Nuclear Subsidy
The government’s electricity market reforms could be about to receive a major boost, after the long-running negotiations surrounding plans for a new nuclear reactor at Hinkley Point in Somerset reportedly reached a breakthrough. The Times newspaper reported today that a deal with French energy company EDF that would set a guaranteed price of electricity generated by the plant at £93 per megawatt hour is days away from being finalised after well over a year of talks. However, an agreement has reportedly been close since the turn of the year and few in the nuclear industry will be celebrating until a final deal is announced. Today, a Department of Energy and Climate Change (DECC) spokesman said no agreement has yet been reached with EDF. A study by energy consultants Mycle Schneider Consulting published earlier this year also suggested the EU is likely to deem the Contracts for Difference (CfD) scheme that enables strike prices as state aid, meaning that the government’s plans could yet face another legal hurdle.
Business Green 10th Oct 2013 read more »
Talks between the British government and France’s EDF over financial terms for building a new nuclear plant at Hinkley Point in Somerset are continuing, the two parties said on Thursday. No agreement has as yet been reached,” a senior press officer at the Department for Energy and Climate Change said. “A contract will only be offered if it’s value for money, fair and affordable, in line with government policy on no public subsidy for new nuclear and consistent with state aid rules,” the press officer said. The reform package is pending state aid approval from the European Commission.The EU’s executive on Tuesday decided to drop a reference to subsidies for nuclear power plants in new state aid guidelines due to be published next month.A reference to nuclear state aid would have helped Britain’s case to support nuclear power, but the government insisted on Wednesday the move would not jeopardise its nuclear new build ambitions.
Reuters 10th Oct 2013 read more »
There are reports in today’s Times of a deal between Government and EDF involving a strike price of £93 per MWh over 40 years. This obviously involves an enormous public commitment, but how enormous is this? The terms matter very much, including, 1. What agreement is there about ‘underwriting’ the construction risk of the Hinkley C project; 2. What are the terms of the £10 billion guaranteed loan; 3. Is this strike price to be ‘inflation’ uprated in line with CPI or RPI? (the renewable incentives are being uprated in line with the inferior CPI); 4. Are there any provisions for altering the ‘strike’ price in future in an upwards direction?; 5. Is it not the case that the ‘deal’ will allow EDF to part-complete Hinkley C having overrun costs and exhausted the £10 billion Treasury loan and then demand more money from the taxpayer/electricity consumer to complete the project?
Dave Toke’s Blog 10th Oct 2013 read more »
The long-awaited deal between the government and EDF over the energy firm’s planned new nuclear plant at Hinkley Point is expected to be announced before the end of this month, according to a report in the Times. The newspaper said today that a deal had been struck over the price of electricity from the £14bn plant, with Hinkley Point to receive £93 for every megawatt hour it generates. The report said this was twice the present wholesale price and much higher than the £80 per megawatt hour that the Treasury was initially prepared to sanction.
Building 10th Oct 2013 read more »
EDF Energy will get £93/MWh for nuclear power generated at its proposed Hinkley Point C plant, according to The Times, as the deal draws closer. Without citing any sources, the article asserted the UK government had agreed to the guaranteed “strike” price for 40 years. Renewable generators, by contrast, are to get 15-year contracts. It also said China General Nuclear Power Group, formerly known as Guangdong, will take a stake of up to 49 per cent in the £14 billion project. On Saturday, the Telegraph reported government and EDF are still haggling over how much risk and reward to share with customers. That article said the strike price was believed to be £90-93/MWh over 35 years.
Utility Week 10th Oct 2013 read more »
Energy Live News 10th Oct 2013 read more »
Process Engineering 10th Oct 2013 read more »
Nuclear Investment
Two stories out yesterday: first, unions are up in arms that China appears likely to bail out our decades-long efforts at building a new generation of nuclear power stations. Second, the next generation of offshore wind farms looks set to be kiboshed because energy companies aren’t prepared to invest on the subsidies being offered by the Government. Surely the one story holds the solution to the other. If China is willing to invest some of its wall of cash in our energy infrastructure, we should welcome it, rather than complain.There is no reason why a strong British regulatory framework and decent monitoring should not ensure a Chinese operator would be just as safe as a French, Japanese or German-owned one. However, it is crucial to get that framework right before China General Nuclear Power Group gets its foot in our nuclear door.
