher, the matriarch of modern British conservatism, was among the first world leaders to raise the alarm on global warming. Prime Minister David Cameron came into office in 2010 promising the “greenest government ever” and drove a dog sled across a Norwegian glacier to prove his environmental mettle.
Even after the May election, the Conservatives continued to flaunt their green credentials, with Davey’s successor, Rudd, vowing to “unleash a new solar revolution” across Britain.
But the policy changes that followed could instead set back British renewable energy for years, according to industry observers. For the first time in more than a decade, Britain in September crashed out of Ernst & Young’s rankings of the top 10 countries for renewable energy investment, with the global professional services firm concluding that the government was inflicting “death by a thousand cuts.”
The changes began in June with the elimination of subsidies for onshore wind farms. That shift, at least, was unsurprising: Conservative backbenchers had demanded it for years, blaming giant white turbines for marring views across the once-pristine British countryside. Of all the renewable energies, wind power is also the closest to reaching price parity with more traditional fuels — meaning it needs less support.
“We are reaching the limits of what is affordable and what the public is prepared to accept,” Rudd told Parliament in June when she announced the cuts.
If the decision on wind power was predictable, an 87 percent reduction in solar subsidies caught nearly everyone off guard when the government proposed it a month later.
Solar power remains widely popular in Britain, with relatively unobtrusive rooftop panels raising little public ire. Prominent Conservatives, including Cameron’s climate change adviser and London Mayor Boris Johnson, have criticized the move.
But the government has shown little willingness to bend, rolling out a slew of other changes that experts say amount to a significant weakening of its carbon-reduction strategy: It eliminated a program to promote energy efficiency in homes, reduced the incentive to buy fuel-efficient cars and forced businesses that use renewable energy to pay a carbon levy — a move that Friends of the Earth equated to “putting an alcohol tax on apple juice.”
Bob Ward, policy director for the London-based Grantham Research Institute on Climate Change and the Environment, said some of the moves may make sense in isolation. But he said the cumulative effect signaled that Britain “isn’t as committed as it should be” to addressing climate change. That could hurt the country’s clout at the Paris conference, where Britain is expected to help lead the push for more ambitious carbon-reduction targets.
So, too, could Rudd’s admission this month that Britain is on pace to miss its E.U.-mandated commitment to supply 15 percent of its energy from renewable sources by 2020. “I recognize we don’t have the right policies” to meet the target, Rudd told a parliamentary hearing.
Van den Heuvel, whose company supplied the solar panels at the Tate, said that his firm was strong enough to weather the government’s cuts but that he was shifting his focus overseas.
“There’s no question solar will be the biggest power-generator globally,” the Solarcentury chief executive said in an interview on the museum’s roof. “The question is whether it’s U.K. companies who are making it happen.”
Even if it is, Howard Johns’s company, Southern Solar, won’t be among them. A former environmental activist who “lived in trees,” Johns founded the firm 13 years ago after deciding that it wasn’t enough to protest. “I wanted to find a way to actually do something positive,” he said.
For a decade, the company doubled in size every year. It ultimately had eight offices across Britain with 100 employees who installed solar panels atop homes, businesses and schools. Johns had plans to expand to Kenya and Rwanda. But his employees have all been laid off and the offices closed.
“It’s been a horrendous experience. We’d invested a lot of money in growing a business. And it was all destroyed by knee-jerk changes in policy,” Johns said.
But in the long term, he is undeterred.
“Solar is the future,” he said. “And it’s not going away.”
Karla Adam contributed to this report.