For years we have been puzzling why the Government remains so leisurely about developing nuclear power when it has known that 18,000MW of coal fired and nuclear generating plant – equivalent to 18 large power stations – would close on grounds of age in the next eight years. Unless you are entirely irresponsible, you can’t face losing nearly 25 per cent of peak load without looking short of sleep.

You know – or you have been told often enough – that renewables, whether wind, waves, tides or solar, cannot fill the gap. Yet every year brings ever more ambitious targets for their development such as, under the Euro-whip, generating 40 per cent of our electricity from them by 2020 – eight times the current level.

You may think that energy conservation will work its magic on demand, though there is no evidence whatsoever to show that the no doubt immense theoretical possibilities are a practical proposition. You may even harbour high hopes of micro-generation, CHP, smart meters and even smarter grids to help fill the supply gap while simultaneously squeezing demand. But again it is all a leap of faith and probably depends more on notoriously elusive behavioural change than technology, always assuming you don’t blow up the grid in the process.

Certainly, if uSwitch.com, the price comparisons service, is anything to go by price will massively deter us from using energy. It reckons today’s average domestic energy bill of £1,243 (which has doubled in five years) could quadruple again to £5,000 by 2020 if this trend continues and you add in an annual £548 per household for 15 years to pay for proposed investment.

But in its official publications the Government will have none of this alarmist talk about prices, though it admits energy will be dearer. As for supply, it is serenity itself. On Page 73 (Chapter 3) of its latest White Paper – The UK Low Carbon Transition Plan – it specifically banishes any thought of a power shortage in the coming decade. It says: “The UK is likely to have sufficient generating capacity in the mid-teens [of the next decade] in spite of power station closures”.

As we noted in the last Newsletter, it carefully omits to mention how the 28,000MWof plant completed, under construction, with planning approval and agreement to connect to the grid or under application will be fired. Leave aside the four coal stations approved, provided they are retrofitted with CCS equipment, it can only mean we have had another (covert) dash for gas. So much for carbon suppression, not to mention combating fuel poverty.

We like to think even Sir Humphrey would have baulked at this kind of cynicism. It certainly explains why they are not rushing to build nuclear power stations.

HAVE WE BEEN CONNED?
All this leaves us wondering whether we have been conned. Let’s face it, the voters are not going to ditch you for missing carbon suppression targets, still less for keeping the lights on. So the name of the cynical political game is to make sure that you have enough generating capacity – and blow carbon emissions - while at the same time embracing politically correct renewables, extolling the virtues of energy conservation and Newsletter No. 131 Aug. 2009 micro-generation and signing up to impossible targets for carbon reduction which you cannot be held responsible for failing to meet.

Longer term commitment to nuclear is in no way inconsistent with this Machiavellian scenario. Essentially, it is an insurance policy for the 2020s if, by then, the boffins have failed to come up with something better such as CCS which really works and is not prohibitively expensive. Members may think we are as cynical as the politicians we criticise. But we are at least consistent. We have never accepted that merely writing a welcome on the mat for privately developed nuclear power represents such a stunning victory for SONE that it could safely shut up shop.

The reality is that not a single political party in Britain is prepared to stand up in public and put nuclear at the centre of its energy policy. The most the two main parties are prepared to do, without any evident enthusiasm, is to welcome private sector nuclear developers and provide them with some sort of framework within which they can take investment decisions. There remain many doubts 9 to whuch we return below) over whether, once the reactor licensing hurdle is cleared, the proposition will prove irresistible.

WICKS AND MANDELSON
Are we being churlish after MalcolmWicks and Lord Mandelson, who is portrayed as some sort of puppet-master pulling Gordon Brown’s strings?Wicks, a former Minister for Energy, burst upon the scene as the Prime Minister’s special international energy representative on August 5 with a report, Energy Security, a national challenge in a changing world.
He proceeded to worry about longer term security of supply, over-reliance on gas, lack of gas storage and lack of Continental power connections and suggested Britain should “aspire” to generating 35-40 per cent of our electricity with nuclear beyond 2030. That is three times the share nuclear is “potentially on track” to produce in 20 years’ time. In other words, as things stand, we shall be back where we are now in 2030. Big deal. No wonder Wicks wants more.

