Hinkley
No review of the Hinkley Point nuclear project of the sort Theresa May’s new government is attempting would be complete without an assessment of its generous economics — and particularly its projected profitability. Assuming the plant can be built — admittedly not a small “if” given the troubled status of two similar projects its sponsor, EDF, has in Europe — the terms of the deal pretty much ensure a juicy payback. They ensure the French utility will receive more than double the present UK wholesale power price, indexed and guaranteed for 35 years. Subsidies are a byproduct of the state not only trying to reduce emissions, but also specifying the power sources to be employed in doing so. And, here, the original sin was committed t10 years ago when then prime minister, Tony Blair, signed up to the EU’s renewable energy directive. This ordained that by 2020, a full 15 per cent of Britain’s energy (or 30 per cent of electricity excluding transport and heating) should come from renewable sources. Concerns that the technologies were immature and delivered power only intermittently were swept aside. Customer-funded stealth taxes were introduced to encourage developers to pump money into wind turbines and solar panels. So, rather than the rational course of applying a neutral carbon levy and letting the market determine the best way to cut emissions, the government tried to pick the technological “winners”. What we do know is that the policy is constraining the supply of new capacity at a time when the supply margin has been falling ominously. Not a single megawatt has been commissioned without a subsidy since 2012. With the Hinkley review, Mrs May has a chance at least to pause the treadmill of escalating interventions. The consequences of doing so may not be clear. But the alternative looks much, much worse.
FT 11th Sept 2016 read more »
Some time later this month the prime minister will make a decision on whether the alleged security concerns raised over Chinese investment in, and technological development of, the planned Hinkley C and Bradwell B new nuclear plants respectively. We know her chief policy advisor, Nick Timothy wrote on the Conservative Homeweb site last October, when working for a conservative think tank: Ironically, at the beginning of the month, the United States Chamber of Commerce issued 116 page report on threats to international free trade in information technology, highlighting the role played by China’s national security laws to exclude US (and others’) companies from selling into the Chinese market.
David Lowry’s Blog 12th Sept 2016 read more »
Letter RCF Martin: The five distinguished members of EDF Energy’s stakeholder panel, in their letter, argue the case for the UK’s supposed need for Hinkley Point C to replace the existing nuclear fleet – as if the method of electricity generation was somehow more important than the cost of the electricity that the UK needs. According to the National Audit Office, UK consumers are expected to pay £29.7bn to EDF and China General Nuclear Power, the owners of Hinkley Point C, in top-up payments to compensate them for the difference between the price that they are guaranteed to receive and the wholesale price of electricity. Instead of being mesmerised by the desire not to upset the French and the Chinese, as we seem to be, it would be sensible to consider the far cheaper alternative of using some of that £29.7bn to subsidise gas-fired combined-cycle gas turbines as an alternative to Hinkley Point C. If this was combined with a linked, concerted effort to commercialise carbon capture and storage, gas-fired electricity generation would not be significantly more carbon-intensive than nuclear electricity. CCS technology has been in existence for decades and is capable of extracting 90 per cent of the carbon dioxide from coal and gas-fired stations. Rather than have consumers pay an additional £10 a year in subsidy for the lifetime of Hinkley Point C, there is a wonderful opportunity for the UK to play a leading role in developing the worldwide decarbonisation of hydrocarbons from traditional power stations. That would have a much greater impact on carbon dioxide reduction than the construction of Hinkley Point C, even if one makes the generous assumption that the technical problems that still beset EDF in Finland and Flamanville in France will be overcome before work commences on Hinkley Point C.
FT 13th Sept 2016 read more »
Moorside
South Korean’s state-backed nuclear firm Kepco is in talks to join the £10bn NuGen project to build reactors at Moorside in Cumbria. The venture is currently 60pc owned by Japan’s Toshiba, which plans to use its Westinghouse reactor technology, and 40pc by France’s Engie, formerly GDF Suez. Kepco first considered investment in NuGen in 2013 and talks were said to have been revived earlier this year by Tom Samson, NuGen’s chief executive, who formerly worked closely with Kepco in the United Arab Emirates. Sources confirmed reports in the Financial Times that the firm was now nearing a deal to invest in the project. However, one cautioned that any such investment may not be confirmed until later in the year. NuGen has made no secret of the fact it is seeking new investors to help fund its project, on which it hopes to take a final investment decision in 2018.