Independent 11th Oct 2013 read more »
Nuclear Liabilities
Fallon: I am today announcing the start of the Nuclear Liabilities Financing Assurance Board (NLFAB) Triennial Review. Triennial Reviews are part of the Government’s commitment to ensuring that non-departmental public bodies continue to have regular independent challenge. The review will examine whether there is a continuing need for NLFAB’s function and its form and whether it should continue to exist at arm’s length from Government. If there is evidence of a continued need for the body, the review will also examine whether NLFAB’s control and governance arrangements continue to meet the recognised principles of good corporate governance.
DECC 10th Oct 2013 read more »
Nuclear Safety
Senior international nuclear safety and radiation protection experts today concluded a ten-day International Atomic Energy Agency (IAEA) mission to review the regulatory framework for nuclear and radiation safety in the United Kingdom (UK). The Integrated Regulatory Review Service (IRRS) mission team said in its preliminary findings that the UK had made considerable progress since reviews in 2006 and 2009. It also identified good practices in the country’s nuclear regulatory system. In addition to following up previous missions, a key objective was to review the effectiveness of the role of the Office of Nuclear Regulation (ONR), the UK’s nuclear regulator, in ensuring the safety of radioactive waste management and decommissioning, occupational radiation protection, and public and environmental exposures, including emergency planning and response. The mission also considered the response of the UK’s regulatory regime to the implications of the Fukushima Daichi accident had been timely and effective.
IAEA 9th Oct 2013 read more »
Energy Costs
It’s a simple but crucial point. The overwhelming reasons for power bills soaring are that fossil fuels are getting more expensive and that two decades of underinvestment by energy companies in the UK’s now creaking energy system has left customers with a steep bill to catch up. It therefore follows that the best way to keep bills down is getting off the fossil fuel hook and dramatically improving the nation’s appalling level of energy efficiency. Yet the raging debate over energy bills is all too often dominated by those dreaded “green taxes” which critics claim are rocketing bills into the stratosphere. That claim is demonstrably false and the 8.2% price rise announced on Thursday by SSE provides the perfect example. SSE’s own figures, analysed by Reg Platt at the IPPR think tank, show the rise equates to £93 a year. Of that, £23 is due to rising wholesale energy costs and £28 for investment in the grid and meters. VAT adds £5 and another £23 is unaccounted for, but will include SSE’s own costs, profit and projected rises for the next year, during which SSE has pledged to freeze its tarfiffs. That all means that just one sixth of SSE’s rise – £15 – is due to the rise in government “green taxes”.
Guardian 10th Oct 2013 read more »
You’d be forgiven therefore for thinking that bills rose primarily because of those pesky government imposed ‘green’ levies (though SSE refrained from branding them as such). You’d also be mistaken, because – in pound terms – the rises don’t reflect the percentages given. A small percentage of a large amount is still bigger that a big percentage of a small amount. Quoting the percentage increase is accurate, but on its own could lead one to draw inappropriate conclusions about the money leaving your wallet. Reg Platt at think tank IPPR has had a look at the numbers. In the Q&A from the SSE press release it says that average annual standard dual fuel energy bill will rise from £1,131 to £1,224, a rise of £93. According to IPPR if you combine SSE’s percentage increases of the different component with their actual size “network charges have added around £28 to the average annual dual fuel energy bill, wholesale energy costs around £23, government schemes around £15, and VAT around £5. This leaves £23 of the rise unaccounted for, presumably in internal operating costs and profits.”
Energy Desk 10th Oct 2013 read more »
Any new graduate wanting to learn about how companies should handle tough public policy questions should study how the energy companies have responded to Ed Miliband’s proposal to freeze utility prices in his party conference speech three weeks ago. Their actions and comments have been a masterclass in how to make a difficult situation worse.The uncomfortable truth is that the energy business is not trusted. It spends millions of pounds on public relations, advertising and sponsorships but it is still considered to be exploiting its market position to the detriment of the ordinary consumer. Why can’t SSE produce a detailed breakdown of costs and charges, including margins? Why can’t they show us why an increase is necessary rather than simply treating us like children who wouldn’t understand if we were told too much? The cost of new nuclear power has doubled in the past five years. Why? EDF must know but it has not put out the detailed numbers by which we could judge whether the coming deal is fair. Having won, through openness, the argument on safety, it is busy losing the argument on costs by reverting to a culture of Masonic secrecy.
