Sunday, 11 January 2009

Daimler CEO says to invest throughout crisis

Reuters, Sunday January 11 2009

DETROIT, Jan 10 (Reuters) - Daimler Chief Executive Dieter Zetsche on Saturday said he would not jeopardize the automaker's long-term success by cutting spending on product planning and research and vowed to roll out at least one new hybrid vehicle per year.
"Despite the enormous pressures that our entire industry is under these days, we are facing the year 2009 with measured confidence," Dieter Zetsche was quoted in a copy of a speech to be delivered ahead of the Detroit auto show.
Zetsche said the automaker behind the Mercedes brand would roll out at least one new hybrid every year, starting with the 2009 top-of-the-line S400 BlueHybrid executive sedan.
The Mercedes S400 BlueHybrid, which is scheduled to be available this year, is on track to be the first mainstream hybrid car to use a lithium-ion battery pack.
With a projected 29 miles per gallon, Mercedes is already touting the s400 BlueHybrid as the most fuel-efficient luxury sedan.
"Right now, we consider our ability to innovate a major competitive advantage -- especially in difficult times," Zetsche said.
Lithium-ion battery technology, which has long been used to power consumer electronics, is being adapted to powering a wave of upcoming electric-drive vehicles, including the Chevrolet Volt from General Motors Corp.
Last month, Daimler took a 49-percent stake in Evonik's [RUHR.UL] lithium-ion battery unit in order to gain access to the technology that represents the critical component of electric-drive and hybrid vehicles vehicles.
"Believe me, we are going to give the term 'E-Class' a whole new meaning," Zetsche said, referring to the group's popular full-size model that will be relaunched this year and unveiled at the Detroit show.
"I also have a lot of confidence that there will be a bright future for innovative car companies -- both here in Detroit and elsewhere -- who make the tough decisions and focus on the road ahead. And I most certainly include Daimler among them," he said.
Daimler, like other automakers, has been hit by the declining demand in the U.S. market, the single largest car market in the world.
U.S. auto sales dropped by 18 percent in 2008 and hit their lowest level since 1992 at 13.2 million vehicles, down from 16.2 million a year earlier.
Analysts see further declines in 2009 before the industry starts to recover, with tighter consumer credit and economic recession in the United States hanging over the outlook.
The Detroit auto show starts Sunday.
(Reporting by Christiaan Hetzner, editing by Kevin Krolicki and Peter Bohan)

China revs up hybrid war with first production plug-in car

A LITTLE-KNOWN Chinese car manufacturer has beaten the motor giants of Japan and America by launching the world’s first production plug-in hybrid car.
The BYD F3DM will be unveiled tomorrow at the preview of the North American International Auto Show in Detroit.
BYD, one of the world’s largest battery manufacturers, started making cars only in 2003. In August, founder and chairman Wang Chuanfu made the audacious claim that he expected his company to overtake Toyota as the world’s biggest motor manufacturer by 2025.
American investment guru Warren Buffett bought a 10% stake in the group in September.

The F3DM is a small four-door saloon equipped with an electric motor and a 1-litre petrol engine, both of which can drive the car.
With its batteries fully charged it can travel up to 60 miles on electricity alone. When the batteries become depleted the petrol engine takes over. And while the engine can charge the batteries, as in existing hybrids such as the Toyota Prius, the F3DM is intended to be recharged overnight by plugging into the domestic mains.
Initially, the F3DM will be sold in China's metropolitan areas starting in Shenzhen, the company’s home city. The price of 150,000 yuan (£14,400) is little more than half that of the Prius in the Chinese market. BYD expects to have several plug-in hybrid models on sale in Europe and America within three years.
The company says that the key to these products is its “iron battery”. This lithium iron-phosphate battery is related to the lithium-ion cells used in laptops and mobile phones (for which BYD is the world’s biggest supplier) but cheaper to produce, and smaller and lighter than those being adopted by other carmakers.
Toyota and Honda show their latest petrol-electric hybrids at the Detroit show this week but neither the new Prius (coming to the UK in the summer) nor the Honda Insight (on sale in March) are offered with the plug-in facility. The Japanese manufacturers remain uncertain about the safety and reliability of lithium batteries but Toyota expects to have a plug-in version of the Prius available next year.
Beleaguered General Motors will launch its plug-in electric car, the Chevrolet Volt, in 2010. Technically this is also a hybrid as it has a small auxiliary petrol engine, but that does not drive the car – it is there to charge the batteries to extend the car’s range.
BYD, according to Chuanfu, stands for “Build Your Dreams”. Established rivals are sceptical about its great ambitions but the business, which is listed on the Hong Kong stock exchange and employs 130,000 people, received a huge vote of confidence with Buffett’s investment. He paid $230m (£151m) for his stake.
This week’s Detroit show is likely to be the most downbeat for years, with the big three US carmakers – GM, Ford and Chrysler – under extreme financial pressure. GM and Chrysler have been kept in business by being given access to state loans originally intended to bail out banks.
Lawmakers have set tough conditions on granting the loans, including a demand that GM and Chrysler’s labour costs be reduced to those at Toyota’s US plants.
Rick Wagoner, chief executive of GM, said he was confident that the company would be able to secure the necessary concessions from the United Auto Workers union.
The two sides meet tomorrow to discuss changes to employment contracts. Wagoner said consideration of a merger with Chrysler had been put on hold during the restructuring talks.

