ESA: Now let’s not get carried away

The 'Duck Curve'.

The ‘Duck Curve’

Despite the enormous hype at the annual US Energy Storage Association conference in Washington, D.C., there are too many outstanding issues to be truly ready for prime time, finds the Editor. This article was first published in the Summer 2014 issue of Batteries & Energy Storage Technology.

The first commandment of dealing drugs is “Don’t get high on your own supply.” At this year’s annual Energy Storage Association conference in Washington, D.C. the dealers were higher than a Colombian cocaine cartel with a habit.

Of course, when there’s around 700 people congregate for an energy storage event, it’s all too easy to believe the hype. But BEST is not buying it quite yet.

This publication is a keen supporter of energy storage, for obvious reasons. But it is our role, dear readers, to pick holes in what was a conference hall-sized energy storage hype balloon. By the end of the week at ESA, so much hot air had hissed out of the balloon this author was wondering whether energy storage is EVs all over again – immense promise of imminent sales, but relatively small beans in reality.

Muchos hype

The hype started with a bang via the keynote address by the CEO of SunPower, Tom Werner, who has seen his company grow from a turnover of $2.5m in 2003 to $2.5bn in 2013, helped by its acquisition by French oil giant Total.

His sermon, entitled ‘The Convergence of PV and Storage’, was delivered at full volume, but this author was not as convinced as Werner that energy storage is on the cusp of a solar PV-like boom of the kind witnessed over the past decade.

Energy storage, says Werner, is an integral part of SunPower’s plans over the coming decade. Having made a bundle on manufacturing and selling PV panels, the Californian company intends to be an “energy service provider”, integrating solar and energy storage to steal customers from the likes of PG&E, ConEdison and other utilities.

Their vision is of sexy “optimized” energy bills, rather than something people just pay and forget about, often not even bothering to look at the bill. SunPower has hired 30-40 people charged with transforming the company to be just that.

On a system level, storage was said to be essential due to the ‘duck curve’. The neck of the duck is the increasing ramp rate of peaking power plants as backup for the ever-deeper penetration of variable wind and solar power.

The belly of the duck is excess generation of solar and other renewables. The bigger the excess, the fatter the duck. Energy storage could flatten the curve and make use of some of that surplus.

Energy storage, said Werner, would grow 12,000% from 2012-2022. However, virtually in the same breath, Werner proffered battery storage would economic “within 3-5 years”; it was exactly at this point the hype balloon was punctured.

SunPower CEO Tom Werner

SunPower CEO Tom Werner

SunPower’s ambition is to be commended but it is a big leap to go from manufacturing high quality solar panels to becoming an energy storage/energy service provider via batteries, of which it knows relatively little.

This author questions SunPower’s business model; it is basing its future on something out of its control – the cost and performance of battery energy storage. Werner confirmed to BEST that SunPower had no intention of becoming a storage technology manufacturer, although parent Total is an investor in liquid metal battery MIT spin-off Ambri and flow battery manufacturer Enervault.

Werner’s speech was one of many in a show bursting with optimism, but in truth they were mostly “within five years, this” and “within five years, that”. There is no doubt energy storage makes sense from a system point of view, but do the numbers stack up?

Undoubtedly there will be growth in energy storage, but as usual, the hype will not be borne out by reality. As we shall see, there are simply too many issues to be ready for prime time.

EPRI drills through the spin

One of the more hype-free sessions was a pre-conference workshop by Sandia National Laboratory and that respected stalwart of the US electricity industry, EPRI (Electric Power Research Institute). EPRI’s Haresh Kamath was a treasure trove of useful nuggets, most of them pretty negative about the prospects for the energy storage.

The arbitrage opportunities arising from the ‘duck curve’ – storing power when cheap to be used at peak times – are much less anticipated and the difference is too small to finance storage. Where storage does make sense now is on islands with limited grid infrastructure, like Hawaii, or the US Virgin Islands, where the retail electricity price is an astronomical $0.52/kWh.

In mainland USA, storage works for frequency response in markets such as the New York ISO, which rewards the inherent advantages of storage, i.e. response in milliseconds rather than minutes as for gas-fired peaker plants.

Reality check for grid storage

Kamath warns, however, that the frequency response market for energy storage – which has not only seen batteries but also Beacon Power’s flywheel technology installed – is in danger of becoming “saturated” over the next five years. By then, he says, the market will have “collapsed”.

Unlike SunPower’s Werner, Kamath was generally down on grid energy storage, saying “there is not a market”. This, of course, comes down purely to costs.

And the costs are not just down to the battery. Power electronics and the balance-of-plant account for up to 60% of the system cost. Concrete pads to park battery storage systems can be surprisingly expensive, as too can the permitting process.

Moreover, the industry does not yet have the reliability desired by financiers to be bankable. Just because a battery may come with a warranty, developers cannot be 100% sure that the batteries will perform as they should, when they should. Cycle life data of ‘real world’ energy storage data is very limited for systems deployed in the field.

Getting utilities interesting in grid storage will be a challenge. Utilities tend to think in decades of operation, rather than years, when it comes to investing in components. Furthermore, energy storage is seen as having relatively poor ROI and utilities were said to be worried about ‘hidden costs’.

In most cases, an energy storage system needs to cost $350/kWh to be in the money. The average system cost of $1000/KWh, not to mention an operations & maintenance cost of $200/kWh suggests this may some time away from being viable without subsidies, mandates with regulated returns etc.

Kamath said storage is where computers 30 years ago. This was damning with faint praise; it meant storage is pre-Windows, not particularly user-friendly, not plug ‘n’ play, with few standards and codes for utilities to be comfortable with connecting an energy storage system into, for example, a transformer.

The so-called ‘value stack’ of energy storage for utilities – frequency response, network investment deferral, arbitrage, voltage regulation, peak shaving and so on – is great in theory but in practice, no-one yet knows the capex cost, or indeed, if a battery system is up to the task of such multi-functionality.

Of course, the developers will be armed with performance guarantees, but for 10 years plus? 20 years? Not yet. For developers like S&C Electric, whose real expertise is switchgear and grid connections, their battery knowhow is more or less limited to bolting together other companies’ kit.

Raging against the dying of the light?

Jim Rogers, who retired as CEO of utility giant Duke Energy in 2013 after seven years at the helm, used the word ‘inevitable’ about storage a great deal, albeit in a preachy sort of way that suggested the exact opposite.

Rogers is no mug; he noted Thomas Edison said energy storage was “around in the corner” in the 1890s. Rogers suggested energy storage was still around the corner, but the corner is the 2020s and predicted a 47.3% global compounded growth until 2020, when total installation will reach 11.3GW.

If this sounds a lot, it must be remembered 11.3GW represents just 1% of the total predicted renewable energy capacity in that magic year of 2020.

In this author’s opinion, Rogers’ speech was rather duplicitous. For all his talk of solar and storage, the ex-Duke man spoke a great deal about the need for coal and nuclear, and seems far more comfortable in extolling the virtues of ‘Big Energy’ than of distributed generation.

Former Duke Energy CEO Jim Rogers

Former Duke Energy CEO Jim Rogers

But it was interesting to hear Rogers speak about the clear and present danger posed by solar and storage to utilities, and what they should do about it. Rogers cited Kodak, which, contrary to public belief, actually did work on digital photography, but because it was very much a non-core business, its film division did not invest in it.

In other words, utilities will not cannibalize their core business of generating and distributing electrons via energy storage – Wall Street will not allow it. The challenge for utilities is to see that change is coming and make money from it by accelerating that change. However, as Rogers, said, “Utilities do not control their change”.

Regulation, regulation, regulation

Of course, there are some barriers to change which utilities cannot control, but can be heavily influential – regulation. In many nations, not least the USA, regulations stand in the way between a viable energy storage market and a virtually non-existent market.

Aside from the so-called energy storage mandate by California, there are market mechanisms to encourage frequency regulation and other balancing services in the New York ISO. In the big bit of the US in between the two coasts, there are dozens of states with no measures to encourage energy storage.

How to encourage state regulators to create a market for storage? With great difficulty. Slothful regulators make utilities look fast-moving and getting regulations changed is like pulling teeth.

But utilities are not exactly chomping at the bit to make storage happen. Commissioner Anne Hoskins of Maryland Public Service Commission said she did not know of one utility which had come forward with suggestions for how energy storage could be implemented, saying its “one for the next generation”.

One of the big issues for utilities is the rate and timing of recovery; risk-averse utilities like steady investments that pay off over long periods – can they be sure storage is such an investment? No-one really knows.

Commissioner Jeffrey Goltz of Washington Utilities & Transport Commission was highly cautious about the cost burden on consumers, and with very cheap electricity costs thanks to largely hydropower-based generation, with good reason. Goltz cited the example of California PSO that invested $24m in a compressed air energy storage system with no real idea about whether it is in the interests of billpayers for regulated return purposes.

In the short term, the sweetspot appears to be islands – both the Hawaiian/Puerto Rican variety as well as – possibly – islanding capability to ensure security of supply whenever natural disasters like Hurricane Sandy batter the shores.

ESA 2014

Utilities uncertain

And what of the utilities themselves? Well, by far and way the most revealing session was a fascinating and genuine debate featuring New York City utility ConEdison, the US Army, developers Convergent Energy and hybrid power technology firm SMA Solar.

The US military is rightly seen as a progressive force in energy technology but Melanie Johnson of the US Army Engineer Research & Development Centre made it clear it is under no pressure to do energy storage. Army bases are pretty much the same as everyone else; they buy grid power from utilities and back it up with diesel gensets.

The US Army is not about to replace those diesel gensets at bases – there is simply not enough juice to be cost-effective – but it could use batteries to reduce usage of diesel to make fuel savings via peak shaving. Moreover, making the numbers work for the Army, e.g. via participation in balancing services, is problematic because by law it is not allowed to pay the penalties for not being available – its taxpayer money.

In general, Johnson was underwhelmed by energy storage, particularly after ZBB Energy’s vanadium redox flow battery failed to perform in a microgrid demo at, of all places, Pearl Harbor.

The smartest person in the room was Rebecca Craft, director of energy efficiency and demand management at New York City utility ConEdison. If there was once place on the US mainland where grid storage may make sense, it is New York City.

Since Hurricane Sandy, when there were 1.3m outages, resilience is the watchword. Wall Street is technically on a flood plain. Generators are problematic, as storing fuel is not ideal.

There are parts of parts of Manhattan where demand reaches 2GW per square mile. It’s also frighteningly expensive to build in the Big Apple; before corpulent New Jersey Governor Chris Christie killed the multi-billion dollar trans-Hudson ARC (Access to the Region’s Core) ‘Big Tunnel’, ConEd estimated the land cost alone for a replacement substation at $1 billion.

So alternatives to digging up roads and sticking in yet more copper wire underground, of which is there is already some 96,000 miles – the world’s biggest copper mine – are attractive. Craft said 10% of ConEdison’s system demand peak is fewer than 75 hours/year, so shaving just 150-200 MW would be highly beneficial to ConEdison and ratepayers.

Craft holds the purse strings for ConEdison’s new programme to permanently reduce 125MW of demand by June 2016. Naturally, Ms Craft was like a honeypot surrounded by bees.

The programme is political. New York State Governor Andrew Cuomo would prefer to close the 2GW Indian Point nuclear plant in Westchester County, which ConEdison estimates would leave 1.4-1.5GW gap in supply. So ConEd is contracting for permanent demand reduction between 2pm-6pm at a cost of $2100/kW.

Although the programme will consider energy storage, its participation is not mandatory. Judging by her remarks, Craft is not sold on storage. This comes down to, unsurprisingly, cost.

Some peaks, she said, are effectively 10-12 hours long, meaning batteries are not a good solution. “I’d rather dig”, she said. For the demand reduction programme, it seems ConEdison would rather go with demand response and energy efficiency measures like low-energy light bulbs.

Convergent Energy’s Johannes Ritershausen pointed out that demand response is not fully dispacthable, and when push comes to shove people are going to use their aircon – customers can save more money by not going to Starbucks twice a month than turning off aircon at peak times.

Craft replied aggregators may get a contract of 10 MW of demand response from utilities, but aggregators will contract for more than 10 MW with organisations to be certain of fulfilling their obligations, should there be any “phantom” megawatts… Every year New York City gets 300 MW of demand response, it’s always there, she said.

The value of storage to ConEd will be “edge of grid” storage to de-bottleneck grid congestion. ConEd spends $1bn on upgrades to meet summer peak and “we like batteries for areas of very rapid load growth to defer network upgrades in built-up areas”, says Craft.

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Permitting problems

The issue of permits threatens to be a show-stopper if authorities are not presented with technical data that can be easily validated. Craft suggested only lead-acid batteries are permitted by the New York City Buildings Department; no permit, no battery, no contract.

And while the New York Fire Department may not know what causes thermal runaway in lithium-ion batteries, they will certainly have heard of the Boeing Dreamliner incident.

It was not all doom and gloom from ConEdison. Utilities are showing more interest in installing storage at network pinchpoints.

Ms Craft believes the Public Services Commissions will start to rethink the market restrictions, allowing utilities to own and operate storage assets. But the question is, will they want to?

SMA Solar’s Wes Kennedy reminded the audience that residential and commercial energy storage is not a simple case of whacking in a battery hooked to a PV grid tie inverter; it needs current-source inverter, more than double than grid-tie inverters.

Convergent Energy’s Johannes Ritershausen put up a good case for storage. He observed storage increases the number of kilowatt-hours the system uses – good for regulated utilities – and by definition is a net power consumer over a cycle, so it acts as a tool to add load when required, as well as while offsetting losses from PV and renewables.

For behind-the-meter storage, however, Ritershausen admitted that apart from enthusiastic early adopters, most will not be willing to pay upfront for residential/commercial storage. Commercial property firms/tenants lease space; they will not want to buy batteries, so the business model will be for storage customers to enter into 10-15 years electricity supply contract at current market rates, or a little below, and the storage system will be installed with no upfront cost.

Of course, this shared saving model, much like ‘free’ solar panels, will need some form of government support to enable developers to make a buck. Monthly fees, avoided demand charges and lower bills are unlikely to add up.

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The utility always wins

And as more consumers seek to lower their demand charges, utilities will hike their connection fees. It will be a brave/rich/stupid customer who detaches her home from the grid entirely and be solely reliant on PV and/or storage or a genset – utilities are betting few will.

Utilities will remain the backstop, always there, even if millions install storage, so escaping the utility’s grubby mitts entirely will be a challenge. This makes a utility death spiral seem unlikely, particularly when it’s apparently reliant on subsidized programmes to be implemented by those self same utilities.

More to the point, is storage a friend or a foe? Delgates heard how Southern California Edison recently began disallowing residential and small commercial energy storage units because the nightly float current charge was powered by non-renewable grid electrons. This niggardly ruling soon spread throughout the United States.

Despite wanting to believe the hype, this author cannot swallow it. It’s not ready for prime time. Not yet.

Advanced Automotive Battery Conference: Running out of road?


The Editor bring a fresh pair of ears and eyes to the 14th Advanced Automotive Battery Conference. Is the industry sticking to the roadmap or has it taken a detour? This article was first published in the Spring 2014 edition of Batteries & Energy Storage Technology.

This author recently saw a presentation by brand marketing guru Peter Economides, who worked on Apple’s relaunch following the return of Steve Jobs in 1997. Economides’ key message was that to succeed, you have to get the customers to do your work for you.

In other words, word of mouth. The early adopters and influential types buy something, like it, and tell their friends. The friends buy it, who tell their friends and so it goes on. Granny will never buy it, by the way, no matter what it is.

Economides cites Better Place, which hired him in its dying days in late 2012, as a classic example of how not to do it. He showed a Better Place commercial featuring a young man telling us why he drives an electric car. In a word, it boiled down to domestitude.

He drives his EV because “She” is for people who want to save the polar bear. The visuals of a similarly aged woman makes it clear that “She” also refers to his lover, the woman who he hopes wants to marry him and have his babies.

Ultimately, the advert (and Better Place) was, in effect, trying to sell electric vehicles – a Herculean task and probably doomed to failure.

Trying to convince someone to spend upwards of $50,000 on a car in an effort to settle down to domestic bliss with their sexy, tree-hugging partner was a bum steer, said Economides. It wasn’t cool enough to influence the influencers; it was trying too hard to be cool while simultaneously trying to appeal to everyman.

Tesla is different. Flying in the face of the mainstream, Elon Musk’s outfit has switched its marketing focus on to the sexiness of the car rather than the driver. The message is rapid acceleration = sexy. Saving polar bears = not sexy.

The drawback, of course, is the cost. And what is the main cost? The batteries!

Tesla, which did not attend AABC, was something of an elephant of the room. It remains an outlier. Who could have predicted when AABC started in 1999 that a nerdy billionaire would cram 7,000 laptop cells into a supercar and thus turn the concept of away from environmental masturbation to a penis-extension supercar?

Most of the presentations were by mass-market OEMs, but it would have been very interesting if Tesla had been there too, 18650s or not. Will Tesla’s ‘cheap’ EV be able to weigh in at circa $40,000 as publicized? Besides, what will $40,000 get you? 40 miles range? 60 miles? 100 miles? Seats included? Doors too? We’ll have to wait and see.

