Double Standard For Nuclear Energy and Wind Energy In UK?

by Zachary Shahan

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I’ll be honest — I’m not a “nuclear power hater.” But if you look at nuclear power objectively and calculate its costs — including insurance costs and waste management costs — it is simply a bad deal. It’s very, very expensive. The private industry would never develop nuclear on its own. The only way it gets built anywhere is from huge government support.

Dr. David Toke, Reader in Energy Politics in the Department of Politics and International Relations at the University of Aberdeen, recently took a brief look at how nuclear power gets extra-special treatment from the UK government. First of all, he took a look at assumptions regarding the working lifetime of wind turbines vs. nuclear reactors:

Ed Davey’s excuse for limiting wind power contracts to 15 years whilst Hinkley C gets a whopping 35 year contract is blown away by some elementary history checking. Lots of wind turbines in Altamont Pass – installed during the so-called Californian ‘windrush’ – are still turning after 31 years. Davey claims that the contracts he has awarded are in proportion to the technologies’ design life expectancy. Yet the Altamont turbines will be turning until 2015, a 33 year lifetime, and only then taken down because of a repowering exercise, and also modern planning conditions which they did not have back in 1982. See http://www.sustainablebusiness.com/index.cfm/go/news.display/id/23757. I am given to understand by a leading authority on the subject that it is likely that quite a few machines built in the early 1980s are expected to carry on running past 2015….

Certainly one can expect modern wind turbines to last a lot longer than these efforts right at the start of the modern windmill era.

So using the Davey formula (about 60 per cent of lifetime as a contract length), using even 33 years as an example, wind power should get a 20 year contracts, not 15. But if this happened, the ‘strike price’ for wind (£95 per MWh at year 2018) would be reduced below that set for Hinkley C.This would breed trouble as the UK Government tries to claim that they are giving the same incentives to renewables as nuclear to pass through the EU’s state-aid regulations (see previous blog post).

Dave then touched on the under-discussed issue of nuclear power loan guarantees:

Then there is the loan guarantee for Hinkley C, all £10 billion of it, that constitutes 65 per cent of the capital cost of the 3.2GW development. If wind power got such guarantees, their costs could be reduced much further as well, since the borrowing costs would be a lot less. Indeed borrowing costs could be reduced by at least 2 per cent – which makes a big difference to the economics of wind power.

And then he did a simple calculation on what the overall price effect would be from if two things were made the same for wind power as they are for nuclear power:

I have calculated what the effects of these two changes – increasing the contract length from 15 years to 20 years, and giving loan guarantees for 65 per cent of the capital costs. The result is that if this was applied to wind power then a strike price of £75 would be the equivalent of the £95 per MWh the Government is offering wind power from 2018. This figure is considerably less than what the Government is giving to Hinkley C.

Dave included much more in the full article, including some comparisons with pricing in Germany, so check that out for more.

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This article, Double Standard For Nuclear Energy & Wind Energy In UK?, is syndicated from Clean Technica and is posted here with permission.

About the Author

Zachary Shahan is the director of CleanTechnica, the most popular cleantech-focused website in the world, and Planetsave, a world-leading green and science news site. He has been covering green news of various sorts since 2008, and he has been especially focused on solar energy, electric vehicles, and wind energy for the past four years or so. Aside from his work on CleanTechnica and Planetsave, he’s the Network Manager for their parent organization – Important Media – and he’s the Owner/Founder of Solar Love, EV Obsession, and Bikocity. To connect with Zach on some of your favorite social networks, go to ZacharyShahan.com and click on the relevant buttons.

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Nuclear Prices Itself Out Of The Market — Graph

by Giles Parkinson

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Originally published on RenewEconomy

The extent to which nuclear is being priced out of electricity markets has finally been revealed by the pricing mechanism unveiled by the British government in the deal to subsidise the Hinkley C nuclear.

The UK government will pay £92.5 for each megawatt hour produced from Hinkley ($A154/MWh), around double the prevailing market price. This is after the UK supplied a loan guarantee for 65 per cent of the estimated $24 billion capital cost. The “strike price” – a fancy name for a feed in tariff – also has an escalator to take into account the impact of inflation, so the cost will rise in coming years.

So how does this compare with rival clean energy technologies? Pretty badly as it turns out.

This graph below, published by Craig Morris in Renewable Energy World reveals that the rates that will be offered for new nuclear from 2023 in the UK are far above what solar and wind currently cost. And, as Morris points out, the rates for solar and wind will go down by then, not up! Even offshore wind is getting £95/MWh from 2018 in the UK, but only for 15 years and without any loan guarantees.