We are not ones to look gift horses in the mouth and recognise that this sort of political positivism about nuclear is as rare as gold dust in the Gorbals. It is potentially very valuable for nuclear to have such advocacy, but it would have been better had it been supported by argument. Why 35-40 per cent when France has gone for 80 per cent – unless Wicks thinks that is too many eggs in one basket?
Some nuclear supporters think Wicks’ 35-40 per cent owes itself to one of two things – either an estimate of future baseload or, more likely ignorance about the greater flexibility of new nuclear power stations in following load.

Nuclear’s greatest fan
Meanwhile, Professional Engineering Magazine has reported “there is no greater proponent of nuclear power within the upper echelons of Government than Business Secretary, Lord Mandelson”. He backed up their judgment with quotes:

“Nuclear is absolutely vital for our country”, he said. “It is back on the map, centre screen, and that’s where it is going to stay… Our commitment can be nothing less than to develop and maintain one of the best business environments for nuclear investment and companies working in the nuclear supply chain. We are going to have to organise ourselves better in this country in order to pull that off... There’s never been a greater global demand for money, equipment and skills to build and operate new nuclear. It’s a hugely exciting challenge and opportunity”.

That’s what SONE members want to hear. They would, however, be more enthused if they had not had to wait until 2006 for the Government’s rather sudden conversion to nuclear and that during its tenure it had not sold off most of the British nuclear industry, including what would now have been a jewel in its crown, Westinghouse.

After SONE’s first eleven years we are not exactly impressionable.

CLARKE WITH US, TOO
Still, it is not every month that we get both the Business Secretary and his Shadow, Kenneth Clarke, volunteering support for nuclear power. Yet that is what August 2009 has produced.We learned of Clarke’s support when we wrote to him on several matters.We look forward to his stiffening his party on nuclear power because, by Jove, it needs it.
To be fair, the Conservatives have adopted a new – and on the face if it sensible – approach to the - 2 - new planning regime brought in by the Government for nationally important infrastructure schemes by “democratising” the process to reduce the risk of legal challenge..

Many of us are deeply concerned that an unelected quango, the Infrastructure Planning Commission, which is supposed to start work in October, will be judge and jury on all applications, with all the opportunities for challenge and delay that that could entail.
Charles Hendry, Shadow Energy Minister, announced on August 13 that decisions would be made by the relevant Secretary of State on recommendations from the Commission’s group considering the project.

He also said that national policy statements would be subject to a Parliamentary vote and not just a debate as currently intended. A Conservative Government would, however, need to introduce legislation to implement these proposals.

Charles Hendry will be able to elaborate on these proposals when he addresses the SONE AGM at the Institution of Mechanical Engineers, 1 BirdcageWalk, London SW1 on Tuesday, October 20 (12 noon–3pm).

BACK TO DRAWING BOARD
Lord Mandelson wishes to maintain “one of the best business environments for nuclear investment” (see above). Well August brought signs that the Government’s current come-on signals are not enticing enough.

On August 16 the Sunday Times reported that the Government was considering introducing a levy on fuel bills (as if they are not inflated enough) to help finance new nuclear stations. It said the industry’s view was that without help in the form of a minimum carbon price of Euros £30-40 a tonne (now Euros14.35), plus a consumer levy varying with the carbon price, reactors would not be built. The Government denied a levy had been discussed.

A week earlier The Times reported EdF was down in the dumps about UK nuclear development because the French Government had limited a power price increase to an average of 2.3 per cent over three years when the company had wanted 20 per cent over 3-4 years to fund investment. Various energy analysts saw this as potentially damaging to the UK’s nuclear renaissance.

No doubt this is a process we have to go through before anything gets done. But if we were potential investors we would want to know two other things: 1 -What exactly is going to be the role of Ofgem, the energy regulator, having once, as the Government’s agent, bankrupted British Energy with an squeeze on wholesale electricity prices?; and 2 - . Are unpredictable renewables – effectively wind – to have priority over all other power? In other words, would baseload nuclear have to make way for wind when the turbines were turning full tilt?

Answers – Yes or No – on a postcard, please. We would then have a better idea whether Lord Mandelson has produced one of the best business environments for nuclear.

IS THIS ACCEPTABLE?
Talk of a nuclear levy on consumers, prompts some of our members to rail against the way in which politicians are funding public policy – not through public funds subject to scrutiny of the Public Accounts Committee but by billing consumers through the utilities whose palms are greased at public expense to co-operate. It might not be so bad if consumers knew they were being taken for this expensive ride.

