UK Renewable Energy Association report: too much good news for its own good?

This week the Renewable Energy Association (REA) published the report "Renewable Energy: made in Britain".  The association represents the interests of renewable energy sectors including biomass, geothermal, energy from waste, hydro, solar and wind power.  The report presents encouraging and optimistic statistics of the renewable sector, its findings include:

• Turnover in the UK renewable sector was approximately £12.5bn in 2010/11[A].
• The renewable sector (including its various supply chains) is now estimated to employ more than 110,000 people in the UK.  The wind and bio-energy sub-sectors are each estimated to employ over a quarter of all people involved in the renewable sector - just over 31,000 a piece [B].
• Within the sector the biggest performer was wind power (onshore & offshore) recording the greatest turnover (£4bn) and exports (£500m) [C].

The publication of rosy figures should not be a surprise from an industry representation body, what is interesting is to see how well these figures are corroborated by data collected by the UK Government.  The Department for Business, Innovation and Skills (BIS) classifies renewables as part of the LCEGS sector (Low Carbon Environmental Goods & Services) made up of Environmental, Recovery & Recycling, and Low Carbon activities (the last of which includes nuclear power).  The BIS report "Low Carbon and Environmental Goods and Services" report, published in 2011, found that:

[A] In 2009/10 the combined UK LCEGS sector achieved £116bn of sales; the largest sub-sectors being alternative fuels (£17bn), building technologies (£14bn), wind (£13bn), alternative vehicles & fuel (£12bn)  and geothermal (£10bn).
[B] '914,273' people were employed in the UK LCEGS sector (and supply chains) in 2009/10.
[C] UK LCEGS exports totalled £11.3bn in 2009/10.  The five largest exports being alternative fuels, building technologies, photovoltaic, wind and water/waste services; totalling £6.7bn

UK Comparative Performance

Though the above figures are encouraging, the REA makes a sober comparison of the UK to that of the continent.  It reports that, renewable energy supplies 12% of European consumption, in Germany renewables supply 11% of energy needs (just as well - as it appears that its nuclear energy sector will be phased out).  In the UK, the renewable sector supplies just 3% of energy.

The REA also states that the German Renewable sector employs over 370,000 people; more than three times that of the UK.  The German economy also receives additional benefit from expenditure in its renewable sector, as these monies recirculate within its industries (unlike purchases of oil and gas).

UK Renewable Sector Risks

The major hazards the REA identifies as endangering the UK Renewable sector are structural and political rather than technological:

1. A lack of recognition and championing of the benefits of Renewable Energy
2. The shortage of 'acute skills', which needs to acted on as a national opportunity
   

The UK Government "Skills for a Green Economy" report of 2011 tends to agree with these findings.  It also considers that a 'green economy' will require skills in the following areas:

• Resource Efficiency
• Low Carbon Industry
• Climate Resilience 
• Managing Natural Assets

A Rosy Renewable Future?

The REA estimates that the achievement of the EU legislated target of 15% renewable supplied energy by 2020 might see 400,000 employed in the UK renewable sector and supply chains.  This figures is roughly comparable to the sector employment in Germany, quoted by the REA, where 11% of energy is renewable-sourced in a country with a population of just over 80 million.
What is more, the REA suggests that UK turnover might also increase by a similar scale to around £50bn per annum - much of this from the recirculation within the UK.