Hinkley
The Downing Street review of the Hinkley Point nuclear power project is coming to an end – and a decision will soon have to be made, probably before the end of September. The latest wave of public relations activity from EDF, the company that hopes to build the plant, shows how nervous the company is about the outcome. Given the range of doubts about the costs, the construction risks, the reactor technology and the involvement of the Chinese, that nervousness is well justified. Can EDF come up with an offer that deals with the doubts? If it focuses on substance rather than spin, it is just possible. The choice will be made in Paris. Three steps – each of which reflect such an approach – would help. First, the French state-controlled company should reduce the scale of the Hinkley project. Instead of two reactors, why not just build one? The second step should be to accept that no new reactor will be built unless and until the comparable plant at Flamanville in northern France is completed and working normally. If Flamanville can’t be constructed – it should have been working in 2013 and it is already €6bn over budget, with many regulatory concerns still unresolved – who on earth would want to try to build the same reactor in Britain? The third step is perhaps the most difficult. Some renegotiation of the terms is essential if the trust that EDF has lost in Whitehall and with the wider public is to be restored. Sometimes companies can negotiate too well and can reach terms that are so one-sided as to be unsustainable in the long term. That is where we are with Hinkley. The bottom line is that EDF could rescue the deal if it wants to, along the lines suggested above. But it may be that the moment for a practical solution has passed and that the game now is about who takes the blame if the Hinkley project is scrapped, and who picks up the bill for the money already invested.
FT 5th Sept 2016 read more »
EDF and its Chinese partner could be paid more than £100bn over 35 years for Hinkley Point C’s electricity if the UK government gives the go-ahead to the French utility’s contentious nuclear power station, according to analyses commissioned by the Financial Times. The total revenue that EDF and CGN secure from Hinkley Point C could even be as high as £160bn, said three analysts, depending on assumptions about inflation, plant output and idle time for maintenance. Juan Rodriguez, analyst at AlphaValue, estimated Hinkley Point C’s total revenue in cash terms at £102bn, assuming that the plant ran at 90 per cent capacity for 90 per cent of the time over the duration of the contract. It also assumes an inflation rate of 1 per cent. “That is why [EDF] want to build the Hinkley Point project so badly,” said Mr Rodriguez. “If they manage to build it on time, it will be a cash machine.”
FT 4th Sept 2016 read more »
Should Mrs May give the green light, and the state-backed company manages to build the power station and get it running by the target date of 2025, EDF and its Chinese partner stand to generate a profit of tens of billions of pounds on the £18bn project. Jean-Bernard Lévy, EDF chief executive, said in July that the company expected to make a 9 per cent internal rate of return on its Hinkley investment based on a contract struck with the UK government in 2013. EDF will not say how much that return will equate to in absolute profit. Peter Atherton, analyst at Cornwall Energy and longstanding critic of Hinkley Point C, says most infrastructure investors look for a return of only 6 to 8 per cent. Hinkley Point C should generate between £100bn and £160bn of revenue in cash terms for EDF and CGN over 35 years, after including the impact of inflation on the £92.50 per MWh electricity price across the duration of the contract, according to three analysts. The National Audit Office estimated that the value of the top-up payments has increased from £6.1bn in October 2013 to £29.7bn in March this year. Similar deals involving contracts for difference are expected to be struck for the other five UK nuclear power projects in the pipeline. The first two under consideration by regulators are at Wylfa in north Wales and at Moorside in Cumbria. Both projects are owned by overseas groups. Horizon, responsible for Wylfa, is a subsidiary of Japan’s Hitachi. NuGen, which is behind Moorside, is a joint venture between Toshiba, also of Japan, and Engie, another French utility. The heads of the two projects — Duncan Hawthorne at Horizon and Tom Samson at NuGen — say they expect their plants to cost less than Hinkley Point C, which should mean lower subsidies.
FT 4th Sept 2016 read more »
Theresa May is to meet Chinese leader Xi Jinping for talks following the delay to the Beijing-backed nuclear power station at Hinkley Point. The Prime Minister is due to give her verdict on the £18 billion project later this month, with security implications and the high cost of the energy produced by the Somerset plant among the concerns raised by critics about the scheme. Mrs May’s face-to-face talks with President Xi come at the conclusion of the G20 summit in Hangzhou, where the Prime Minister has sought to win support for the UK as it prepares for life outside the European Union.