Detour from the roadmap

AABC is quite a glitzy show, sleekly managed in an impossible-to-get-lost kind of way. There are concerns that AABC is not quite the force it once was. Perhaps this is true. But if it is, it’s more due to the industry taking a detour from the EV roadmap.

All the projections for EV take-up are well short of expectations. When AABC first came into being in 1999, peak oil was a real concern and future decisions about auto electrics and the contribution it could make to vehicle performance and emissions reductions were up in the air.  Shale oil and gas has seen that off for the time being.

In Europe, emissions reduction targets have been delayed and/or watered down. Will the US follow suit? The final decision to adopt the federally mandated fleet average of 54.5 mpg by 2025 will be taken by Congress in 2017.

If the Republicans get in again, this ambitious target could also be seen off as an ‘attack on personal liberty’ or some such. Perhaps the answer to the car industry’s emissions headaches lay in paying off Jeb Bush, Chris Christie or whichever character ends up winning the Republican nomination?

Even if the EV industry hasn’t quite taken off as hoped, AABC remains a conference with clout on the cultural calendar, attracting C-level speakers and most of the right companies. But it is noteworthy AABC will hold its first conference in Asia – in Japan’s Kyoto – in May.

The Japanese may have already won the battery war. Toyota, Panasonic et al are years ahead in both lithium batteries and EVs, while Samsung and LG Chem have caught them up in terms of lithium battery sales. Asia, perhaps more than ever, seems the natural place for an advanced automotive battery show.

To this end, the author was struck by a presentation by ARPA-E’s Ilan Gur, who spoke about an AMPED (Advanced Management and Protection of Energy Storage Devices) project for the US DoE.

Gur repeatedly boasted about how ARPA-E was the “skunkworks” of the US battery industry, but this particular project seemed pretty conservative. Gur started off by saying next-generation technologies typically took 50-70 years to become standard issue, the implication being they shouldn’t bother.

But surely the job of ARPA-E, so often compared to the Pentagon’s DARPA, is to reduce this (extremely lengthy) timeline? Instead, AMPED is dedicated to getting more out of existing technology: what it calls “removing the blinkers” from lithium-ion.

This, it is envisaged, would achieved by developing ‘smart cell’ battery packs, with individual cell-level active monitoring and control via sensors. A ‘smart cell’ system would reduce the physical capacity of battery packs by 20-30% by mitigating the need for other power electronics in the vehicle.

As this is a system-level approach, the development of ‘smart cell’ EV battery packs requires the input of 10-15 different development teams, so there is little chance of manufacturers developing such a system. Which is a big reason why ARPA-E is funding it.

But is this really something which should concern ARPA-E? Is this going to have the Japanese quivering in their boots?

It is also highly noteworthy that both AABC Europe and AABC 2015 will both include “two to three sessions” concerning stationary battery applications. This seems a sign AABC is either running out of automotive ideas or delegates, or both.

Attendees were down roughly 100 on 2013. Is this merely due to being held in Atlanta rather than Florida, as initially planned? Next year’s AABC will be in Grand Rapids, Michigan, which may well be picturesque but is not exactly a metropolis.

Commercial breaks

AABC seemed rather like US television: commercials punctuated by the actual programmes you tuned in to see.

William ‘Freedom’ Wallace of General Motors kicked things off with a commercial for the Chevy Volt, aka the Opel Ampera in Europe. It remains the United States’ best-selling PHEV (40% of sales were in California) at 23,000 units, although sales dropped by c.350 in 2013.

GM draws encouragement from the widening socio-economic profile of buyers of the Volt. The average income of a Volt owner has fallen from $150 000 in 2011 to $75 000.

GM’s sample of 500 Volt users found they drive an average 27 all-electric miles per day, leading to an 81% reduction in gas. A concern for GM is that US power utilities are looking to recoup the cost of EV charging infrastructure – the days of freebies are coming to an end.

GM said ‘fun to drive’ was the main reason to buy a Volt. It was only when your author brought up the question of how much longer will Volts be eligible to drive in California’s car pool lanes – its days are numbered – were reasons other than the Volt’s ‘greatness’ proffered.

Michael Lord of Toyota wasted no time in saying the Prius is better than the Volt and the Leaf, but served up a few useful nuggets, such as EV sales total 10,000 a month in the US, with an 84% jump in 2013 overall. xEV sales have risen 900% since 2005 and with BMW, Daimler, Hyundai, Kia, Mazda and Volkswagen coming to the party before 2018, sales are only going one way, if not as quickly as anticipated.

As usual, Avicenne Energy’s Christophe Pillot won the ‘Most Beautiful Slides’ award at AABC 15. Even if EV sales are not spectacular, a very small EV market in the automotive world will still represent a huge market for batteries.

The respected Frenchman forecasts 10% annual growth of lithium sales until 2025, with 15% annual growth for ‘new’ lithium applications such as UPS, telecoms, forklift, medical, residential and grid energy storage.

As an aside, Pillot mentioned the cost of 18650s falling from $1.50/Wh in 2000 to just $0.17/Wh now. Expect further substantial price decreases in the coming years.

The great 48V debate

The debate about whether the auto industry should introduce 48V vehicles to cope with the growing power demands of cars continues apace. Stephen Kim of SK Continental gave the by now obligatory ‘48V is inevitable, it’s happening, please buy our kit’ spiel.

Having developed a 48V NMC pack, SK Continental is in a slightly smug position if it does take off but overall this author was not particularly convinced about its apparent low cost/inevitability.

Real-world 48V driving conditions may see a 25% in CO2 reductions against only 10% for test cycles, but real-world conditions do not matter when this is driven by regulation. Unless, of course, the regulations change…

SK Continental expects 9% of the global market will comprise mild hybrids, of which 21% will be sold in the EU, 15% in the US and just 1% in Asia. Hmmmm.

Dr Anderman then went about obliterating the arguments for 48V, starting off with a reminder of just what a flop 42V was ten years ago, with more or less only the 42V versions of the Ford Escape and GM Silverado seeing the light of day. The implication was clear: 48V is the new 42V.

Dr A raised more questions than he answered. The costs of lithium 48V were a predicted $1000/kW, more than a full hybrid EV. Can OEMs deliver a cost-effective 48V system while  keeping within the 60V safe over-voltage limits? Will mass production of 48V bring down costs enough before 2020?

Is 12-15 kW at 48V really much less expensive than at 110V for a plug-in hybrid? And, that being the case, why would anyone buy a mild hybrid and not a plug-in hybrid?

The plain truth is mild hybrids are not sexy enough and even if it costs $1 500 for a 15% fuel efficiency gain, the stats show customers are more willing to pay $3 500 for 35% fuel efficiency improvementas it offers the prospect of a purer hybrid experience. Indeed, mild hybrid sales are expected to fall over the next three years.

Looking to what’s happening in Japan, Dr A notes Honda has replaced its Fit mild hybrid and is offering two new powertrains: the P2 strong hybrid and the Micro-2 hybrid with ultracap pack.

While Honda and GM are likely to continue shrinking their moderate/mild hybrid offerings, European car makers are developing 48V mild hybrids for Model Year 2016 and beyond.

But at current cost levels, these can only be justified for high-end cars. Automakers have to absorb much of the extra cost and the positive business case is probably still beyond 2020.

The debate was taken on by the car manufacturers, which are looking to 12V stop-start as far as possible to meet emissions regulations in the mid-2020s. Ford’s Daniel Kok said the business case for 48V was a challenge and may well not bother with it.

Compared to Europe with 25% of new sales, stop-start cars are relatively small phenomenon in the US. But if there is one projection on which you may wish to bet your house, it is the adoption of good old lead-acid 12V stop-start in the US will soar.

Unlike hybrids there are common standards for stop-start for almost all processes, and it is cheap, low-hanging fruit for emissions reductions. The question is: will 12V lead-acid stop-start be enough in the US?

Probably not; Ford, for example, needs to reduce emissions by 4% a year. Chrysler, meanwhile, was sweating cups about its gas-guzzling pick-up trucks ruining their future average fleet emissions.

Besides, lead-acid stop-start doesn’t always work as it should and this makes customers uncomfortable; Ford says 30% of its customers deselect stop-start. So, Ford is looking at 12V lithium-ion stop-start not only as a fix to the increased energy demands of cars, whose cabins are rapidly becoming entertainment centres, but also to harness regen power.

Kok says 12V lithium-ion is a very feasible option but the costs need to drop 30-50% to get there. LG Chem agreed, seeing 12V lithium coming down the track before 48V.

Jeff Kessen of A123 Systems says the 11.5kg weight reduction and 3-5% fuel economy saving due to increased charge acceptance puts the value of a 12V li-ion battery system at the $200 mark compared to $78 for 70Ah AGM lead-acid system.

In cash terms, the pack costs of a VRLA lead-acid battery are roughly $115 versus $600 for an equivalent lithium iron phosphate pack. This $500 cost premium could drop to $300 by the end of the decade. Although even then it will still be more than twice as expensive as VRLA, this does seem as a relatively cheap way to meet emissions reduction targets.

A123 says there is a positive business case for 12V lithium now, but where are the sales? The cost of lithium remains the biggest hurdle, while there is also the ‘hot button’ issue of cold cranking temperatures.

12V lithium-ion could potentially offer 4 kW compared to 10-15 kW for 48V. In effect this would be a micro-mini hybrid; not quite up to 48V levels, but offering significant fuel economy and emissions reductions on existing 12V stop-start. 

Bright lights, big city

The final day was a little PR heavy and only 90 brave soldiers managed to stay the course for the full five days of AABC. Yet one of the most interesting sessions was saved for last – on charging infrastructure.

The key messages was using the public purse won’t be enough to pay for chargers – it needs capitalism – and, like the Kevin Costner movie ‘Field of Dreams’, build it and they will come.

For Chargepoint, which is doing a roaring trade in installing EV equipment for private parking lots in the US, capitalism is working. So much so, in fact, that the wife of Chargepoint’s CEO Richard Lowenthal has a housekeeping allowance which stretches to buying him a Tesla S for Christmas.

Lowenthal explained how free electricity for EV charging is worth $550 per employee per year to Google as a tool to retain employees. In contrast, Microsoft makes a profit from employee charging.

The ‘build it and they will come’ model may well work in the US, where many businesses have their own parking lots in which to offer subsidized charging. In countries where there is not a mall on every corner and citizens make use of their legs to get around, however, public charging may be needed for EVs to take off as hoped.

This remains a very tough nut to crack. EVs are being sold as city cars, but many city dwellers live in apartments without practical access to charging. Furthermore, with space in cities at a premium, installing charging infrastructure may mean retrofits.

Mark Duvall of EPRI put the cost of retrofitting car parks at $100,000 for a DC charger. Who is going to pay for that? In this case, capitalism won’t be enough; it’ll need grants, subsidies, mandates etc.

An elephant in the room 

One of the main takeaways of the 14th Advanced Automotive Battery Conference was the future cost of electric vehicles versus their ever more efficient internal combustion engine rivals over the coming decades.

Next-generation ICEs, which may feature turbo-charged dedicated EGR (exhaust gas recirculation) engines, will match or even exceed the fuel economy of hybrid cars. For a Toyota Camry, the engine efficiency rise from 36.3% to 38.4% in 2030 and 42% in 2050 will translate into a fuel economy rate of 32.2 mpg today rising to 65.6 mpg to 88.5 mpg respectively.

The message is that one of the strongest arguments to go electric – fuel savings – may not always be so.

Yet for most of the advanced powertrain technologies there is a single point in the future where the costs start to get very similar. John German of the International Council for Clean Transportation had a number of interesting slides that showed the manufacturing costs of ICE, plug-in hybrids, pure EV, and fuel cell cars would converge in the 2040s.

When the manufacturing costs of ICE cars will exceed battery EVs, hybrid EVs, fuel cell cars (if not plug-in hybrids), and the cost of ownership issue will likely disappear. But this may not be for decades.

At the moment the industry is at 80 real-world miles range for a mass-market vehicle, but what happens when we get to 120 miles? The greater range will simplify charging infrastructure.

A lot of the need for convenience charging goes away and the need for public charging infrastructure comes from PHEVs, and they’ll be lots of them. Domestic charging will be sufficient for metropolitan day-to-day charging. Fast charging will take care of the rest.

Dr A sees 120-150 miles real-world range needed for mass-market appeal of EVs. This is someway off at a realistic price point with lithium. Or will Tesla prove everyone wrong?

Utility customer psychology is bad for you

iu cover crop

This article was first published in the March/April 2014 edition of Intelligent Utility magazine

You may think Europeans are more sophisticated than you Americans, meeting our beautiful partners with cheese-slicer cheekbones to sip cappuccinos in an elegant cafe before jumping on a Vespa back to our Georgian townhouses.

Well, it turns out that when it comes to utility customer psychology, we are pretty much the same as our root beer swilling, cowboy boot wearing, deep-fried-bacon-with-everything eating cousins in the US of A.

There are some pertinent universal truths for the utility industry. Customers don’t like you. It’s true. They feel powerless against the mighty utility which almost always holds the whip hand: they decide the price and customers have to stump up. They feel they have no real choice about this; it’s certainly true this is an industry whose participants offer, at base, undifferentiated products. There are no premium electrons or value-range CH4 molecules.

In simple terms, customer behavior in different nations boils down to the level of energy liberalization/deregulation, market mechanisms and how smart are the utilities. In those countries with state-run command and control energy systems, customer behavior simply doesn’t matter as long as supply meets demand.

In sub-Saharan Africa or South Asia, rolling blackouts are often part of everyday life. Most customers in Europe, however, do not even think about energy because it is omnipotent and because it is not expensive enough to really worry about.

In many cases, the command-and-control way of thinking refuses to die, even in nations quite far down the smart track. In North America, utilities are able to create an entire framework for smart grid because they more or less control the entire chain. This means customers are pulled into smart grid on their terms.

In Europe, there is much more potential for an open market, as utilities are more fragmented and they are innovating to compete to have the most attractive offering. This innovation is leading to a change in consumer psychology.

Established thinking says that customers want predictable, flat prices. According to Dr Philip Lewis, who has directly researched over 1 million customers worldwide as CEO of VaasaETT, this remains the case, but is becoming increasingly nuanced.

The question is what the customer means by predictability?

“Price rises, and volatility, make customers want predictability,” said Lewis. “Australia has had several price rises in recent years and as a result it is the most active market in the world. Customers are looking for a way out.”

Often that means fixed-term price contracts, but smart grid means more innovative, variable contracts are increasingly popular. “The old wisdom that customers want predictable pricing is changing,” said Lewis. “What they actually want is a predictably good deal, even if that means volatility. It’s rather like mortgages, you have fixed-rate or variable-rate, and you pick and choose depending on which way the wind is blowing.

“We’re starting to see more and more countries in Europe customers preferring to have more volatile prices in order that they have more transparency. In Norway, 55 percent of customers have spot-tied contracts, in which the supplier charges a commission on a rate tied to the Nordic spot market.”

Conventional wisdom that customers save money through competition, i.e. switching supplier, is also changing. Despite also experiencing sustained, inflation-busting energy price rises, no market has experienced a more dramatic decline in customer activity than Britain, once the most active market in the world.

VaasaETT figures show Britain has fallen from first to twelfth in eight years and from a rate of 21 percent switching per annum to just 11.5 percent in seven years. Shoddy practice, such as mis-sold tariffs and (now outlawed) aggressive door-stop sales, as well as the deliberate complexity and variety of tariffs has bewildered and alienated consumers.

Ultimately, said Lewis, customers want to feel on equal terms with their energy supplier. This is easier said than done, but smart grid technology offers utilities to change customer psychology away from distrust and dislike.

Fundamental to any behavior change is education of the customer. Automation alone is not enough. Customers who participate in automation without education are actually less likely to save energy at off-peak times than if they had no automation at all because they believe automation is doing it all more them, says Lewis. Reduction at peak hours is 40 percent more effective when participants are provided with feedback.

Customers want to feel in control and they have to feel rewards through their own direct experimentation. Feedback is vital, but it need not be complex. Devices like the simple rate clock fridge magnets trialed in Ireland are good for time-of-use tariffs.

If a smart meter display unit shows the change in tariff and the current cost of consumption, there is an immediate feedback loop.

In the longer term, utilities will need to show some ankle if customer psychology is to be transformed from borderline hate to love.

Ben van Gils, Ernst & Young’s global leader for power and utilities, said it’s not about products, it’s about the relationship. “In our experience, utilities tend to think they are not successful because they haven’t introduced the right product. In reality, the negative perceptions that consumers have of energy providers has resulted in limited permission for energy providers to stretch into new products and services.

“This lack of permission creates a huge obstacle for utilities, and minimizes the chances that any product, regardless of how good it is, will be taken up by customers. The quality of consumers’ experience with utilities must be improved before the relationship can stretch any further. Essentially, consumers want a voice; they want to be listened to and treated as an individual. Brands and companies that can offer this are the ones that earn their trust and loyalty,” he added.

So there you have it: Customers need to feel the love wherever they may be.

