Hinkley
Another week, another series of disasters for EDF and it’s Hinkley C nuclear power project, writes Oliver Tickell, with the company’s credit rating downgraded partly due to its exposure to the project, and its Chinese partner CGN ruling out a takeover of the site. How much longer can the tragicomedy continue before the curtain falls? The remarkable thing about the ongoing Hinkley C fiasco is just how long it’s going on – and how one disaster piles onto another without the project ever quite dying – so far at least. Moody’s credit rating agency has just downgraded EDF’s debt from A1 to ‘A2 outlook negative’. OK, that’s still not junk grade – after all the company has the French government standing behind it as 85% owner. But the A2 negative rating will make it all the harder and more expensive for it to raise the cash it needs – not just to build Hinkley C but to finance its forced €2.5 billion takeover of insolvent nuclear components manufacturer Areva, make good its problems, finance the impending closure and docommissioning of its own aging nuclear fleet … you get the picture. In other news, Germany’s energy minister Sigmar Gabriel has just announced plans to invest €17 billion over five years in energy efficient technologies as part of an ‘Effizienzoffensive’ campaign aiming to halve the country’s energy consumption by 2050. That’s under a quarter of the UK’s estimated cost of supporting Hinkley C. Could Gabriel possibly know something we don’t?
Ecologist 13th May 2016 read more »
One of the UK nuclear energy industry’s highest-profile lobbyists is calling on the government to pause its nuclear strategy and think again about what technologies to pursue. As concerns mount about whether a new nuclear power station will be built at Hinkley Point in Somerset, Tim Yeo, the former Conservative MP, has said he thinks the government needs to rethink its policy. Mr Yeo, the chairman of New Nuclear Watch Europe, an industry-funded pressure group, called on ministers to review which nuclear projects are most likely to be built. His comments add to growing calls for ministers to draw up a Plan B should Hinkley Point not go ahead. Other projects are currently building their own cases to submit to the regulator, including one at Moorside in Cumbria and one at Wylfa in Anglesey. But many in the industry worry that if Hinkley Point does not go ahead, it would jeopardise these future schemes. All of this doubt surrounding the project has led industry insiders to start questioning whether the UK government should have a back-up plan in case it is not built. On Friday, the Chinese state-owned nuclear group, which has a one-third interest in the scheme, denied reports that it was planning to build two reactors on the site if the current plans collapse. But Mr Yeo said the government now needed to take a more proactive role to make sure that other nuclear power plants planned after Hinkley Point receive the right backing.
FT 13th May 2016 read more »
France’s energy minister has warned of the “colossal” cost of the £18bn flagship Hinkley Point nuclear project to EDF, saying the state-owned utility may have been “carried away” with its British investment. The comments by Segolene Royal are likely to fuel already fraught negotiations over a final investment decision for the nuclear plant that is critical to the UK’s energy future. Ms Royal told the Financial Times she was worried at the impact the project would have on EDF’s already stretched balance sheet if it were to proceed. “I am wondering if we should go ahead with the project. The sums involved are colossal,” the minister said. Other members of the French government, including Emmanuel Macron, the economy minister, have stressed that the project must go ahead, saying that it has already been informally agreed with the UK government and that it is crucial to the future of France’s struggling nuclear industry. Even though Ms Royal is the only minister publicly to express doubts, she is – as President Francois Hollande’s former partner and mother of his four children – an influential force in the administration. Ms Royal has dismissed Mr Macron’s argument on the impact on the wider French nuclear sector if EDF were to back out. “I think that if Hinkley Point did not happen it would not put the French nuclear sector in danger,” she said. EDF’s share price has halved in the past year while its debt has ballooned past its market capitalisation to 37bn euro. On Friday, credit rating agency S&P followed Moody’s and downgraded EDF’s debt, saying Hinkley Point was one of a number of factors that could “hamper the group’s business risk profile”.