Mackie wind farm scheme victim to cold economic climate

Ice cream entrepreneur fails to scoop up enough investors for green energy company

Entrepreneur Maitland Mackie has been forced to abandon plans to set up a multi-million-pound rural wind farm company after failing to sign up enough investors.
Mackie, 71, said that signing up 580 investors for the project had been “encouraging” but was not enough to allow him to press ahead with plans for a wind power company owned by farmers, landowners and other investors.
It is thought that the company received pledges of around £2.5m towards a target of £10m that was needed under Mackie’s plans to build 30,000 three-megawatt wind turbines across the UK. The turbines would have had the potential to deliver more than a third of Britain's generating capacity.
But Mackie said that at least 3,000 people would have had to commit around £4,000 each to make the project viable. Raising additional cash in the money markets would also be difficult in the present climate.
All money will now be returned to investors.
“We have been reviewing the project in the cold light of the current economic climate and sadly we are of the view that we have to stand the initiative down,” said Mackie.
“It is hugely disappointing to find myself not delivering but I think we have raised awareness of this issue,” he said. “My enthusiasm has not waned but the practicalities have got in the way.”
Mackie, whose Aberdeenshire dairy which makes the famous Mackie’s ice cream is powered entirely by green technology, said he was hopeful that the plan could be resurrected in other forms.
“I think we have raised the understanding of the potential financial gains so that individ-uals and communities can fight for a big share of the cake,” he said.
“I still think it a splendid plan, and hope that some enthusiasts will have a go to put together substantial local schemes.”

Energy suppliers feeling the heat

Power firms are in Labour's sights over profits - but they can play the green card, says Tim Webb
Tim Webb
The Observer, Sunday 11 January 2009

One Friday evening in September, the chief executives of Britain's biggest energy suppliers received a surprise phone call. Shriti Vadera, the government's formidable business enforcer, was on the line. She was brutally to the point: unless they signed up to a fuel poverty package to help their poorest customers, she said, the government would levy a windfall tax on their profits. "We will do something much worse which you won't like" was her warning, prompting suppliers to complain that they were being blackmailed.
Bashing the energy companies seems to be the government's preferred sport these days. Not that there's much sympathy for them. Electricity and gas bills surged last year on the back of the record oil price of $147 (£97) in the summer. The utility companies said this was because gas prices are index-linked to the price of oil. Since last summer, oil has plummeted to $40 a barrel and wholesale gas prices have slumped too. Yet none of the leading suppliers has announced across-the-board reductions in consumers' bills.
Ed Miliband, the head of the newly created department for energy and climate change, has taken up the theme of telling energy companies what to do with gusto. Last week, he warned them not to use the dispute between Russian giant Gazprom and Ukraine, which led to a temporary spike in gas prices, as an excuse not to cut bills - or else. Such intervention is a world away from the previous policy approach of letting energy companies decide what power plants to build and how much to charge consumers to pay for them. State intervention to bail out the banks has hogged the headlines, but energy companies are now feeling the heavy hand - or arm - of government too.
Whether the industry likes it or not, companies have effectively become arms of the state, at least in Whitehall's eyes. They are expected to deliver secure and clean supplies of energy, all at an affordable price. Britain has signed up to the EU's renewable energy targets, which require one third of electricity to come from renewable sources by 2020, up from barely 3% today. Building wind farms is a lot more expensive than building conventional coal and gas plants. Poyry Energy Consulting estimates that it will cost at least £2,000 per household on top of current utility bills to meet the target by 2020, or about £200 extra per year. Yet wind farms don't work when the wind isn't blowing, requiring back up power plants and adding further to the bill.
In public, energy bosses say meeting these targets is "challenging" even if they could pass on the costs to consumers. Privately, they say it is impossible, and that was before the worsening credit crunch made it even harder to raise the estimated £100bn investment needed. Tony Ward, director at Ernst & Young, says: "This three-way dilemma will be with us for decades to come."
Not surprisingly, energy companies don't seem to be too happy with the new way of doing things. One chief executive of a FTSE 100 energy company says wearily: "We have got targets coming out of our ears."
The industry's lack of transparency has not helped their cause. Companies do not have to reveal how much it costs them to generate electricity. This makes their justification for not cutting bills even when wholesale gas prices have slumped unconvincing, particularly as they continue to make bumper profits. The "Big Six" suppliers - npower, E.ON, British Gas, Scottish Power, Scottish & Southern Energy and EDF - have the market sewn up, preventing any serious competition from new entrants.
But consumers are starting to realise that they will have to pay more for greener energy. Mike Clancy, deputy general secretary of the union Prospect, says a windfall tax on profits to subsidise energy bills for the poorest customers would be self-defeating, as higher profits are needed to build new power plants.
The utility companies know they hold this trump card: if a windfall tax is imposed or they decide their profits are not high enough, they can threaten to scrap plans to build new power plants or wind farms. This threat is even more real because four of the Big Six are foreign owned, with domestic markets more important than the UK's. This means that they can easily choose to invest in other markets instead of ours if they decide that this would be more profitable. This was not an option when the utilities were focused purely on the UK.
Relations between the government and the energy industry will be bruising for some time to come.

