Place your bets now on when the lights will go off
Deepening Energy Crisis: Britain Has Become ‘Uninvestable’, Analyst Warns
Danny Fortson, The Sunday Times
The German owner of Npower is set to write off hundreds of millions of pounds on the value of its British power plants in the latest sign of a deepening crisis among the big six energy suppliers. RWE, one of Europe’s largest power companies, will reveal the British loss as part of an expected £4bn writedown of the value of its fleet of power stations.
RWE npower’s Major Power Plants in the UK (2007)
The loss arises from pollution taxes that are forcing the closure of old coal-fired plants. Big subsidies for renewable energy, meanwhile, have made even gas-burning plants, which are much cleaner than coal stations, loss-making.
The hit will alarm Whitehall, which is increasingly worried about the lights going out. Companies have stopped building new power stations amid a political and regulatory backlash, sparked last year by Ed Miliband’s pledge to freeze energy prices.
RWE, for example, has not commissioned a new plant in Britain since 2009, when it broke ground on a big wind farm and a gas-fired plant in Pembroke. Since then it has sold out of a consortium to build new nuclear plants, closed down plants capable of lighting more than 4m homes, and cancelled a proposed £4bn offshore wind farm. […]
Peter Atherton, analyst at Liberum Capital, said Britain had become uninvestable as political pressure over soaring household bills has intensified. “I can think of a dozen very good reasons not to invest in the UK, and not one good one to invest here this side of the election,” Atherton said.
Full story (subscription required)
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h/t to The GWPF
When the light and heat (or the a/c in summer) go off because of the lack of basic solid power that can’t be met by renewables (wind, solar etc) will the populace finally rise up and toss out the politicians that created such a regulatory mess that building new power stations is next to impossible?
That might be the day the execrable Bob Ward goes back to his home planet.
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A republic is what stands above the rest of governmental types. Majority vote is the first step towards losing individual freedom. The US government is a cross between a democracy and a republic. I wish it were a libertarian government. No rules may be passed that limit individual land use freedoms on your own land, in your own business, and in your own relationships with consenting adults, and city rules override county rules, which override state rules, which override federal rules where individual rights to what they individually own are not involved.
KRJ Pietersen says:
March 2, 2014 at 11:38 am
As a technical point, I can’t see the lights going out in the UK because of the two links to the synchronous grid of Continental Europe, the HVDC Cross-Channel and BritNed; a third is proposed, the HVDC Norway–UK
You must also consider that france has to close 22 nucleaire in the next 10 years (EU). That will mean the end of the 2G link. Also, in the last moderately cold winter France shut the link to Italy and reduced the amount available to the UK because it didn’t have enough for itself. At the moment we have plenty to spare because the socialist are driving us into a deep depression but in ten years … aucun, rien, de nada.
importing large amounts of electricity from France, which is 70% nuclear generated
KP, we are 82.5% nucléaire but not for much longer. One nucléaire is closing now (near the german border) and 21 more will follow at an average of 2/ year.
Merkel decided she didn’t like nuclear power
KP, Merkel is a physicist, apparently. She probably understands nucléaire as much as most people but there is a huge and powerful green lobby in De. It was them that forced the closures.
So, it all going according to plan:
http://green-agenda.com/
The Sunday Telegraph also has an article about how investors are being put off investing in Britain’s energy future. Only this time it is in renewables.
Wind farm plans in tatters after subsidy rethink
At present onshore wind farms receive $70 (£42.02) MwH in subsidy by the Renewables Obligation Certificates ROCs. For offshore wind farms it is double that. This is on top of the wholesale price, currently about $90 MwH.
The article says that the total amount of subsidies will be capped, with a bidding system in place. Major schemes are being shelved.
In the 12 months to August 2013, ROCs were issued to the value of £2.07bn ($3.43bn), 140% higher than in Jan-Dec 2010. Source. Of this $3.43bn, $1.63bn was to wind turbines.
I have looked at the benefits to the planet. The 2006 UK Government Stern Review estimated the social cost of carbon to be $85 t/CO2. By 2013, with 1.2% pa increase this equated to $108 t/CO2. The UK Industry lobby group RenewablesUK estimates that wind farms currently take out 11.16 million tonnes of CO2 from the atmosphere annually. That is $1.2bn of benefit for $1.63bn of cost. Seems a marginal loss, until you add in the additional grid costs. Also factor in that Stern’s social cost of carbon is six times the IPCC figure in AR4 of $12 per tonne.
So, investors are shying away from renewables as the British Government tries to equate costs with the most extreme estimate of benefits.
Stephen Richards says:
March 2, 2014 at 1:24 pm
“You must also consider that france has to close 22 nucleaire in the next 10 years (EU). That will mean the end of the 2G link.”
We have to stop thinking about countries in Europe as being individuals. They are not. Our power generation has been linked and combined for generations. Technically, France is but a part of Europe’s synchronous grid.
I was talking to a Belgian politician recently. He related that he had been present at a balancing station when an alert message came up. A Finnish nuclear power station had gone off line for a technical reason. He watched as the dials steadily ramped back up to 100% before his eyes. The technical guys explained that no human intervention was necessary. The computers detected the drop out of the Finnish plant and called in extra power from elsewhere to compensate.
That’s Europe.
The curious part of the UK National Grid stats http://www.gridwatch.templar.co.uk/ is that pumped storage is being used routinely at low levels (about 300MW) during daytime hours. The only reason I can guess for it being used then is for rapid response to instability in other supplies.