FT 13th May 2016 read more »
Times 14th May 2016 read more »
Politics Home 14th May 2016 read more »
Moody’s one-notch downgrade of EDF debt has pushed the utility’s 10 billion euros worth of hybrid debt uncomfortably close to non-investment grade, posing a risk to its refinancing. Late Thursday, Moody’s downgraded EDF’s senior debt to A2 from A1, leaving it in upper-medium investment grade, but EDF’s perpetual junior subordinated (hybrid) debt was cut to Baa2, just two levels above junk. Moody’s kept the outlook on EDF ratings negative and warned it could downgrade further if EDF goes ahead with its 18 billion pound (23 billion euro) nuclear reactor project in Britain.
Reuters 13th May 2016 read more »
Utility Week 13th May 2016 read more »
Standard & Poor’s on Friday downgraded EDF’s hybrid debt to non-investment grade, which will make refinancing the French utility’s 10 billion euros (£8 billion) worth of hybrids complicated. Standard & Poor’s lowered its rating on EDF’s junior subordinated hybrid securities by two notches from BBB to BB+, the first level of non-investment grade. Late on Thursday, Moody’s also downgraded EDF’s perpetual junior subordinated (hybrid) debt one notch to Baa2, but left it two levels above junk status.
Reuters 13th May2016 read more »
Greenpeace has called a rating agency’s decision to downgrade EDF debt a “massive red flat warning” to the UK Government over the Hinkley Point nuclear plant. Moody’s has downgraded EDF debt because of Hinkley Point, pushing some of the French energy company’s riskiest debt close to junk, meaning that traders are advised not to invest in it. It said the negative outlook reflects the fact that the Hinkley plan does not address the fact that power prices at current levels do not cover the required investments enough to make money off them. EDF had not accounted for the incremental risks associated with Hinkley Point C, Moody’s said. Standard and Poor’s warned in October that it may also have to lower EDF’s rating if it presses ahead with the plant. “If investing in Hinkley is not a rational commercial decision for private investors then any French government financing would be illegal state aid,” John Sauven, Greenpeace executive director, said.
Independent 13th May 2016 read more »
There is a real chance the (Hinkley) deal as currently envisioned will not go ahead. It certainly faces fierce opposition from a number of EDF shareholders. Both the Labour Party and environmental lobby groups are pointing to the hole this would leave in government energy plans and demanding a plan B – something which, according to former energy secretary Lord Howell of Guildford, is being drawn up by EDF’s partner on the project, Chinese state operator China General Nuclear Power Corporation (CGN). Whether there is any credence to Howell’s comments is not known. Publicly, there have been denials from CGN and the Department for Energy, while The Guardian notes that the Hualong designs China wants to use in the UK are currently unlicensed, which would complicate a takeover of the project in the short term. If nothing else, the comments show how real the prospect for Hinkley Point falling through has become – and the challenge that this would pose.
The Week 13th May 2016 read more »
A Russian nuclear group is hoping that the potential meltdown of French plans to build new European pressurised reactors at Hinkley Point could offer an opportunity to break into the British nuclear market. Deeper concerns about the future of the Somerset scheme were raised by the French energy minister, Ségolène Royal, who warned of the “colossal” cost, which EDF admitted could be £18bn or even £21bn. Recent talks have been held between state-owned Russian nuclear group Rosatom and the UK’s Nuclear Decommissioning Authority (NDA) despite the chilly political relations between London and Moscow over Ukraine, Moscow sources claimed. These discussions centred on whether Russia could help Britain with removal of uranium from old reactors – but Rosatom is understood to have a wider agenda of trying to resuscitate earlier plans to build its own reactors in Britain.