FT 10th Oct 2013 read more »
Reducing green levies on energy companies to reduce household bills would land the Government in court, David Cameron has been warned. An inflation-busting price hike yesterday – the first of a number expected from the main energy companies in the near future – has intensified the political battle over the rising cost of electricity and gas. The prospect of reducing green taxes – which energy companies claim account for 10 per cent of bills – has been raised by ministers as a way of matching Labour’s claimed saving. One option is to soften the impact of the Energy Companies Obligation (ECO), which requires the biggest companies to insulate the homes of pensioners and those on low incomes by 2015. Negotiations are underway between the industry and ministers to extend that deadline, a move that could save the average consumer about £10 a year. However, even this modest measure may be impossible thanks to legislation that requires efforts to reduce the numbers of people defined as being in “fuel poverty”. The Fuel Poverty Advisory Group (FPAG), the Government’s official adviser, has already written to ministers warning that any moves to water down the scheme, which the industry claims adds £94 a year to household bills, would leave them vulnerable to a judicial review. Derek Lickorish, the FPAG’s chairman, said: “Our anxiety is that the Treasury wants to take a knife to ECO. Clearly that would be an absolute derogation of the Government’s obligation to do all it reasonably can to eradicate fuel poverty.”
Times 11th Oct 2013 read more »
George Osborne’s plan to cut financial support for energy efficiency in poorer households is an “unforgivable” attack, according to the government’s own adviser on fuel poverty. With a political row raging over soaring energy bills, inflamed further by an 8% rise from “big six” energy company SSE on Thursday, Osborne and No 10 sources have repeatedly indicated that the Energy Company Obligation (ECO) is being targeted for cuts or delays to reduce the government levies imposed on consumer energy bills. But Derek Lickorish, chair of the government’s Fuel Poverty Advisory Group, said: “It is completely inequitable to attack the only measure that is doing something for the fuel poor in England. It is unforgivable when w e have energy prices that are going only in one direction.”
Guardian 11th Oct 2013 read more »
Senior Conservative ministers are attempting to cut the amount of money energy firms have to spend helping their poorest customers reduce the cost of their bills, The Independent understands. Today SSE became the first of the “Big Six” energy firms to announce it will raise gas and electricity prices by up to 10 per cent from next month – adding around £100 to a typical bill. But the company claims that this rise could have been restricted to around £50 if it was not forced to spend £300m a year subsidising energy efficiency improvements for poor households. Senior Tories are said to be sympathetic to the company’s argument and believe the Big Six could restrict overall price rises significantly if the £1.3bn a year Energy Comp anies Obligation (ECO) was scrapped or watered down. However, they are being strongly opposed by the Liberal Democrats who point out that such energy saving measures directly help those who run the greatest risk of fuel poverty.
Independent 10th Oct 2013 read more »
The head of SSE, the power supplier, has called for a complete rethink of government green policies, saying public support for an expensive shift to low-carbon power was waning amid concern at rising fuel bills. Alistair Phillips-Davies was speaking on the day SSE became the first of the big six utilities to raise gas and electricity prices, saying household tariffs would rise by an average of 8.2 per cent from November 15. In an interview, Mr Phillips-Davies said SSE had been forced to act in part by the rising cost of green policies, such as subsidies for low-carbon power generation and the Eco energy-efficiency scheme.
FT 10th Oct 2013 read more »
Telegraph 10th Oct 2013 read more »
Much discussion of the cost of energy misses the point. The chief problem is less what we pay than what we use. Too many of us live in houses with wind-blown attics and rattling Victorian windows. Our homes are among the draughtiest in Europe, wasting tens of billions of pounds a year. Attempts to deal with the great British energy sieve have fallen short. Und er the Green Deal, the Energy Secretary has offered loans to tempt householders into fitting their own insulation and other improvements. The policy has been a resounding failure. Indifferent to interest rates of up to 8 per cent, two or three times the cost of a cheap mortgage, the public has simply ignored it. Only 12 homes have taken Ed Davey up on his offer to date, with 372 more pending. The Government must address the underlying causes. For the poorest, it must concentrate its subsidies and willpower on helping housing associations to block draughts and save power, achieving economies of scale. There is scope for imagination: some council estates in London have already installed their own solar panels.