Energy from waste generates cash


Harnessing energy from waste enables companies to cut costs as well as carbon emissions, but there is potential for greater progress, as Tim Probert discovers. This article first appeared in the special report, ‘Managing Waste’, published in The Times on 5 March 2014.

Every year the average person in the UK generates 500kg of waste. Of this, half usually ends up in landfill. Driven by the EU directives on waste, for which the UK must reduce landfilling to 35 per cent of biodegradable municipal waste on 1995 levels by 2020, Britain is making strides to turn waste into energy and wealth.

Energy from waste (EfW) is not particularly new. Landfill gas has been used for decades and generates more than 5,000GWh a year of electricity from over 1GW of installed capacity.

Similarly, the large, typically 250,000 tonnes a year waste-to-energy plants burning unsorted, municipal solid waste (MSW), popularly known as incinerators, generate around 2,300GWh a year from approximately 600MW of installed capacity.

The landfill tax introduced in 1996, which saw councils charge a tax of £8 a tonne of material disposed in landfill, is perhaps the single most effective piece of legislation to incentivise efficient waste management practice. It has transformed the perception of waste to that of being a resource. A landfill tax escalator has seen the level steadily rise to £80 a tonne, with Chancellor George Osborne putting a floor under this figure until 2020.

Moreover, almost all EfW projects are eligible for three main revenue streams. These are the gate fee paid for processing waste instead of paying the landfill tax; the sale of the produced electricity; and one of two incentive regimes – renewable obligation certificates and feed-in tariffs.

Although so far not widely deployed, the Renewable Heat Incentive offers an additional inducement primarily for CHP (combined heat and power) anaerobic digestion (AD) plants. Non-CHP incinerators do not qualify for support.

Local opposition to thermal treatment technologies or incinerators can be fierce. Concerns are often raised about the health implications and the wider environmental impacts of burning waste. However, government and the industry argue the evidence shows the thermal treatment of waste is safe, while plants using cleaner technologies, such as advanced gasification and pyrolysis systems, which create synthetic gas and reduce air pollution, are increasingly common.

But there are fears market saturation has created overcapacity and undersupply of energy feedstock, with some councils locked into punitive contracts to provide waste to incinerators instead of recycling. Indeed, fears about potential white elephants have forced the Department for Environment, Food & Rural Affairs to withdraw hundreds of millions in funding to build new incinerators.

According to Nigel Aitchison, partner and co-head of environmental at investment management firm Foresight Group, talk about overcapacity is misplaced. He says: “When people talk about overcapacity they tend to talk about municipal waste, not the full waste market including commercial and industrial (C&I) waste produced by manufacturers, industry, hotels, restaurants and so on. In dry recyclables, there may be overcapacity and a number of facilities have closed, but there haven’t been any closures of EfW plants.”

The trouble is nobody is quite sure how much waste there is available or will be in future. It is widely accepted that the waste datasets are not fit for purpose.

Waste management consultancy Ricardo-ASA assumes that by 2020, there will be 53 million tonnes of MSW, C&I, and construction and demolition waste in need of treatment at thermal, organic and sorting facilities. On current capacity projections, however, this is 15 million tonnes more than both the operational facilities and known infrastructure likely to be delivered by 2020.

The absence of reliable waste data is a major hindrance to investors; this applies to both the quantity of waste and the detailed information about its composition. The lack of sound data using a common methodology makes putting a business case together challenging and one of the core reasons for limited financing for new infrastructure.

“What we’ve seen is a number of EfW projects that haven’t gone forward, not because they haven’t got the land or planning permission, but because they didn’t adequately structure the project in a way which meant it was investable,” says Mr Aitchison. To this end, the role of the Green Investment Bank (GIB) as a cornerstone investor is increasingly important, particularly for larger EfW projects.

Foresight Group recently forged a consortium with the GIB to construct a £47.8-million 10.3MW recovered wood gasification project in Birmingham. The GIB also invested £20 million in a 49MW waste-to-energy plant on Teesside in a consortium of SITA UK, Sembcorp Utilities UK and Japan’s Itochu.

Mr Aitchison sees AD as a significant area for growth. This uses natural bacteria, which breaks down waste to produce biogas for power and heat generation, and slurry which can be used for fertiliser.

AD accounts for more than 500GWh a year of electricity generation from 122MW of installed capacity, a tenfold increase in only five years. There are two main segments of AD – source-generated food waste (SSFW) and on-farm AD. SSFW units tend to be the larger of the two, typically 1 to 1.5MW with approximately 30,000 tonnes a year capacity. On-farm AD typically comprises sub-500kW units.

The planning process for AD is considerably less controversial than larger waste management incinerators because they are smaller, less intrusive facilities and are usually designed to manage locally sourced waste. Mr Aitchison has an eye on a possible move to ban food to landfill, as proposed by the Labour Party should they be successful at the 2015 general election, as giving a big boost to the AD sector.

Figures from the Waste & Resources Action Programme estimate 7.3 million tonnes of food waste is produced by UK households each year. “There is a progression to incentivising this,” says Mr Aitchison. “A landfill ban on food waste, which some people have said would be difficult to police, would undoubtedly be a benefit.”

There are some caveats. The UK as a whole is poor at collecting waste material, with more than 100 different ways used to collect waste, be it bag, box or bin. Indeed, most local authorities do not collect food waste separately.

Furthermore, the Department of Energy & Climate Change (DECC) last month confirmed feed-in tariffs for AD would be cut by 20 per cent, which the Renewable Energy Association fears will make some sub-500kW projects uneconomic.

If the Labour Party gets in in 2015 and keeps its pledge to ban food waste from landfill, however, AD is likely to be back in vogue.

2020 vision: A look at the European electricity market

europe light pollutionThis article was first published in the January/February 2014 edition of Intelligent Utility magazine

Europe’s electricity market is a mess. The clash between the European Commission’s desire for a single European market and national considerations of renewables targets, carbon emission reductions, price regulation and “keeping the lights on” is profound and getting harsher.

In effect, Europe has two power generation markets—one that is subsidized and does not react to market signals, and one that is not subsidized and driven by market forces. The growing surplus of intermittent wind and solar is a nightmare for utility companies for many reasons, and the problem is only going to get worse for Europe’s transmission and distribution system operators.

With 230 GW of wind and 120 GW of solar expected to be installed in the European Union by 2020, things have got to change. Utilities say the only solution is the complete integration of renewables into the market, and this must be done urgently.

This is easier said than done. Unlike the U.S. and FERC, the European Union has 28 member states with 28 governments, electricity regulators and national grid companies, not to mention collectively thousands of distribution network operators (DNOs). Each country works to its own interest and so harmonizing electricity policy is almost impossible.

While the Commission seeks to turn Europe’s 28 national power grids into effectively a single grid with power traded freely across it, plans by Member States such as Germany and the UK to introduce capacity markets risk the viability of such a unified system. Yet the world where European generators could calculate their business case by being certain of 6,000/7,000/8,000 hours of operation has gone.

Capacity markets are arguably justified in countries where there is too much renewable generation, insufficient conventional generation and where the grid is inadequate, and so the Commission has a battle on its hands to keep the single European market project on track, despite a growing surplus of 100 GW above peak demand in normal periods. The battle may already be lost.

Klaas Hommes of Dutch TSO TenneT BV sees great upheaval in the European energy market. “Feed-in tariffs are disturbing the market across Europe. An excess of solar power in Germany suppresses power prices in the Netherlands, meaning gas-fired and even coal-fired power plants are increasingly out of the money.

This is symbolized by the transfer in 2013 of a generator from the Enecogen combined-cycle gas turbine plant in Rotterdam, which had been operational for little more than a year, to Israel Electric Corporation’s Gezer gas plant near Tel Aviv, located some 2000 miles away,” said Hommes.

“We see the strengthening of the energy-only market and complete European market integration of renewables as the only answer,” added Hommes. “However, we are really concerned at the speed of progress.”

Hommes sees the need for more flexibility due to the greater challenges in balancing from one hour to the next. Furthermore, the increased flow from northern Europe to southern Europe and from Central Europe to Northwestern Europe will increase pressure on grids not designed to do so.

“The European market is no longer a day-ahead market, it is increasingly shifting to a near real-time market,” said Hommes. “This will require more cross-border co-operation and ownership of TSOs, more co-ordination between grid and generation and more system support services to be delivered by DNO/DSOs and third-parties.”

Hommes sees a greater role for ancillary services, with even a role for wind and solar power to provide active power, if not reactive power for voltage control.

Meanwhile, the need for grid investment continues apace. The European Network of Transmission, System Operators for Electricity (ENTSO-E) expects 100 bottlenecks on the European transmission system by 2020, requiring a 17 percent increase in grid investment worth 104 billion euros, equivalent to 52,300 kilometers of wire. Whether this investment will actually be forthcoming in an “austerity era Europe” is another matter.

Longer term, ENTSO-E’s eHighway2050 project is actively exploring the development of ‘electricity highways’, or transmission lines with significantly more capacity to transport more power than existing high-voltage lines in the AC grid.

If there can be any certainty about Europe’s electricity sector thru 2020, it is that the role of DNOs will become something akin to a DSO (distribution system operator). This is seen as crucial if Europe is to successfully integrate the ever-increasing growth of distributed generation, said David Trebolle, manager of Spanish DNO Gas Natural Fenosa’s active networks and control systems and chairman of Eurelectric’s DSO network codes technical group.

“Passive distribution networks will evolve to active distribution systems,” he said. “System services like congestion management, voltage control, information exchange, connection and planning are fundamental tools to maintain security of supply and quality of service at the distribution level. We will have new grid codes and ancillary services along the way.

“Real-time and near real-time networks are becoming more of a challenge. This will mean more opex spending as opposed to capex spending, and this will need a change in the regulatory regime. For this change to happen, better co-ordination between TSOs and DSOs are a must.”

Peter Styles, chairman of the European Federation of Energy Traders’ electricity committee, says an inevitable change to the way renewables are supported—from feed-in tariffs to quotas or certificate schemes—will open up new market opportunities. “With market-based mechanisms, there will be exposure to negative prices for renewables producers, meaning they will be subject to re-dispatch, possibly easing the path towards a new type of interruptible contract,” he said.

“National renewable schemes will require cross-border validity and thus reform of existing national renewable schemes will be necessary; cases currently before the European Court of Justice may accelerate this change,” he added. “For the future benefit of renewables, the Commission will revisit whether it will have grid priority access and dispatch, and whether renewable generators are immune to grid congestion management mechanisms.

“Exposure to balancing responsibility for renewables generators will open up the possibility for virtual power plants operated by owners of a mixture of types of plant and better return on investment for storage and demand response.”

Sunday Papers Energy Newslinks, 23 February 2014




Frack backlash has Tory MPs quaking in boots

North Sea shale gas

Cameron warns Scottish independence would jeopardise North Sea oil

Refinery crisis deepens as Welsh plant faces closure

Roll up, roll up for electric Monopoly at 150mph



Cabinet’s warning to Scotland over North Sea oil

Put investment and energy at heart of Budget, CBI urges

BP nears deal to lift ban on US contracts

Wind farms paid £30m to shut down during high winds

The energy ‘savers’ that cost you more

BBC flogs dead horse 





Centrica typifies the ills of the British energy industry

Nuclear leaks bill will be paid by taxpayer


independent edit



Risk of nuclear leak sparks call for installation of flood defences

North Sea oil investment could be at risk if Scotland votes for independence, warns David Cameron ahead of Aberdeen cabinet meeting






Hard at work in… Mexico: Ed Miliband’s flood supremo basks in 85C on sun-kissed jolly as Britons count the cost of the deluge

North Sea oil companies ‘must drill together’ to maximise production

Simply electrifying: Tesla’s ingeniously designed, earth-shatteringly fast, battery-powered supercar






Millions to get energy payout as faulty meter clocks blamed for overcharging







How to get YOUR money back from the bank accounts of the Big Six energy firms







Climate change is as old as the hills – but do environmentalists really have the right idea?





Scottish independence: New energy department plan






Ukip adviser branded hypocrite after striking wind-farm deals

Sunday Papers Energy Newslinks, 16 February 2014

Sunday Times






Planning delays ‘hinder fracking’

Centrica woos BP boss for hot seat

Plug us into Iceland, it will be cheaper than a nuclear plant

Price cuts by energy suppliers

‘The government made us all wet’ and other myths of the flood

This time, let’s learn from our mistakes

Games a loser in green stakes, says activist




Centrica chief feels the heat

British Gas ‘could turn loss making’

UK weather: it’s not as weird as our warmists claim [Booker]




Climate change is an issue of national security, warns Ed Miliband

Ed Miliband: ‘Britain is sleepwalking to a climate crisis’

Britain needs to learn to live with water

Climate change: time for the sceptics to put up or shut up

British Gas struggles to keep the home fires burning


independent edit


Your bills help British Gas to £600m profit








Private equity retreats from renewables ‘fad’




Energy giants including British Gas owner Centrica could exploit loophole in bills probe

It’s not just you who’s fed up! 5.5MILLION unhappy customers complained to the Big Six energy firms last year 

Energy bosses pledge millions will get refunds: Customers in credit to automatically get cash back… unless they’re with npower

Rubbish idea making everyone sort too many recycling bins, according to Veolia boss Estelle Brachlianoff





British Gas owner Centrica to fight break-up threat

Power problems for a green Queen

Power in your hands: Keeping a lid on energy bills

scotland on sunday



Iberdrola chief unveils energy network investment

Priming hydro power’s pump in Scotland

Shame on the gullible politicians who were taken in by Trump




The best deal offered to Scotland or just bribery? Two communities split by wind farm

West Lothian communities win landmark £13m deal after tough talks with wind-farm developers

Sunday Papers Energy Newslinks, 19 January 2014


Unholy row over church wind farm

Rural lobby hosts shale debate

At last the watchdogs are angry

California dreaming? No, this is the real electric McCoy

A Life in the Day: The lights will go out if we don’t go nuclear

Pious anti-fracking councils are standing on shaky ground [Ireland]


Nuclear waste site consultation was rigged to favour Sellafield, say experts

Fracking has conquered the US. But here’s why it can’t happen in Britain

Introducing the 2014 Observer Ethical Awards


English wind is too slow for turbines

Energy firms botch supplier switches

Small energy suppliers ‘at risk’ from Miliband price freeze plan


One million families switch energy supplier in last 2 months of 2013 after big price hike

‘Yeo must go': Fury of Tory faithful as former Minister at centre of sleaze inquiry dodges the axe

His face went crimson… and it was like a squire addressing peasants: Tory official on Yeo’s reaction when challenged about lobbying scandal at local meeting


Energy grid firms set for a grilling from MPs

wales on sunday

Energy bills rocket by 47% in just six years in parts of Wales, shock new figures reveal


Economists: Scotland deserves £bns in compensation for squandered oil money

Sunday Papers Energy Newslinks, 12 January 2014


Npower homes still hardest hit

Directors’ Deals: Head of SSE grabs cheap energy deal

Former Tory leader braves pirates for oil


Britons pay more for wind farms

Total’s shale deal could be worth six months of gas

Flooding chaos is down to David Cameron, not climate change




Npower seems to be charging us too much for our energy


Why power blackouts would be GOOD for Britain: Ed’s aide sparks fury as we brace ourselves for winter’s first Arctic blast

From energy monitors to radiator tubes … SEVEN gadgets that can cut your bills by hundreds of pounds

BP rocked as US judges refuse to limit spill compensation payouts





It’s VITAL that we win fight with EU over red tape on fracking






Rip off energy firms take a hit as nearly 150,000 families abandon the Big Six


Customers left cold by the ‘big six’ power firms




Renewables projects ‘held up by uncertainty’

Sunday Papers Energy Newslinks, 5 January 2014


The PM’s green pledges ebb away even as floods rise

British Gas pays for meter chaos

Your guide to simplified energy tariffs


Scourge of banks tackles frackers

ScottishPower to cut energy bills by 3.3pc in wake of government green levy deal

Shale set to cut energy bills

Not just the ice that’s sadly thick

HOW GREEN IS THEIR VALLEY; A small Welsh community is showing how a collective will can harness local resources to power its own future


Power firms tackled by MPs over profits and performance

Irish free to sue British nuclear operators over contamination

Back to Rising Damp? One million rented homes in private sector are substandard


The desecration of Britain: This stunning Lake District view is set to be blighted by new ‘super-pylons’ soon to scar 300 miles of countryside (all to hook up green energy)


Turned off by Big Six energy firms


Scottish Enterprise opens tidal cable competition

Why will Hinkley Point C cost £16bn?

Hinkley-Point-C-6134662The reported costs of the proposed Hinkley Point C nuclear power plant rose from an expensive £10bn in 2012 to an eye-watering £16bn within the space of a year. Why so much?

During a 21 October investor conference call, the CEO of the French state-owned utility EDF, Henri Proglio, estimated the construction cost of the 3260 MW, twin EPR reactor project at £14bn, “in line with the amounts committed to the EPR at Flamanville,” i.e. £7bn each.

EDF estimates a further £2bn will be necessary due to the specifics of the UK regulatory regime and site specifics of Hinkley Point C. The total estimated project cost, therefore, is £16bn.

