IS A WIND OF CHANGE BLOWING THROUGH ENERGY POLICY?

On the face of it, we are making progress. Both the Government and its heir presumptive, the Conservatives, are reconnecting with reality. Ed Miliband, the Energy Secretary, has heralded the return to a more state-directed model of energy policy setting out a framework for developing Britain’s future energy mix. According to The Times it will be contained soon in a summer strategy or 2030 masterplan.

We are also informed that the Conservatives will come forward this autumn with a policy statement encompassing greater Government engagement in energy policy. This is potentially important. It is certainly a step away from Lord (Nigel) Lawson’s 1980s’ vision of the free market determining Britain’s mix of fuels when we were awash with cheap energy, privatisation was the thing, Arthur Scargill’s teeth had been drawn and we were blissfully unaware of global warming.

Now North Sea oil and gas are past their peak, oil and gas generally are likely to be scarcer and dearer, we have next to no indigenous coal industry, officially we regard nuclear as necessary but not nice and are driven to all sorts of costly nonsense by the mere mention of carbon emissions. Some of us were profoundly sceptical even in the 1980s about the ability of the untutored market to answer all our prayers. It would never have served in the old Department of Energy, which, faced with the disruptive tendencies of the National Union of Mineworkers, sought to achieve security through diversity, including nuclear power. Sooner or later, we then said, the Government would have to take a strategic view and manipulate the market to obtain security of supply.

In fact, it was not supply considerations but targets for carbon suppression to combat global warming that brought intervention. To get people to invest in wind, solar and any other form of “renewable” power (since it looked down on nuclear), the Government found it would have to bribe them to do so. That bribe now probably costs each household at least £80 a year and the politicians have hardly started throwing money at renewables developers.

At the same time both Labour and Conservative – the Liberal Democrat leader would not touch coal or nuclear with a bargepole – insist on leaving nuclear to the market. As Vincent de Rivaz, chief executive of EdF and owner of British Energy, has latterly made clear, this is unsustainable, even if nuclear does not need direct subsidies.

So, if the change in direction of both major political parties heralds a return to reality, we welcome it.Whether we shall get something we can recognise as an energy policy out of either party is another matter.We shall believe it when we see it. As things stand, Mr Miliband’s interest in intervention seems to be driven more by carbon reduction than security of supply.

INVESTOR CONFIDENCE
We groaned when the FT presented the aforesaid Mr de Rivaz’s views in the context of subsidies. SONE has invested a lot of effort in persuading nuclear sceptics that nuclear is the most competitive source of electricity and needs no recourse to the taxpayer.

In fact, Mr Rivaz was making some perfectly legitimate points about nuclear’s position in the context of a Government offering more generous subsidies for offshore wind and new support for projects to prove carbon capture and sequestration at four coal-fired power stations. Even if the French Government has an 85 per cent stake in EdF, its British arm needs to be able to show that its plans for four nuclear power stations each at a cost of £4bn-plus make commercial sense.

One way to give nuclear investors confidence would, Mr de Rivaz suggested, be to put a floor under the highly volatile price of carbon permits. Another is to clarify nuclear’s access to the market. Is nuclear to be regarded as continuous baseload capacity or is it going to have switch on and off to accommodate wind power when the wind is blowing optimally?

In short, if the Government persists in allowing environmentalism to dictate energy policy, it needs to make up its mind whether it wants to minimise carbon emissions at the cheapest possible price or to indulge its fantasies about renewables at our enormous expense.

WHAT IS VALUE FOR MONEY?
We have very serious doubts whether Mr Miliband would be able to recognise value for money at five yards given his reason, quoted by the FT, for not subsidising nuclear. He said: “I think we are right not to subsidise new nuclear power stations because we have an obligation to get to a low-carbon future at the lowest cost to the billpayer”.

If he does not understand by now that new unsubsidised nuclear is the cheapest route to the cleanest electricity, he perhaps never will. It should be blindingly obvious to him that he cannot get a single unit of electricity from wind or solar or indeed any other renewable source of energy without subsidy since the renewables market is founded not merely on subsidies but also preferential access to the grid.

Nor can he get continuously available electricity out of wind, solar, tidal or wave power because of the vagaries of nature or in industrial quantities from such things as geothermal, biomass and various forms of waste. As for carbon capture and sequestration (CCS), about which there is massive controversy whether it will work, that could be so expensive as to double the price of coal or gas-fired power.

