Meanwhile nearer to home, Centrica last week announced tough times ahead for the industry and customers alike as the rise in wholesale gas and electricity prices continues to bite. It reported a dip in profits on gas and power sales in the residential sector in the UK and warned it would closely monitor fuel bills in light of the wholesale situation. Between you and me, that sounds very much like a prediction for higher fuel bills this winter!
Archive for December, 2007
On 4th December in this blog I wrote about the continued wrangling over the USA Energy Bill (‘Battle Continues over USA Energy Bill……….’). It was hoped it would include the first meaningful increase in fuel efficiency standards for vehicles in the US for decades and a boost in production of biofuels. However, I was disappointed to read on Forbes.com that the Bill was blocked by the Senate last Thursday. It seems the politicians, law-makers and energy industry just can’t agree on a final outline and the Bill is being whittled down to such a degree that one wonders if by the time it gets to President Bush’s office for signature it will be worth having at all? It seems there is strong opposition to a tax package favouring investment in energy efficiency but coming down heavily on the oil industry. To bring the Bill to a vote Democrats were forced to drop a provision that required utilities to obtain at least 15% of their electricity from renewable sources such as wind and solar power. The Bill now goes to a third reading – albeit watered down – hopefully to be passed before the end of 2007.
I read today that British Energy has announced a safeguard of the future of nuclear power stations Hinkley Point B, near Bridgewater in Somerset, and Hunterston B in Ayrshire, Scotland, by five years until 2016. As the arguments for and against nuclear power rage on, no doubt this announcement will be welcomed by pro-nuclear campaigners, those in the nuclear industry and indeed employees at British Energy. Hunterston employs around 670 people and brings an estimated £55m a year into the local economy. However, the UK has still to define its nuclear policy, which the Government has said it will do in 2008. There are those in politics I’m sure who see this as an indication that it has already made up its mind. The way I see it is that in an ideal world we could meet our power needs, maintain energy security and tackle climate change through a comprehensive programme of renewables, energy efficiency and cleaner carbon technology. But that’s the crux – we do not yet live in such a utopia and until we do we need to find a way to meet our expanding energy needs and it is not being done through indigenous production.
Interestingly, British Energy’s announcement came the day after leader of the Department of Business and Enterprise John Hutton revealed plans to install up to 7,000 offshore wind turbines to boost wind produced energy 60-fold by 2020. The business secretary admitted it would change Britain’s coastline, and result in higher electricity bills. However, it would go a long way towards addressing climate change through low-carbon energy production and enable the UK to be more self-sufficient. Mr Hutton was quoted on the BBC’s website as saying: “I do not want in 20 years’ time to find that whether the lights go on in the morning is down to some foreign government. “I agree! In the meantime, for information about how to protect your supply of energy visit Riello UPS.
Riello UPS has had a busy week – picking up two awards from Frost and Sullivan for Product Line Leadership and Customer Value Enhancement. These are significant ‘wins’ for Riello UPS who has been pursusing a differentiation-based strategy based on innovation and customer service for several years now. Pictured receiving the award are Robin Koffler, Riello UPS Ltd General Manager and Leo Craig Sales Manager. The award was made by Mr. Brett Gascoine, EIA Director, Best Practices Group, Frost & Sullivan. After another highly succesful year in the power protection industry awards such as these show that we are succeeding with more than the financial numbers. We are succeeding with customers and that is the ultimate measure for any business.
Increasingly more of the UK’s electricity is being generated from natural gas. Okay, so it would seem we can all breath again now that agreement for gas supplies to Ukraine in 2008 has been signed. Most of Russia’s gas exports to the European Union (EU) are piped through Ukraine so it is important that there is agreement between the two nations. Russian gas currently accounts for one quarter of the EU’s supplies but that could rise in view of the fact that the UK, for example, is expecting to import gas to meet up to 80% of demand by 2020. The agreement on both price and terms of gas supplies to Ukraine will ensure a more stable supply of Russian gas to European consumers. The Department for Business (BERR) wants to allow private firms into gas supply projects to ‘help maintain reliable supplies’ and I think this is a good idea; the less politically motivated suppliers are the more we as consumers are able to extend our influence and thus secure supplies. As I see it, the problem with importing gas is that we have little control over security of supply. If the infrastructure is allowed to break down or an international dispute results in the supply being cut off (as happened in January 2006 to Ukraine), we are powerless to react. We can’t change international politics but we can advise on secure power protection, which is becoming ever more critical in these uncertain times in which we live.
After months of wrangling between themselves and the auto industry, it seems USA Congress just can’t reach an agreement over its proposed Energy Bill. Happily, though, the centrepiece was agreed this weekend and it is the first meaningful increase in fuel efficiency standards for cars, light trucks, SUVs and minivans in the USA for over 30 years. The provision raises average fuel economy standards from 25 to 35 miles/gallon by 2020, thus saving 1.1 million barrels of oil a day (equating to half of current imports from the Persian Gulf).
Not everyone is happy about the Bill, however. The utility and oil industries – Washington’s most powerful lobbyists – are firmly holding out against a measure requiring them to obtain at least 15% of their electricity from renewable sources like wind and solar power. Some have said it will cause a dramatic increase in power prices in some areas of the country and that it will slow economic output by 4% by 2030.
I worry more about the definition of the word ‘renewable’ and the danger of having a federal renewable energy standard based on a politically determined definition of that word. Is a municipal waste burning plant renewable, for example? Or a power plant that burns timber waste? Both of these are counted by the Energy Information Administration as renewable. My view is that their environmental benefits are questionable and a definition of what is a renewable source of alternative energy should be debated and determined outside of politics.
What do you think?
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