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John Major`s idea of a windfall tax may be incorporated into the Autumn statement,IMO.It also serves as a warning to the energy companies to restrain themselves on price rises next year where they could potentially decide the election outcome.
The man has a heart of stone.
It is rehashing overly familiar material but this piece once again makes the point that it is the failure to invest in our energy production over the last decade and more that is the problem today: http://www.telegraph.co.uk/earth/energy/nuclearpower/10396307/Were-flirting-with-an-energy-crisis.-It-should-never-have-got-to-this-point.html
Until this week the last nuclear plant commissioned in the UK was in 1995. What on earth happened in the interim?
Well apart from having an astonishingly incompetent government we also had very cheap supplies of gas both domestically from the north sea and internationally. This made it very difficult for other energy suppliers to make a case and we became overly reliant on this source making us very vulnerable to international price movements.
So much of the current debate seems to me politicians from all sides claiming that they are really relevant to today's problems and so much of the alienation from politics arises from the conclusion that they are not. So the public are healthily sceptical about short term fixes like energy price freezes, John Major's windfall taxes and the cost of green levies. The failure of strategic vision in our political class, which perhaps reached some sort of pinnicle in the last government but is a common fault has been laid bare. Again. As the article says, we should never have got to this point.
OT
A sobering thought for Scotland and Europe after recent oil refinery closures in Italy and Hungary.
Demand for refined fuels in Italy dropped from 116 million tonnes in 2000 to 80 million tonnes in 2012, he said.
In Scotland, the 210,000 bpd Grangemouth refinery was shut down earlier this week in a labour dispute that could lead to the plant's full closure.
A total of 16 European refineries, or 1.7 million bpd of refining capacity has been mothballed since 2008, according to the International Energy Agency.
http://www.reuters.com/article/2013/10/16/europe-refinery-idUSL6N0I638T20131016
Sound as a pound .... or ten thousand of them .... to me.
I'm sure we'd all like to thank "tim" for highlighting this excellent Coalition government pilot scheme. Well done "tim".
After a long run of good economic news this is certainly a blow. Not only are we losing a lot of well paid jobs we will now be importing much of our refined products including petrol.
As the article makes clear one of the reasons for this is the very cheap gas that has been available to US producers in recent years. If we had started fracking 10 years ago, only 10 years after the US showed it was safe and cost effective, the future of Grangemouth might have been different. That we are still arguing about it drives me to despair.
Oh you and your facts. What matters is a single data point to be spun endlessly as proof than Marxism works...
This coupled with the very tawdry 'Go Home Vans' was always going to have a short term effect. The question is whether Dave is going to continue to head rightwards and keep seeming to stick up for big business at the expense of the unfortunates and whether Ed can keep finding issues that resonate
OA "country" (vs me/my family)
Economy: 66 (+9)
Immigration: 54 (+38)
Welfare benefits: 31 (+16)
Health: 30 (-3)
Housing: 17 (+2)
Education: 15 (-1)
Pensions: 14 (-16)
"I agree with Iain Martin that John Major tends to be an outrider for Cameron and find it difficult to believe that he didn`t clear things first with no.10"
Do you think a secret putsch against his own government is taking place in No 10 with the aim of putting Ed in power?
I can't see any other scenario in which your post makes sense
I rather suspect Unite have had their members play Russian Roulette with a fully loaded revolver....
Is my memory faulty? Could you remind us what your final ARSE prediction for GE2010 was?
A failure to learn from past mistakes? Or simply another example of fixating on the short term at the expense of the long term?
http://www.bbc.co.uk/news/uk-england-london-24634352
Throws lifebelt into Thames to help rescue woman.
I frankly don't believe the opponents of fracking who claim it would not make much of a difference to the price but that is not really the point here. The fact is we have unexploited gas reserves within the UK that could have serviced this site and saved a major plant if we had only got our act together and started exploiting it sooner. It is too late now and by the time we are exploiting the fracked gas most of the valuable kit on this site will be gone.