Telegraph 12th Sept 2016 read more »
BBC 12th Sept 2016 read more »
Engie operates several nuclear plants in Belgium and is part of a consortium to build a nuclear plant in Turkey, but new Engie chief executive, Isabelle Kocher, wants to focus on renewable energy, energy efficiency and power networks. Sources say both companies have been looking to reduce their stake in NuGen for several months, but low wholesale power prices and tough competition for ever-cheaper renewable energy have darkened the investment outlook for nuclear energy.
Reuters 12th Sept 2016 read more »
NuGen, a partnership between Toshiba of Japan and the French company ENGIE, wants to build three Westinghouse AP1000 reactors at Moorside. The News & Star reported in May that it had approached Korea Electric Power Corporation (Kepco) as a potential investor in the project. Now the Financial Times is saying that Kepco is “closing in” on a multi-billion pound investment in Moorside. NuGen is due to make a final decision on whether to proceed in 2018 with a view to starting construction two years later.
In Cumbria 13th Sept 2016 read more »
Business Desk 13th Sept 2016 read more »
The company that plans to build a new nuclear power station is West Cumbria, is making grants available for community projects surrounding the site. NuGen has announced that it’s Green Grants scheme will be open this year for community projects to apply for support, to help them improve the local environment close to the Moorside Project site. Last year, the scheme attracted more than 60 applications and17 successful schemes being awarded grants worth more than £37,000.
ITV 12th Sept 2016 read more »
Nuclear Finance
Poland mulling funding options for nuclear plant as it dumps UK blueprint. Poland is looking at “various options” for financing the country’s first nuclear power plant, a government official said on September 12, stating that the previous plan to run the project via the “contract for difference” (CfD) model would be too costly.
BNE Intellinews 12th Sept 2016 read more »
Nuclear Research
A new research hub for nuclear energy – created to encourage partnerships between industry, academics and the government – has been opened at the University of Bristol. The South West Nuclear Hub will also run an education programme to train the next generation of nuclear plant operators, regulators and supply chain workers.
Utility Week 12th Sept 2016 read more »
Nuclear Jobs
New figures published today highlight that high-quality, high-skilled jobs are being created by the UK’s civil nuclear industry in ‘every part of the country’. The Nuclear Industry Association’s 2016 Jobs Map shows 65,791 people are now working in the sector – an increase of more than 2,000 on last year. The latest statistics – updated annually by the NIA – in its Civil Nuclear Jobs Map also highlights the number of women, apprentices and graduates employed in the industry. More than one fifth all of all employees are female, almost 2,000 are on an apprenticeship programme and over 1,000 are part of a graduate scheme.
Scottish Energy News 13th Sept 2016 read more »
Energy Policy – Scotland
Scotland is leading the UK in greenhouse gas emissions reductions, but much more needs to be done to ensure future targets are met, according to a new report for the Scottish Government published today by the Committee on Climate Change. The report reveals that Scotland’s annual emissions reduction target for 2014 was met, with gross Scottish greenhouse gas emissions, including international aviation and shipping, falling by 8.6% in 2014. This compares to a 7.3% fall for the UK as a whole. Since 1990, gross Scottish emissions have fallen nearly 40%, compared to nearly 33% at a UK level. There has been good progress in deploying renewable electricity generation capacity in Scotland, and excellent progress in installing community and locally-owned energy projects (meeting the target for 500 MW of capacity five years early). However, to meet Scotland’s ambitious targets beyond 2020, much more will be required, says the CCC’s report. Whilst emissions have fallen by an average of 3.3% per year since 2009, this has been mostly due to progress in the power sector with reduced coal and expanded renewable generation. Other sectors now need urgent attention.
