Nuclear Subsidies
PLANS to build Britain’s first nuclear power station for two decades could collapse in a fortnight unless the government agrees to provide tens of billions of pounds in subsidies. EDF Energy, the French power giant, wants to build two reactors at Hinkley Point, Somerset. The eight-year, £14bn infrastructure project will be the largest in Britain. The Olympics, by comparison, cost £9bn. EDF says it cannot proceed until it receives a government guarantee that it will be able sell power at roughly twice the current price for up to 40 years. The exact figure has been the subject of fraught negotiations with ministers. Talks have dragged on for more than a year and EDF has told the government that it needs to know by the end of the month or it could walk away from the project. EDF has launched a worldwide search for investors to take up to a 50% stake. China Guandong Nuclear Power, the state-owned group, is seen as a likely candidate. The French are also talking to pension funds and infrastructure investors. Sources close to the company said it would prefer to bring in a mix of financial and operation partners.
Sunday Times 17th March 2013 read more »
In Budget week, George Osborne can signal that he is passionate about backing this country’s future – he should green light Hinkley Point in Somerset. The delay is now about money. For this £14bn project to work, EDF is asking for a guaranteed price for energy to ensure that its internal rate of return hits the vital 10pc. Below that and investors will simply not risk the upfront capital costs. Such a “strike price” is a point of tension now between EDF and the Treasury, worried that it could watch EDF raking in profits as the consumer foots the bill. EDF would like a price of £100 per megawatt hour. The Treasury is keener on £80. The Chancellor should now force this to a decision. Such have been the endless stops and starts and stops again, Centrica has already decided not to pursue an option of a 20pc stake in the deal. The Treasury should either agree a price or make the embarrassing admission that, in fact, it doesn’t want significant new infrastructure investment in nuclear which could create 25,000 jobs and ultimately produce 7pc of the UK’s energy needs. This project would be, as EDF describes it, “as big as the Olympics”. Of course it is right that price has to be careful ly negotiated but this is also about political will, not voluminous spreadsheets put together by pointy-headed academics. The economy needs an injection of verve. More than half the firms that would work on Hinkley would be British. The UK would once again become a centre for nuclear build expertise. Rolls-Royce, for example, is likely to be a partner in the building of the reactor. Future projects would come in cheaper and more efficiently delivered, expertise could be exported abroad. An anti-nuclear bias runs deep in both Her Majesty’s Opposition and the Liberal Democrats, a totem more concerned with the ancient battles of the Campaign for Nuclear Disarmament than with worries about jobs created or future energy needs.
Daily Telegraph 17th March 2013 read more »
The boss of a company set to build two nuclear reactors in Somerset has been demanding cuts to renewable energy subsidies and to help for people in fuel poverty while quietly lobbying the European Commission for financial help for new nuclear power stations. Areva, which is part owned by the French state, has signed a contract to build nuclear reactors for EDF, another French company, at Hinkley Point. If it goes ahead, it will be the first new nuclear power plant in Britain for a generation. Areva already has hundreds of engineers working on the project. EDF and the Government are locked in negotiations over how much the firm will be paid for the electricity it produces at Hinkley. Even though the Coalition Agreement states that new nuclear power stations will only go ahead if “they receive no public subsidy”, the Government is offering to guarantee a minimum price for the electricity produced for up to 40 years. Critics say this amounts to a subsidy. A new document reveals that last November, Areva’s chief executive officer, Luc Oursel, lobbied the European Environment Commissioner, Connie Hedagaard, for financial help for the construction of new nuclear power stations. He asked the commission and European Central Bank to give “credit guarantees … to be used as a catalyst to ease the financing of low-carbon technologies”, such as nuclear. His letter was obtained by the NuclearSpin website under European Freedom of Information laws. Mr Oursel also called for the “progressive removal” of “a stack of ad hoc tariff distortions” – such as “subsidies for renewables [and] energy poverty”.
Independent 17th March 2013 read more »
Hinkley
Energy secretary Ed Davey is poised to press the button on the construction of two new reactors at Hinkley Point in Somerset. Dubbed Hinkley Point C, it is being developed by French-based EDF Energy. His decision is due to be announced on March 19 with the nuclear industry expecting him to give the reactors the green light. However, talks on the investment framework for the reactors are thought to be ongoing. They centre on the strike price, which is a guaranteed payment for the price of electricity produced by new nuclear stations.
Express 17th March 2013 read more »
Urenco
HOLLAND has dropped its historic opposition to a sale of Urenco, clearing the way for a full privatisation of the state-backed nuclear fuel maker. The sudden change of heart came after several rounds of intergovernmental talks over the future of Urenco, which is owned by the governments of Britain and Holland and two German utility companies. The British and Germans were planning to press ahead with selling their stakes this year, but the Dutch had held back because of fears about security. Sources close to the talks said the Dutch had now agreed to a sale, provided strict controls on the company, including a golden share to be held by the governments, were put in place.
Sunday Times 17th March 2013 read more »
Energy Costs
ENERGY companies are preparing to extract record profits from every home in Britain after hiking up gas and electricity bills. Industry regulator Ofgem predicts the big six power suppliers will more than triple their margins in the next 12 months, pumping a £110 profit out of every domestic property. The revelation of consumer woes puts more pressure on George Osborne before he delivers what is seen as a crucial budget. His standing has fallen to a new low in the polls. The huge windfall predicted by Ofgem is more than triple the £30 average profit per household that the big six suppliers made in the 12 months to March this year. Figures show that the average household bill has risen 8% compared with the same time last year, while the cost of energy on the wholesale market has fallen.
