The environment: Green giant step for mankind

Published Date: 09 November 2008
By Kenny Farquharson

THE clue to its ambition is in the name. Barack Obama says his No 1 priority on getting into the Oval Office will be something he calls "the Apollo project".

By giving his plans for a green energy revolution, the same name as Nasa's programme to put a man on the moon, he has shown the importance he attaches to it, and signalled the amount of effort and vision it will require to work. American political analysts believe Obama sees this as one of his legacy projects, one of the epoch-making advances for which his administration will be remembered. Obama's plan promises a $150bn (£96bn) investment that had the political benefit of addressing three key goals for his administration. The first is jobs. On Friday last week, it was confirmed that American unemployment was at its highest for 14 years, with a million jobs having been lost from the country's economy in the past year.A new push on alternative energy generation would provide five million new "green collar jobs", according to the Obama team's calculations."The engine of economic growth for the past 20 years is not going to be there for the next 20. That was consumer spending. We turbocharged this economy based on cheap credit," he said during the campaign. Now a new turbocharger is required, and "there is no better potential driver that pervades all aspects of our economy than a new energy economy".He believes a clean-energy revolution can offer the same opportunities for economic growth as the computer did in the 1990s.The second benefit of the Apollo project is in cutting America's greenhouse gas emissions. Obama has wholeheartedly allied himself to former vice-president Al Gore, who is credited with changing the international debate on global warming with his Inconvenient Truth campaign. Obama also is conscious of the damage done to America's international reputation by George W Bush's refusal to sign up to the Kyoto agreement on climate change. Green groups say the Apollo agenda is one the country – and the world – cannot shirk. "We are not just facing an economic crisis unseen since the Great Depression; we are also facing a climate crisis, which we have never before seen in history. We must respond to both," says Gernot Wagner, economist with the Environmental Defense Fund in New York.But there are questions over how, in the current financial climate that makes it difficult for green energy firms to raise money on the markets, such a grand economic strategy can be financed. "The reality is when oil prices fall and consumption falls and taxes fall, then subsidising wind power becomes proportionately even more expensive," says Kevin Book, an analyst at Friedman, Billings, Ramsey and Co.The Apollo aim is that renewable energy should supply a 10th of America's electricity within four years – a modest proposal by Scottish standards. Alongside this is a plan to insulate a million homes a year and to put a million rechargeable hybrid cars on American highways by 2015, by offering a $7,000 tax credit to those who buy them. The revolution is going to start with the White House car fleet.Obama is looking to the motor industry to play its part by focusing the development of new models on environmentally friendly vehicles rather than 4x4s. Research on fuel economy will also get a boost. The third benefit is one that speaks to a US mindset that craves a buffer between it and the rest of the world. Americans are uncomfortable with their reliance on the volatile Middle East for oil.The Republicans' answer to this during the presidential election campaign was to push for new oil exploration projects across America – summed up in Sarah Palin's promise to "drill, baby, drill". Obama's emphasis is very much on renewables, but to the same end – an America that is more self-reliant in energy and less vulnerable to turmoil in unfamiliar and unpredictable parts of the globe.Whether justified or not, the argument that Bush went to war in Iraq over oil, rather than democracy, is one that carries weight with Obama's base support. The willingness of an emboldened Russia to use oil as a political and economic weapon is another consideration driving the policy forward.The Apollo project is a daunting undertaking. Sceptics say that if this was such a central part of Obama's thinking for the country, why did he not devote a single speech to it in his entire campaign?Washington insiders also wonder whether Obama will need to reshape government in order to deliver this goal. They see a potential clash between the branches of the federal machine responsible for energy, transportation and the environment.It may require a new structure, with a powerful new cabinet member at its head. Although there are many senior Democrats with a good track record in this area – including Jay Inslee, from Washington state, who has co-written a book called Apollo's Fire: Igniting America's Clean Energy Economy – there is some speculation that Obama might reach out to a Republican businessman. This would have the twin benefits of demonstrating his bi-partisan credentials and having someone in charge who is trusted by the business community, which is still coming to terms with what the Apollo project will mean for them.There are many people to persuade – the energy generation and supply industries; the car manufacturers; the oil industry. This is expected to be one of the main tasks of Obama's policy team in anticipation of Obama taking up residence at 1600 Pennsylvania Avenue.

EDF Energy poll claims growing support for nuclear power

By Margareta Pagano, Business EditorSunday, 9 November 2008

A growing number of people are warming to nuclear power and more people now favour it rather than oppose it, according to a new YouGov survey for EDF Energy, the French nuclear power operator.
The survey, to be published tomorrow, shows that 53 per cent of the 4,449 people who took part in the online poll are now in favour of nuclear power stations to replace old ones. This compares with 46 per cent last year, and 41 per cent the previous year. At the same time 62 per cent agree that nuclear is needed as part of a balanced energy source for the UK compared with 59 per cent last year, and 54 per cent in 2006.
Vincent de Rivaz, chief executive of EDF Energy, said: "This latest poll shows increasing support for nuclear power to be part of the solution to meet the looming energy gap in the UK. Alongside energy efficiency, EDF Energy believes that nuclear and renewables have a key role to play, alongside clean coal and gas generation. The survey shows that the public has a strong understanding of the nature and scale of the energy challenge facing the UK."
However, according to the survey, people remain worried about the safety issues surrounding nuclear with 76 per cent expressing fears about safety, albeit down from 79 per cent last year. The study found 81 per cent cite disposing of waste as a cause for concern.