Green tax breaks from Tories

Jill Insley
The Observer, Sunday 11 January 2009

Investors who put money into "green" equity-based funds and shares could get a bigger individual savings account (Isa) allowance under a Conservative government.
Shadow chancellor George Osborne has asked the former chief executive of Norwich Union, Patrick Snowball, to explore the idea of boosting investment in environmentally sound companies by extending the £7,200 tax-efficient Isa allowance for green equity investments only. Investments into cash Isas and other types of equity-based Isa would not benefit from the increased allowance.
Osborne said: "Patrick Snowball is considering how much the allowance should be extended by - it may be £1,000 or £2,000 higher. This would help a large number of people who want to do something for the environment."
The Conservative party last week emphasised its opposition to encouraging spending to help Britain out of recession, calling for tax cuts to encourage cash savings. Announcing a new savings policy on Monday, David Cameron said the 20% cash savings tax should be scrapped for basic-rate taxpayers. This would reduce the tax bill for any saver with earnings or pension income below the higher rate threshold of £43,875, but those who are reliant on savings income would benefit most, up to a maximum of £7,200.
Osborne said: "The plight of savers and pensioners has not featured very much until now, but we reckon savers are £27bn worse off as a result of the cuts to the base rate from 5.5% to 1.5%."

Abu Dhabi's IPIC delays Pakistan refinery plans

Reuters, Saturday January 10 2009
(Adds Fujairah refinery review, other investments)
By Stanley Carvalho
ABU DHABI, Jan 10 (Reuters) - Abu Dhabi government-owned International Petroleum Investment Company has delayed plans to set up a refinery in Pakistan and is reviewing its Fujairah refinery project, its CEO said on Saturday.
IPIC also plans to invest $70 billion over three phases in Abu Dhabi's petrochemical industry and may increase its stake in Austrian energy firm OMV and Spain's Cepsa after finalising a deal to buy 70 percent of industrial services firm MAN Ferrostaal AG, part of German group MAN.
IPIC invests in oil-related projects for the government of Abu Dhabi, the capital of the United Arab Emirates, which is the world's fifth-largest oil exporter. Its board approved last year plans to build a $5 billion refinery with a capacity of 250,000 barrels per day (bpd) in Pakistan.
"We are facing problems in Pakistan ... For any decision on the Khalifa Point refinery, we, both governments, need to sit together to take action," Khadem al-Qubaisi told reporters.
"We are delaying the project till we sort out the fundamental issues," he said, declining to elaborate.
A planned $6-7 billion refinery with capacity of 500,00 bpd in Fujairah in the UAE is also likely to be delayed, he said. "We are reviewing options. We are changing the configuration and making it smaller due to the demand-supply situation." he said.
But a 370 km (229.9 mile) crude oil pipeline from Abu Dhabi to Fujairah is on track for completion by early 2010, he said. It will carry 1.5 million bpd of crude for export from Fujairah.
The storage terminal at Fujairah will have capacity of up to 12 million barrels. "We will lease the storage facilities to Abu Dhabi National Oil Company or operate ourselves and charge ADNOC a tariff," he said.
Qubaisi said a new joint venture company Chemaweyaat, in which IPIC is a 40 percent shareholder, plans to invest at least 70 billion dollars in petrochemicals in Abu Dhabi.
"In the first phase, $20 billion will be invested and more than $50 billion will be invested in the second and third phases," he said, adding that the company is being set up.
Abu Dhabi Investment Council holds 40 percent and ADNOC holds 20 percent stakes in Chemaweyaat.
IPIC also plans to invest up to $2 billion in the Caspian Sea region in various sectors and will involve MAN Ferrostaal in these projects, he said.
IPIC's investment portfolio currently stands at between $12 to $15 billion but it is poised to increase as it seeks new and diversified investments, said Qubaisi.
"In the next five years we will continue to search for opportunities taking our portfolio to $20 billion. We are also looking for consolidation, looking to benefit from companies we have invested in," he said.
"We are in discussions to increase our stakes in OMV and Cepsa because they are adding a lot of value to IPIC," he said, adding it could be finalised in the next few weeks.