It's a similar mistake when people say the UK shouldn't bother controlling CO2 emissions because the UK is only a small proportion of the total, or if somebody tells their family it's OK to drop litter in their town because what their family drops will only make up a small proportion of all the litter dropped in the town.
Mr. Tokyo, the carbon dioxide point is sillier than a dog wearing a fez. If China and India's increasing emissions outweigh the whole UK total than it's insane to do ourselves economic harm when our stated desire (lower emissions) is impossible.
I think even our politicians have got that which must mean it is pretty obvious.
I predicted more LibDem seats in the range 75 with a Conservative/Lib Dem coalition government. ARSE projected 65 with 305 Conservatives. The individual seat projections were accurate save for the LibDems failure in Watford - which remains a beguiling result to this day !!
my option
Step 1
Two perfectly good coal power stations were closed down on orders from the EU to prevent global warming which
a) flat-lined 15 years ago (although most people in this country don't know it because the BBC won't tell them)
and
b) wouldn't matter even if true as those countries who didn't let their industrial base be looted are building new coal power stations every week
Step 2
New Labour didn't put any new capacity in place during their time in office meaning the early closure of those two coal power stations under orders from the EU was going to lead to blackouts around the time of the next election - as wind needs a reliable backup system for when it isn't working.
Step 3
In the short amount of time available the only way to prevent blackouts was to knock together an emergency system based on creating farms of diesel generators and run the national grid off diesel.
your option
Step 1
It's a deliberate and well thought out low carbon solution.
If you're right and farms of diesel generators aren't the least efficient, most expensive and most polluting option possible then the BBC, Greens and political class will be falling over themselves to publicize it not just in this country but internationally, yes?
'Bedroom taxes' and 'Go Home Vans' might be popular but all the time Dave's building a history which when combined with support for 'Big Utility' against the little man you have the seeds of a campaign.
I think John Major being rather longer in the tooth has seen the writing on the wall and has felt compelled to speak out. Having been there more times than most he can see the train crash coming.
One of the things climate hawks have been saying since forever about why developed countries need to their act together in reducing carbon is that it's blindingly obvious that poor countries aren't going to continue indefinitely emitting virtually nothing per head while a small number of people in developed countries emit enough to cause serious problems all by itself.
If your logic is right, the UK shouldn't do about climate change anything that causes economic harm even if the end result was - for the sake of argument (I'm not saying this is actually going to happen) - that everybody was going to die in 100 years. I think that logic is obviously wrong - don't you?
If I believed in global warming due to man-made factors then I'd advocate a global agreement, because then everybody would be in the same boat. Acting unilaterally or with a handful of equally deluded politicians from other countries whilst the major players do nothing is just stupid. The only guarantee is economic harm.
At that time, it was generally accepted that you needed $8/mmcf gas prices to make shale gas work (and in the US, production was largely restricted to Texas and Louisiana, with the Marcellus mostly just a concept). Given where UK gas prices were at that time, with North Sea production significantly higher than current levels, there simply would not have been much interest.
In addition, much of the groundwork from the British Geological Society and like had simply not been done. We forget that Texas and Louisiana were some of the most mature petroleum basins in the world, with hundreds of thousands of core samples available to geologists. Even then, except for some people at George Mitchell Energy, few saw the benefits of shale gas.
I think there is a general misunderstanding of how long it's going to take to get the full benefit of our shale reserves in the UK, and it's still perfectly possible that - like the Alum Shale in Sweden, or much of Poland's shale reserves - it will not be possible to economically extract them. Not all shales are the same, they differ in depth, which affects drilling costs, in organic content levels, in the porosity and permeabilty, etc. etc. etc.
My personal view is that it is likely we will have a healthy industry in the UK, supplying perhaps 20-25% of our gas needs, but that commercial exploitation is probably still five years away, and significant benefits to our balance of payments, and the like, is probably another five after that.