Paul
Yes, I think that’s correct. Pumped storage – aka Dinorwic – exists for the purpose of rapid response to failure in other supplies. I suppose you have to keep it at least on tick-over [ though 300MW is actually quite an impressive tick-over 🙂 ] for rapid response. I imagine a cold start of that facility would take a fair bit of time.
Khwarizmi says:
March 2, 2014 at 1:09 pm
“I want someone to come and liberate us from the fascist tyranny.”
_____________________________
We’re barking hard on your heels, up here in the US. Looks like you’re on your own. Might I recommend a couple of helpful blokes named Crocodile Dundee and Donk?
The inestimable John Brignell has been predicting this for many years. I must admit, when he first started talking about it, I thought it was a bit of hyperbole. Surely, they would stop the irrationality before it reached crisis. Surely, a conservative government would reverse this madness. Nope.
http://www.numberwatch.co.uk/2009%20September.htm
The problem isn’t the politicians it is the overgrown insatiable media reporting every word the politicians say 30 seconds after they say it and holding them to impossibly high standards. They try to please every noisy fringe group in the country that might attack them on TV. The Conservatives would love to do a U turn on energy, frack a few trillion cubic feet of English gas and wave goodbye to gas imports and wind farm/ solar subsidies. This would only be possible if the media lost their green agenda and portrayed it not as a U turn but as sensible planning.
.
I think I will still buy that extra back up generator, just in case.
Anto says:
March 2, 2014 at 1:56 pm
“The inestimable John Brignell has been predicting this for many years. I must admit, when he first started talking about it, I thought it was a bit of hyperbole. Surely, they would stop the irrationality before it reached crisis. Surely, a conservative government would reverse this madness. Nope”.
Indeed. Entirely right. All sensible countries (or groups of countries) make it a policy priority to be energy self sufficient, because if you are energy dependent, you are politically dependent.
Any 15-year-old kid could work that out.
“What exactly did you expect me to do, in order to get a government I ‘deserved’?”
Pack it up and move to Texas. It’s great! Energy is cheap, and everybody (except for a few old soreheads) knows that the energy business is the bread and butter for all of us.
Of course, Anthony hasn’t done it yet, either. What are y’all waitin’ on?
“This side of the election”? All the UK major parties pledge to continue the madness, the opposition faster than the gov’t. And so far the British have been too mired in complacency to vote for the non-major parties. They may have to suffer a disaster before they come to their senses. Hope I’m wrong.
That doesn’t make much sense. Subsidies might make renewables more attractive but how could they make gas-burning plants loss-making? Especially when the thesis is tied to very high electricity prices?
“One nucléaire is closing now (near the german border) and 21 more will follow at an average of 2/ year.”
Thus destroying the one economic advantage the French economy has (cheap and stable power) in an otherwise shaky economy.
France is also going down the oh so stupid windmill route, I wonder how they plan to make up the energy shortfall. But then again perhaps they won’t need to as they will have destroyed what is left of their industry.
Should make my summer holidays cheaper.
This is good news in a funny sort of way (as per Dr. Phil Jones). Only when the lights go out will voters vote for anyone else but the status quo parties. See the Australian example. PS I am a political moderate but CAGW policies will make most of us worse off. When will these fools stop their climate energy madness?
Next time, go UKIP.
M Courtney says:
March 2, 2014 at 12:53 pm
“Here are the most important issues for the UK electorate. Energy policy doesn’t even register. And that won’t change because the price of importing energy across the connectors will rise very gradually.”
I see that the most important issue for the voters is the economy. So, you want to imply that the average voter doesn’t understand the connection between energy cost/availability and economic activity? These people didn’t even ask about energy policies, so the only sector the surveyed could bring in such concerns was the economics sector. I think your conclusion is exactly backwards.
Khwarizmi says:
March 2, 2014 at 1:09 pm
“Topically, Hamburg reclaimed it’s public electricity from the fascist sector. The wishes of the people prevailed:
http://wakeupfromyourslumber.com/news/hamburg-germany-buys-its-energy-grid-back-400-million
Fascism (according to Mussolini) is when the government works with corporations to rule over us, and we get the privilege of choosing between pre-selected celebrities foisted upon by the banskters.”
Oh, a socialist. You do know that Mussolini started his career as a socialist. Where’s the difference between fascism, where the state controls companies, and socialism, as in Hamburg now, where the state owns the company?
You are spitting on one form of socialism and endorse the other? You socialists are so crazy, crazy people.
It was closer than we previously thought!
Seriously though only blackouts will wake people up. They will still blame the sceptics though. They will argue that the UK should have invested MORE on windmills and solar panels, not less. I feel so saddened to watch allegedly intelligent people fighting so hard to make themselves be right, though they are wrong. Sad.
Old Chines proverb: Those that cannot hear must be made to feel.
The UK has some of the best educated politicians the world has ever known. Oxford, Cambridge you name it. Yet some of these people are among the most stupid the world has ever known. How can this be???
If solar energy and wind is so cheap / free then why is it that the average UK energy bills have been going up higher than the rate of inflation over the past few years?
Long ago electricity production was left to engineers. Now, any fool who can flip a light switch can design the system.
Why do governments have energy policies and departments at all?
@Nigel S
…Old Etonians to keep contributing the benefit of a good education to the life of UK. ‘The battle of Waterloo…’, loses in the First World War 1,157 dead, 37 Victoria Crosses… (Disclosure; I went to a much less grand school that only lost 650 dead…
I think you may find that was 1,175?
We just piped you at 682, but I note that Harrow had only 600. Perhaps they learnt to keep their heads down…