Energy Policy
Confusion over energy policy looks “like a laughable plot line from The Thick of It” and risks increasing consumer bills, Tim Yeo, the Tory chairman of the energy select committee has warned. After weeks of public rows within the Coalition over policies on wind, gas and decarbonisation, which have seen the Energy Bill delayed by several weeks, Mr Yeo said the situation was beginning to resemble the satirical TV series. Ian Temperton of investment manager Climate Change Capital told the committee his clients were asking him: “Are these guys (Davey & Hayes) on the same page? Have they met?” Ian Simm, chief executive of Impax Asset Management, told MPs: “Investors are really worried that with the political debate that has come into the forefront in recent weeks, a future administration will simply change the rules of the game again.” The Energy Bill, intended to incentivise investment in low-carbon power, had been scheduled for November 5 but is not now due until the end of the month.
Telegraph 18th Nov 2012 more >>
Peter Atherton: Technically speaking the CO2 target will require the electricity sector to reduce its CO2 intensity from around 500g per KWh today to around 50g by 2030. In practical terms, this means that all of the UK’s coal-fired power stations are under a sentence of death. They will all need to close by the early 2020s with the first wave of closures due by 2015. Coal-fired stations currently provide over 35pc of the UK’s power. But to hit the CO2 targets we can’t use much gas to run power stations either. A modern, highly efficient gas station produces around 300g per KWh, well above the target. The hope was that carbon capture and storage (CCS) would become viable and could be fitted to gas-fired power stations to keep their CO2 emissions down. However, few people now believe that CCS will become available at an affordable cost in the required timescale. So the only practical route to hit the targets will be to build even more renewables, and new nuclear, and have gas-fired stations operating as back up. Effectively, the policy goal is to phase out fossil fuels from power generation within 15 years. And the cost ? We’re looking at over £100bn in the UK just to get to the 2020 milestone and at least the same again in the next decade. Which brings us nicely to the problems faced by the Coalition Government.
Telegraph 18th Nov 2012 more >>
David Cameron’s former energy minister has called on the prime minister to get a grip over Britain’s energy policy and put an end to a coalition stand-off between the Conservatives and Liberal Democrats over green power. Charles Hendry, who held the position until September’s reshuffle, warned that without a ceasefire there was a risk that "even if the lights don’t actually go out" the cost of energy bills for consumers and industry will "go through the roof". Mr Hendry told the Financial Times that investors in low-carbon energy are finding it more expensive to raise money against a backdrop of such acute political uncertainty. "The crunch is getting uncomfortably close," he said.
FT 18th Nov 2012 more >>
Nuclear Costs
Tony Lodge: what price should Britain be prepared to pay for new nuclear plants? If a strike price – i.e the guaranteed price paid for electricity from the plant when completed – is anywhere near the £140 per megawatt hour (MWh) said to be required by offshore wind, we should be surprised if EDF were not inclined to line our coast with nuclear plants, as was the case in France in the 1960s, 70s and 80s. But this is an absurdly high price and should be out of the question. Any price close to it would rightly destroy nuclear’s low cost reputation and with it the case for new nuclear. After all, £140/MWh is today more than double the current market price, and DECC forecasts that electricity prices will fall over the long term as a result of electricity market reform. 
A challenge for the Government is to make the strike price negotiations as transparent as possible. EDF has now increased the cost of each proposed reactor at Hinkley in Somerset by 40% to £14bn in total. Why? The outcome of the ’strike price’ negotiation risks saddling householders and businesses for a long time to come with further costs since the subsidy for low carbon power is to be financed by the consumer.
Conservative Home 19th Nov 2012 more >>
Centrica
Centrica is expected to abandon plans to build new nuclear power stations in the U.K. and focus instead on expansion in the U.S., the Mail on Sunday reports. Responding to Sunday’s report, Centrica reiterated a statement made Thursday in its interim management statement."A Final Investment Decision on Hinkley Point C is targeted for around the end of 2012, although much remains to be achieved before this decision can be taken and the economics must prove to be sound," the company saidThursday. The nuclear sector in Britain is under pressure as a result of the global financial crisis which has made capital for large and costly projects scarce, while regulatory and legislative uncertainty has also proved a hurdle to investment.
NASDAQ 18th Nov 2012 more >>
Centrica is planning a new wave of expansion in North America, in a strategy shift that is likely to see it pull out of plans to build new nuclear plants in the UK. The British Gas owner has an option to take a 20pc stake in an EDF-led project to build nuclear reactors at Hinkley Point in Somerset, with an investment decision due by the end of the year. However, it is widely expected to withdraw, raising fears about the UK’s energy plans and doubts over who will fund the estimated £14bn cost of the reactors.
Telegraph 18th Nov 2012 more >>
It is likely to formally announce a decision to walk away from the plans by January at the latest, according to The Mail on Sunday.
Telegraph 18th Nov 2012 more >>
New Nukes
By the time any new nuclear power station could be built in the UK (2020 or later), the market for its electricity will be disappearing because of explosive growth in photovoltaics (PV), according to the Energy Fair group. It claims that, by 2020, consumers will be able to buy electricity from anywhere in Europe. The falling cost of PV would, said Fair Energy, lead to a booming market for solar panels, generating large amounts of power during the day when the demand for electricity is greatest. And there will be stiff competition from wind power and other renewables that work at night.
Heating & Ventilating.net 19th Nov 2012 more >>
Nuclear Testing
A campaigner has welcomed a book which claims thousands of UK servicemen were contaminated when a nuclear bomb "went rogue" and showered them with radioactive fallout. The incident took place in 1958 when the UK detonated Grapple Y over Christmas Island in the Pacific Ocean. Veterans say they were left with cancer and infertility problems. In the new book, Between Heaven and Hell, journalist Alan Rimmer cites documents released under Freedom of Information laws which state the massive bomb created rain-producing thunder clouds.
Herald 19th Nov 2012 more >>
Green Deal
The energy industry has accused ministers of underestimating the impact on households of its Energy Company Obligation (ECO) rules. They will force companies to provide energy efficiency technology and home improvements to low-income households and others considered to be at risk of fuel poverty. The scheme, due to start next year, will oblige firms to fund expensive modifications including cavity wall insulation. Energy firms say ministers have understated the costs of the work, which will be recouped from other customers. Energy UK, which represents the industry, is expected to publish a report by independent economic consultants suggesting the scheme will add as much as £50 to the average household bill.
Telegraph 18th Nov 2012 more >>
Renewables
An ambitious plan to provide 15% of Europe’s power needs from solar plants in North Africa has run into trouble. The Desertec initiative hoped to deliver electricity from a network of renewable energy sources to Europe via cables under the sea. But in recent weeks, two big industrial backers have pulled out. And the Spanish government has baulked at signing an agreement to build solar power plants in Morocco.
BBC 19th Nov 2012 more >>
One of Europe’s largest offshore wind energy companies has confirmed it will locate its UK turbine manufacturing site in Scotland. French firm Areva has signed an agreement with Scottish Enterprise. The announcement was made during a visit by First Minister Alex Salmond to Paris. He told BBC Scotland the deal could create up to 750 jobs from manufacturing and the supporting supply chain. Areva describes itself as a "global leader in nuclear energy and a major player in renewable energies".
BBC 19th Nov 2012 more >>
Good Energy will today unveil a new electricity tariff offering people living near its wind farms discounts on their energy bills in a bid to boost the benefit communities get from hosting turbines. The independent utility will launch the local electricity tariff early next year for any customers living within two kilometers of a Good Energy wind farm with a capacity greater than 4MW.
Business Green 19th Oct 2012 more >>