Guardian 13th May 2016 read more »
Allan Jeffery: Some dreams come true; others turn into nightmares. Hinkley Point C nuclear power station has been a dream to many politicians. Is it about to come true? Margaret Thatcher was one of the first to dream of building Hinkley C. It was to be the second of 10 nuclear power stations she would build, to rescue the country from the menace of those socialist, coal-dependent generators, providing most of the UK’s electricity and too often holding the country to blackout ransom. But her dream turned sour as her privatisation of the nation’s nuclear electricity production bankrupted British Nuclear Energy. The government had to bail out the privatised company. Even worse, the world’s largest nuclear accident at Chernobyl occurred, and the radioactive pollution spread over many countries in Europe. Mrs Thatcher gave up on her nuclear dream. Nuclear was too risky and dangerous and too expensive. The nuclear dreams of many people will turn to disaster, whatever EDF decides on the final investment decision.If the decision is yes, France could lose its national electricity generator and the French taxpayers will rue the day they tried to follow the nuclear dream.If EDF says no, the UK’s energy policy is in tatters leaving the hopes and dreams of politicians, councillors, aspiring businesses and some British trade unions regretting the day they put all their eggs into one nuclear basket, following the Hinkley C dream. My dreams are coming true. All around the world I see rapidly growing investment into a decentralised, renewable, truly sustainable future for our children.This is article has been abbreviated. The full version can be read at http://stophinkley.org/StopPress.htm
Plymouth Herald 13th May 2016 read more »
In March, the UN Economic Council, Economic Commission for Europe, Environmental Impact Assessment in a Transboundary Context Implementation Committee ruled regarding the proposed new Hinkley Point Nuclear Power Station in the UK “that the characteristics of the activity and its location warrant the conclusion that a significant adverse transboundary impact cannot be excluded in case of a major accident, accident beyond the design-base or disaster. The Committee also finds that, as a consequence of its conclusion concerning the likely significant adverse transboundary environmental impact, the United Kingdom is in non-compliance with its obligations under article 2, paragraph 4, and article 3, paragraph 1 of the Convention.” (ECE/MP.EIA/IC/2016/2 See more further below).
Mining Awareness 12th May 2016 read more »
An energy giant owned by the Chinese state has denied it plans to step in with a “Plan B” at Hinkley Point should a £21 billion deal with the French collapse. China General Nuclear Power Corporation (CGN) issued the denial after former energy secretary Lord Howell told the Lords the Chinese were prepared to “bypass EDF altogether” at the Hinkley C project in Somerset.
Plymouth Herald 13th May 2016 read more »
Guardian 13th May 2016 read more »
Bradwell
A PETITION has been launched to fight against controversial plans to store more nuclear waste at Bradwell Power Station. Magnox has applied to Essex County Council to remove a planning condition barring it from storing waste removed from other power plants at Bradwell. The intermediate level waste which will be stored at Bradwell typically consists of sludge, sand, gravel and metal. Two community events were organised to update residents in Bradwell and Mersea on the plans with around 70 people attending across both events.
Maldon Standard 12th May 2016 read more »
EDF
Moody’s Investors Service (Moody’s) has today downgraded to A2 from A1 the issuer and senior unsecured ratings of Électricité de France (EDF), as well as its perpetual junior subordinated debt ratings to Baa2 from Baa1. Concurrently, Moody’s has confirmed the group’s short-term P-1 ratings. The outlook on all ratings is negative. The negative outlook reflects: the execution risk associated with certain elements of EDF’s action plan, notably the disposal of commodity-exposed activities; that the action plan does not address the fundamental challenge faced by EDF, that is power prices at a level which currently does not allow the group to cover the required investments and earn a return on those; and the incremental risks associated with the Hinkley Point C (HPC) nuclear power station project in the UK, should it go ahead.
Moody’s 12th May 2016 read more »
Areva
The former chief executive of Areva, the French nuclear group, has been placed under formal investigation in France over her role in an ill-fated acquisition of a number of African uranium mines. Anne Lauvergeon spent the day on Friday answering questions in front of national prosecutors over whether she deliberately submitted misleading annual accounts that concealed huge writedowns on its 1.8bn euro investment in Uramin in 2007. Following the hearing she was placed under formal investigation for the “publication of inaccurate accounts” and the “spreading of false information”, the office of the French prosecutors told the Financial Times. Areva bought UraMin, a Canada-based company with assets in Namibia, the Central African Republic and South Africa, when uranium was about $138 a pound in 2007. In 2011 the company wrote off nearly the entire stake as prices dropped following the Fukushima disaster.