ITV 5th Sept 2016 read more »
In her decision as to whether to go ahead with the Chinese-backed Hinkley C nuclear power station – postponed from July apparently because of security concerns – Theresa May will find no better guidance than the advice which has been given to her and her aides while attending the G20 summit in Hangzhou this week. They have reportedly been advised to not to take their mobile phones, and to use temporary replacements while in China. They have also been given temporary email accounts which can be deleted upon return, and to avoid using public charging points for laptops and iPads. Any mobile phones that are taken to China, reports the Sunday Times today, should be concealed in security boxes out of fears that the Chinese security services have developed ways of accessing phones even when they are switched off. If these are genuine concerns, and not the inventions of paranoiac inside MI6 or GCHQ, then they do seem to provide an answer to the Hinkley question: how can Britain possibly trust another country with it nuclear power infrastructure when we can’t trust it not to spy on government aides attending an international summit? Of course we want to encourage trade with China – we want to do business there and for the Chinese to invest here. But to allow involvement in sensitive nuclear power infrastructure seems an odd place to start.
Spectator 4th Sept 2016 read more »
The Government could renegotiate the controversial electricity price deal for the proposed new nuclear plant at Hinkley Point in Somerset if it takes a stake in the project, say experts. Reports this weekend suggest it is preparing to step in with a £6 billion payment to support the scheme, replacing a contentious investment in the plan by a Chinese nuclear group.
Daily Mail 4th Sept 2016 read more »
THE SNP’s energy spokesman has challenged the UK Government to clarify its plans for the controversial Hinkley Point nuclear power station after it was reported that Tory ministers were prepared to pay £6 billion to continue with the project. It was reported that EDF executives have said the UK Government could have to take a stake of up to £6bn in the Hinkley Point nuclear power station to avoid a “disaster” if the Chinese decide to withdraw from the project. SNP Westminster energy spokesperson, Callum McCaig, called for clarity from the UK Government over its position on the scheme and “explain how, at a supposed time of austerity, they can find the money to throw at the nuclear white elephant”.McCaig, said: “This just exposes the Tory hypocrisy on public spending. They impose austerity on Scotland despite the fact the Scottish people clearly rejected them, yet continually find billions for the unnecessary projects that matter to them like nuclear bombs and nuclear power.
The National 5th Sept 2016 read more »
Wylfa
The firm behind a new nuclear power station on Anglesey have apologised for making “a bit of a mess” of a bid to delete policies designed to safeguard the Welsh language. In a written submission Horizon said Welsh language measures in the proposed Gwynedd and Anglesey local development plan were “too restrictive” and called for the condition that councils could refuse developments which would cause “significant harm to the character and language balance of a community” be deleted. That suggestion has been blasted by language campaigners but in an open letter to local residents Horizon Nuclear Power chief executive Duncan Hawthorne insisted the Wylfa Newydd power station will create generations of high quality employment for local, Welsh speaking people.
Daily Post 5th Sept 2016 read more »
Radwaste
Homo sapiens sapiens, or anatomically modern humans, emerged on the African continent about 200,000 years ago. They started migrating to various parts of the globe around 60,000 years ago with some eventually reaching the Japanese archipelago. The Paleolithic era came and went, and rice cultivation began in the Neolithic era. I started thinking about these prehistoric times after a recent news report mentioned “100,000 years” in connection with radioactive waste that must be disposed of when nuclear reactors are dismantled. It takes a mind-boggling number of years for nuclear waste, stored deep underground, to decrease in radioactivity to a level that is no longer a health hazard. With respect to highly radioactive waste such as reactor control rods, the Nuclear Regulation Authority has just set its basic policy, which is that electric power companies will be responsible for the management of such waste for 300 to 400 years, and then the government will take over for the next 100,000 years.
Asahi Shimbun 2nd Sept 2016 read more »
Energy Policy – Scotland
The SNP has responded to a new opinion poll published by WWF Scotland shows 61% of people agree with the SNP in seeking a future powered by renewable energy. The poll revealed how out of touch the Tories are when it comes to energy policy, as they continue to focus their attention on nuclear power as opposed to the renewable energy systems of the future. SNP MSP Ash Denham (Edinburgh East) who sits on Holyrood’s Economy, Jobs and Fair Work Committee, said: “This opinion poll is a vindication of Scottish Government policy which encourages the development and use of renewable energy technology – in order to both meet our climate change commitments and ensure our energy needs are met in decades to come.
Scottish Energy News 5th Sept 2016 read more »
Uranium
The world needs to grasp the importance of nuclear power for its future energy security, the boss of a uranium miner has said, as it prepares to list in London. Peter Reeve, executive chairman of Aura Energy, predicted a “huge future for nuclear” because of its ability to cater to a growing population. “The world population is growing by the equivalent of one Germany every year. Standing still with water, food, energy and resources is not enough. You’ve got to be growing these things,” he said, pointing out that the number of nuclear reactors worldwide is predicted to double between now and 2030.
Telegraph 4th Sept 2016 read more »
Kenya
Kenya’s plans for nuclear electricity generation by 2027 have received a boost following the signing of a partnership deal with three top South Korean nuclear energy entities.
