Nuclear Subsidy
ENERGY subsidies have a long history. Governments often argue they are necessary to promote new energies during early developmental stages—think of NASA’s funding for photovoltaics. In America, support like this goes back all the way to land grants for timber extraction in the 1800s. There have been tariffs to support coal, preferential tax treatment for oil and gas, loan guarantees for nuclear power, and so on. Yet nowadays renewable energy is singled out for the support it receives from the government. Critics focus on 2011, when two-thirds of the $24 billion in energy-related subsidies went to renewable energy and energy efficiency ($6 billion was spent on ethanol), while a mere $2.5 billion was spent on fossil fuels. But this ignores history. One study by a venture-capital group that does green investing suggests that in inflation-adjusted dollars government spending on the nuclear industry averaged $3.3 billion a year over the first 15 years of the subsidies. The equivalent figures are $1.8 billion for oil and gas, and $400m for renewable energy during the first 15 years of their respective subsidies.
Economist 7trh June 2013 read more »
Subsidies for green energy will spiral out of control unless the Government rips up its new Energy Bill, one of Britain’s biggest power providers has warned. The Bill, which has been five years in the making, will award low-carbon power producers such as nuclear reactors and giant offshore wind farms huge subsidies funded from levies on energy bills. But executives are concerned about the complexity of the market-based approach, which many admit privately that they do not fully understand. SSE has called for the Government to go back to the drawing board and introduce straightforward guaranteed subsidy payments for different forms of green generation. The company, one of the Big Six British energy suppliers, argues that a simpler system would make it easier to attract the investment needed to update infrastructure and reduce household bills.
Times 10th June 2013 read more »
New Nukes
David Lowry: Members of construction unions GMB, Ucatt and Unite should be aware that despite the signing of a “groundbreaking” agreement with EDF over working conditions (M Star June 6), the Hinkley plant may never be built. The French state-owned energy firm has permission to build a European pressurised water reactor (EPR) at Hinkley. But authoritative business news provider Bloomberg reported on May 30 that EDF is holding off from building atomic plants in Britain until it’s sure they’ll be profitable. EDF CEO Henri Proglio told shareholders at the company’s AGM in Paris: “We won’t go without the formal conviction that we can guarantee the profitability on your investment.” Then this week, Dr Tim Fox, head of energy at the influential Institution of Mechanical Engineers, suggested in trade magazine Professional Engineering that the Hinkley C plant may never be build because of funding uncertainties.
Morning Star 9th June 2013 read more »
Japan and France agreed on Friday to deepen their cooperation on nuclear technology and to discuss joint development of military equipment, vowing to raise the tenor of their partnership. Visiting French President Francois Hollande and Japanese Prime Minister Shinzo Abe issued a joint statement pledging to prevent nuclear proliferation while raising safety standards for nuclear energy. The two sides also agreed to establish a regular dialogue between their foreign ministers and defense ministers, discussions that will include possible cooperation in developing and managing exports of defense equipment. Japan has similar arrangements with the United States and the United Kingdom.
China Daily 8th June 2013 read more »
Lobbyists
With newspaper stories circulating about Tim Yeo MP’s alleged dalliances with various lobbyists (biomass and a fake solar company have been mentioned) you’d think Tim Yeo spent most of his time promoting renewable energy. The reality is that the influential Committee he chairs, the Select Committee on Energy and Climate Change (DECC), has been busy pumping out faithful pro-nuclear propaganda which favours, in effect, nuclear power being given a blank cheque for construction costs from the Government. Previous blog posts have detailed how the Committee favours the Treasury offering ‘loan guarantees’ to nuclear power (presumably on the basis of 35-40 year contracts) whilst renewable energy has to make do with 15 year contracts and no loan guarantees. Nuclear loan guarantees and underwriting of nuclear construction risk. That is the language spoken by the Committee which Tim Yeo leads.