The whole elaborate apparatus of Renewable Obligation Certificates (ROCs) to promote renewables is administered by Ofgem, an unelected quango which has allowed Scottish and Southern to milk consumers for its expenses on the proposed Beauly/Denny transmission line in Scotland – as if the cost of hydro-electric schemes eventually admitted to the ROCs scheme after industry pressure were not enough.

We all know about the competence of Ofgem. As we have said, it bankrupted British Energy. The coming political question is whether any future Government can – dare – allow the untold billions to be dispensed under Labour’s elaborate plans for wind power development in this holein- the-corner way.

OUT OF THE FRYING PAN
Sir Jonathon Porritt, “Green” quango-builder as chairman of the Government’s Sustainable Development Commission, has just proved he learned nothing after nine years in post. This will not surprise SONE members.

Encouragingly, in a farewell interview with the Daily Telegraph, he seemed to be retiring hurt, bemoaning the waste of years in pursuit of new nuclear power stations.
“I am deeply disappointed that we have a - 3 - government position on nuclear power that is pretty unreconstructed”, he said, after working with the old DTI to produce aWhite Paper that concluded “nuclear power is not necessary for a secure low-carbon efficient UK economy”.

Instead, he said, officials [who no doubt did not believe a word of this nonsense],“kept the nuclear flame burning”. “The Civil Servants won that battle at great cost to energy policy in the UK.We have had years of delay on critical things that could have been done on renewable energy and energy efficiency. We had six to eight years’ prevarication when we could have been getting on with it”.

And with a flounce he was gone, saying he did not think nuclear power would be revived “because the markets will not put up with it”. He is succeeded by an unknown, Will Day, who made an auspicious start by positively encouraging demos against coal-fired power stations. Still, Porritt bequeaths Day a quango with a £4.1m budget, 15 commissioners and a secretariat of 61 to keep him warm. Porritt started the SDC with next to nothing.
What the SDC has achieved apart from holding up nuclear development is another matter.

VALUE FOR MONEY
Which brings us effortlessly to the question of value for money. In a curiously brief piece on its front page on August 10 – a story that was not followed up elsewhere – the Daily Telegraph claimed that the Government’s green energy plan would cost 11-17 times the economic benefits to be obtained from it.

Quoting from the Government’s own Renewable Energy Strategy it said the expected cost would be about £4bn a year over the next 20 years, or £57-70bn. But the value of reduced carbon emissions would amount to only £4-5bn. The massive shortfall is presumably the cost of saving the planet bringing non-monetary benefits by way of compensation.
Not surprisingly, the DT said economists are sceptical. So are we.

Assault on wind
Indeed, a feature of the month has been the uncoordinated but massive assault across the world against wind power which is what renewable energy largely adds up to in the UK. The Guardian, while saying we need lots of wind turbines, claimed that just about the worst place to erect them was on peat bogs because of the release of CO2 it could engender. Yet this is where more than half Scottish wind turbines have been built.

The Australian Herald-Sun reported that theRudd Government’s “green power” strategy had been “utterly shredded” by detailed analysis showing the “total uselessness of the one formof power onwhich it is entirely based –wind”. Professor Michael Trebilcock, University of Toronto, said there was no evidence that industrialwind power was likely to have a significant impact on carbon emissions.

And the Independent belated got exercised about a New York paediatrician’s study of the effects of living near wind turbines in the UK, USA, Canada and Italy. She said living too close to them could cause heart disease, tinnitus, vertigo, panic attacks, migraines and sleep deprivation. It hoped Ed Miliband, Energy Secretary, would not dismiss the report.
So what did the UK Government do? Why, arrange for the part-nationalised RBS and Lloyds to lend up to £1bn to wind farm developers becalmed by a lack of cash.

FoE GETS SERIOUS
Friends of the Earth have launched a new website for their Get Serious About CO2 campaign. We look forward to telling you when they have. They will not then have the screaming habdabs when nuclear is mentioned. It is time they got with it. Another 60 countries are considering the use of nuclear power over and above the 30 that already do so. The IAEA said 20 of them could have a programme in place by 2030.

GATHEREING FOR PATRONS
Damon de Laszo, one of our industrialist patrons, is to give a lunch for his fellow SONE patrons on November 25. We look forward to their discussion of energy policy.