Times 11th Oct 2013 read more »
The row between David Cameron and Ed Miliband over fuel bills has intensified after Downing Street said the 8.2% increase in prices announced by one of Britain’s largest energy companies shows that Labour’s pledge to freeze prices is a “con”. The prime minister’s spokesman said international pressures, which are an important factor in driving up prices, would make it difficult for a prime minister to intervene in the market. Miliband responded to the announcement by SSE that it would increase prices by 8.2% from 15 November – hitting more than 7m households – by saying it highlighted the importance of his pledge to freeze energy bills for 20 months if he won the general election in 2015. But the prime minister’s spokesman said the price increase was driven in large part by international factors, highlighting the weakness in Miliband’s argument that a prime minister could intervene so decisively in the market.
Guardian 10th Oct 2013 read more »
Scotsman 11th Oct 2013 read more »
Energy Policy
Paul Brown: British government claims that it is the “greenest ever” and a prime mover in trying to ensure progress is made at next month’s climate talks in Warsaw have been undermined by a parliamentary committee report that says the UK is not on course to meet its legal obligations to cut carbon use. The Environmental Audit Committee, which includes members of Parliament from all the major parties, warns that unless new policies are developed to improve energy efficiency, reduce emissions from transport and cut waste, the UK will miss its own targets to cut greenhouse gases. Some of the existing policies are failing and need to be revised, it says.
Climate News Network 10th Oct 2013 read more »
Politics
Germany has pledged to close its nuclear reactors by 2022 thanks to Green Party influence. Germany is now leading the way on getting rid of nuclear reactors because that is the only sane thing to do after the disaster at Fukushima in Japan. Switzerland and Spain have stopped nuclear reactor construction. France is locked in a national debate over the future of nuclear power. By contrast, Britain now has only one political party committed to phasing out nuclear. The Green Party wants to ditch nuclear in favour of a safe renewable energy future. We are the only party saying that for the sake of our common future it makes no sense to have nuclear plants like Sizewell and Bradwell, when instead we can have safe solar power, wind turbines, and tidal power around our coast.
Peterborough Telegraph 10th Oct 2013 read more »
Cumbria
More than 200 industry leaders are due to attend a global energy conference in Cumbria next week. The eboc13 conference at Energus, Lillyhall, will feature national and international companies and brings together all sections of the energy industry and its supply chain. The first day, on Tuesday, will look at decommissioning and include the latest news from Sellafield, plus the decommissioning of nuclear submarines in the former Soviet Union. It will also include a new build and infrastructure session. There will also be a session looking at low carbon and energy efficiency with a presentation from Alison Conboy, head of carbon budgets for the Department of Energy and Climate Change, on the transition to a low-carbon economy.
Whitehaven News 10th Oct 2013 read more »
Nuclear Weapons
The Campaign for Nuclear Disarmament (CND) has welcomed a new report which lays bare the financing of nuclear weapons.Don’t Bank on the Bomb, produced by IKV Pax Christi and the International Campaign to Abolish Nuclear Weapons (ICAN), details how 298 of the world’s leading banks and financial institutions invest almost $314 billion in companies involved in the production, maintenance and modernisation of nuclear weapons.
Ekklesia 10th Oct 2013 read more »
CND 10th Oct 2013 read more »
Canada
Ontario’s government will shelve plans for a major new investment in nuclear power, according to industry and government sources. Kathleen Wynne’s Liberals have decided against spending upwards of $10-billion to buy two new nuclear reactors as had been planned when Dalton McGuinty was premier, and will commit only to refurbishing existing ones.
Globe and Mail 10th Oct 2013 read more »
Financial Post 10th Oct 2013 read more »
Reuters 10th Oct 2013 read more »
US
Four nuclear plants have closed this year and dozens are at risk of early retirement, as the industry faces low-cost competitors and renewed doubts about the wisdom of nuclear power. A funny thing happened on the way to a nuclear renaissance: For the first time in 15 years, operating nuclear plants are being forced to close, and energy companies are scuttling plans for new plants and upgrades to existing ones. Mark Cooper, a senior research fellow at the Vermont Law School’s Institute for Energy and the Environment, says “The aging reactors are getting too costly to run given the alternatives available to us.” In a July 2013 report, “Renaissance in Reverse,” Mr. Cooper identifies 38 other US nuclear reactors at risk of early retirement due to competition from cheaper energy sources.