Waste leads £30bn energy revolution

Below Ross Davidson’s feet, the ground is sinking. But the boss of the Brogborough landfill, on the outskirts of Milton Keynes, isn’t worried that the ankle-deep mud will swallow him up.
It’s a gradual process. Every year, the largest repository of waste in western Europe sinks by about a metre as 25 years of binbag waste putrefies deep underground. Like a tray of tomatoes left out for too long, the 43m tonnes of accumulated muck breaks down into liquid, inorganic solids and methane gas.
Brogborough stopped taking waste a year ago and has since been covered with a thick layer of clay, but it will be decades before the decomposition runs its course. It is up to Davidson to keep the gurgling, seething mess under control. The black, foul-smelling liquid must be siphoned out constantly so that it doesn’t pollute the water table, and underground fires set off by chemical reactions must be smothered. Most importantly, the methane has to keep flowing because Brogborough, though it may not look it, is a gasfield.
More than 550 “wells” have been drilled into the site, their black plastic heads poking out from the mud and willowy grass. Each of them is linked to a central suction system that draws the gas generated by natural decomposition into an adjoining power station. The flow is enough to feed a line of gas-fired engines, two of which originally powered the QE2 across the Atlantic. They generate enough electricity to light 26,000 homes.
It is a set-up that any big power company would dream of. The site is big — 70 metres at its deepest point and covering an area equal to about 250 football pitches. This year it will generate about £18m in revenue for Infinis, the renewable-energy firm, but it costs only about £2m a year to maintain.
It helps that the fuel is free. Using current technology, there is enough gas underground to power the station for another decade at least. For Guy Hands, whose buyout firm Terra Firma owns the business, it’s easy money. Overall, Infinis, Britain’s biggest generator of power from so-called landfill gas, will pocket profits of £55m on £110m in revenue from the 80 sites it oversees around the country.
Yet there is a problem for the landfill business. It is dying. Owing to a combination of rocketing landfill taxes, an increasing aversion to burying garbage in these environment-conscious times, and generous subsidies for new technologies that convert rubbish into energy, Brogborough is the last of its breed.
An entirely new industry of high-tech metabolising plants and digestors is emerging to take its place. These sites are designed, essentially, to do what Brogborough does, but above ground and much quicker and more cleanly. “The great advantage of the new technologies is that instead of waiting for 40 years for this stuff to release its calorific value, we can get it in a week,” said Alan Lovell, head of Infinis.
By 2010, the amount of waste sent to landfill in the UK must be reduced by 25% from 1995 levels under the EU landfill directive. By 2013, it must be cut in half. This is a big challenge: in 2006 the UK sent 65m tonnes of waste to landfill, or more than a tonne per person. AMA Research, a consultancy, estimates that the UK will have to spend up to £30 billion to build the infrastructure to handle what, for decades, has been buried.
“In the past year there has been a sea change in the UK,” said Andy Street, head of SLR, Britain’s largest waste-energy consultancy. “When security of energy supply has become such an issue, it is sensible to get what we can out of waste. Waste isn’t waste. It’s a resource.”
Every year J Sainsbury dumps the equivalent of the Titanic into landfill — about 80,000 tonnes. Most of it, about 70,000 tonnes, is food waste such as ready meals, stale bread and spoilt fruit. By this summer, the supermarket giant expects to be sending no food waste to landfill.
It sounds ambitious, but Lawrence Christiansen, the supermarket giant’s green guru, has a plan. For the past five months Sainsbury has been testing a programme it plans to roll out across the company over the next two years. Instead of sending lorryloads of organic waste from its Northamptonshire distribution centre and 38 surrounding stores to landfill, the company has been trucking it to an anaerobic digestor operated by a small company called Biogen Greenfinch.