Dave Toke’s Blog 9th June 2013 read more »
Tim Yeo, the Tory grandee and former environment minister, has rejected allegations that he used his position on a Commons select committee to help business clients. In a lengthy statement, the chairman of the energy and climate change select committee dismissed a claim by the Sunday Times that he had coached the managing director of a company before he appeared before his committee as “totally untrue”.
Guardian 9th June 2013 read more »
Independent 9th June 2013 read more »
Telegraph 9th June 2013 read more »
Energy Bill
Christopher Booker: Towards the end of a seven-hour debate on its virtually incomprehensible, 200-page Energy Bill, the Government slipped in a new amendment proposing something so utterly mad that, if anyone present had understood its implications, it might have made front-page news. What MPs were being asked to endorse was that, within just six years, we should all be forced by law to make a mind-boggling cut in how much electricity we are allowed to use. The reason why no one seemed to grasp this was that the amendment was so opaquely dressed up that only an MP with some knowledge of the basics of electricity might have twigged the enormity of what was being proposed. By 2020, it said, Britain must reduce its electricity use by “103 terawatt hours”, rising by 2030 to “154 terawatt hours”. This could have been understood only by someone aware that we currently use each year some 378 “terawatt hours”. So what was being proposed was that this must be cut down in six years by 27 per cent – more than a quarter – rising 10 years later to a cut of more than 40 per cent, or two fifths. brought home, more than ever, was the scale of the shambles the Government is making of our energy policy, skewed by its obsession that the world is in the grip of runaway global warming and that Britain alone must do something to halt it. In order to “decarbonise” our electricity supply by 2030, the Government wishes to build thousands more wind turbines, so heavily subsidised that this doubles, or trebles, the price of the electricity they unreliably produce. It babbles about “carbon-free” nuclear reactors, although companies are refusing to build them unless they are also allowed to sell their power at double the price. The Government is deliberately trying to drive out of business the CO2-emitting fossil-fuel power stations which still supply more than two thirds of our electricity, by charging them a “carbon tax” which, if they survive at all, will also eventually double the price of their electricity.
Telegraph 8th June 2013 read more »
Germany
The polls show Ms Merkel’s CDU with a lead but not an overall majority. The current coalition with the Free Democrats could be sustained if they win enough votes. If not the options are a Grand Coalition with the Social Democrats or a looser alliance involving the Greens. Anything is possible and Ms Merkel has kept all her options open. No policy which could hinder any possible combination is being pushed forward. Energy policy is suffering badly as a result. Investment, particularly in the power sector is badly needed. But for the moment in the complex regional and federal decision making structure through which the fuel mix is set by a combination of regulations and subsidies the decisive voice of central Government is silent. That affects the German utilities such as RWE and EON but also external suppliers who cannot plan or invest in the absence of a clear framework. There are real issues at stake. German business is starting to realise just how expensive the shift to renewables will be, particularly if the mix of low carbon sources excludes nuclear. As things stand the amount of gas used will fall sharply – just when global gas prices are declining. That creates a competitiveness gap. One provocative answer to the problem is now being floated. The most likely partnership after the election in September is a Grand Coalition of the CDU and the SPD. With a sufficient majority such a coalition could decide to extend the life of some or all of the nuclear plants which at the moment are set to close by 2022. The timetable could revert to the schedule originally set, after painful negotiations, by Chancellor Gerhard Schröder a decade ago. Ms Merkel controls her own party, and the SPD would probably endorse what was their own policy. Business and the unions would also be on side. That would give the stations at least another decade.
FT 9th June 2013 read more »
Japan
Fumiya Kokubu has taken over as chief executive of Marubeni at a testing time, with nuclear power facing an uncertain future and its deal for Gavilon coming under question from critics. The FT’s Ben McLannahan talks to the head of the trading house about how to resolve Japan’s power problems and the future of his company.
FT 10th June 2013 read more »
Iran
The United States has successfully tested missiles designed to destroy Iran’s underground nuclear laboratories. In information passed to Israel, the US government said that tests last year of the GBU-57B had gone well. The massive ordnance penetrator, as the weapon is called, has cost $500 million to develop, and can be dropped from B-2 stealth bombers.