Thomas Piquemal, EDF’s group finance senior vice-president, confirmed the additional £2bn did not include construction costs. “The investment cost is estimated to be £16bn, consisting of £14bn of construction costs and £2bn of other costs such as the acquisition of the sites, preparatory work for the various regulatory authorizations and the training of the 900 future employees of the nuclear station,” he said.

Later in the conference call, Proglio spoke of a “series effect”, i.e. a reduction in construction costs arising from experience learned the hard way from the long delayed and over-budget Flamanville 3 EPR project in Normandy, initially estimated to cost €3.3bn (£2.7bn).

Proglio said: “There is a series effect since we took lessons from our experience in Flamanville 3 and in Taishan [China] and compared to the cost of Flamanville 3 we are able to reduce significantly the cost of an EPR if we were to build a new Flamanville 3.”

Proglio went further, saying, “If we had to build a new Flamanville 3 it would cost £2bn less”.

That would put the cost of a new EPR reactor in France at £5bn, rather than £7bn for Flamanville 3, and suggests the overall construction cost of Hinkley Point C could be £12bn (£10bn for two EPRs + £2bn for “specificities”) rather than £16bn.

Yet the construction cost of EPRs at Hinkley Point C remains at £7bn each, exactly the same as the delayed, hugely over-budget Flamanville 3.

Pressed on this by a curious journalist from French newspaper Les Echos, who was clearly wondering how the “series effect” seemed to have no effect on the construction cost of EPRs built across la Manche, Proglio gave this contradictory response:

“The lessons learned…are offset by the site specificities for Hinkley Point, the regulatory environment in the UK and all specificities for HPC. The significant decrease offsets the additional incremental work that we have to perform and to carry out at Hinkley Point.”

But didn’t Monsieur Piquemal say that site specificities were accounted for by the £2bn on top of the £14bn construction costs? Confused?

Proglio tried to explain. “We have to have many ancillary buildings at Hinkley Point C that we don’t need for Flamanville. The site has a geologically different nature, softer ground and we have to do more earthworks and to put more concrete underground as a consequence.

“We have to take into account the fact that the Severn estuary is the large tidal flow location and there are many issues of that nature which leads to a more expensive cooling system when you are going to get the water in the sea to cool the power station.”

Although EDF says a new EPR in France would now cost £5bn, in Britain it is, in effect, £8bn. As Hinkley Point C is a twin reactor project, the difference between a ‘new’ twin-reactor Flamanville 3 and Hinkley Point C would be effectively £6bn.

Even allowing for the additional regulatory/site specifics plus land, training costs etc., does it really cost £6bn more to build two reactors of the same design in Britain than in France? Evidently so.

This matters because the British government wants consumers to pay for Hinkley Point C via an index-linked feed-in tariff at £92.50/MWh for 35 years (which during the conference call even EDF Energy CEO Vincent de Rivaz calls a “high price”). This, remember, is for a 3260 MW power plant that EDF expects will have an availability factor of 91%.

In his ‘flabbergasted’ note published on 30 October, utility analyst Peter Atherton of Liberum Capital estimated that Hinkley Point C would earn EDF and its investment partners up to £80bn over the 35-year lifetime of the deal. If EDF had overpriced Hinkley Point C by 25% it could cost British bill-payers up to £20bn in additional subsidies.

Proglio concluded the British government had examined the figures and were satisfied with the £14bn+£2bn cost, whichever way it had been calculated.

“[This is] fully understood by the government because all those costs have been scrutinized, analyzed, challenged by government, by the consultants and they have been convinced that these costs are justified and they are in the strike price,” he said.

The full transcript is well worth a read. It contains information about the nature of the Hinkley contract, especially its financing, which is not disclosed in either the 21 October DECC press release or EDF press release.

This includes EDF Energy CEO Vincent de Rivaz saying decommissioning costs had been factored into the strike price at between “£2-2.50/MWh with a cap at £3/MWh and any difference will be passed through to consumers”.

De Rivaz also states the Hinkley Point C contract would contain “protection mechanism against adverse changes in expected operating costs such as uranium price or labour cost, and changes in other costs which are out of NNB controls such as transmission charges and business rates.”

Sunday Papers Energy Newslinks, 22 December 2013




Swansea’s £850m tidal power plan

Should we go ahead with fracking?

Big firms that failed you in 2013




Fracking protests head north as activists mass on proposed Manchester shale gas exploration sites

Fracking chief breaks bread with church leaders in Lancashire

European Union funding £90m green lobbying con

Even the famous ‘taper’ won’t lower oil prices

The BBC and the warmists are ‘victims of group-think’




Fifty new nuclear plants could be goal in official energy plans

independent edit



Put some green in your portfolio





Energy regulator delays fee plan after MoS report





Compensation row could halt shale gas exploration






Energy company ‘threatens to turn off Christmas lights’ after issuing town with £10k bill

Conservative chairman Grant Shapps ‘a dead man walking’ as MPs want him sacked






Grinch energy firm spoils hols… but Daily Star Sunday intervenes

The death spiral – Australia’s changing grid

This article first appeared in the November/December 2013 issue of Intelligent Utility magazine

BIGCSIROb_edit_crop_smallBy now most will be aware of the dreaded utility “declining demand death spiral”: As solar PV grows, utilities’ demand drops. Utilities respond by raising prices and/or network charges—either for solar or non-solar customers—further incentivizing solar (and battery storage), thus further reducing demand.

Few places are more likely to experience the death spiral than Australia—a vast, sun-drenched nation with huge distances between urban and rural populations.

The highly-populated East Coast National Energy Network—connecting Queensland, New South Wales, ACT (Australian Capital Territory), Victoria, South Australia and Tasmania—currently has 3 GW of solar PV out of 35 GW peak demand. Yet, this relatively small proportion is having a material impact on utilities.

Queensland regulated utility Ergon Electricity, which operates 160,000 km of power lines in a territory of 1.7 million square kilometres with only 700,000 customers, is shedding hundreds of jobs in an effort to stay competitive with solar suppliers who do not have a distribution grid to support.  Utilities are fighting back with an increasing rejection of rooftop applications due to network constraints, but the rising tide of solar will only get harder to stem as solar costs fall.

Distribution network service providers (NSPs) are keen to introduce a residential capacity charge for solar power, effectively a tax on the sun, to mitigate the death spiral. But this, of course, may also have the opposite effect. In Australian states where rooftop solar PV power generation in winter is adequate (such as Victoria, South Australia and Tasmania), consumers may begin to desert the grid.

It is with this in mind that CSIRO (Commonwealth Scientific and Industrial Research Organisation) is studying the likely impact of a potential death spiral. CSIRO is leading a report by the Future Grid Forum (FGF) —due to be published by the end of 2013—with input from input from virtually every Australian generator, transmission and distribution network operator, plus regulators, consumer groups and regional/national government.

“By 2030 we fully expect to have more solar power generation during the daytime than the grid can deal with,” said Dr. John Ward, CSIRO research leader. “Australian peak demand occurs during the middle of the day. But if the take-up of solar increases as expected, this will shift to early evening, and the need for load management during the early evening becomes considerably more important.

“The nature of the ‘death spiral’ is that it leaves those not in a position to go off-grid in a very bad place. Furthermore, we may have to run a 100 percent redundancy system with large amounts of spinning reserve, as well as paying to deal with voltage control problems at the distribution end.”

The FGF has been discussing in detail how the industry can move to a more cost-effective solution. “The high penetration of solar power will require either balancing prices to rise significantly or a fundamental change in the market and we have been discussing this at length,” said Ward.

One way could be battery storage. Australia’s solar feed-in tariff is roughly equivalent to the wholesale price, and consumers can already start thinking about using storage to manage the price differential between peak (A$0.525/KWh) and off-peak (A$0.137/KWh) regulated prices.

Ward added, “Power suppliers are certainly thinking about selling systems rather than merely electrons, but it’s murky territory having a generator or NSP having involvement with equipment on the customer-side of the meter. It’s not quite clear how this will play out, but the NSPs in particular are looking at this from the perspective of network upgrade costs. Is there a more cost-effective solution which involves storage on the customer’s site and how they make that work from a regulatory point of view?”

NSPs have been exploring exactly this in trials. The Smart Grid Smart City project by Ausgrid, which operates the distribution network in the Sydney, Central Coast, Hunter Region and Newcastle areas of New South Wales, deployed both battery storage systems and fuel cells outside of the usual regulatory environment to answer questions about social acceptance of the technology.

CSIRO is also working on a number of research projects to better understand the relationship between solar power, storage and the grid.  The projects are concentrated in remote communities, where power prices are highest and power quality is lowest. One such project, called Plug and Play (PnP), is motivated by improving understanding of solar generation forecasts in order to reduce spinning reserve, i.e. diesel generators, or replace it with energy storage.

CSIRO is undertaking the A$2.9m ($2.8m) project with ABB Australia and the U.S. National Renewable Energy Laboratory (NREL). The first phase of the project will involve the development of the technology; the second phase will see pilot systems set up in both the United States and Australia.

Users will be able to “plug” in the generation sources and the system will “play,” i.e. work out which source to use based on programmable parameters, such as maximising power availability, minimising diesel usage or lowering maintenance costs. In essence, PnP will make the decision when to schedule the diesel generator, when to use solar energy and when to charge the batteries.

Dr. Ward says forecasting is crucial to the process. “The better we can improve load and  generation forecasts the better we can improve the energy management system, i.e. the batteries,” he said.

Ward adds PnP will be a useful tool for microgrid project developers who want an out-of-the-box solution rather than custom-made hardware and software for each installation.

“As the electricity grid evolves to have more interplay beteen consumer demand and resource availability, there’ll be a role for PnP-type systems to become mainstream in every part of the electricity grid,” he noted.

Sunday Papers Energy Newslinks, 15 December 2013


It shale be done: green light for fracking

Coal power plant faces axe by ministers

Biomass: a burning issue

Firms plan huge rollout of pylons [Ireland]

Gas deal sealed for extra €50m [Ireland]

Big six fail to deliver best buys

Peronist builds a fracking empire

The Frackers: The Outrageous Inside Story of the New Energy Revolution by Gregory Zuckerman

Abramovich Jr buys £110m oilfield

Branson and DiCaprio together in electric dreams


EU plan for fracking law threatens UK’s shale gas boom

Energy bills to fuel rise in inflation

Coalition backs coal-based energy revolution

UK’s next offshore energy fortune lies in coal

‘Toxic’ culture at npower at root of poor service – whistleblower

4,000 windmills produce no more than one proper power station [Booker]

Green energy cost-cutting plans may lead to more onshore wind farms

Inside the Hinkley Point nuclear plant

Hinkley Point C: Britain’s nuclear future


Energy market shake-up to hike bills by £6bn as households will be forced to pay extra £20 a year, warn experts

The great green con: MPs, Lords and lobbyists who advise Ministers on eco policies… then cash in 

The fatcat ecocrats exposed: Web of ‘green’ politicians, tycoons and power brokers who help each other benefit from billions raised on your bills

Two peers set ‘to be barred’ from the house of Lords following cash-for-access allegation

JAMES FORSYTH: What do the Tories want from Santa? A veto on every EU law

wales on sunday

Rock star Cian Ciaran speaks of his fears over the building of a nuclear energy plant in Wales

sunday independent

Bord Gais wind farms rebuff for Mainstream

‘Blackout’ Britain? Waking up to demand-side response

Photography for EnerNoc Web site and publications of new NOC facility.From National Grid to Distribution Network Operators and energy suppliers, demand-side response is seen as having great potential for tackling the Britain’s growing problem of how to keep the lights on. Tim Probert surveys the scene. This article was first published in the November 2013 issue of Energy World.

As surely everybody will now have realized, the state of the UK energy market is far from ideal. Having sweated its power generation assets for the best part of a quarter of a century post-privatization, the country finds itself in a panic about ‘keeping the lights on’, as an increasing volume of decrepit coal, oil and gas-fired generation is decommissioned.

While Parliament debates the Energy Bill to incentivize new generation under Electricity Market Reform, transmission system operator (TSO) National Grid has taken more immediate action by proposing rewarding larger power users to reduce consumption between 16:00 and 20:00 on weekdays in winter, as well as increasing the use of Short Term Operating Reserve (STOR) and other balancing mechanisms. The subsequent sturm und drang in the tabloid press about ‘power rationing’ and ‘Blackout Britain’ belatedly brought demand-side response (DSR) to the fore.

Very much under the radar there has been a quiet revolution in National Grid’s Short Term Operating Reserve (STOR) balancing product. Introduced in 2007, STOR is designed to ensure sufficient operating reserve to replace sudden generation losses, or unpredictable changes in demand.

National Grid procures around 3 GW a year of STOR, a large proportion of which must be available within 20 minutes. Driven by National Grid’s decision to offer 15-year contracts in June 2009, there was a brief boom in large STOR new-build projects. Green Frog Power, for example, supplies 214 MW from fourteen diesel-fired generator power plants rated between 6 and 20 MW in Yorkshire and South Wales.

There are two forms of STOR contract, firstly the committed service, which applies to all providers who wish to make themselves available for all required windows nominated by National Grid.  Balancing Mechanism (BM) units, typically sub-50 MW plant such as open-cycle gas turbines, and non–BM units, such as smaller diesel generators, can tender for this service.

The second form, which applies only to non-BM units, is the flexible service, which allows the provider to make the unit unavailable for particular windows on a week-ahead basis. Participants can reduce their load and/or use back-up generators to make up the shortfall (peak lopping) or export power from on-site generators to the grid during agreed times.

Only 10-15% of flexible STOR, however, is actual demand reduction, or ‘turndown’. While an effective measure, heavy use of diesel is not the most economically efficient or environmentally friendly and there is a growing trend towards genuine demand reduction measures to save costs and, of course, save the planet.

To be awarded a STOR contract, participants must guarantee a minimum of 3 MW capacity. Larger participants often contract directly with National Grid, but not all willing participants are able to supply this amount of reserve. However, commercial aggregation service providers, which now comprise around half of the non-BM unit STOR capacity, create a basket of participants who together comprise 3 MW or more.

Aggregators agree a strategy with the participants, typically data centres, offices, hospitals and factories, and bid the collective capacity into the balancing market. In return for offering bidding services and sometimes ‘free’ metering and IT equipment, aggregators take a cut from National Grid’s availability and utilization payments.

One such aggregator is KiWi Power. The London-based firm manages just under 100 sites in total, including Hilton hotels, Gwynedd Hospital in Wales, East Midlands Airport and J Sainsbury’s distribution depot Hams Hall, taking a 30-50% margin of DSR payments from National Grid. Like with financial services, KiWi Power packages 3 MW portfolios of sites in close proximity which statistically sit well together in terms of load profile; typically a hospital, a shopping centre and a hotel, to ensure one site can pick up the slack if another is unable to reduce consumption.

Layout 1

Increasing role for DNOs

While National Grid is responsible for STOR, Ofgem is offering distribution network operators (DNO) demand-side response incentives under its 2015-2023 price control regime price control, RIIO-ED1 (Revenue = Incentives + Innovation + Outputs). As a forerunner, DNOs are currently conducting trials as part of the £500m Low Carbon Networks Fund.

This summer, UK Power Networks (UKPN), which operates London’s distribution network, worked with KiWi Power to conduct a series of DSR trials. Over the course of the summer, UKPN called on KiWi Power’s customers to deliver a total of 45 times across its portfolio, delivering a total of 47 MWh of DSR.

Whereas National Grid pays on an undifferentiated rate, the trial was part of UKPN’s £23.8 million Low Carbon London scheme and thus paid differently. The ‘greener’ the DSR, the better it pays; a hotel reducing air conditioning load is, therefore, more lucrative than a hospital firing up a generator.

When this writer visited the offices of KiWi Power on a summer evening during a rare heatwave, we were interrupted by a phone call from UKPN requiring an immediate drop in load.  KiWi Power responded by cutting the air conditioning load from four hotels, as well as ordering a hospital to start a diesel genset. Over the next hour, consoles display the sites steadily reducing consumption.

John Conlan, Director of Facilities & Project Management at Mariott International Europe, decided to participate in the trial after being convinced by US utility Constellation Energy’s DSR performance at its Las Vegas hotels, investing £4000 per site on metering and related equipment. Conlan believes the flaw in the DSR plan – reducing load when it is needed most – is not a major problem.

“At the moment it doesn’t get any more sweaty than this,” he said. “No amount of payment from DSR is going to be of value if it has a negative impact on our guests, particularly in Central London. We’ve had a number of [DSR] calls, but had no negative comments from our guests.”

UKPN says the trials have given it confidence in using DSR as an alternative to network reinforcement as part of RIIO-ED1. Martin Wilcox, UKPN’s Head of Future Networks, said its RIIO investment plan identifies £38m of savings from using DSR, not only from working with aggregators like KiWi Power, but also by cutting out the middleman and providing DSR directly to customers.

“The 2015-2023 plan has a different flavour from previous DNO price control periods. The UK faces supply challenges over the next decade and we are being incentivized to reduce demand.

“As a DNO, we have natural advantages given our already strong relationships with larger customers. At the time of new connections to our network, there’s a great opportunity to discuss how to make new buildings ‘demand-side ready’.”

