Gossage:Gossip November 2016

Typography
Opinion

Chinese chequers

My thousands of devoted readers will recall the main reason why the new Prime Minister, Theresa May, placed a seven week moratorium upon endorsing any go-ahead for the Hinkley Point C new nuclear power station. It was the overt horror of those charged with overseeing the nation’s defences, at the prospect of a Chinese government-controlled company owning 40% of a British nuclear power station.

Eventually it was the fact that it was only a minority shareholding that won the day for Hinkley. But there can be no such escape clause for the next new nuke, due at Bradwell in Essex. Which is due to be 100% owned by the Chinese, employing only Chinese technology, the as-yet untried Hualong 1 reactor. It would also be constructed in one of the most potentially vulnerable places in England.

This site is quite unsuitable and unsustainable in the long run.  It is at sea level on a coast highly vulnerable to storm surges and sea level rises: witness the coastal erosion already happening throughout East Anglia. The local Blackwater estuary is very shallow, making it very difficult to supply cooling water without substantial damage to the local ecology: it is highly “protected” by national and international designations including the recent declaration of a Marine Conservation Area status. Alternatives - sea cooling, cooling towers – provide serious technical and environmental challenges.

Unlike other prospective sites, this area is quite heavily populated. Some 300,000 people live within a 20-mile radius. It will be difficult, if not impossible, to implement emergency planning measures in the event of any serious incident. The nearest large settlement is within 2 miles, an island cut off completely during certain high tides, and with only one access road. 

As yet nobody has any idea how many reactors may be built, what cooling system is proposed, how the Chinese intend to deal with environmental constraints or what they will do with the spent fuel and other wastes. My old friends at GCHQ are, quite literally, in despair at the prospect of this Trojan horse ever proceeding.

 

Lumbered with backward-looking mindset

Much chortling by the Old Guard of Electricity at the rather unspectacular birth of Innogy Not a name you recognise?  This is the “good” part of the German giant utility RWE. This megalith has spun off its renewables, networks and retail businesses, leaving behind just the conventional fossil fuel generation assets and energy trading division under the old name.

Last month Innogy became Germany’s largest “initial public offering” (IPO) this century, raising almost 5 billion euros.  But immediately after its launch, its trading price dropped well below its initial trading price of 37.30 euros. And despite recovering a bit of ground, the company’s stock market performance has so far been singularly underwhelming. Cue further mockery of the impact of Germany’s radical electricity transformation programme, Energiewende.

In practice, this simply means that the stock was initially rather accurately priced. I suspect that in years to come those who opt to invest in this forward-looking stock will find their foresight well rewarded. They will have seen the future. And they will find that it works rather better than the old RWE.

 

In the Rialto, you have rated me

The forthcoming reform of business rates looks like boding extremely ill for certain parts of the solar photovoltaic industry.  According to the Valuations Office Agency, major changes are due to start from next April.

As currently proposed, the current total exemption from business rates on most micro-generation installations below 50 kilowatts, will disappear overnight. Larger installations also look like being encumbered with a hike in their business rates too.

This will mostly affect businesses that have already installed rooftop PV installations, particularly if the power is being generated primarily for that business’ own use. In contrast any installations mainly focused on exporting to the Grid, or with power purchase agreements with tenants, should enjoy a fall in their business rates.

If as seems likely, all this is confirmed, the end result will be distinctly perverse. Identical installations will end up paying very different rates; it will all depend upon ownership. Own your own panels, and you will be penalised. Enter into a power purchase agreement with a third party, and you should be quids in.  You have paid your money. But now you have no choice.

 

Breaking the laws of man and meter

There have now been three separate Parliamentary committees, each has examined the £14bn smart meter programme. As did its predecessors, the House of Commons Science and Technology committee has also ended up raising some very scathing questions regarding the efficacy of the entire programme.

More than anything else it wants to know how on earth the government can justify its regular claim that rolling out 53 million smart meters will deliver a £6.2bn benefit to the UK economy. It seems that these “benefits” are largely dependent upon electricity and gas retailers passing on to consumers practically all the enormous system savings they will be making on reading meters, dealing with estimated bills, and tariff time-switching. Past experience suggests this may well not occur.

The Science Committee is disturbed over the lack of clarity about the primary purpose of smart metering. There are no less than 11 separate and “disparate” objectives making this difficult to perceive. As a result, it reckons that the project “will become viewed solely as an, inefficient, way of helping consumers to make small savings on their energy bills.” In that context, MPs are very concerned at the continuing lack of interoperability, whereby customers switching suppliers find they lose smart functionality, and end up never switching supplier again.

The consumer group, Which?, has already  called for the complete abandonment of the smart meter roll-out programme. The Institute of Directors has expressed concern that it may end up being yet another Government IT programme failure. I have a feeling they may end up being spot on.

Data Centre news from our sister title

@elecreviewmag