Sunday Times 17th March 2013 read more »
ENERGY companies are to be questioned by MPs over allegations that they have exploited their market dominance to rake in huge profits at the expense of consumers. The prospect of a bruising encounter comes as figures from the regulator show that the big six power firms are expected to squeeze record profits of £110 from every household in Britain over the next year. Tim Yeo, Conservative chairman of the energy and climate change committee, which last week opened an inquiry into the energy companies’ profits, said it would investigate the new Ofgem figures. He said: “The suspicion of consumers is the power companies are exploiting the market to their own advantage.”
Sunday Times 17th March 2013 read more »
A briefing document on the wind industry written for investors – and seen by The Sunday Telegraph – shows how attempts to increase the supply of green energy will make turbines far more profitable over the next decade. It predicts that wind farms will generate greater income following the introduction of a new tax on energy from gas and coal-fired power stations because it will drive up the cost of electricity over the next seven years. The new tax, intended to cut pollution from traditional sources of electricity, will allow wind farm operators to charge more for the power they produce, with the extra costs expected to be passed on to consumers through their bills. Energy industry experts predict the new tax will cost electr icity customers an extra £1billion a year from 2016.
Telegraph 17th March 2013 read more »
Politics
Labour would establish a new network of banks, modelled on the German Sparkassen, with a duty to promote growth in underdeveloped regions. There are important details to be worked out, most notably where the banks will operate and how they will be capitalised, but this is an encouraging example of Miliband’s long-term focus on rebuilding “the foundations” of the economy.
New Statesman 14th March 2013 read more »
Last month Cameron made an important speech about the greenest economies being the ones that would prosper – but it has disappeared almost without trace. No 10’s website will tell you that on February 4 he made a statement with the presidents of Afghanistan and Pakistan but not that he gave a speech in which he claimed that this government would make Britain “the most energy-efficient country in Europe”. I suspect this event was to bolster the confidence of companies that invest in green energy and energy efficiency schemes. But for political reasons it was decided that the public didn’t need to know. The internet newsletter of the Department of Energy and Climate Change records the prime minister’s involvement but attributes his quote about becoming the most energy-efficient country in Europe to Greg Barker, the climate change minister. No 10’s explanation to me was that Cameron had “dropped in” to an event hosted by Barker and made some introductory remarks. It was no big deal. Yet it is clear Cameron did more than “drop in”. He spoke from a prepared text for up to 15 minutes and then took questions from reporters.
Sunday Times 17th March 2013 read more »
Japan
Tokyo Electric Power Co. said Friday it detected a record 740,000 becquerels per kilogram of radioactive cesium in a fish caught in waters near the crippled Fukushima Daiichi Nuclear Power Station, equivalent to 7,400 times the state-set limit deemed safe for human consumption.
Mainichi 16th March 2013 read more »
Scotland
MINISTERS have slashed funding for renewables schemes in Scotland by more than £33m amid an apparent lack of enthusiasm for green energy. Ministers conceded in the Scottish parliament last week that millions of pounds of funding for renewable schemes has been largely ignored. The take-up for micro-generation, such as biomass plants, heat pumps, solar panels and rooftop wind turbines is particularly poor, with almost £9m of funding languishing in the pot. Consequently, the energy budget, pegged at £64m for 2012/13 – and increased to £75m in October – was dropped last month to £42m. While there is no shortage of enthusiasm for wind farms, the energy budget aims to support micro-generation activities that “contribute towards the achievement of Scotland’s energy ambition, which is to be a world leader in sustainable energy production”. According to the Energy Saving Trust, by 2050 micro-generation could provide 30%-40% of the UK’s electricity needs. Households, businesses and schools have been encouraged to adopt energy-saving meaures to reduce Scotland’s carbon footprint. Among those that have heeded the call is the National Trust for Scotland, which has installed biomass heating at the Culloden battle site.
Sunday Times 17th March 2013 read more »
THE Scottish Nationalists’ dream of becoming a leading exporter of green energy faces being thwarted by proposals in Norway that could kill a planned £1.5 billion North Sea power line, the project leader has warned. Odd Oygarden, chairman of NorthConnect, the consortium behind the interconnector between Peterhead and western Norway, said cancelling the project was a “possible development” if Oslo’s proposal to put state-controlled grid operator Statnett in charge of all Norwegian interconnector projects comes to fruition. Statnett currently has no interest in NorthConnect, but this has prompted fears it would prioritise interconnector projects in which it does have a stake – including its North Sea Network (NSN) joint venture with National Grid south of the Border. NSN proposes to build a line between Northumberland and Western Norway, w hich would potentially allow the rest of the UK to dominate green energy exporting in the event that Scotland voted for independence.
Sunday Herald 17th March 2013 read more »
Renewables
JOHN HAYES, the Tory energy minister who said he would “protect our green and pleasant land” from wind turbines, is objecting to plans to build Britain’s biggest solar energy farm next to his own constituency. Hayes has criticised plans for a £300m energy park that will cover 900 acres of prime agricultural land near Peterborough with 500,000 solar panels. His intervention, in his capacity as a local MP, risks reviving tensions with Ed Davey, the Liberal Democrat environment secretary, and encouraging opponents of solar farms elsewhere. In a letter to the chief executive of Peterborough city council, whose scheme it is, on February 28, Hayes wrote: “I share the concerns of my constituents who are unclear why the beautiful and flat Fenland countryside has been chosen for the construction of half a million solar pan els and nine large wind turbines when there are many suitable brownfield sites nearby.”
Sunday Times 17th March 2013 read more »
Microgeneration
This week’s Micro Power News includes news of a new electricity company for London; Riverside Housing to install PV on 6,000 houses in North England; two Glasgow schemes to tackle fuel poverty; updates on Green Deal; new Kingspan Building Integrated solar for commercial roofs.
Microgen Scotland 15th March 2013 read more »