Electricity North West, the DNO which serves Greater Manchester, is one step ahead of UK Power Networks. Its ‘Capacity to Consumers’ (C2C) project aims to release redundant assets in its high voltage network and offer customers to provide DSR in a post-fault scenario.

The firm likens its network to having three hard shoulder motorway lanes which could be released as capacity to customers as demand increases. C2C seeks to offer customers connecting directly to its high voltage network (132kV and 33 kV) the opportunity to reduce distribution charges in return for agreeing to a delayed restoration of power following an outage. Typically, power is restored within an hour but C2C-managed customers can be delayed up to a pre-agreed period, usually eight hours.

Electricity North West is trialling C2C with both new and existing customers. The latter are rewarded with payments for entering into post-fault DSR, new customers have an additional incentive: avoidance of high voltage network reinforcement charges and reduced connection asset costs.

Electricity North West mitigates the need for network reinforcements by changing the electrical configuration of the primary substation, i.e. closing the normal open point and taking control of the network within its management system. This is achieved by fitting remote control equipment to a customer’s incoming circuit breaker connected to the primary substation.

C2C is being trialled until September 2014 to better understand network performance with altered configurations. Electricity North West expects a small increase in overall fault levels; it also faces issues with 6.6kV switchgear, which will require changing.

Due to the nature of this programme, customers must make themselves available 24/7 and the inherent risk to participants has not led to a surge in C2C; just three companies have participated, equivalent to 1.5 MW.  Simon Brooke, Low Carbon Networks Manager, says most interest has come from small manufacturers, with large manufacturers preferring, so far, to be in charge of their own destiny.

“We need to understand better how price points change for different customers and draw up attractive contracts to persuade customers to provide post-fault DSR,” he says. “It’s not merely placing a value on reduced connection and reinforcement charges, but also on how customers are providing security of supply to other customers on the network.”

KiWi Power control centre showing drop in load at Marriott Regents Park hotel

KiWi Power control centre showing drop in load at Marriott Regents Park hotel

DNOs to DSOs?

For the time being, however, the role of DSR for DNOs is expected to be limited. DNOs are by nature relatively passive and non-innovative, doing little more than owning wires and printing money. But with increasing volume of intermittent generation, what goes on between the half-hourly balancing periods becomes more important and the UK is arriving at a point where DNOs have to become more involved.

Craig Dyke, National Grid’s Strategy Development Manager, says over the next decade the role of DNOs is changing to one of running largely passive networks to a more active distribution system operator (DSO). “National Grid needs to work much more closely with DNOs to understand what’s happening on networks and how it impacts on transmission,” he says.

In October 2012 National Grid created a working group with the DNOs to understand the future role of demand-side response, the DSR Shared Service Framework, including the role of suppliers and aggregators.  National Grid, of course, does not think demand reduction is always necessarily a good thing.

“With increasing volumes of wind on the system,” says Dyke, “We are seeing excess supply at night, and we want to be able to increase demand at these times, perhaps from electric vehicles and heating, to reduce curtailment. DSR is all about peak demand – 4 PM to 8 PM on weekday evenings, particularly in winter.”

DECC knows this all too well. Its Electricity Market Reform (EMR) package tackles this problem head-on, including as it does a capacity mechanism to boost generation capacity to ensure the lights stay on at these peak times.

Capacity Mechanism role for DSR

As part of the capacity mechanism, DECC is grappling with how to introduce incentives for DSR. The department has wisely ruled out a ‘negawatts’ feed-in tariff, rewarding commercial investment in energy efficiency according to the level of energy that would otherwise have been consumed.

Instead, DECC will incorporate a DSR element of the capacity mechanism with different rules from those for generation capacity. DECC estimates there will be at least 1 GW of DSR purchased in capacity market auctions but as yet the market is insufficiently designed to tell if it will work, says Lisa Waters of the Waters Wye Associates consultancy.

“DECC has said DSR participants will be able to bid at higher prices than under the capacity mechanism, recognising that participants may need to invest in new infrastructure to fulfil the requirements, but it’s having trouble determining how the DSR is measured,” she says. “For example a 50 MW steelworks would be ‘derated’ by DECC to 40 MW, and the baseline for judging whether it has delivered DSR will be based on recent historical consumption data.

“I think they may struggle with that. If the steelworks has committed to DSR and suddenly the global economy picks up boosting demand for steel, it will be very difficult for boardrooms to be persuaded about the benefits of DSR, particularly as DECC said it will impose penalties for lost load of greater than £3000/MWh.”

The capacity mechanism, however, has one key feature which may ultimately lead to a radical approach to DSR, much to the benefit of the ‘Big Six’ vertically integrated utilities. Cost recovery in the capacity mechanism will depend on the level of peak load, i.e. punished for high load at the system stress peak. Suppliers will therefore be incentivised to contract for more demand-side response, or seek customers which have very flat load profile and ditch those with peak load, or at least charge them accordingly.

Chris Harris, Npower’s Head of Retail Regulation, cites research by Redpoint that predicts energy unserved could rise from almost zero in 2013 to 6 GWh by 2020. In other words there is a 20% chance of a brownout by the end of the decade.

“We are staring at lost hours in the face, but unused [generation] capacity is expensive,” he says. “There needs to be a paradigm shift away from inelastic demand and flexible generation to demand-side management. We must turn the existing model on its head and have a consumer-driven, rather than production-driven, system.”

For Harris, this means effectively shifting the suppliers’ burden of having spare generation capacity on to consumers by making them pay a premium for using electricity at peak times.

“We need to deliver full price signals. Our regulatory solution has always been to back off from this but it’s simply not efficient. Consumers will pay more but if you keep driving the price signal high enough they will change their behaviour to reduce their bills so that they’re better off than they were before.”

Npower ultimately wants to be able to directly communicate with devices via smart meters to directly reduce demand rather than have consumers running around switching off the heating. “It’s about moving heat load to a cheaper time of day,” says Harris. “In a smart world we will be able to manage the [heating] device remotely to automatically respond to price signals.”

Keith MacLean, Head of Policy & Public Affairs at SSE, thinks effectively doubling Granny Smith’s energy bill overnight would not be tolerated by politicians. “I don’t think we’re politically brave enough to vary electricity prices enough to make changes.

“The real opportunity to make a difference in our domestic energy consumption is in heat rather than power. Keeping the lights from going out by telling people to turn off the lights is not a good way of doing it, but we need to be prepared to legislate and regulate if aggregating and automating DSR is the right solution.”

How Do You Solve a Problem like West Cumbria?

Aerial shot of Sellafield

Aerial shot of Sellafield

Tim Probert examines a dilemma for the Government: what to do with the plutonium stockpile at Sellafield, as well as the long-running saga of developing an underground depository for nuclear waste. This article first appeared in the October 2013 issue of Energy World.

What was once thought to be a valuable asset is now a costly liability. Britain has accumulated the biggest pile of civil plutonium in the world and it is now struggling to decide what to with it.

The plutonium stockpile at Sellafield is primarily an accumulation of Britain’s atomic weapons programme, the Magnox reactors, as well as the failed fast breeder reactor programme, which sought to use reprocessed spent fuel in anticipation of a global shortage of uranium, a shortage that never materialized.

In total, the stockpile currently stands at approximately 120 tonnes and growing. The Nuclear Decommissioning Authority’s (NDA) Thermal Oxide Reprocessing Plant (THORP), which takes in spent fuel from both home and abroad, separating the uranium and plutonium for the former to be reused in reactors, generates an additional four to six tonnes per year.

The plutonium is currently safely stored in concrete bunkers in around 14,000, 7kg, stainless steel containers approximately 12 inches long. However, the volume of plutonium at Sellafield is said to be enough to produce 10,000 nuclear weapons and the Government estimates the annual cost of at approximately £80 million for the next 100 years.

Officially, the plutonium is not classified as a waste but as a zero-value asset. So the Government faces a dilemma; should it continue to treat the plutonium as a potential source of energy or simply write it off? Should it turn it into nuclear fuel for reactors, leave it in storage above ground at Sellafield or area deep underground in a geological formation in an as yet undesignated location?

In 2008 the Government asked the NDA to identify solutions for the long-term management of the stockpile. In response, the NDA published a ‘Credible Options Paper’ in 2011. After consultation, DECC set out three options for long-term plutonium management.

Firstly, re-use. The Government’s preferred option is to re-use the material, which it says contains enough energy to generate national electricity demand for 500 years, by using it in Mixed Oxide (MOX) Fuel. This would require the construction of a new MOX fuel fabrication plant.

Secondly, immobilise plutonium and treat it as waste. The plutonium stockpile could be immobilised so as to be ‘proliferation-resistant’ in several ways: through vitrification or using ceramics or cement-based grouts.

Thirdly, indefinite storage. This is the current default setting; plutonium will be stored at Sellafield until 2120 if no alternative is pursued.

Government’s preferred option

DECC’s preferred option of the MOX route is highly controversial. From start to finish, the original Sellafield MOX Plant (SMP) was a disaster.

The business case for SMP was predicated on British Nuclear Fuels Limited (BNFL) acquiring Siemens, including its MOX expertise. When the Siemens acquisition was abandoned, BNFL nevertheless proceeded with SMP, relying on its limited in-house expertise.

In an internal report released under a Freedom of Information Act request, the Government remarked, “As a result, SMP had significant gaps both in its design and operating capability. This meant that the plant was not fit for purpose and struggled from the start with a wide range of operational problems.”

Scheduled to open in 1997 at a cost of £265 million, SMP finally opened in 2001 at a cost of £473 million.  Yet it was not until 2005 that the first MOX fuel assembly was manufactured, forcing BNFL to subcontract their first orders to arch-rivals Areva in France. Remedial work was required, bringing the total cost to £490 million.

Designed to produce 120 tonnes of MOX fuel a year over a ten-year period, the SMP could only churn out 13.8 tonnes over its entire lifetime. The accident at the Fukushima Daiichi nuclear plant in Japan was the final nail in the coffin as it was left with no new potential orders for the MOX fuel.

In August 2011 the Government announced the plant was to close as soon as practically possible. The final cost to the taxpayer is estimated at £2.2 billion once decommissioned. US government cables released by WikiLeaks stated the plant to be “one of the most embarrassing failures in British industrial history.”

Yet despite this dismal failure, the government’s current policy is to construct a second MOX facility, estimated to cost between £5-6 billion. This is a particularly baffling policy decision given the total lack of customers for such fuel at home or abroad; there is only one power plant capable of using MOX fuel, Sizewell B in Suffolk, but owner EDF has not sought the necessary license.

EDF has also currently ruled out the use of MOX at Hinkley Point C in Somerset, should it be constructed. Horizon, the joint venture between E.ON and RWE subsequently acquired by Hitachi, which plans to construct new nuclear power stations at Wylfa in Anglesey and Oldbury in Gloucestershire has no plans to use MOX either.

Furthermore, the clear front-runner to win a contract to build another SMP is Areva, which is currently experiencing costly over-runs with its US project at Savannah River, South Carolina. The US General Accountability Office says the plant is more than three years behind its 2016 completion deadline and is now expected to cost $3 billion more than planned, ballooning to $7.7 billion in total.

The Obama administration says the high costs “may make the project unaffordable” and is looking for different ways to dispose of plutonium, such as immobilisation.

Sellafield MOX plant

Sellafield MOX plant

Other MOX technology options

MOX-2 is not the only technology option being reviewed for the Government’s preferred re-use route. Coming somewhat out of leftfield in 2011, the NDA announced it was exploring two other options: GE-Hitachi’s PRISM reactor and the Canadian Enhanced CANDU-6 reactors.

The PRISM reactor is a Generation IV sodium-cooled fast breeder reactor, also known as an integral fast reactor. The proposed solution would comprise two modular reactors generating a combined 622 MW employing metallic fuel, a mixture of the plutonium and uranium oxide, which would be produced at an adjacent fuel-fabrication facility.

Candu Energy proposes building four 700 MW Enhanced CANDU-6 heavy-water reactors to burn its own version of MOX fuel, which would require the construction of its own version of a MOX fuel-fabrication plant. Both options would be first-of-a-kind projects and this is inevitably likely to make the Government apprehensive.

In August the NDA sent its appraisal of the three technology options to DECC. The Government is not expected to make an announcement until after the political conference season has ended, but sources familiar with the consultation process suggest it is highly unlikely that DECC will give the go-ahead to ‘MOX-2’ of any variety for the foreseeable future.

“The government is under considerable pressure because of the large plutonium stockpile at Sellafield, but it has a history of delay,” the source said. “There is no immediate pressure to put shovels in the ground tomorrow because although you can burn MOX fuel in some of the new reactors, you first have to get those reactors built.  With the delayed new build programme, we are probably two decades away from being able to use MOX fuel in new reactors.”

That another MOX fuel-fabrication plant is even on the table is a triumph of public relations, according to Dr. David Lowry, an independent nuclear research consultant. “The nuclear industry is extremely successful in lobbying to convince the Government that it should build new projects,” he says.

“But no minister is going to come before Parliament between now and the General Election in austerity Britain and say they’re going to invest up to £5 billion in a new MOX plant knowing the last one was a complete disaster. They’ll kick it into the long grass.”

Going underground

Another Cumbrian nuclear legacy policy option in danger of derailing is the long-running geological disposal facility (GDF) saga. The on-off affair has rumbled on since the 1976 Royal Commission on Environmental Pollution report, popularly known as the Flowers Report, which recommended the foundation of a ‘Nuclear Waste Disposal Corporation’ to store High Level Waste and Intermediate Level Waste.

37 years later, Britain is barely any closer to finding a long-term solution to its nuclear waste. In January, Cumbria County Council voted against Government plans to undertake preliminary work on an underground waste repository, despite district councils Allerdale and Copeland having previously voted in favour.

Under current legislation, this would appear to rule Cumbria out of the equation: if a part of that community has said no then, strictly speaking, it should eliminate Cumbria from the process for good. However, DECC is consulting on the next steps.

It is thought unlikely that the Government will walk away from its current approach of encouraging a community to host the GDF voluntarily, but it could explore a revised process which would enable Cumbria to go forward with a GDF based on a decision taken below the County Council level.

Politicians have hinted that the veto of the GDF plans by Cumbria County Council could ultimately result in a merger of Copeland and Allerdale district councils to create a new unitary authority. Ultimately, however, Cumbria County Council is also the nuclear waste planning authority and would have to give permission to junior planning authorities for any exploratory drilling for a GDF.

Again, says Dr. Lowry, expect the Government to boot it into the long grass. “It may be that the Government keeps asking questions until it receives the ‘correct’ answer,” he says, “But I don’t think this will wash politically.

“The government will have to go ahead with interim storage at new nuclear sites. In the long-term there may be a version of a GDF, but I don’t think it will be deep underground, but shallow burial.”

Artist's impression of a Geological Disposal Facility NDA.jpg

Artist’s impression of a Geological Disposal Facility NDA.jpg

 Low level waste headaches

The Government has another painful headache with the on-going problem of storing Low Level Waste (LLW). Past policy on the disposal of LLW and Very Low Level Waste (VLLW) has been for it to be stored in situ before being consigned to the UK’s only dedicated disposal facility: the LLW Repository (LLWR) at Drigg, in Cumbria.

Here, waste is placed into metal containers which are then placed into engineered landfill cells and then covered with concrete for long-term storage. However, this facility is expected to run out of capacity in the next ten years, and alternative options are being sought.

A number of conventional landfill sites – two in Cumbria, one in Lancashire and another in Peterborough – are seeking the necessary authorisations to receive LLW and for landfill disposal. However, problems with obtaining planning permission look likely to stall these developments, with only Waste Recycling Group (WRG) at Lillyhall in Workington and Sita in Preston being set to proceed because their sites have long had the necessary planning consents.

In May 2012, Cumbria County Council refused planning permission to use the Keekle Head former open cast coal mine in West Cumbria as a site to store up to a 1 million cubic metres of LLW for the next 50 years. Endecom, which aims to operate the facility, is hopeful Westminster will overturn Cumbria County Council’s decision following a public inquiry in June 2013.

Also in June, Sellafield Ltd was fined £700,000 and ordered to pay more than £72,000 costs for sending bags of LLW to a conventional landfill site. The five bags, which contained plastic, tissues and clothing, should have gone to Drigg, but were sent to the WRG Lillyhall site in Workington.

Sellafield said a faulty scanner used to monitor radioactivity levels allegedly allowed the bags of waste from a restricted area of the site to be passed for conventional landfill disposal.  The Environment Agency has managed to recover at least one bag of waste from Lillyhall, but the incident has cast doubt on the robustness of the controls needed to ensure that only VLLW and LLW are disposed of in conventional landfill.

Asset or liability?

Yet the most serious problem remains what to do with the plutonium stockpile. There are growing calls from environmentalists for it to be simply written off as waste and immobilised so as to be ‘proliferation-resistant’.

Using existing technologies, the only way to store the plutonium waste in the GDF would be to deposit small concentrations in cement. To deposit all the plutonium in this way would require around 200,000 tonnes of cemented waste at a cost of around £8 billion.

While vitrification has been successfully deployed for liquid HLW at Sellafield, the process of vitrifying plutonium is not yet technically proven and would still require long-term storage underground at an estimated cost of £5–7 billion. The NDA is assessing this option through studies at the National Nuclear Laboratory.