It follows that since Mr Miliband has to find substitute sources of power when nature is unhelpful to “renewable” methods of harvesting its energy, nuclear is not only relatively cheaper but much cleaner than any other major source.

All politicians who want “to get to a low carbon future at the lowest cost to the billpayer”, as Mr Miliband puts it, need to follow the logic set out above and explain how nuclear is going to fit into the future mix. If the forthcoming statements from the Government and Conservatives do not do that they will not be worth the paper they are written on.

WHERE ARE FREE MARKETS?
All this demonstrates what a formidable educational job SONE still has in front of it after 11 years’ continuous effort to introduce some rationality into the nuclear argument. Perhaps we have been too gentle with our politicians who have the queerest notions about what constitutes a free market.

One example of their eccentric thought processes is that the recent bursting of the international financial bubble has killed off the idea of soft touch regulation, as if soft touch regulation meant no touch at all – the utter abandonment of the market to Keynes’ animal spirits. In fact, what we had – as is now widely recognised – may have been light touch but was also incompetent and muddled regulation, which is different.

Every market we have ever come across – except schoolboy bartering - is hedged about with restrictions in one way or another. The nuclear industry can also testify to the destructive nature of heavy handed regulation.

This century opened with Ofgem, the energy regulator, bearing down heavily on wholesale electricity prices. It knocked 40% off them and in the process rendered all forms of generation (apart from subsidised wind) uneconomic. British Energy had to be rescued by the engine of its downfall – the Government.

If we were one of Mr de Rivaz’s Paris bosses, we would want to know what kind of guarantees there were against a repeat of this kind of tomfoolery.

RECYCLING NONSENSE
Talking of tomfoolery, there is a persistent effort on the part of Greens to close down recycling at Sellafield. The Guardian delights in recording the latest reason why we should get rid of any plant there involved in the business of extracting more energy from “spent” fuel.

We recognise that the THORP plant and the manufacture of MOX (mixed uranium and plutonium) fuel are not the brightest jewels in Sellafield’s crown. But it is a major step from there to abandoning recycling when even the USA is showing signs of reconsidering its longstanding ban.

One of the ironies of current life in this allegedly warming planet is that recycling has become a religion, with an infinite variety and colour of plastic rubbish bins assigned to the householder at heaven knows what cost in natural resources.

What is more, the zealous authorities police the use of these bins, even with computer chips, to ensure compliance. Big brother is watching you. Yet somehow these preservers of global resources jib at the very idea of minimising the mining of uranium and burning up plutonium (a by product of nuclear fission) by recycling – or reprocessing – “spent” nuclear fuel and putting it through another generating cycle.

They are ludicrously prepared to bury material capable after treatment of producing vast amounts of clean and cheap electricity, which is just what the world needs. It is utterly irrational. It is perhaps time SONE members started pointing out that, since virtually all – 96-97% - of the “spent” fuel is recoverable for productive re-use, killing recycling would be an act of criminal waste and contrary to the international interest.

A LONG HAUL TO CCS
We mentioned earlier the controversy over CCS. Paul Golby, chief executive of E.ON, which is in the nuclear, wind and coal-fired power business, has stressed the importance of carbon capture in an interview with The Guardian.

He said: “If there were just one climate change issue you were tackling, it would be CCS, on the simple basis that China and India are sitting on 200 years’worth of coal and they are going to burn it. And whatever you, I or Greenpeace or anybody else, or Copenhagen (December’s UN climate change summit) says to them, they are going to continue burning coal because that is their indigenous fuel and the only way they can get their population to a decent standard of living. What we have got to do is to de-couple coal from carbon”.

But how feasible is it? Professor Fenton F Robb, of Berwickshire, in a recent letter to The Scotsman, complained that all Ministerial statements omitted any reference to the “disastrous” effect of CCS technology on the efficiency of generating plant. Compressing gas and injecting it into geological strata at great depths is so energy-intensive that the efficiency of the power station would be almost halved. So almost twice as much coal or gas would be needed to produce the same amount of electricity.

“I know of no more wasteful way of generating electricity”, he said. “Is it not time for politicians to take a short course in thermodynamics before they waste all our cash and natural resources on such hare brained schemes?”

One of four new coal-fired power stations approved by the Government will be fitted with pre-combustion and another with postcombustion technology. They will be required to capture a quarter of the carbon and convert to full CCS within five years of the technology being commercially and technically proven. We clearly have a long way to go before Mr Golby’s decoupling of coal and carbon is achieved. Don’t ask about the cost.