General Election @UKELECTIONS2015
YOUGOV
AGE 18-24 VOTING INTENTION
LAB 39%
CON 33%
LD 12%
UKIP 8%
NAT 4%
GREEN 4%
AGE 60 +
CON 39%
LAB 33%
UKIP 20%
LD 6%
NAT 1%
GREEN 1%
A campaign might have resonance if Ed M hadn't done so little as Energy Minister other than to add more taxes and regulations, or Blair had addressed energy supply issues in the first place.
If the lights go out this winter, would you prefer to remain with the foolish virgins in the dark, or the foolish virgins in the light?
I remember getting irritated with the Government over energy policy about ten years ago. It was clear then that we needed to prepare more more capacity for the future. Nuclear was the only certainty for that secure future but Tony sat on his hands, and when Gordon took over, he left Ed to dream green dreams.
Tony wouldn't go forward because nuclear was unpopular and all the cost was front-loaded while the benefits would be reserved for a future government. A classic case of party before country.
We should have shot the lot of them.
a) You're very interested in energy markets.
b) You're thinking about investing in a farm of diesel generators.
c) You're a writer for the Mail or the Telegraph trying to push a dodgy narrative premised on pretending not to understand the difference between something that emits CO2 all the time and something that only emits it for 30 or 150 hours per year.
Edited to add: I don't have a strong opinion on whether there are better ways of covering short-term peaks than farms of diesel generators - maybe Robert can fill us in?
So we have nationalised energy. Nationalised by the French...
Workers will be told at 10am by Callum MacLean, Grangemouth Petrochemicals chairman.’
http://www.telegraph.co.uk/finance/newsbysector/pharmaceuticalsandchemicals/10397839/Grangemouth-decision-looms-as-war-of-words-breaks-out.html
Natural fluctuations in environmental conditions should be adapted to as we always have done. That's it. There's no need to start creating a thought experiment with crazy and non-crazy countries (whatever that might mean).
I'm not totally convinced energy is a market like that, but maybe we could take the decision away from pre-election politics and give it to the Monopolies Commission or somebody? If we can tax all monopolistic businesses instead of just the non-telegenic ones the taxpayer might be able to get some serious money out of this.
It's not okay to drop litter. It is however realistic to acknowledge that the volume of litter you produce is inconsequentially and unnoticeably small compared with the amount of paper waste produced by, say, shredding machines at the Falkirk Labour Party offices.
Ten years ago, British Energy, the UK's nuclear power plant owner went bust because the electricity it produced was too expensive relative to the market.
When you say 'we' should have invested, you would have struggled to find a sensible human on planet earth who would have invested in new nuclear at that time.
Even now, new nuclear only makes economic sense if it costs twice what coal or gas fired plant does. There is this romantic notion that nuclear is cheap. But that simply does not hold up to the evidence - nuclear generators around the world have struggled to make and sell electricity at a profit because (a) capital costs are enormous, (b) maintenance is non-trivial, and (c) availability rates are usually below 80%.
Now, if you are an ardent climate-believer, you can argue that it makes sense as a reliable - albeit expensive - source of low carbon baseload electricity. That's a reasonable case to make. Likewise, you can make the case that diversity of supply is important. That's OK too.
But what you cannot do is claim that adding more nuclear to the mix will do anything other than raise electricity prices.
How we laughed.
Centrica had the option of paying for a 20% stake in new nuclear in the UK. Even with £92/MWh, index linked, it didn't make sense for them to invest and they pulled out the project in February of this year (http://www.bbc.co.uk/news/business-21319031).
The EDF consortium is able to invest at much lower returns than anyone else, because the Chinese funding is so cheap.
As an aside, the actual technology is owned by French company Areva, EDF is just the operator.
"But that simply does not hold up to the evidence - nuclear generators around the world have struggled to make and sell electricity at a profit because (a) capital costs are enormous, (b) maintenance is non-trivial, and (c) availability rates are usually below 80%."
Is that Global experience rather than just UK British Energy experience and has there been examination of the performance of newer build plants compared to older, more maintenance heavy plants?
And don't they have cheaper leccy than us ?
What am I missing ?