FT 13th May 2016 read more »
Emergency Planning
Preparedness for and response to a nuclear emergency are in large part technical, physical undertakings. They involve equipment such as pumps, generators, containment vessels, and helicopters. But they aren’t just technical. Preparedness and response also involve, as my roundtable colleague Manpreet Sethi has pointed out, sophisticated legal instruments and organizational capacities. Moreover, as noted in the section for readers’ comments, preparedness and response involve sophisticated regulatory and training abilities. But no matter how many international conventions a nation has ratified, and no matter how flexible (or inflexible) its approach to beyond design-basis accidents, critical decisions during an actual emergency ultimately rest with a plant’s staff—and on the staff’s judgment of the emergency’s magnitude. As a disaster progresses, judgment evolves. Experts shift their views on the disaster’s severity and its potential consequences. They discover entanglements between systems that had previously been thought unrelated.
Bulletin of Atomic Scientists 10th May 2016 read more »
SMRs
MIT Technology Review reports that the U.S. could be closer to implementing a new type of nuclear plant known as the small modular reactor. This month, the Tennessee Valley Authority is slated to apply for a permit to build a small modular reactor at Clinch River. Clinch River is the same site the TVA developed for $1 billion in the 1970s for the Clinch River Breeder Reactor. In 1983, the project was abandoned.
Popular Science 13th May 2016 read more »
Energy Futures
For the first time since September 2014, the U.S. Energy Information Administration, the Department of Energy’s key data and forecasting branch, has released a set of long-range international energy projections aimed at helping inform public policy. But at a time of major transition in the energy sphere, some critics are suggesting that the agency has failed to include key information in its models — and as a result, critics are questioning both the accuracy and the usefulness of the report.
Washington Post 13th May 2016 read more »
Utilities
Britain’s biggest energy supplier British Gas is to offer households free power on Saturdays or Sundays as it attempts to halt an exodus of customers to cheaper rivals. The Telegraph understands the energy giant is preparing a national campaign to launch the so-called FreeTime tariff this summer, in the hope of retaining customers and persuading them to let it install smart energy meters in their homes. The deal would see households offered “free electricity” between 9am and 5pm on either Saturday or Sunday, using smart meters to monitor their usage in real-time. But consumer experts warned that the eye-catching deal, which British Gas first mooted in 2013 and has been trialling at a small scale since, could still work out significantly more expensive than the best value tariffs in the market.
Telegraph 13th May 2016 read more »
Nuclear War
The image of the atomic bomb and accompanying devastation in Hiroshima is seared into many people’s minds. Now there’s a collection of maps that show what the terrible effects of nuclear fallout might look it if a similar bomb was to be dropped on cities in Europe. The researchers used data from a declassified list of US nuclear targets compiled in 1956 in the midst of the Cold War, while a second map shows what would happen if all 1,100 of the US’ targets – across China, Europe, Russia and North Korea – were hit by nuclear bombs at once.
Daily Mail 13th May 2016 read more »
US
With five reactors closed in the last three years, the US nuclear industry is in shutdown mode, writes Linda Pentz Gunter – and that means big spending on decommissioning. But now the nuclear regulator is set to exempt owners from safety and emergency costs at their closed plants – allowing them to walk away from the costs and liabilities, and palm them onto taxpayers.
Ecologist 13th May 2016 read more »
Denmark
About a week ago, Denmark made the absolute most out of a particularly windy 24 hours by harnessing its power and producing not only all of its own electricity needs for the day, but enough extra to spread between three neighboring countries. To be exact, the sustainable wind-power technologies harnessed and collected 144% of one days electricity needs. Denmark had previously developed its wind-power plants but on that particularly windy day, it reached 116% of its domestic electricity demands through wind farms and then exceeded even that impressive surplus, reaching 140%, causing Denmark to export excess power to Norway, Germany, and Sweden. 80% of the excess energy surplus was given in equal parts to Norway and Germany and Sweden received the remaining 20%. Germany and Norway possess hydropower systems with storage capabilities and were thus able to store the extra away for later use.