.nuclear-fit

This second graph below is even more interesting. It takes into account all the expensive PV that was installed with really high feed in tariffs at the start of Germany’s energy transition before the price of solar fell dramatically. From 2023, when the Hinkley reactor is due to be switched on, nuclear at this price still fairs poorly, and as the cost of those tariffs continue to decline, the cost of nuclear will continue to rise. It’s probably as good an illustration as any as to why Germany are not interested in new nuclear power station, and few countries are.

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This article, Nuclear Prices Itself Out Of The Market — Graph, is syndicated from Clean Technica and is posted here with permission.

About the Author

Giles Parkinson is the founding editor of RenewEconomy.com.au, an Australian-based website that provides news and analysis on cleantech, carbon, and climate issues. Giles is based in Sydney and is watching the (slow, but quickening) transformation of Australia’s energy grid with great interest.

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Hinkley C Nuclear Power Plant To Get Twice The Rate As Solar PV From UK Government

by Zachary Shahan

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In a demonstration of how out of touch the UK government is with public opinion, it intends to pay approximately twice as much for electricity from the proposed Hinkley C nuclear power plant near Bristol than is paid for electricity from solar power in Europe. With high public support for solar PV and low support for nuclear, that’s quite absurd. It’s also very absurd from an economic standpoint.

Dr. David Toke of the University of Aberdeen writes: “Looming large over the UK Government’s EU state aid application for Hinkley C is the charge that this deal will distort the EU’s internal market, in particular to undercut solar PV arrays in Germany over 10 MW in size. Such arrays are no longer eligible to receive premium prices under the German feed-in tariff system. Such plant will only receive the wholesale electricity price, which is less than half the rates to be paid to Hinkley C.”

Dr. William Nuttall of the Open University writes: “Today’s news is that a two reactor power station is to be built at Hinkley Point near Bristol capable of supplying 3,340MW, or roughly 7% of British electricity in the 2020s. This has come at a price, called the ‘strike price’. French company EDF Energy, the lead firm of the construction consortium, has secured a long-term commitment from the government that the nuclear-powered electricity it generates will be bought at the hefty price of £92.50 per megawatt hour. That wholesale price is almost double today’s market price, and isn’t far off what the end consumer is paying today to keep their lights on. When wholesale prices meet retail prices things are unsustainable. Don’t forget that between power generation and use there are businesses that deal with transmission, distribution and supply, and they all need their cut.”

Furthermore, as a summary by Craig Morris of Renewables International indicates, the payments are supposed to be guaranteed even if electricity is not provided to the grid because of curtailment, and the guarantee is supposed to last for 35 years, which would be from 2023 (if the power plant is miraculously built on time) to 2058.

With the guaranteed price already well above what solar and wind power cost (and their costs continuously declining), the taxpayer commitment for this power plant is so crazily high that it seems this story should be coming from The Onion rather than reality.

The UK’s move to subsidize nuclear power to such an insane degree is simply astonishing.

Dr. Toke has more on how this commitment goes completely against EU rules:

The fact that the Hinkley C deal distorts the EU’s internal market to give a state aid to nuclear power that is not available to renewable energy directly flies in the face of the EU’s state aid regulations. Under these rules it is permissible to give premium price incentives to renewable energy, subject to clearance by the EU Commission that they have been applied according to the correct procedure. However, state aid for non-renewable energy, while not necessarily illegal under EU rules, has to be the subject of a special application. The issue that arises here is that the UK Government, in effect, is wanting to give priority state aid in the EU electricity market to a fuel which has no exemption over and above a fuel which does have an exemption.

The UK is going to be increasing trade in electricity along with the others, with increased electricity interconnector capacity helping this. But what is going to be happening now? British policy will be giving a state-aided competitive advantage to nuclear power in this cross border trade over and above renewable energy. This threatens to directly contradict EU competition and internal market policy and law.

This issue will be a prominent factor in the European Commission’s investigations in the UK Government’s application for state aid for Hinkley C (for which it has recently notified the Commission). Renewable generators across the EU will be pointing out how the UK policy may be contravening EU law. Analysts will remember that it took a case at the European Court of Justice (ECJ) to establish the right of the German state to give premium prices to renewable energy. What would the ECJ say about a case where nuclear power was being given priority premiums in the EU electricity market against renewable energy? I can see no basis in law for this, as discussed above.

For much more, I recommend Dr. Toke’s, Dr. Nuttall’s, and Craig Morris’ articles on the subject.

For other interesting nuclear stories, take a stroll through our nuclear energy archives.

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This article, Hinkley C Nuclear Power Plant To Get Twice The Rate As Solar PV From UK Government, is syndicated from Clean Technica and is posted here with permission.

About the Author

Zachary Shahan is the director of CleanTechnica, the most popular cleantech-focused website in the world, and Planetsave, a world-leading green and science news site. He has been covering green news of various sorts since 2008, and he has been especially focused on solar energy, electric vehicles, and wind energy for the past four years or so. Aside from his work on CleanTechnica and Planetsave, he’s the Network Manager for their parent organization – Important Media – and he’s the Owner/Founder of Solar Love, EV Obsession, and Bikocity. To connect with Zach on some of your favorite social networks, go to ZacharyShahan.com and click on the relevant buttons.