Independent nuclear consultant Steve Kidd, who recently left his post as Deputy Director General of the World Nuclear Association, says the Government would be unwise to write off the plutonium stockpile as waste.

“It is an economic asset rather than a liability,” he says, “It would better to keep it stored where it is for the next 30-40 years to be used by Generation IV reactors.

“People get very excited by plutonium but it’s not in a Pu-239 form which could be directly used in a bomb without further reprocessing. It would have to be a very clever terrorist organization who somehow managed to walk off it.”

Although it requires relatively expensive active management, the plutonium is safely stored at Sellafield and there is no reason it cannot be for the foreseeable future.

Whether for plutonium, high, intermediate or low level waste, none of the proposed solutions need rushing.  It is much more important to get it right than to get it quick because past attempts at a speedy solution have not been successful.

Storage of Plutonium at Sellafield

Storage of Plutonium at Sellafield

Sunday Papers Energy Newslinks, 8 December 2013


Fracking chief pledges billions to villages

Agenda: Opposition to fracking can’t just be bought off

Inspector Blight blows away wind farm objections

Green stores’ open doors pour out CO2

We shall never surrender, sunshine


UK missed chance of offshore wind jobs

Political battles have put investment by energy firms at risk

Sir Roger Carr: the Punch and Judy politics on energy must stop

Wind turbines policy is all at sea

Fears of £3bn nuclear sell-off after Dutch object

Bill fiasco at npower: ‘A shock demand for £1,800′

independent edit

Sellafield chief may have misled MPs over clean-up programme


How can I live in a passive house?


E.ON ‘lured customers into deals more expensive than their existing contracts using scam’


Predicted ‘Power cuts at Christmas’ as big chill hits Britain


Stuart Paton: UK can benefit from shale revolution

Sunday Papers Energy Newslinks, 1 December 2013


Homebuyers to get £1,000 energy efficiency grants

Be brave, George, and pull the switch on Ed’s energy gimmick

Agenda: Never mind the bills, 
let’s keep the lights on

Yeo deselected after being cleared in lobbying case

How I Made It: Janet Thornton, founder of Inspired Energy


Energy bills: £1,000 green grants for home buyers

Barclays invests in shale gas revolution

IGas starts drilling for shale gas at protest site

Energy bashing – banker bashing by another name

The secret society of warmists [Christopher Booker]

Autumn Statement 2013: From business rates to energy bills: what Thursday holds for Britain Plc


George Osborne set to focus on fuel bills and NHS in autumn statement

David Cameron’s attempts to fix energy market don’t inspire confidence

Tim Yeo MP will seek local party ballot as he fights to retain his seat

What is the second law of thermodynamics?

independent edit

Coalition strikes deal on ‘green taxes’

Energy prices – you ain’t seen nothing yet


A £50 green energy tax cut is good news. The bad news? Britain will have to foot a £300BILLION eco-bill by 2030

Energy firms set to curb bills as Osborne is expected to cut ‘green’ and social levies

Osborne gives £1,000 to all home-buyers: Coalition seizes energy bills initiative in mini-Budget

MP caught in lobbying scandal fighting for his political career after being ditched by his local party



Cameron: We can help the poorest and stick to our green policies


David Cameron pledges new measures to cut energy bills

Big Six to cash in on hardship

Move to renewable energy is ‘too costly’


David Cameron pledges to cut energy bills by £50 after pressure from Ed Miliband




Low-carbon centre wins top green prize


David Cameron vows to cut energy bills

Sunday Papers, 17 November 2013


Inside the City: SSE waits to flick switch on power trip
Is the Green Deal any good?
A little blackmail by the big six and lower energy bills are toast
Energy bills set to rise by £500m
Energy boss gets £2m bonus as household bills climb


Energy bills rise by 36% in three years
Climate-change activists are playing a dangerous game with their ‘enemy’ narrative

independent edit

The big switch: Consumers urged to act together to undercut Big Six
The Big Switch will be a big help


E.ON breaks ranks over green levies
Centrica seeking millions in rate refund
Green scheme and a red tape ‘farce’
The Lib Dems’ green tax proposals are holding Britain back

Energy firms’ fury over refusal to cut green tax as Ed Davey warns Big Six are ‘too profitable
JAMES FORSYTH: The big freeze is here, so George cosies up to voters

Energy debt line calls soar to 3,000 a month – even BEFORE the latest price hikes bite
Anti-fracking protesters pitch up in tents outside council’s offices to demonstrate against evictions


Labour peers paid by energy fatcats

Water from coal mines could heat our homes
Exposed: the truth behind the Big Six attacks on green charges
What the politicians have to say on energy
Why energy prices have risen so much


Power penny pinchers: SSE slap £1.98 on £10 meter cards hitting 900,000 of their poorest customers

Sunday Papers Energy Newslinks, 10 November 2013


Green tax deal will cut energy bills

Blackstone gas bid in balance

Rise of female eco-warriors

Knives are out for water giants

The gadgets to fight energy prices


New Green tax threat in energy bills ‘deal’

Energy bills could fall by 7pc if Government cuts green tax

Cut green taxes and lighten the burden

Plan to sell Urenco runs into Dutch objections

Centrica chief plans cut-backs 

Chim-Chim Kerching! The return of the chimney sweep

Climate change is an uncertain science


Forests could face threat from biomass power ‘gold rush’

Gigha watts: Scottish island tests batteries for wind farms

Explaining nuclear fusion: is it the way forward for cheap energy?

Once, politicians assumed they had a role in energy pricing

independent edit

Report damns Sellafield firm over clean-up


Energy firms to pay back billions: Windfall for customers as Big Six finally  agree to refund direct debit overpayments after pressure from the MoS

BP’s North Sea gas field reopens – but hopes for lower gas prices are dashed as  restart could take nine months

‘We’re fighting back and saving money': Angry army of energy customers desert  the Big Six for smaller and cheaper energy rivals

Torrent of water price hikes in the pipeline as cost of average annual bill set  to rise to over £400


£10BN ENERGY BILLS RIP-OFF: Salmond wind farm obsession cost British families £2,860

Centrica to axe investors payouts


Gas and electricity firms ripping off hard up families in energy bill ‘postcode lottery’

Under the Tories we have become Fool Britannia as foreign countries cash in on  our energy bills

Millionaire Conservative MP Nadhim Zahawi claimed for electricity bills at his  STABLES

Oil traders finally feeling the heat on an alleged DECADE of price  fixing



Minister: Fracking coming to South

‘£100M FREEZE’


SSE profit fall unlikely to halt energy bill row

Sunday Papers Energy Newslinks 3 November 2013


Energy bills may fall by £75

Osborne’s new green deal to cut energy bills

Energy giant in row over bid to cut tax liability

Axe hangs over Welsh fuel refinery

Iran sanctions deal reopens North Sea field

Miliband fights water firms for fairer bills

Marine energy must push for wave of support


Utilities have to speak for their customers first

Britain seeks Qatari gas and funds

340 MPs claim £200,000 on expenses for energy bills

Rebellion over wind turbine plan for 320 year old battlefield


Lesley Yellowlees: ‘I saw something no one else had seen’

An early Christmas present from the energy companies

How can I reduce my energy bills?


David Cameron’s green agenda is ‘spurious,’ says Sir Jonathon Porritt


‘Tell the truth over rocketing bills': MPs demand energy firms for full breakdown of costs and profits

‘I had to wait three months for a refund': Energy suppliers earn millions as they reap interest on customer overpayments

The minister and the eco-zealots: The incredible story of how Lib Dem’s green campaign has been hijacked by far-left group who rioted and stormed London store

I knew about energy watchdog chief’s green business links, admits Ed Davey – but he denies they are a conflict of interest

RACHEL JOHNSON: We’ve been mugged – and they did it by direct debit!


Britons forked out £1m to energy firms during megastorm that killed five

It’s down to Osborne to rein in rampaging energy giants


House of shame: 340 MPs get their energy bills paid on EXPENSES to heat second homes

Gas bill blow for millions as energy giants scrap discounts for millions of customers


NPOWER CRAZY; Price hike energy firm plans to axe 2,500 jobs

Brits raid savings to fund light and heat


Energy companies ripping off customers by keeping them on hold for up to an hour

Abuse of power: Big Six energy fatcats insult Parliament but Stephen Fitzpatrick impresses

Big Six energy companies are trusted less than bankers and used car salesmen


Scottish Government hits out over energy plans

Energy sector ‘least trusted’ by consumers


Energy minister’s blackout warning

The big six’s greed knows no bounds

Examining the latest fallout from Fukushima

wales on sunday

Vale villagers plan campaign to protest against test drilling

Sunday Papers Energy Newslinks, 27 October 2013


Meltdown: Parties feel the heat over power bills

Have we got nukes for you

EDF urges price probe

Regulator cracks down on ‘sneaky’ energy price rises

Dave, Nick and Ed scatter like hunted badgers


‘Green Dave’ Cameron as much to blame as ‘Red Ed’ Miliband for energy crisis [Booker]

BP’s bill for Gulf of Mexico spill set to hit $43bn

Shale energy ‘could supply UK’s gas needs for four years and save jobs’

Why nuclear deal is good news for Britain

Cameron shouldn’t play on Miliband’s side of the pitch


British Gas rakes in £20m profit from overestimated bills, says whistleblower

UK universities urged to pull cash from fossil fuel giants

Do Britain’s energy firms serve the public interest?

Only full-scale reform of our energy market will prevent endless price rises

Five questions that the big six energy firms must answer

Labour has landed a palpable hit – but it’s not a knockout punch

An independent Scotland must own its energy sources

Switch to small energy suppliers, consumers urged


The other energy scandal – power giants use loophole to cut their own tax bills

Green tax goes to wrong homes, says think tank

Greenpeace abandons Hinkley Point ‘lost cause’

Clarity is needed on green taxes

Turn up the heat on this silly energy advice


JAMES FORSYTH: Clegg starts to melt as Dave turns up the energy price heat

Britain says ‘no’ to green levies: More than half of voters object to paying eco taxes

‘I’ll make the Big Six refund millions of YOUR cash… or face fines,’ says  minister as energy companies are summoned to Downing Street over direct debit  payments

Red Ed: How I grabbed my own price freeze… after £1,000 bill

Carbon tax should be scrapped before it makes energy imported from Germany  cheaper than domestic supplies, according to City analysts

Yes, energy bosses like me make mistakes… but green levies are the real enemy


UK household gas prices have risen faster than in any other major European country

Government’s energy policy such a Major disaster even former Tory PM is giving  Cameron advice

On climate change David Cameron is the phoney green giant


Energy bills soar but the watchdogs at Ofgem are having a gas

Energy firms to defend price hikes as bosses are called into Parliament

Majority ‘opposed to green levies’

BP and Shell profits set to fall by billions


Sky high

A longer lifespan for wind farms greener

Sunday Papers Round-up, 20 October 2013


Minister haggles over nuclear bill

Agenda: New nuclear dawn will lead to bigger power bills

That’s our children’s future you’re selling to China, Mr Osborne

Npower next to raise prices

Green jobs promise goes up in smoke

D-Day looms for Grangemouth

Grangemouth boss: help me keep it open


Coalition at war over energy policy as Tories plan to cut green taxes

First Utility boss: bills could double in the next 10 years

Nuclear given final green light

‘Mini-nukes’ beat monster wind farms on every count [Booker]


George Osborne in China – wide-eyed, innocent and deeply ignorant

Irish greens fight UK nuclear plan in court

Fuel prices: the power of Britain’s energy giants must be reined in


Energy bills for dummies: A budget guide to staying warm

Let’s play God: The scientific experiments that might save the world (or destroy it…)


Archbishop damns energy price hikes in controversial attack: ‘Firms must show generosity…not just maximise their profits’

Power plant deal leaves the UK handing £90bn to France and paying DOUBLE the going price of electricity for 35 years

Energy Minister Greg Barker: ‘We put some wind farms in the wrong place’

MAIL ON SUNDAY COMMENT: We must sort out fuel prices… right now

JAMES FORSYTH: As the gloom lifts George gets ready for revenge

MAURICE SAATCHI: Soaring power bills… and why a slavish devotion to old capitalism by the Tories will hand Ed the keys to No10


Bishop’s shock at gas hike/Minister calls for end to ‘copycat’ energy price rises


Whistleblower reveals price-hiking SSE’s ‘white lies and brainwashing’ sales secrets

Energy giants SSE and British Gas give £1.6bn to shareholders as others suffer

Two more energy giants prepare to hammer millions of customers with price hikes

Watch out for the red levy as Tories go cap in hand to China to keep Britain’s lights on


Get a grip on energy firms


Backing for gas drilling buffer zones

Is our green energy dream falling apart?

Sunday Papers Round-up, 13 October 2013


Green light for giant nuclear subsidies

Green loans cost £34,000 per home

Wind farms ‘spinning out of control’

Volcano power gives green boost to paradise isle


Energy watchdog Ofgem ‘broke job rules’

Wind farm subsidies generate £900m for Britain’s big six energy suppliers

Number of planned new onshore wind farms has doubled since 2011

Green energy: How their green rush is costing us all

Subsidising wind is a costly mistake

Friends: The One With the Energy Bill

It’s showdown time for our insane ‘green’ energy policy [Booker]

Wind farms are ‘green vandalism driven by greed’


It won’t be the price that freezes if Osborne capitulates to the power firms


‘Defend green policies,’ activists urge Lib Dems

The Government’s answer to global warming? Cold feet

A local solution to energy bills, a new word, a farewell to floral designs and a phantom at the opera

Cloudy with a chance of… climate change: Discovery that agricultural practices help form clouds could change the way we calculate global warming


Red Ed’s great green obsession… and the real reason YOUR bill has gone through the roof: The hidden subsidies each household pays every year thanks to Miliband’s laws

A meagre slice of cake for birthday boy Dave – and no prezzie from Nick


£900million plan to cut winter fuel deaths

Fuel hikes to push families over edge


Power grabs — £24m bonuses for energy chiefs while our bills soar



Record numbers fight to claim back £1.2billion overpayments which make energy  companies £12m interest a year

John Prescott on why it’s coal power to the people


George Osborne to give the ok for Chinese nuclear power stations to be built in the UK


2,500 wind farm applications made in past 18 months

Fuel prices debate heats up for winter

Comment: We’re paying the price for renewables


Renewables recruitment firm soars

wales on sunday

Electric shock! Welsh families suffer Britain’s highest electricity bills

Sunday Papers Round-up, 6 October 2013


Hinkley nuclear deal hinges on profit sharing

The birthing pains of new nuclear

‘Carbon tax too expensive’, says industry

Green energy to cost consumers £400 over next five years

Climate change ‘scientists’ are just another pressure group [Booker]


Blackout Britain

Hand over the turbines, this is a land grab

A new kind of dark satanic mill threatens the land – solar farms

Bord Gais faces split after sale

Grangemouth oil refinery strike may hit flights


Energy lobby insiders will lead cold war against Labour

Labour promises to create a US-style consumer tsar

£1bn a month: the spiralling cost of oil theft in Nigeria

In our democracy, the BBC has to give a voice to climate change deniers


Labour attacks bonuses for energy officials as bills soar

Still rainbow, but more warrior: The latest Greenpeace protests mark a strategic change in its approach


Letters warning of 10% energy price rises expected to start hitting doormats in  next two weeks

JAMES FORSYTH: How Ed’s energy price freeze gave George the shivers


Energy giants sitting on one BILLION pounds of our money from overpaying on estimated bills

Energy watchdog investigating ALL of “Big Six” power firms

Britain’s green future is looking dark under the Coalition


Scottish independence: Split from UK energy market call


Independence ‘could mean lower power bills for Scots’

Sunday Papers Round-up 29 September – ‘Return to the 1970s/price controls abolished in 2002’ super-jumbo edition


China eyes Sellafield

Centrica warns on Miliband freeze

Miliband’s energy ultimatum wrongfoots City

Don’t bully the energy giants — here’s how to help the little guys

Don’t delay, make energy switch easier

The UN’s hot air gets hotter, but the Earth just isn’t following suit


Energy giants close in on green taxes delay

David Cameron: My mortgage plan for struggling families

Ed Miliband can’t freeze those bills he himself sent through the roof [Booker]

Red Ed Miliband sparks green war

George Osborne should delay green targets to cut energy bills

Shale may fail in Sussex, but it will give America the edge

Solar power: can you really earn 12pc?