Politics in the USA 8th May 2016 read more »
Renewables – solar
Solar deployment is set to ramp up over the next decade according to the Scottish National Party’s (SNP) energy and climate change spokesman, who said Scotland represents a huge opportunity for solar. Speaking at the launch event of Solarcentury’s Sunstation yesterday evening, Callum McCaig said the re-elected SNP would be focusing on solar following a prolonged period of wind deployment. “There has clearly been a huge deployment of onshore wind in Scotland in the last decade or so and perhaps to a degree that has constrained the ability to which we can see solar coming,” he said. “But the re-elected SNP government has the target of having 100% electricity produced from renewables and clearly the broader mix that we have in that the better. That means there will be a huge opportunity for solar deployment over the next five to ten years or so.” The SNP won the Scottish elections on a manifesto which included plans to increase community energy schemes, create a government owned energy company and a Scottish Renewable Energy Bond to help the public invest in clean energy. Despite pledging to work closely with the Solar Trade Association to expand deployment, there was little mention of solar-specific plans in the manifesto. However, McCaig’s comments suggest the new minority government has big plans for the technology north of the border.
Solar Portal 11th May 2016 read more »
The Scottish National Party’s (SNP) victory in last week’s elections is “good news” for the solar industry in Scotland according to the Solar Trade Association, which contributed to some of the party’s campaign winning manifesto. In a long-predicted outcome of the Scottish elections, Nicola Sturgeon’s party stormed to victory winning 63 seats at Holyrood. Among the policies promised by the SNP during the election were a series of pledges towards solar deployment and more specifically, community energy projects. These include plans for greater control over feed-in tariff revenues; the possible creation of a government owned energy company to help grow local and community energy projects and a Scottish Renewable Energy Bond to allow savers to invest in Scotland’s renewable energy sector.
Solar Portal 9th May 2016 read more »
Sadiq Khan’s decisive victory in the London Mayoral elections means a “clean energy revolution” will soon be underway in the capital following the Labour mayor’s election pledge to be “the greenest mayor London has ever had”. Following a bitter campaign between Khan and Conservative candidate Zac Goldsmith, the Labour candidate won out after attracting well over a million first preference votes. As well as his plans for affordable housing and cheaper travel around the city, Khan also pledged to deliver several key renewable energy programmes, not least the establishment of ‘Energy for Londoners’. This not-for-profit company will seek to “take a lead” on clean energy initiatives across the city as well as create a dedicated solar strategy which will see more solar deployed on London’s rooftops particularly on Transport for London (TfL) Great London Authority (GLA) land and buildings.
Solar Portal 9th May 2016 read more »
Microgeneration
This week’s Micro Power News.
Microgen Scotland 13th May 2016 read more »
Energy Efficiency
Germany’s energy minister has announced massive investment in energy efficient technologies to take place over the next five years. Sigmar Gabriel said the country will invest €17bn ($19.4bn) in a “broad campaign”, dubbed ‘Effizienzoffensive’, with an ultimate goal of halving energy consumption by 2050. ‘Effizienzoffensive’ will comprise of four programmes including: A competitive tender to find the most cost-effective energy saving measures; A pilot programme promoting smart metering; An initiative to improve the recovery of waste heat, and; An initiative to promote cross-cutting technologies, namely those that enhance the efficiency of energy output or its use. “In practical terms, (the aim is) to halve the energy consumption by 2050, which corresponds mathematically to the current combined energy consumption of the Benelux countries and Austria,” the ministry said.
Power Engineering International 13th May 2016 read more »
Jenny Chu, a manager at The Climate Group, was speaking from the Alliance to Save Energy’s annual efficiency conference, which took place this week in Washington, D.C., and where The Climate Group — an international nonprofit that works with businesses and governments to transition to clean energy — launched a new initiative, EP100. Under EP100, companies will commit to doubling their energy productivity — that is, getting just as much done using only half the energy (or getting twice as much done for the same amount of energy — you get the idea). That’s a big deal. One of the major talking points against emissions reductions is that lowering our carbon footprint will ruin the economy — but efficiency is hard to argue against. And perhaps more than other emissions-reductions efforts, there is a lot of low-hanging fruit in efficiency. According to light bulb company Phillips, if all the world’s companies switched from old-fashioned light bulbs to LED ones, they would collectively save $94 billion in energy costs — and reduce demand by the equivalent of 371 power plants. (For comparison, there are currently 290 active coal-fired power plants in the entire United States). And if you’re willing to go further than light bulbs, there is more hidden inefficiency to target. A retrofit at Pittsburgh’s U.S. Steel building resulted in $1 million worth of energy savings each year for the commercial building, according to Danfoss, another company that joined the EP100 initiative this week. That company installed new pumps for the 64-story building’s water supply and new fans in its air circulation system. In a case study, the building manager says that driving down energy costs has also made the building more attractive to tenants — a positive economic side effect.