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Waste-To-Energy Plant To Be Constructed In Nottinghamshire

by Nicholas Brown

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Artists impression of the Bilsthorpe plant.Image Credit: Waste2Tricity Website.

At the site of the old Bilsthorpe Colliery, a new(ish) idea will be put to use. That is a synthesis gas generator. This plant will collect waste from Nottingham, Nottinghamshire, and surrounding areas to convert it into synthesis gas (also called syngas) via plasma gasification. This gas will then undergo a purification process before using it to generate electricity for exportation into the internal electricity grid. This is an alternative to the more traditional waste-to-energy approach of rubbish incineration (setting fire to piles of rubbish).

This is one of multiple forms of waste-to-energy power plant technologies which have been on the rise.

This facility will process up to 97,000 tonnes of feedstock annually (feedstock is raw material to be fed into an industrial process), and it can generate 16.6 MW of energy. It can both directly accept feedstock or prepare it itself using the materials recycling facility.

This facility consists of the following key components:

  • Materials Reception, Storage and Handling Facilities.
    including Material Recycling Facility.
  • Oxygen Production Unit.
  • Plasma Gasification Plant.
  • Syngas Processing System.
  • Power Generation.

There is a renewable energy option for all countries, including cloudy countries such as Britain, and waste is one such option that is abundant in literally every country on Earth. Countries with cloudy weather can not only enjoy low-emissions power from such power plants, and energy security, but they can divert waste from landfills in the process.

Apart from that, this facility is intended to be fuel cell–ready, and accommodate a 1 MW bank of alkaline fuel cells for AFC Energy. These fuel cells will be powered by hydrogen produced from syngas. Efficiency above 55% is expected. This will be deployed by Waste2Tricity in the future.

Follow me on Twitter @Kompulsa.

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This article, Waste-To-Energy Plant To Be Constructed In Nottinghamshire, is syndicated from Clean Technica and is posted here with permission.

About the Author

Nicholas Brown has a keen interest in physics-intensive topics such as electricity generation, refrigeration and air conditioning technology, energy storage, geography, and much more. My website is: Kompulsa.

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Ecotricity Offering Green Electricity For Less Than Dirty Electricity

Ecotricity Offering Green Electricity For Less Than Dirty Electricity

by Guest Contributor

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Originally published on the Ecotricity website.

Ecotricity, Britain’s first green energy company, today announced they will now undercut the standard tariffs of the Big Six energy companies, supplying green electricity for less than the price of their standard brown tariffs from Tuesday 1st October.

Until now, Ecotricity has always price matched the standard power prices of the Big Six – however, from October 1st Ecotricity will no longer follow the Big Six price changes, and will instead price its 100% green electricity tariff entirely independently.

Dale Vince, Ecotricity founder: “Around 40% of our electricity supply is self-generated by our own fleet of wind and sun parks, and we have planning permission to more than double that supply in the near future – this degree of energy independence now means we can be price independent.

The good news is that,when we make this change, it will mean slightly lower bills for our customers – it will be a very modest reduction, just a few pounds, but this is a really significant step in our evolution as a green energy company.

People often falsely assume that green electricity is always more expensive. But most people in Britain are actually still on a standard tariff – so we’re a little cheaper than what the majority pay for brown electricity and we aim to get even cheaper than that big brown price in the near future.”

Ecotricity already offers a one tariff, one price policy, supplying all of its electricity customers with the same 100% green tariff: everyone gets the same tariff at the latest best price, regardless of when they signed up or how they pay (part of Ecotricity’s Ethical Price Promise).

Dale Vince: “We are stretching the gap between ourselves and the conventional energy companies – we have one simple 100% green electricity tariff, we continue to invest more per customer in new sources of renewable energy, and we are now moving further away from the price of the Big Six standard tariffs too.

Our work is aimed at bringing about an energy independent Britain, and as a green energy company we want to demonstrate how this can be achieved – the more of our own energy we produce through our own renewable sources, the greater we’ll be able to shield our customers from price hikes that come with an over-reliance on fossil fuels. It’s all part of our vision for a Green Britain.”

On average, Ecotricity spends more per customer on building new sources of green energy than all other energy providers in Britain put together – on average, over the last nine years, this has equated to almost £300 per customer.

The company currently powers over 75,000 homes and businesses and this year obtained permission for what will be the fourth largest wind park in England, at Heckington Fen in Lincolnshire.

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This article, Ecotricity Offering Green Electricity For Less Than Dirty Electricity, is syndicated from Clean Technica and is posted here with permission.