British plan to avert climate disaster using sun power

We must harness the power of the sun

No more denial. Time to act on climate change

IPCC climate change report: a scientist’s story

Socialism has failed. Neoliberalism has failed. But Ed Miliband’s new deal might just work

‘Red Ed’ Miliband? Not really, but at least he’s made a start


It’s high time for the ‘Big Six’ suppliers to clean up their act

‘Miliband’s focus is right, but his solution is economically illiterate’

Babcock takes nuclear option for new name

Two British Greenpeace activists to appear in Russian court

Populism? By Gove, I think they’ve got it


Energy chiefs call for urgent talks on Ed Miliband’s price freeze plan

‘Only Finland and the US have cheaper gas – don’t let Miliband’s price freeze scheme damage the UK': British Gas boss stokes up the heat in storm on fuel pledge

Met Office proof that global warming is still ‘on pause’ as climate summit confirms global temperature has stopped rising


Ed Miliband energy plan boost: Other EU countries already have charges capped

Ed Miliband energy plan: Most people want David Cameron to copy Labour policy

John Prescott: Ed Miliband’s got it right, Peter Mandelson’s a fuel

At last Ed Fights for ordinary folk over energy bills


Ed Miliband’s fuel price freeze ‘will put lights out in 2015’

Why we all need to be much brighter sparks

Prime Minister can do a power of good by scrapping wind farms


Gerald Warner: Dodgy dossier on global warming

Sunday Papers Round-up, 18 August 2013


Robots to clean up tomb of Sellafield

No cracks in the granite ignorance of the ‘frack and ruin’ brigade


Fierce opposition to giant Atlantic Array wind farm

Give fields over to solar farms, industry urges

Noisy protest drowns out the truth about fracking

Fracking in UK’s interest, says Cuadrilla’s Browne

Police drafted in to boost security at fracking protest

Fracking: There’s no place for mob rule at Balcombe

The new Luddites are standing in the way of a shale gas revolution. They must be stopped


Middle England and the eco-warriors say victory is theirs in the battle for Balcombe

Why smart meters might not be so clever after all

Party leaders don’t have to be popular to win elections, says Caroline Flint

The sunny side of solar power


Balcombe fracking protest widens: Second campsite opens as activists prepare to step up their campaign against shale gas exploration in Sussex


50-year-old fracking site that makes a mockery of the Balcombe zealots: It’s next to a nature reserve – and has fracked enough gas and oil to power 21,000 homes every day… with no complaints from locals


Shale gas could halve UK imports


Cairn expansion campaign eases pressure on Greenland


Don’t fear the Far East buy-in to North Sea oil and gas: it’s breathing new life into the sector, says expert

Sunday Papers Round-up, 4 August 2013


Fracking minister’s shaking walls jibe

Liddle’s Got Issues: Fracking protests


Tycoon’s bid to burn sea coal dismissed as foolish

Oil invaders park their rigs in the North Sea

Wave firm’s tide of discontent

Free energy? You’re better off switching

Hands auctions off green energy assets


Lib Dem president Tim Farron warns fracking could harm countryside ‘for decades’

Balcombe’s eco-warriors have the limelight, but a strong local contingent wants to be heard

Matt cartoon

Adams comment cartoon, 04 August 2013

Christopher Booker: We could soon be paying billions for this wind back-up


Why the ‘dash for gas’ has got off to a false start

Ignore fracking protests, government tells planners

The Tories and the ‘desolate’ north

Revealed: how UK water companies are polluting Britain’s rivers and beaches

The water companies and the foul stench of exploitation


Doomsday alert over fracking as minister warns of rectory walls quaking across  Middle England if drilling continues

My fracking drills won’t cause cancer or pollute water whatever the death-threat  zealots say, by drilling company CEO

Campaigners call on householders to switch as energy prices rocket


Minister Michael Fallon in alleged fracking ‘shakes’ jokes


Home of fracking firm boss is ‘perfect’ place for shale gas drilling


Customers blast Marks & Spencer over ‘mis-selling’ of gas and electricity

Scots ‘face world’s biggest energy bills’ from wind power

We ignore shale gas at our peril


Minister in fracking ‘shakes’ joke

Lord Howell’s week off hell

Sunday Papers Round-up, July 28


Inside the City: Drax paints it green

British Gas faces fuel poverty row

Singapore joins Urenco pursuit

SNP full of hot air over North Sea oil windfall


Osborne on EDF nuclear charm offensive

Centrica set to raise gas prices as costs escalate

More arrests as veteran green activists dominate village ‘fracking’ protest

Will the Government use shale revenues wisely?

Middle England for wind turbines and expensive energy? Pull the other one.


EU and China settle solar rift

More arrests in Sussex fracking protest


Caroline Lucas: ‘Politics is about everything we do’


BP profits down as it waits for new trial over Deepwater Horizon oil rig disaster


Taxpayers’ bill of £1million to police West Sussex anti-fracking protests

Anti-fracking mob mayhem


Peterhead plan not viable, say experts

Trade union threatened to shut Grangemouth refinery over Falkirk chairman’s suspension

Oil revenues could be better spent


Shale Gas Protestors tell police to ‘Frack Off’


Sunday Papers Round-up, 21 July


United Utilities opens talks with Cuadrilla over fracking deal


Fed may ban banks from oil speculation

A fracking good proposal

£185m in Whitehall ‘golden goodbyes’


Cameron tells big energy firms to end contract ties: Anger as Ofgem delays action in energy deals row


Power trip

SNP: indy Scotland will get oil bonus, but it won’t be basis for economy


Independence: Oil ‘a bonus’ in independent Scotland

Wanted – a tax break for lower fuel costs

Sunday Papers Round-up, 14 July


Wind farm subsidies cut by 25 per cent

Tax break boost for shale gas explorers

Centrica’s £1.4bn gas store could be shelved

[Christopher Booker] This new energy scandal makes the wind industry look underpaid


Climate change sceptic energy minister fired for security asking energy companies to warn of blackouts unless coalition watered down its green crusade 

[James Delingpole] The dirty secret of Britain’s power madness: Polluting diesel generators built in secret by foreign companies to kick in when there’s no wind for turbines – and other insane but true eco-scandal

Shale riches may cut price of nuclear deal with the French

Rollover energy contracts for small businesses should be banned, says energy giant E.ON


Revealed: Fracking industry bosses at heart of coalition


INEOS considering move into shale gas


Greenpeace’s Shard stunt was bold, but will it help its cause?

Climate change is happening too quickly for species to adapt


GE to crash bid battle for Invensys

Heat is on for Bord Gais sale

Energy rules hit second homes

Plan to restart decaying Congo nuclear reactor

Rural families ‘left in the cold’

Put energies into heating rural homes

Warm to renewable heat payouts


Wind farms cleared for building by 3D radar


Petrol prices: Campaigners to call for major probe into market-fixing claims

Sunday Papers Round-up, 7 July


Green power boss plots £60m listing


Rival nuclear companies cheaper than EDF, Ed Davey suggests

Christopher Booker: Our lights will stay on – but it will cost us a fortune

Handing Africa the power to charge ahead


Will fracking in Lancashire’s green hills solve Britain’s energy crisis?

Deepwater Horizon: BP cry foul as 10,000 claims flood in each month


Anger as Ofgem delays action in displaying contract expiry date on energy bills


Scots power firms battle with English rivals over timetable for reforms


British & Irish Lions beat Australia to claim first series in 16 years

Sunday Papers Round-up, 30 June


China in talks on nuclear plants

Ministers save 2,000 pit jobs with break-up of UK Coal

Why we need to frack, slash, build

Get on your bike and go for growth

Families can grab a green giveaway

See, global warming has a bright side


Crunch time as UK faces battle to keep the lights on

No quick fix to ensure energy security for Britain

Britain can’t afford to throw money at wind power

Coalition facing back-bench revolt over wind farm subsidies

Christopher Booker: The message of shale gas is: scrap the Climate Act

Uncle Sam’s proxy war against British business


Stephen Emmott Q&A: ‘Wind farms are not the answer to our problems’


It won’t be shale gas that keeps the lights on


Dirty tricks of the the fracking deniers: How Green zealots peddle cynical propaganda to stop Britain mining £3trillion of shale gas…enough to keep the lights on for 141 YEARS

Cheap, clean and safe: get fracking…


RSPB gives the go-ahead to bird-killing windmills


Dart makes ‘fracking’ promise


Scottish fracking licences to be dropped

Beyond the shale

Sunday Papers Round-up, 23 June


Green Deal flops as only two get eco-loans

ESB gears up for plants sale

[Anti-Severn Barrage] Lobbyist ‘wrote peer’s speech’


Energy regulator to warn over blackouts

Push for solar power that could cover a hundred Olympic parks

Beefed up animal waste to boost UK Gas industry

BP-backed oil firm poised for City float

Christopher Booker: Cameron’s free-trade dream is destined to end in failure


Government’s green deal branded a failure as fewer than ten UK homes take out loans offered


Our summers will be as hot and dry as 1976, the Met Office said three years ago… and now they’re predicting a soaking decade


Can wind and sun power run trains on time?

George Osborne’s £15billion road to economic recovery


Funding for green vehicle loan scheme slashed

western mail

[From Saturday] Concern raised over future of Wales’ pioneering Centre for Alternative Technology

newStatesman logo

Commons Confidential [Robert Smith MP, Interim chair of Energy Select Committee]

Sunday Papers, 16 June


Shale gas: bonanza or illusion?

Payouts to trigger shale gas bonanza

Green homes jump in value


True cost of Britain’s wind farm industry revealed

Wind power has failed to deliver what it promised

Christopher Booker: Cash draining away – how the water industry avoids tax


If Centrica is prepared to risk earthquakes in Blackpool, big oil will want a share of shale

EDF backs single energy price plan


Vento Ludens plan to build solar farm in Scotland


Russians target Britain in nuclear power deal: Builder of reactor at Chernobyl has gained a toehold in UK market

EDF promises simpler prices – if its rivals do the same

Lord caught in lobbying sting is linked to boss of green firm locked up in Cambodia jail over £32m ‘eco fraud’


EU tax may see sun set on UK solar firms

Sunday Papers Round-up, 9 June


Top Tory in new Lobbygate row

‘I told him in advance what to say. Ha-ha’

Wind energy will be blow for jobs and bills

Wind farms won’t take the vulnerable out of the Dark Ages (Irish ST)

Shell steps on the natural gas

Playing with frozen fire: the new fuel tempting the world


Christopher Booker: MPs want to turn your lights off. A shame no one told you

Centrica seeks partners for Irish energy company bid

Watchdog calls for crackdown on nuisance calls


Energy UK launches new animation on YouTube to end myths about switching

MP paid £400,000 by green firms slams climate change peer… for hypocrisy exposed by the Mail


Revealed: £2bn cost of failed Sellafield plant


‘Go green’ is £200m Govt flop – Just 3 sign energy deal


John Prescott: Tories’ dirty secret is out – David Cameron’s talk about creating the greenest government ever was hot air                                                             


No prizes for policy wars

Tim Yeo’s decarbonisation amendment speech to Commons in full

I draw attention to my entry in the Register, especially my interests in energy industry.

In doing so I emphasise, as I have done before, that my views on climate change, on the need for Britain to move more swiftly to a low carbon economy and to cut its dependence on fossil fuels, were formed two decades ago when I had ministerial responsibility for this area of policy.

I’ve not changed these views at any time since then. I’ve repeated them publicly and privately on many occasions throughout the last 20 years. My views have never been influenced at any time or in any way by my financial interests.

All those interests were acquired after I left the Shadow Cabinet in 2005. That was 12 years after I accepted the overwhelming scientific consensus on this subject and began campaigning for a more urgent response to the challenge of climate change.

Various bloggers, columnists and others, including one or two Honourable Friends, who insinuate otherwise, and who ignore this scientific consensus, invariably overlook my strong and consistent support for nuclear power, a low carbon technology which should be part of Britain’s energy mix.

I’m grateful for this opportunity to debate the amendment in the name of honourable members from all parties and myself.

The amendment is based on a unanimous recommendation made in July last year in the Report of the Energy and Climate Change Committee on the draft Energy Bill.

The Govt accepted many of the Committee’s recommendations, and by doing so materially improved the Bill.

I congratulate my RHF the Secretary of State and his team on their response to our Report and on the outcome of their negotiations with the Treasury on a range of issues, including the LCF.

However for a variety of reasons the need for the amendment we are debating is even greater now than it was when my Committee’s Report was published.

Firstly, despite some positive signs about the Govt’s support for low carbon electricity generation, the publication on the day of the Autumn Statement of the Gas Strategy confused many investors.

The possibility that the Govt might sanction 37 GW of new gas fired generation capacity rests uneasily with its acceptance two years ago of the 4th Carbon Budget which covers the period 2023 to 2027. It suggests that the purpose of next year’s review of the 4th Carbon Budget is to water it down and weaken incentives for low carbon investment.

The understandably envious glances cast across the Atlantic by the Treasury at the transformation of the US gas market in the wake of the exploitation of shale gas have not passed unnoticed.

Not surprisingly there are now doubts in the minds of many prospective investors about the depth of the Govt’s commitment to decarbonising electricity generation.

On the issue of shale gas incidentally the ECC Committee was one of the first bodies to urge the Government, more than two years ago, to approve more exploration and testing to establish the scale of Britain’s shale gas reserves.

If our dependence on imported gas can be cut and if consumers can be protected against the fluctuations in international gas prices which have been the main cause of the rise in domestic energy prices in the last few years then that is wholly to be welcomed.

However my Committee also warned in our more recent Report on Shale Gas that it would be rash to base energy policy on the assumption that Britain will soon be a major shale gas producer.

The opposition to exploring for shale gas in Sussex which is already emerging is a foretaste of the battle for public opinion which must be won before domestic production of shale gas on even a modest scale can occur.

The case for a diversified energy mix is therefore as strong as ever.

Secondly, although we hear regular warnings about a looming capacity crisis in electricity generation, and the consequent risk of power cuts, there is a curious complacency about the Government’s attitude.

Investment in new generating capacity is now at a low level.

The nuclear talks between Government and EDF remain unfinished. Even if, as I now expect, they are brought to a successful though belated conclusion it will be 2020 at the earliest before a single KW of electricity is generated by a new nuclear power station in Britain.

New investment in coal is unlikely to occur until an economically viable form of Carbon Capture and Storage is available. Despite the huge potential market for CCS there is no sign anywhere in the world of this happening.

I am an enormous fan of CCS. It is the single technology the world most urgently needs to address Climate Change but we may have to wait another decade or even longer for a breakthrough on this front.

Meanwhile coal can currently be imported cheaply from America so our remaining coal fired power stations are running flat out.

Gas generation, the great white hope of many people, is currently so unprofitable that, far from large scale new investment taking place, some plant is currently mothballed.

Critically, potential investors in gas generation are holding back until the details of the Government’s proposed capacity mechanism are known. I urge my Right Honourable Friend to publish these details as soon as possible.

With a decision on nuclear still awaited and fossil fuel generating investment at a standstill it might be thought that money would pour into low carbon renewables. Even here the picture is unclear. For example, according to new figures from Bloomberg, the flow of funds is actually slowing down.

Doubts about whether a future Govt will stay committed to supporting low carbon technologies after 2020, fears that instead it will bet the farm on another dash for gas, and a lack of clarity about the level of strike prices to be proposed for the new Contracts for Difference regime have all unsettled investors.

The only certain consequence of this is that investment will be slower and the risk of a capacity crisis greater.

The element of perceived political risk will lead investors to seek higher returns for investment in the UK energy market.

Higher returns to investors mean higher prices for consumers.

My amendment directly addresses these issues.

By itself it will not immediately alter the low carbon pathway on which the Govt has already embarked, most notably by its acceptance of the 4th Carbon Budget.

But the prospect of the 4th Carbon Budget being watered down in next year’s review is simply another unwelcome uncertainty.

The amendment removes that uncertainty. It requires the Secretary of State to set, no later than 1April 2014, a decarbonisation target for 2030 for electricity generation.

As currently drafted the Bill merely gives the Secretary of State a power to set such a target without compelling him to do so. It also prevents him from exercising this power before 2016.

Suggestions that this amendment would force him to set the target at 50 grams per Kwh in 2030 are mistaken. The amendment requires him to set the target in accordance with advice from the Committee on Climate Change. If he does not follow the advice of the Committee on Climate Change he would have to explain why.

The CCC would not have a free hand in advising the Government. It would still have to take account of all the matters already referred to in the Bill in Clause 2 section 2. These include READ OUT (a) to (e).

In truth therefore this amendment is not very revolutionary. It seeks to bring forward by a couple of years something which the Government is contemplating doing anyway.

If it is indeed true, as the Secretary of State asserted yesterday, that we are heading for substantial decarbonisation of electricity anyway, what objection to this amendment can there possibly be?

There is now very widespread support for it. Only two weeks ago the CCC published a report recommending that a target for reducing carbon emissions from electricity generation by 2030 to 50 grams per Kwh should be set in legislation, with flexibility to adjust this in the light of new information as the amendment provides.

A wide range of businesses and trade bodies have backed it. The Aldersgate Group for example, whose members include Microsoft, Marks & Spencer, Aviva, Sky, PepsiCo, British American Tobacco and others, are strong supporters.

Many companies with interests in the supply chain and with potential to create jobs in Britain want to see it passed.

A wide range of voluntary bodies are campaigning for it, including the Women’s Institutes,

Even among HMs there are signs of enthusiasm. At the Lib Dem Party Conference last September the Chief Secretary to the Treasury proposed a motion to establish, and I quote, “a target range of 50-100g of CO2 per Kwh for the decarbonisation of power sector in addition to existing carbon reductions.”

If every Lib Dem MP who supported the Chief Secretary that day joins me in the Aye Lobby at 4 o’clock the amendment will be carried. I am sure that all my Honourable Friends on the Lib Dem benches are keen to take this opportunity to strengthen their well known reputation for consistency.