Climate Progress 13th May 2016 read more »
The energy department is drawing up changes to two household schemes, the ECO and the Warm Homes Discount. The ECO, or energy companies obligation, is a levy on bills which goes towards home insulation. The Warm Homes Discount helps pensioners with their bills during the winter. Amber Rudd, the energy secretary, wants to focus both schemes more closely on lower-income people who need more help. The government is also preparing for sweeping reforms to the energy market, implementing proposals set out recently by the Competition and Markets Authority. It proposed a cap on prepay charges for electricity customers to help the poorest households and called for companies to be forced to share data on customers in what has been billed by critics as a “spammers’ charter”. There will not be a standalone energy bill but the CMA proposals could end up in a “markets bill”.
FT 13th May 2016 read more »
Fossil Fuels
Fracking is set to resume in the UK after a five-year hiatus with planning officers recommending the controversial technique be used to test for gas in North Yorkshire. Third Energy wants to frack for shale gas at an existing well outside the village of Kirby Misperton to see if the rock below is suitable for large-scale exploitation. It could lead to hundreds of wells across the rolling hills of Ryedale and create an indigenous shale industry after years of delays. Hundreds are expected to demonstrate when North Yorkshire county councillors take the final decision next Friday in Northallerton. Public opposition has prevented any fracking since 2011 when it caused two minor earthquakes near Blackpool. The Conservative dominated council will be under huge pressure from government to give the go-ahead, while most local residents ar e opposed.
FT 13th May 2016 read more »
Britain is on the verge of fracking for shale gas for the first time since 2011, after council officials backed plans to carry out the controversial process at a site in Yorkshire. Gas company Third Energy’s plans to frack at Kirby Misperton in Ryedale should be approved by councillors, North Yorkshire County Council’s planning officer said in a report. Fracking could be underway by the end of the year if councillors follow the officer’s recommendation in a crucial vote later this month. But the plans have attracted fierce opposition, with hundreds of anti-fracking protesters expected to demonstrate against the plans when the council’s 11-man planning committee meets in Northallerton next Friday.
Telegraph 13th May 2016 read more »
Guardian 13th May 2016 read more »
The amount of electricity generated from coal in the UK has fallen to zero several times in the past week, grid data shows. In what green energy supporters have described as a “historic turning point” for the UK’s power system, coal-fired electricity first fell to zero late on Monday night and for the early hours of Tuesday morning, according to data from BM Reports. On Thursday, there was no electricity from coal for more than 12 and a half hours, more than half the day, with it making no contribution to the UK’s power supplies late at night when demand was low and for a period in the day, the data shows. It is thought to be the first time the UK has been without electricity from coal since the world’s first centralised public coal-fired generator opened at Holborn Viaduct in London, in 1882, according to the Carbon Brief website which reports on climate science and energy policy.
Guardian 13th May 2016 read more »
VETERAN oil explorer Algy Cluff, 76, saw his pay fall more than 16 per cent to £284,136 last year as a Scottish Government moratorium forced his company to write off licences that could have converted “billions of tones” of offshore coal into gas. “Longannet, which was the last remaining coal fired power station in Scotland, has now closed and makes a mockery of the Scottish Nationalist Party’s energy policy where they have even imposed, at this critical time, a moratorium on both shale gas and underground coal gasification,” Mr Cluff writes in the 2015 annual report for Cluff Natural Resources. “We accordingly concluded that continuing to pioneer for a future energy formula which would convert cleanly and safely our offshore coal into gas was not consonant with our shareholders’ best interests.”
Herald 14th May 2016 read more »