Christian Science Monitor 10th Oct 2013 read more »
California regulators are grappling this week with how much it will cost to decommission the scandal-plagued San Onofre Nuclear Generating Station – artfully baptized SONGS. It sits by the beach in northern San Diego County; 7.4 million people live within 50 miles. It’s supposed to be able to withstand an earthquake with a magnitude of 7.0 on the Richter scale. But a fault has since been discovered nearby, capable of producing 8.0 earthquakes. Ten times more powerful than a 7.0 quake. San Onofre is also protected against tsunamis, much like Fukushima Daiichi.
Oil Prices 10th Oct 2013 read more »
Iran
Six world powers and Iran will seek trade-offs between curbing uranium enrichment, allowing intrusive inspections and lifting crippling sanctions when they resume talks next week on Tehran’s nuclear programme that could yet trigger a Middle East war. Negotiators from the major powers and Iran meet in Geneva on Oct. 15-16 in a mood of cautious optimism after a tentative thaw between the Islamic Republic and the United States, arch-foes for more than three decades.
Reuters 11th Oct 2013 read more »
An exiled opposition group claimed Thursday that Iran has transferred a research centre leading its alleged attempt to develop nuclear weapons to a new location in order to hoodwink the world.
Middle East Online 10th Oct 2013 read more »
Vietnam
Looking to take advantage of Vietnam’s booming economy, which is growing at around 5% a year, and the subsequent increasing demand for energy, the US has signed a deal to share knowledge, expertise, and technology of nuclear power, allowing the potential for future investments into the growing industry. The deal strictly mentions that Vietnam must not enrich or reprocess any nuclear materials supplied by the US.
Oil Price 10th Oct 2013 read more »
World Nuclear News 10th Oct 2013 read more »
Guardian 10th Oct 2013 read more »
Bloomberg 10th Oct 2013 read more »
CCS
The number of projects that capture carbon dioxide emissions from power plants and industrial facilities – seen as a crucial tool for coal-reliant countries shifting toward a lower-emitting economy – is losing momentum, dropping from 75 to 65 worldwide since 2012, according to a new study released on Thursday. The Global CCS Institute, an Australian-funded research group supporting the deployment of carbon capture and storage technology worldwide, said in its annual survey that despite four new large-scale projects coming online this year, the rate of new projects entering the pipeline has slowed.
Guardian 10th Oct 2013 read more »
Fusion
Scientists claim to have made a key step that proves it will be possible to produce a self-sustaining nuclear fusion reaction. A £2.1 billion ($3.5 billion) experiment that uses lasers to spark nuclear fusion has for the first time released more energy than was absorbed during attempts to trigger the reaction. Experts say it marks a significant step towards full ignition – where the fusion reaction becomes self-sustaining and produces more energy than is needed to power the lasers.
Telegraph 10th Oct 2013 read more »
Fossil Fuels
The latest rumour is that the government may offer to regulate old coal power plants to pacify Lib Dems agitating for a power sector decarbonisation target in the legislation. So just how good a deal is it for those who want to see the UK’s power sector emissions fall? A decarbonisation target would commit the coalition – and future governments – to low carbon policies. In contrast, extending the EPS is a short term measure with no strings attached. It’s unclear whether the government’s proposal will be enough to persuade Lords to pass the energy bill without a decarbonisation target. The CCC’s comments suggest that if Lords accept the deal, they may be gaining short-term emissions reductions at the expense of longer-term commitments.
Carbon Brief 10th Oct 2013 read more »
The EU authorities have opened a new front in efforts to clamp down on shale gas, warning that the carbon footprint from methane emissions may be high enough to call into question the whole future of fracking in Europe. “Methane is a much more powerful greenhouse gas than CO2,” said Jos Delbeke, director-general of the European Commission’s climate divisions. “The level of methane emissions tilts the balance for or against the development of shale: it is the central issue. We don’t want to copy and paste what happened in the US. We will do things differently in Europe,” he told the Daily Telegraph.
Telegraph 10th Oct 2013 read more »