Even the Government itself seeks powers in the Bill as it stands to introduce such a target. But for some reason they don’t want to do so until 2016 at the earliest.

The problem with this St Augustinian coyness, this promise of possible future chastity in the matter of greenhouse gas emissions but please God, not just yet, is that by 2016 many investment decisions will have been made.

If these lock Britain into a high greenhouse gas emission future they will either prevent us from meeting our climate change commitments or else will lead to the construction of fossil fuelled generating capacity which has to be subsequently scrapped.

2016 is also after the next General Election. Delaying a decision until then creates another needless but harmful element of doubt about the Government’s true intentions.

I therefore urge HMs on all sides to support this amendment. Doing so will remove an element of uncertainty whose presence hampers investment, increases the risk of a capacity crisis and raises electricity prices unnecessarily.

This amendment will not impose on the Government today any commitments it does not already claim to embrace.

Furthermore it will not remove the need for even greater priority to be given to demand side measures and to energy efficiency, issues which I wholly support.

By itself it will not raise electricity prices in the next seven years by a single penny because the total sums spent on subsidising low carbon electricity in the period up to 2020 has already been capped by the LCF.

By contrast the Treasury’s own cherished floor price for carbon does raise prices and add to consumer and business bills making British industry less competitive relative to the rest of the EU but does so in a way which does not cut emissions by a single kg.

Without the amendment this Bill, whose early passage through Parliament is desperately needed for economic and security reasons as much as for environmental ones, will be needlessly weakened.

I commend the amendment to the House.

Sunday Papers Round-up, 2 June


Lords Laird, Cunningham & MacKenzie offered to start up a solar energy All-Party Parliamentary Group for bogus client …

Will we have the world’s costliest energy?

£40bn: the real cost of going green

Let’s bury the new march of the mega-pylons


Set carbon target or face power cuts, says Yeo


European Commission blow for George Osborne’s £250m green subsidy as Brussels probes ‘unfair state aid’ over bid to help big energy users


Clean power is good for jobs, bills – and Earth–and-earth-8640754.html

Investment in green energy falls to seven-year low


Thames Water wants to raise average bill by £100 before 2020


Many still in the dark over energy prices              


Plan for simple energy tariffs ‘too complex’

Thorium nuclear power: Forever the bridesmaid?

Alvin Weinberg celebrates 6,000 operating hours of Oak Ridge National Laboratory's Molten Salt Reactor Experiment, a 7.4 MW thorium-based demonstration reactor

To the great surprise of the established nuclear industry, thorium and molten salt reactors could be on the verge of making a comeback. Tim Probert cuts through the growing hype to explore whether good ideas can ever become good business. This article was first published in the May 2013 edition of Energy World.

Thorium has enjoyed a remarkably high profile of late given its chequered history. Despite the fact most development programmes by commercial entities (though not research institutes) were canned in the 1970s and 1980s, an increasing amount of hyperbolic articles are being published in serious and not-so-serious outlets extolling the virtues of thorium.

In reading these articles, the reader may be led to believe thorium is something of an energy panacea. Thorium is a ‘green’ source of nuclear energy, they say, abundant, cheap, safe, without the drawbacks of core meltdowns and copious amounts of radioactive waste.

The truth, of course, is far more complex. While thorium does offer highly attractive potential advantages as a source of atomic power, there are also several considerable barriers to the development of thorium-based nuclear reactors.

Uranium’s head start

Some view thorium as the Wankel rotary versus four-stroke piston engine or Betamax versus VHS battles of the energy industry: despite its significant technical advantages over its rivals, the ‘lesser’ product won. There is a great deal of truth in this, and a short history lesson is required to explain why.

It is essential to point out Thorium-232 (T232), like Uranium-238 (U238), is a fertile isotope, not a fissile isotope. Both these isotopes have to be first irradiated in a reactor to produce their derivative respective fissile isotopes U233 and Plutonium-239 (Pu239) resulting from neutron capture decay chains, neither of which exist in nature.

To begin its nuclear weapons programmes in the 1940s, the United States decided to produce both enriched uranium in U235, the only naturally occurring fissile isotope in nature, and Pu239, produced from neutron irradiation of fertile U238 in a reactor.

The United States recognised but declined the third option to produce U233 from irradiation of Th232 in U235-enriched reactors for two main reasons. Firstly, it was known that U233 was a hard gamma emitter which would be both difficult to reprocess and to machine and handle from a personnel protection standpoint.

Secondly, and more importantly, it was demonstrated that the 0.7% level of fissile U235 in natural uranium was sufficient to be the basis for a nuclear reactor system, with the 99.3% U238 content in natural uranium hence being partially converted to produce around 0.8% of the new fissile element plutonium – unknown in nature – which could then be chemically separated through reprocessing.

Had the United States gone down the thorium route, there would have been a significant weapons programme delay in producing sufficient quantities of the required enriched uranium driver. Unlike uranium, thorium cannot be driven by a natural uranium reactor (since neutrons are absorbed by the U 238), only by an enriched uranium reactor.

Uranium, therefore, got a head start for civil nuclear power from which thorium has never recovered. Thorium research became a side show as a means to an end to produce U-233, the only other fissionable feed isotope.

The light water nuclear reactors (LWR) deployed in nuclear power stations developed simply as scaled-up versions of nuclear submarine reactors, again driven by military impetus. As a result, virtually the entire nuclear energy industry has been optimised around the uranium and, to a lesser extent, plutonium fuel cycles.

While thorium is three to four times more abundant than natural uranium, there is no shortage of the latter. At current usage of 68,000 tonnes/year, global proven resources of 5.3 million tonnes mean there is enough natural uranium for at least 80 years, notwithstanding spent fuel.

While there are many good arguments in favour of thorium, energy security is one of the weaker ones and governments may only turn to thorium if uranium economics or its geopolitical abundance becomes problematic, says P.K. Doshi, Director of International Business Development at nuclear consultancy Excel in Maryland, USA.

Doshi, who has 45 years of nuclear industry experience and also thorium fuel manager when Westinghouse Electric operated the world’s first pressurized water reactor with thorium cores (at Shippingport, near Pittsburgh) in the 1970s, is highly sceptical about thorium’s chances.

“The infrastructure is in place to support LWRs on the uranium cycle,” says the Indian. “It’s expensive to compete with an established infrastructure, particularly when the timeframe to develop an alternate is so long.  In this sense, thorium is kept down by ‘the system’.  But I don’t see it as a conspiracy, rather as an economic fact of life.”

Westinghouse's 60 MW  experimental light water breeder reactor at Shippingport, Pennsylvania, which successfully transmuted Thorium 232 to Uranium 233

Westinghouse’s 60 MW experimental light water breeder reactor at Shippingport, Pennsylvania, which successfully transmuted Thorium 232 to Uranium 233

Molten salt reactors: The next big thing?

It is the job of the Weinberg Foundation to challenge ‘the system’. Founded in 2011 to promote thorium energy, the Foundation is named after thorium advocate Alvin Weinberg, research director of Oak Ridge National Laboratory (ORNL), which produced plutonium for the Manhattan Project.

Weinberg Foundation’s headquarters are at Somerset House on London’s Strand. In keeping with thorium’s image as a ‘green’ nuclear energy source, its patron is Baroness Bryony Worthington, founder of emissions trading lobby group Sandbag and a key architect of the 2008 Climate Change Act.

The Foundation’s CEO Laurence O’Hagan is under no illusions about the scale of the challenge of taking on a uranium fuel cycle industry worth an estimated £200bn a year. “The argument is it will take too long,” he says. “That the established nuclear industry doesn’t want to change. But if we don’t start now, we’ll never get there. The potential advantages are so significant that we believe they are worth pursuing.”

O’Hagan sees considerable promise in molten salt reactors (MSR). Indeed, one of Alvin Weinberg’s major projects at Oak Ridge was the Molten Salt Reactor Experiment of 1965-1969, a 7.4 MW thorium-based demonstration reactor using U-233 as the main fissile driver.

Unlike conventional nuclear reactors which use solid fuel, usually rods or pellets, MSRs use a mixture of fluoride salts in a molten state. The salt mixture includes fissile material, i.e. fissile isotopes of uranium and/or plutonium, together with fertile material, such as T232 or U238.

The front-running thorium-based MSR is the liquid fluoride thorium reactor (LFSR). In this design, the molten salt also serves as the primary coolant, carrying heat away from the reactor, and delivering it to a secondary cooling circuit and ultimately to the steam turbines that generate electricity.

One of the main advantages is the reactor and its cooling circuits operate at near atmospheric pressure, reducing the chance of any explosion. As fuel in a LFTR is already in liquid form, it cannot melt down, as can solid fuel rods in a LWR.

Furthermore, the LFTR’s large negative temperature coefficient means that regulation of the reactor’s temperature is passive, so there is no need for control rods. The molten salt expands as a result of the heat generated by fission, which slows the rate of fission.

The reduction in fission heat cools the salt, which in turn leads to an increase in the rate of fission. In other words, as the reactor temperature rises, the reactivity decreases. The reactor thus automatically reduces its activity if it overheats.

In the event of a reactor overheating, the fuel and salt drains into a holding tank, where the fuel spreads out enough for the reactions to stop. The salt then cools and solidifies, encapsulating the radioactive materials.

Another major advantage over uranium is fuel efficiency. Due to the degrading effect of neutron bombardment on solid fuel rod metal cladding in LWRs, between only 2-4% of the energy contained within can be used before they have to be removed.  An LFTR reactor, however, would continuously recirculate nuclear fuel, thus greatly improving efficiency and radically diminishing the produced volume of nuclear waste and proliferation risk.

Corrosion: The killer blow?

On paper at least, LFTRs are highly attractive and it is easy to see why they have a growing number of proponents. In practice, however, there are major drawbacks yet to be overcome.

While Weinberg’s work at Oak Ridge’s relatively short-lived Molten Salt Reactor Experiment successfully demonstrated the potential for thorium molten salt reactors, a number of serious problems were highlighted, particularly pertinent for power generation reactors with an operational lifetime of several decades.

Researchers at Oak Ridge found that the Hastelloy-N metal used for the containing molten salts cracked and corroded under intense radiation.  The development of corrosion-resistant materials capable of surviving exposure to neutron bombardment and fluoride salts at high temperatures for decades is essential if LFTRs are ever to be a commercial proposition.

“Corrosion was one of the problems at Oak Ridge but since then material science has considerably progressed,” says O’Hagan. “We are now two generations beyond Hastelloy.

“MIT is researching using salt as a coolant and they are about to patent a corrosion-resistant material. We are not claiming all the engineering problems have been solved and there has to be work done to resolve them, but all the signs are pointing in the right direction.”

The main stumbling block, though, is economics. “LFTRs are theoretically beautiful but making it work in practice is a different matter,” says Johann Lindner, who heads up Excel’s European division. “In the end, they will not get off the ground because building a full-size unit will prove to be economically unviable,” he says.

“Building an LFTR requires more than just a reactor design. It requires a new fuel cycle with fuel fabrication facilities, remote handling equipment, and new back-end spent fuel management methods and technologies.

“It’s a non-starter; Darwinian selection has chosen LWRs. There may be some prototypes built but you’ll never convince utilities to buy them for commercial power generation. The first 50-100 will be too expensive compared to LWRs.”

Thorium fuel has so far been used in about 30 operational reactors. Most of these were located in the USA, Germany, Netherlands and India. A single example operated in the UK, from 1965 to 1976: the Dragon Reactor at Winfrith, a helium-cooled test reactor.

Aside from Oak Ridge, perhaps the most significant use of thorium was the German THTR-300 (Thorium High Temperature Reactor), a 300 MW pebble bed modular reactor, which used a mixture of thorium and highly enriched uranium, between 1983 and 1989. The plant, constructed in the North Rhine Westphalia town of Hamm-Uentrop by Hochtemperatur-Kernkraftwerk, was not a success.

On 4 May 1986, within just six months of generating grid-connected power and days after the Chernobyl accident, the THTR-300, which had no containment building, was found to have released radioactive dust into the environment due to an erroneously open valve. It was later found that pebble friction had generated so much dust that several pebbles became jammed, and the attempts to unclog the blockage merely aggravated the release.

The THTR-300 was a thorium high-temperature nuclear reactor rated at 300 MWe

The THTR-300 was a thorium high-temperature nuclear reactor rated at 300 MWe

Thorium in the UK

Keith Perron, a former nuclear submarine reactor specialist at Rolls-Royce, believes the only viable usage of thorium in the UK is its use in existing LWRs rectors or to incinerate plutonium as a final disposal route as an alternative to the type of MOX reprocessing plants as developed at Sellafield.

“Uranium MOX fuel designs, whereby plutonium is mixed with uranium oxide, do not remove plutonium, they just recycle it,” he says. “Such fuel actually produces more plutonium than it started with. Judged as a means to incinerate separated plutonium and to rid it from the world, MOX is a dismal failure.”

The traditional problem with uranium MOX is chemical changes within the fuel rod result in a positive feedback coefficient, i.e. radioactivity increases over time. By mixing thorium with plutonium oxide, so-called ‘THROX’ would not react that way, it stays negative, which means in theory you could continuously recycle and reprocess the fuel rods until the actinides have been burnt up, says Perron.

Again, however, the medium-term prospect for thorium usage in conventional reactors is extremely poor, although a company called Thor Energy, a division of Scatec, has made an experimental thorium fuel rod to be loaded into a test reactor in Norway this year.

Current development of molten salt reactors

The only operational reactors using thorium currently are in India, which possesses abundant thorium reserves but little uranium. These are conventional, solid fuel LWR reactors.

It is expected China will be the first nation to develop a new MSR. The China Academy of Sciences in January 2011 launched a $350 million R&D programme on LFTR, known locally as the thorium-breeding molten-salt reactor (TMSR).

The 2 MW test unit, developed by the Shanghai Institute of Nuclear Applied Physics, is currently expected to be operational by 2020. However, the programme has been delayed by two years as it is taking longer than expected to train the 700 scientists required, says O’Hagan.

India is also slowly developing a thorium programme at its Bhabha Atomic Research Centre in Mumbai, although primarily for usage in an advanced heavy water reactor rather than MSRs. Meanwhile, Russia is believed to be developing thorium as part of a generic nuclear research programme.

Reborn in the USA?

The USA does not have a concerted thorium programme at present, although there are interesting developments in Cambridge, Massachusetts, home to Transatomic Power. An offshoot of MIT, Transatomic Power is developing the WAMSR (Waste-Annihilating Molten Salt Reactor) designed to run not on thorium, but on the United States’ considerable stockpile of radioactive waste.

The company’s ultimate aim is to produce a 500 MW unit. It estimates that it can build such a plant for $1.7 billion, roughly half the cost per megawatt of current LWRs.

Transatomic Power, backed by the founder of E Ink, Russ Wilcox, appears to be serious. It has recruited highly experienced nuclear engineers from Westinghouse and MIT scientists and it recently scooped the top award at the Department of Energy’s 2013 Energy Innovation Summit.

So far, it has raised a fraction of the $200 million needed to build a small prototype. Aside from materials science, the lack of funding – from both the private and public sectors – is likely to continue to thwart ambition for thorium.

Steve Kidd, Deputy Director General of the World Nuclear Association, cannot foresee a bright future for thorium. “It’s only when the likes of Westinghouse, GE Hitachi and Areva come into the frame will thorium get going,” he says.

“Most of the current development is by physicists and other scientists at government research centres and they are not too fussed about commercial development. It may be so that the thorium cycle is superior to uranium and using thorium in reactors is perfectly technically feasible but nobody is going to commercialise it because in the 1950s we decided to go down the uranium route.”

The Weinberg Foundation refuses to be downhearted in the face of cynics in the conventional nuclear industry. “In my opinion, a commercial MSR is quite likely within 20 years,” says researcher David Martin. “There are many reasons for this, firstly the economics of the current nuclear industry. They don’t have a product they can build on time and to budget.

An MSR is basically a chemical set with some surrounding concrete, and it operates at atmospheric pressure so there’s no need for multiple redundant safety systems and high-pressure vessels.  In theory, the key components of MSRs could be constructed in a modular fashion, rather than built in situ on a bespoke basis.

“Furthermore, fuel fabrication is more chemistry than physics. It’s far easier to manufacture the few cubic metres of fluoride or chloride salts than fabricate fuel rods. Given the safety of operation I just can’t see how it could be more expensive than light water reactors.”

Martin thinks it is high time the Government put its hand in its pocket to fund more research. “There should be a vigorous programme in order to recapture some of the optimism that characterised the first wave of nuclear reactors. In the UK, nuclear R&D is a mess. The fragmentation of the industry was an act of vandalism which has left us without a nuclear research base.”

Had there been 60 years of development of molten salt reactors, the nuclear industry may have been in a very different position. Given the prevalence of the uranium fuel cycle, however, only an optimist could believe that the world will give thorium a second chance.

Schmatic of Transatomic Power's Waste Annihilating Molten Salt Reactor (WAMSR)

Schematic of Transatomic Power’s Waste Annihilating Molten Salt Reactor (WAMSR)