Scottish Energy News 13th Sept 2016 read more »
BBC 13th Sept 2016 read more »
Energy Policy
Much of the policy approach still takes a top-down, centralised view of the system, and is dominated by the supply side. At the same time, when you speak to those within the sector you get a sense that many of the new solutions that are entering the system across generation, heat and the demand side, are doing so in a random way – it’s all a bit of a scramble as companies chase value in the system. This market-driven approach is a long way from the strategic analysis and direction that is increasingly needed to ensure we are putting in the most sensible solution for any particular area – not only in terms of the system and its operation, across different vectors, but also in terms of cost and acceptability. We could easily be locking-in the wrong technologies, in the wrong place, for the wrong cost, with little or no public consent. The current policy approach seems to be based on observing and reacting, in respect to system change; this seems increasingly not-fit-for-purpose. There is a way to potentially reconcile these three issues i.e. 1) putting end users into the centre of the system; 2) taking a whole systems approach; 3) taking a strategic approach to transforming the system. Instead of focussing on a centralised, top-down, approach to system design, operation and policy making/regulation, based around large and in some cases inflexible technologies, the system should be optimised from the bottom up
IGov 12th Sept 2016 read more »
Companies
James Fisher Nuclear has signed an agreement with the China National Nuclear Corporation (CNNC) to host a team from the corporation for training and familiarization as a first step in building future cooperation. The first training session is planned to take place at JFN’s Head Office in November 2016. “CNNC has many of the same challenges in decommissioning its legacy facilities as exist in the UK Nuclear sector, and recognises the expertise built up by British companies in safely decommissioning high hazard plants.” comments Paul Read, Managing Director of James Fisher Nuclear.
Energy Business Review 12th Sept 2016 read more »
Germany
Germany’s top utilities said they were nearing a deal with the government over funding for storing radioactive waste, denying a media report that said the cost to the firms of the agreement had risen. The country’s top four energy groups — E.ON, RWE, EnBW and Vattenfall — are in final talks with Berlin to nail down the details of a deal proposed by a government-appointed commission in April. Under the plan, the utilities are to transfer 23.3 billion euros ($26.14 billion) in funds to the state, along with responsibility and liability for storing their nuclear waste. A final deal, which will outline the terms and timing of the payments, is expected within weeks, a spokesman for E.ON said on Monday. “I assume there will be a solution for the four utilities,” he said.
Reuters 12th Sept 2016 read more »
Germany is close to an agreement with its utilities that will see the government assume the risks and liabilities of storing private-sector nuclear waste in return for a €26.4 billion ($29.6 billion) cash payment, daily Boersen-Zeitung reported on Saturday. An initial recommendation from an expert commission in April was for Germany’s power firms, led by industry leaders E.ON and RWE, to pay a total €23.3 billion to remove unwanted long-term liability for the underground storage of nuclear waste from power plants. Boersen-Zeitung cited sources close to the commission as saying the final agreed amount included a 35 percent top-up on financial provisioning already set aside by the companies to account for the risk of unforeseen cost inflation in storing the waste safely. Under the deal, utilities would by year’s end pay their respective contributions in cash into a public-sector trust.
Japan Times 12th Sept 2016 read more »
US
Nestled between Chattanooga and Knoxville, Tennessee, the Watts Bar 2 nuclear power plant sits on 1,700 acres in an area friendly to nuclear power. It’s near Oak Ridge National Laboratory, which might be best remembered for its work on the Manhattan Project. The 1,150-megawatt plant is undergoing testing to go fully online this month, and will join the existing 1,100-megawatt Watts Bar plant, which already provides 650,000 area homes with electricity that emits zero carbon emissions. The number of states that support nuclear is by no means high. Although 29 states have renewable energy goals, until recently, only Indiana and Ohio expressly included nuclear energy in those strategies. But other states are starting to craft plans to subsidize nuclear power generation, which accounts for 20% of the nation’s total electricity production.
Guardian 12th Sept 2016 read more »
Philippines
The Philippines government is considering the possibility of taking out of mothballs its only nuclear power plant, a Westinghouse pressurised water reactor completed more than 20 years ago at a cost of more than $2bn, but never put into operation before.
Modern Power Systems 13th Sept 2016 read more »
Renewables – offshore wind
Vattenfall AB won a tender to build two offshore wind farms in the Danish North Sea with a record-breaking bid of 60 euros ($67.33) a megawatt-hour. That’s 20 percent cheaper than the previous record set by Dong Energy A/S in the Netherlands in July. The total capacity of the projects is expected to be 350 megawatts, Sweden’s largest energy company said in a statement. “With our bid for DNS we have demonstrated that we are able to reduce the costs of offshore wind faster than had been expected, only a few years ago,” said Gunnar Groebler, head of Vattenfall Wind. “This again proves that renewable energy is going to be competitive. We contribute to this growth and we will continue to do so for the next few decades.”