What I'm really hoping is that if we can put the issues in the right way somebody will say something original about them and I'll learn something, rather than everybody banging on their talking points for the gazillionth time.
If you have a strong emotional reaction to assuming the premise of something like climate change being real and can't discuss it from that basis I guess I can probably rephrase the problem in terms of Martian invaders or something...
Zero.
There were plans NRG to build two new nuclear plants in Texas. However, this was cancelled two years ago as it was simply uneconomic. In the US, older nuclear plants are being decomissioned as increasing maintenance causes them to become money sinks. (See both Exelon and NRG.)
There is an excellent article in the Bulletin of Atomic Scientists (http://thebulletin.org/nuclear-aging-not-so-graceful), that takes you through the ageing of a nuclear power plant.
British Energy's problem was that if global gas prices went down it lost lots of money while if global gas prices went up it suddenly started making lots of money - eg by 2007/8 its share price had soared.
France's energy market does not have the same exposure to gas - since its majority nuclear - and I guess prices there would be a lot more stable than here.
2. The French government paid for the plant originally, so the costs have been born by the taxpayer, not the consumer.
Better to either scrap the green subsidy ,nationalise the industry (if the politicians really want the full responsibility fro keeping the lights on fairly cheaply - do they?) or get out of the EU so we can scrap VAT on fuel bills.
http://www.tom-watson.co.uk/2013/10/media-zoo-the-child-labour-specialists-whose-senior-staff-used-to-work-for-the-bbcs-consumer-programme-watchdog
It's doubly ironic that the same people who use this utterly bonkers argument accuse David Cameron of being 'out of touch' with the real world.
Well, here's a tip: in the real world, it's a good thing if you can produce lots of stuff people want to buy without causing the price to collapse.
http://www.scottishgreens.org.uk/uncategorized/grangemouth-greens-call-for-end-to-corporate-bully-culture/
Vote will go down faster than Sir Patrick Spens' ship.
Mr. M, I quite agree. The climate is changing because it has always changed.
Same old.
Obviously the fact that somebody can make money selling it is a good reason to do it, as is the fact that people will have cheaper gas, albeit a lot of people all over Europe having slightly cheaper gas, rather than a smaller number of people in the UK having much cheaper gas.
Indeed. - odd how so many refuse to see the wood for the trees.
'Tis fifty fathoms deep;
And there lies gude Sir Patrick Spens,
Wi' the Scots lords at his feet!
http://www.bbc.co.uk/sport/0/formula1/24636633
Huge shame. He had the skill to be a world champion. Kubica himself still believes a return is possible.
RCS,
Ten years ago, we had decisions to make about energy supply and we did one half of bugger all. Nuclear may be expensive for a variety of reasons but it's reliable and well known. (thorium might have been a better option). But the decisions (or rather non-decisions) were taken for political reasons only. A daft way to run a country.
A mix of supply is best but standing round with your finger up your bum hoping. like Micawber, that something will turn up, was short term-ism at its worst.
No wonder, I'm a NOTA when it comes to politicians
you can get if you try.
http://www.telegraph.co.uk/earth/energy/nuclearpower/10394209/Ed-Milibands-wife-advised-EdF-on-Hinkley-Point-nuclear-deal.html
Must be a right wing smear...
Not to mention the fact that the options (if we assume global warming's real) aren't death or ruining the economy. It's harming the economy or the possibility of a 15 year temperature plateau ending with the potential to perhaps alter sea levels, but the climate changes naturally anyway so anything we do is probably irrelevant.
Who is funding Olkiluoto Unit 3 or does it have government guarantees?
I'm not surprised that the 1970s generation of reactors are incurring high maintenance costs but my interest would be in how the later build plants are comparing. Also I'd expect the operator experience from the current generation of plants to help reduce the costs of the next generation of nukes.
I've said on multiple occasions that we should produce shale gas, because it's better than importing from abroad, from a tax, employment and balance of payments perspective.
However, expecting to make more than an infinitesimal difference to the price of your electricity is incredibly naive.