Mini nuclear plants to power 20,000 homes

£13m shed-size reactors will be delivered by lorry
John Vidal and Nick Rosen
guardian.co.uk, Sunday November 9 2008 00.01 GMT
The Observer, Sunday November 9 2008

Nuclear power plants smaller than a garden shed and able to power 20,000 homes will be on sale within five years, say scientists at Los Alamos, the US government laboratory which developed the first atomic bomb.
The miniature reactors will be factory-sealed, contain no weapons-grade material, have no moving parts and will be nearly impossible to steal because they will be encased in concrete and buried underground.
The US government has licensed the technology to Hyperion, a New Mexico-based company which said last week that it has taken its first firm orders and plans to start mass production within five years. 'Our goal is to generate electricity for 10 cents a watt anywhere in the world,' said John Deal, chief executive of Hyperion. 'They will cost approximately $25m [£13m] each. For a community with 10,000 households, that is a very affordable $250 per home.'
Deal claims to have more than 100 firm orders, largely from the oil and electricity industries, but says the company is also targeting developing countries and isolated communities. 'It's leapfrog technology,' he said.
The company plans to set up three factories to produce 4,000 plants between 2013 and 2023. 'We already have a pipeline for 100 reactors, and we are taking our time to tool up to mass-produce this reactor.'
The first confirmed order came from TES, a Czech infrastructure company specialising in water plants and power plants. 'They ordered six units and optioned a further 12. We are very sure of their capability to purchase,' said Deal. The first one, he said, would be installed in Romania. 'We now have a six-year waiting list. We are in talks with developers in the Cayman Islands, Panama and the Bahamas.'
The reactors, only a few metres in diameter, will be delivered on the back of a lorry to be buried underground. They must be refuelled every 7 to 10 years. Because the reactor is based on a 50-year-old design that has proved safe for students to use, few countries are expected to object to plants on their territory. An application to build the plants will be submitted to the Nuclear Regulatory Commission next year.
'You could never have a Chernobyl-type event - there are no moving parts,' said Deal. 'You would need nation-state resources in order to enrich our uranium. Temperature-wise it's too hot to handle. It would be like stealing a barbecue with your bare hands.'
Other companies are known to be designing micro-reactors. Toshiba has been testing 200KW reactors measuring roughly six metres by two metres. Designed to fuel smaller numbers of homes for longer, they could power a single building for up to 40 years.

SSE tipped to unveil slump in profits after delay in passing on price rises

Published Date: 09 November 2008
By William Lyons

IAN Marchant, chief executive of Scottish & Southern Energy (SSE), is expected this week to reveal a dramatic fall in profits despite hiking retail gas prices by nearly 30% in the summer.
In August the UK's second biggest supplier was one of the first of the UK's 'big six' suppliers to raise prices, increasing gas charges by 29.2% and average electricity costs by 19.2%.But Marchant is expected to tell investors on Wednesday that profits in the six months to September 30 will be "substantially lower" than previous years, as the firm absorbed the cost of higher wholesale gas prices for months before passing them on to customers. He will look to reassure investors by saying the majority of its profits will be made between October and March as the impact of price hikes comes through.SSE has also suffered delays with the installation of new gas de-sulphurisation equipment at Fiddler's Ferry and Ferrybridge, which limited the stations' output in the first half of the year. These factors are set to knock the company's pre-tax profits back by more than half to £293m from £665m."Generation and supply profitability needs to be significantly higher in the second half in order to meet full-year expectations. "Most of the ground should be made up by the average 24% increase in retail tariffs effective at the end of August, however, which should restore supply margins," said Merrill Lynch's energy analyst Fraser McLaren.In June Scotland on Sunday revealed that SSE was stepping up its investment in wind farm technology by opening a research and development office in Beijing. The office focuses on procurement of technology from Chinese companies to be used in the UK and the development of wind farms in Asia.Meanwhile, SSE has warned that a swathe of problems in developing wind farms threatens to blow the Government's renewable energy targets off course. SSE, which is involved in developing the £1.3bn 504-megawatt Greater Gabbard farm in the North Sea off the coast of East Anglia, said Britain would need about four schemes the size of Gabbard per year if it is to achieve the 2020 target."We've made significant progress with a number of key projects in the last six months, but there's still much more to do to hit the 2020 target," an SSE spokesman said.