DAMAGE LOOMING
Every passing month brings us closer to an energy crisis that could seriously hamper Britain’s painful climb out of recession. The last things we need with debt of £1 trillion round our necks are load shedding and black outs in five years’ time.

Energy policy, such as it is, is in a parlous state. With a third of our generating capacity (20- 25MW) due to close within 10 years or so, we need every new coal and nuclear station we can lay our hands on. Yet every attempt to build either type can be guaranteed to bring the Green nutters out of their tepees and academic eyries.

The academics are already out of their traps. The laughably described Nuclear Consultation Group has inventively seized on the Government’s tribulations and “low confidence in Ministers” to demand a public inquiry into building new nuclear stations, claiming that the current system of justification is flawed.

Perhaps more serious is the disclosure by the Chief Nuclear Inspector to the Observer that he is struggling to recruit new staff and that lack of resources could jeopardise the Government’s target date of 2017 for the first new nuclear power station.

THE PAST MONTH
Over the past month we have had the expected quota of global warming scares in the build up to the Copenhagen UN climate change summit in December. Kofi Annan, former UN Secretary General, actually claimed that it is already causing 300,000 deaths a year.

Fat people were lumbered with being an environmental as well as a health problem by Sir Jonathan Porritt, chairman of the Sustainable Development Commission, which advises the Government. His last contribution to the debate was to ration families to two children to avoid over-population. His argument seems to be that since the obese take more stoking than the leaner variety they make greater call on the world’s resources. Their stigmatisation at least it makes a change in this context from flatulent cows.

The Guardian informed us that investment in green energy overtook that in fossil fuels for the first time last year $140bn against £110bn, with the biggest growing in China, India and other developing countries. This contrasted with confusing reports about both wind and solar power in Europe. There is evidence of growing concern about the cost, utility and environmental damage caused by wind turbines but increasing support for solar, even though BP is turning its back on it on cost grounds.

One of Britain’s oldest nuclear power plants, Wylfa, has been given what is regarded as a first nine-month step towards a longer operating life. Centrica has at last bought a share of British Energy’s action.

While the recession cut world-wide nuclear generation last year to 14% of total power supplied – the lowest figure for five years – energy ministers of the G8 industrialised countries gave greater prominence to the future role for nuclear than ever before.

RADIATION AND REASON
A SONE member, ProfessorWade Allison, Fellow and Tutor in Physics at Keble College, Oxford, has just published a popular science book on the internet – Radiation and Reason: a thinking man’s guide.

You might have thought that with a nuclear renaissance around the corner, publishers would have seen a market for a book aimed at the common sense layman. Prof. Allison had no luck in firing their enthusiasm, so he has gone it alone with an e-book. There are facilities for free inspection and free 60 pages on Tizra publisher. It can be downloaded for US$14.We are carrying reference to the book on the SONE website.

NEW SECRETARY
SONE has a new Secretary. He is Alexander Center, a life member, of 45 ChurchWay, Sanderstead, Surrey (Tel 020-8657-3479; e-mail: ).

Mr Center, a graduate of Aberdeen University, worked, mainly as personnel and industrial relations director, for Shell, BIA,Wates, Hertz and Marryat before becoming an international management and training consultant. For nearly 20 years he also ran the very successful Surrey Downs branch of the Institute of Directors.

He will become a director of SONE along with SirWilliam McAlpine (chairman) and TerryWestmoreland (Treasurer). Robert Freer, who took over as Secretary from Sir Bernard Ingham after last October’s AGM, has found it not possible to do the job to his satisfaction.

SONE’S THANKS
SirWilliam McAlpine’s recent letter discussing SONE’s future has brought the most generous donations from members in this organisation’s history.We wish to thank the following for their most handsome contributions: Derek Kingsbury, Lord Vinson, Michael Payton, Neville Chamberlain, Sir Peter Cazalet, G M Nissen, ViscountWeir, Dr Vernon Eldred, John L Maxwell, Philip Owen, Dr E O Maxwell, P D Sanderson, Robert F Jackson and Dr Peter Chester. The total so far contributed towards the running of SONE is £11,550.

FOR YOUR DIARY
SONE’s AGM is to be held on Tuesday, October 20 at the Institution of Mechanical Engineers at 1 BirdcageWalk 12noon-3pm.We are able to announce that Charles Hendry, Shadow Minister for Energy, has accepted our invitation to speak.