Daily Nation 5th Sept 2016 read more »
100% Renewables
More US cities are making environmental and political commitments to be powered 100% by renewable energy led by heavily populated San Diego, San Francisco and San Jose in California, according to a new Sierra Club report that highlights 10 of them.
Recharge News 15th August 2016 read more »
Renewables – solar
The installed price of solar energy has declined significantly in recent years as policy and market forces have driven more and more solar installations. Now, the latest data show that the continued decrease in solar prices is unlikely to slow down anytime soon, with total installed prices dropping by 5 percent for rooftop residential systems, and 12 percent for larger utility-scale solar farms. With solar already achieving record-low prices, the cost decline observed in 2015 indicates that the coming years will likely see utility-scale solar become cost competitive with conventional forms of electricity generation.
Scientific American 27th Aug 2016 read more »
Renewables – wave
Scottish Enterprise looks likely to get little back from the £13 million it is owed by a collapsed wave energy developer. Pelamis Wave Power fell into insolvency almost two years ago after running out of cash trying to produce a commercial technology. The administrators suggest in their most recent update that the publicly funded economic development agency is unlikely to recover much of the money it is due. Scottish Enterprise has already written off the debt it was owed by Pelamis, whose demise led to 50 job losses when no buyer could be found. Highlands and Islands Enterprise eventually purchased the intellectual property and assets for £305,000. Pelamis, which was founded in 1998, became the first wave power developer to generate electricity for the grid in 2004.
Times 5th Sept 2016 read more »
Renewables – onshore wind
The number of wind turbines in Scotland has been growing by at least one a day in the last four years. There are now a total of 3,400 onshore turbines, up from just 1,657 in 2012. That is an increase of 1,743 – an average of more than one new turbine every day. And an additional 1,547 have planning approval, many of them now under construction. The figures were released by the Scottish Government as it emerged energy companies were paid almost £5.5 million to switch off their turbines in Scotland for one day this summer. The firms received the cash via “constraint” payments after their stations managed to produce more electricity than Scotland needed over a 24-hour period in August. The situation has brought into sharp focus the continuing divisions that surround wind farms. While many environmental groups support the development of turbines to meet the country’s power needs, there are many who feel the proliferation has spun out of control. Last year, local communities in England were given new powers to veto wind farms. All onshore wind farm applications are dealt with at local level, rather than national authorities dealing with the biggest projects.
Scotsman 5th Sept 2016 read more »
Energy Storage
Behind-the-meter energy storage will overtake grid-scale storage as the largest market segment in 2021 as the result of a surge in storage capacity. Currently utility-scale storage developments make up 84 per cent of total installed capacity, but by 2024 behind-the-meter storage will account for two-thirds of capacity according to Bloomberg New Energy Finance (BNEF). A new forecast report by BNEF revealed that by 2024 capacity will reach 45GW, 16 times the current amount, following investment totalling £33 billion ($44 billion). This compares to £2.9 trillion in power generation capacity. This will be the equivalent to less than 2.5 percent of the total installed capacity of intermittent renewables.
Utility Week 2nd Sept 2016 read more »
Climate
It was vaguely wonderful watching Presidents Obama and Xi cement their bids for a place in history, via climate change, by announcing American and Chinese ratification of the Paris Agreement on September 3. These two nations, so far apart on so many issues, have erected glass walls around the shared climate threat and worked hard together for four years to fight it. They do so now buoyed by the strengthening momentum of climate-survival technologies, and aware of the increasing catalogue of problems faced by the energy incumbency notwithstanding climate considerations. Meanwhile, the increasingly alarming warnings they hear about the unfolding pace of global overheating from their respective scientific establishments is undoubtedly a major motivator. The great global race against time has very much begun now, and they are the undisputed leaders on the first lap. The figures for US electricity generation from renewables came out: 16.9% of the national electricity mix, up from 13.7% in 2015. A new front opened, as the first offshore wind turbine was installed. There will be hosts more. Sixteen cities have now targeted 100% of their power from renewables, and four have achieved it already: Aspen, Colorado; Burlington, Vermont; Columbia, Maryland; Greensburg, Kansas. In the cloudy UK, renewables set a new quarterly generation record of25.1% of the national mix on the back of solar growth. The new government approved the world’s largest offshore windfarm, the $7.8bn 1.8 gigawatt Hornsea 2 project. It will be installed by a former oil and gas company, now a mostly-renewables company, Dong Energy. The pace of development in storage, that vital partner for renewables, continued to amaze. Notable this month was an exhuberant survey of growth and technical advances in both batteries and renewables by the international business editor at the Telegraph, the UK Conservative government’s newspaper of choice.
Renew Economy 5th Sept 2016 read more »
Jeremy Leggett 4th Sept 2016 read more »