Bloomberg 12th Sept 2016 read more »
Renewables – tidal
First Minister Nicola Sturgeon has formally unveiled a tidal turbine that is to be deployed in the Inner Sound of the Pentland Firth. The device is the first of four to be completed at the Nigg Energy Park in the Highlands for Atlantis Resources’s MeyGen project. The project is said to be the world’s first large-scale tidal energy farm. The Scottish government has provided £23m of funding to help develop the tidal stream farm. Atlantis hopes to eventually expand the project to up to 269 turbines, with completed turbines being transported north by sea from the Nigg Energy Park on the Cromarty Firth to the tidal stream farm site in the Inner Sound of the Pentland Firth, which separates the north Caithness coast and Orkney. Last month, another Scottish energy project become the first in the world to deliver electricity to the national grid from a tidal array system. Nova Innovation said its Shetland Isles project represented major progress in using tidal energy as a long-term source of predictable renewable power. The Scottish government hopes that further growth in the industry will create jobs for people moving from the oil and gas sector.
BBC 12th Sept 2016 read more »
Guardian 12th Sept 2016 read more »
Community Energy
The number of new community-owned renewable energy projects of the sort backed by Jeremy Corbyn this week has plummeted after a series of government decisions have made many proposals for wind and solar farms no longer viable. Only 10 new community energy organisations have been registered so far this year, compared to 76 last year, according to new data from the trade body Co-operatives UK. The fall has been directly attributed to policy reforms in the last two years as government ministers noticeably cooled on renewable energy before and after the 2015 general election, with subsidy rates slashed and tax relief ended. These changes stand in stark contrast to the promises made this summer by Theresa May of a windfall for local residents from fracking operations, which could amount to thousands of pounds per household.
Guardian 12th Sept 2016 read more »
Energy Efficiency
EU regulators are to propose a more stringent energy efficiency target than was previously set to go ahead, according to a draft document seen by Reuters. The draft law, which has yet to be agreed formally by the European Commission, would see the EU commit to a binding goal to cut energy use by 30 per cent by 2030 compared with a business-as-usual scenario, Reuters said on Friday.
Business Green 12th Sept 2016 read more »
More government investment in home energy efficiency programmes could help tackle climate change and create up to 9,000 jobs, economists have said. Researchers said increased spending could boost economic activity across Scotland and reduce fuel poverty. They have called for a national infrastructure programme to improve the efficiency of Scotland’s homes. The Scottish government said 40% of Scottish homes were now in the top three energy efficiency ratings. Economists at the University of Strathclyde and London School of Economics were backing calls from the Existing Homes Alliance to “transform” Scotland’s existing housing stock by making it more energy efficient. Prof Karen Turner, director of the Centre for Energy Policy at the University of Strathclyde, said: “Our own research shows that energy efficiency improvements free up disposable income for low-income households to better heat their homes or to spend on other things.
BBC 12th Sept 2016 read more »
Third Force News 13th Sept 2016 read more »
Energy Storage
The Dancing Ladies of Gigha — a set of community-owned wind turbines — are about to be joined in their Scottish island idyll by a less dynamic but potentially more important electrical innovation: a battery. But not just any old battery. The shipping container-sized object to be installed on Gigha is a “vanadium redox flow battery”, a new class of device that supporters say could revolutionise the global renewables sector. Growing reliance on renewable but intermittent sources of power such as solar and wind have created a huge need to smooth out peaks and troughs in supply and so keep the lights on at night or on calm days. The UK government-funded trial on Gigha, site of Scotland’s first community-owned grid-connected wind farm, will demonstrate that vanadium redox flow is now commercially viable, says Scott McGregor, chief executive of the device’s developer, redT.
FT 13th Sept 2016 read more »
CCS
Energy produced using carbon capture and storage (CCS) technology could become cost competitive with nuclear and offshore wind power in the 2020s, according to a new parliamentary report. Produced by the Parliamentary Advisory Group on CCS, led by Lord Oxburgh, for the Department for Business, Energy and Industrial Strategy, the report sets out the potential for the beleaguered technology in the UK, and how the government could foster a cost-competitive industry before 2030.
Carbon Brief 12th Sept 2016 read more »
The UK government must take immediate steps to ignite a national carbon capture and storage industry (CCS) to prevent a dramatic increase in the cost of tackling climate change, according to a joint industry and parliamentary advisory group. In a new report on the future of the industry, the group – formed earlier this year following the controversial cancellation last year of the government’s £1bn CCS competition – said the technology is an “essential component” in delivering lowest cost decarbonisation across the whole UK economy.
Business Green 12th Sept 2016 read more »