IB Times 9th June 2013 read more »
Iranian President Mahmoud Ahmadinejad was on hand Sunday as officials at a nuclear plant took a critical step toward completing a reactor, the semiofficial Fars News Agency reported. Workers installed two containers on the reactor at the Arak heavy water facility in central Iran, Fars said. It quoted the head of Iran’s nuclear agency as saying he thought the reactor will be able to help produce medicine in 2014.
CNN 10th June 2013 read more »
Green Deal
ONLY three people have signed up to the Government’s flagship energy policy, The Sun can reveal. In a huge embarrassment for ministers, just a handful of people had agreed by last month to pay off a green loan through their energy bills. And one of those turns out to work for the Department of Energy. Chancellor George Osborne has allocated £200million for the Green Deal scheme which encourages people to fit new boilers, loft insulation and cavity wall insulation. Industry sources say a total of 100 people have signed up to loans to be paid back over time.
The Sun 9th June 2013 read more »
Renewables
MPs have hammered the final nail in the coffin of the controversial £25 billion Severn Barrage tidal project. The project would be too costly to build and could wreck the estuary’s sensitive ecosystem, the House of Commons Energy and Climate Change Select Committee has said. The project, developed by Hafren Power, would stretch 18km across the estuary to capture the strong tidal currents of the River Severn and, it is claimed, would generate about 5 per cent of the UK’s electricity. It would be one of the largest projects of its kind in the world and would require huge subsidies funded by levies on consumers’ electricity bills.
Times 10th June 2013 read more »
Energy Live News 10th June 2013 read more »
Guardian 10th June 2013 read more »
FT 10th June 2013 read more »
Wales Online 10th June 2013 read more »
BBC 10th June 2013 read more »
John Prescott: In Hull, we’ve been waiting for Siemens to make a decision on whether it will create a Green Port??– an offshore wind-turbine assembly and export facility. But before they invest, Siemens and other energy companies want to be confident the Government is committed to renewable energy. So when the lights go out in the power cuts in years to come and you can’t afford to switch on the gas, light a candle and think of Eric and his climate-sceptic chums. They didn’t want to save the planet. They were more concerned about saving their seats in Parliament. Cameron’s talk about creating the greenest government ever was just that – a lot of bloody hot air!
Mirror 8th June 2013 read more »
Minister Mark Prisk came not to praise former Energy Secretary Chris Huhne but to bury his political legacy, an ambition to carpet England with ugly, ineffective on-shore wind farms. To achieve this end, Huhne stripped communities of their democratic right to have a say over where wind farms were sited. Conservative Ministers last week restored power to local communities, delighting Tory MPs whose postbags frequently bulge to bursting with anger from windfarm-blighted towns and villages. It proved too much for Huhne’s successor, Lib Dem Energy Secretary Ed Davey. He stormed out of the chamber, grumbling he could not take “an hour of this”. You could practically hear the Coalition carriages decoupling.
Express 9th June 2013 read more »
Fossil Fuels
Fracking is fast reducing American reliance on Saudi Arabia for oil, but shale gas is just one of many new energy sources that are changing geopolitics. In the 1970s, geologists discovered crystalline natural gas — methane hydrate, in the jargon — beneath the sea floor. Stored mostly in broad, shallow layers on continental margins, methane hydrate exists in immense quantities. Estimates of the global supply of methane hydrate range from the equivalent of 100 times more than America’s current annual energy consumption to 3m times more. A tiny fraction — 1% or less — is buried in permafrost around the Arctic Circle, mostly in Alaska, Canada and Siberia. The rest is beneath the waves, a reservoir so huge that some scientists believe sudden releases of undersea methane eons ago set off abrupt, catastrophic changes in climate. Humankind cannot tap into the bulk of these deep, vast deposits by any known means. But even a small proportion of a very big number is a very big number. By some estimates, it is twice as abundant as all other fossil fuels combined.
Times 9th June 2013 read more »
