Will renewable energies take the baton from oil

BP's latest Statistical Review of World Energy shows world oil consumption grew by 2.7m barrels per day in 2010 to reach a record level of 87.4m barrels per day.

The UK, however, bucked the trend with oil use falling for the fifth year in a row, down 1% on 2009. BP's report also noted UK renewable energy consumption rose by 4.5% on 2009.

But it is far from certain that renewable energy will be taking the baton from anyone any time soon, let alone the mighty behemoth of oil.

To start with, the two different sources are in very different leagues: BP put 2010 UK oil consumption at 73.7m tonnes, compared with an equivalent 4.9m tonnes of renewable energy.

One of the 'frequently asked questions' on the website of the UK's Renewable Energy Association (REA) is: 'Does the government have coherent policies for renewables?'

Its reply: "Are you kidding?"

The industry body goes on to bemoan many different policies across several government departments, some of which fit together, and others that counteract each other or clash with the regulatory infrastructure.

The UK is towards the bottom of the renewables league table, according to the REA, which claims it obtains just 2% of total energy from renewables.

The government puts this figure at 3% and defends itself against charges of incompetence and lack of dedication in this area.

In last year's Comprehensive Spending Review, renewable energy emerged relatively untouched as the government strives to meet its target of 15% of energy from renewables by 2020.

The government nailed its colours to the mast when it upped a supplementary tax on oil producers to 32%, from 20% in the 2011 Budget. It also announced an extra £2bn for a Green Investment Bank.

It is likely that the relationship between the UK's foreign and domestic supply of oil will be the main driver away from fossil fuels and towards other sources.

Government figures show the UK currently imports approximately 8% (net) of its oil. By 2020, UK oil import dependence is likely to be in the region of 45 - 60%.

This will coincide with the often-predicted advent of 'peak oil' around 2020 - when a permanent decline in global oil production will begin.

A recent report for the government by engineering consultancy Arup concluded renewable sources could provide at least 35% of the UK’s energy capacity by this time.

But 'could' is the operative word because there are numerous hurdles to cross before this becomes a reality.

Indeed, 35% marks Arup's most optimistic predictions with more conservative estimates in the report placing renewables at 20 - 25% of generating capacity.

One of the biggest barriers is a sceptical public that isn't ready to pay the bill.

Dr John Constable, Director of the Renewable Energy Foundation, has estimated the consumer subsidy for wind farms and other renewable energy sources will total at least £100bn by the time the Government meets its carbon reduction targets in 2030.

There are also sceptical investors to be won over as the UK's different planning systems can make creating infrastructure very difficult.

Other barriers to deployment - cited by Arup - include the availability of land, skilled labour and equipment, materials or fuel, as well as the costs of connection to the National Grid.

The use of renewables compared to oil must also be considered in relation to other competitors, chiefly gas and nuclear energy.

The founding chairman of the New and Renewable Energy Centre recently said that the benefits of green energy have been “over-hyped” and the cost of wind-generated electricity is almost twice as much as that of nuclear.

Meanwhile the International Energy Agency has predicted a 'golden age' for gas, which could see it outstrip demand for coal by 2030, and get close to demand for oil by 2035.

One can't help but feel that it will be a while before any one starts talking about renewables in these hallowed tones.