The digestor is essentially a large steel stomach. It speeds up the natural breakdown of waste from years to a matter of days by feeding it into an oxygen-starved environment infested with microbes. The process generates a mixture of carbon dioxide and methane, which is burnt to generate heat and electricity. The digestate, the substance that is left, is sold as a type of super-manure for local cereal farms and the heat is piped to a nearby immigrant detention centre.
“This is a win-win-win,” said Christiansen. “It’s green as hell. It saves us a chunk of money, and we can set up that link with the digestate for our suppliers.”
Sainsbury has been so encouraged by the programme that last month it announced plans to build five food-to-energy sites around the country over the next two years. Christiansen expects the digestors to shave an estimated £2m off the company’s annual £9m disposal bill. When they are all up and running, they could be a money maker, with Sainsbury selling surplus power to the grid.
Every year, the food industry produces about 17m tonnes of landfill waste, a quarter of the nation’s total. Because most of it is organic, the opportunity to convert it to fuel is higher than with typical municipal waste, which requires sorting.
Inetec, a small Welsh firm, thinks it has an answer. The company has devised a system that grinds up food and packaging material into a mixture that can be burnt in a converted biomass boiler to generate electricity. Greggs, the baker, Northern Foods and Greencore have all agreed to send their food waste to a new £100m facility that Inetec hopes to build near the docks at Immingham on the Humber. “Instead of woodchips or other biomass, we will be burning food waste. It will be the first plant of its nature almost in the world,” said contracts administrator Gareth Nicholas.
It could be, but at the moment the plant is stuck on the drawing board. Inetec has been struggling for more than a year to find financial backers. As at many companies that are trying to get novel projects off the ground, finding financing from banks that are themselves having financial problems is difficult.
“In the current climate, the banks aren’t lending. They want very safe investments, like schools or hospitals,” said Rob Dustan, environmental business development director at VT Group, best known for its military and shipbuilding work. “When you say you want to build a plant to process waste with a new technology, it’s very hard to persuade them.”
But there are several reasons why companies are beginning to throw their weight behind the shift. For one, being seen as more green than your rivals has become important. Consumers are much more conscious than they were even a year ago about the environmental credentials of the companies they use.
The government is also pushing the issue because reducing the amount of landfill methane — which is 21 times more powerful a greenhouse gas than carbon dioxide — will help it to reach its targets for reducing pollution. The Tories have latched on to waste and recycling as a key issue, proposing a system that would give monthly payments to households that recycle. The government boasts that recycling levels reached 34% this year, up from 8% a decade ago. But that is still well below the European average of more than 50% of total waste.
Britain’s approach is “much less advanced than in most of Europe”, said John Edwards, a partner at the Augusta & Co merchant bank. “Only Greece sends proportionately more waste to landfill than the UK.”
The real driver for change, however, is cost. Ten years ago, landfilling was still cheap, maybe £10 a tonne. Today it is about £70 a tonne. The cost has been pushed up by the government’s “landfill tax escalator” — it rises £8 a tonne every year — and by the increased cost of engineering landfills so that they comply with stricter environmental regulations. According to the Audit Commission, Britain could run out of landfill capacity within seven years anyway.
For a company like Sainsbury, it’s a bearable cost. But for smaller firms and, more importantly, local authorities, which are saddled with handling more of the country’s waste than any other group, it’s painful. According to Dustan at VT, 18 projects from councils will be put out to tender in the coming months.

Indeed, the company won planning approval late last year for a new waste-management facility that will recycle, digest, compost and generate electricity from 200,000 tonnes of rubbish from Wakefield council.
VT is also one of five bidders vying for a 25-year, £500m contract from the Portsmouth naval yard to build a plant that converts commercial waste into energy that will one day be used to provide power to the Royal Navy’s new aircraft carriers when they are in port. “The targets have come up a bit on people. They have known about them for a while, but it takes two years to run a competition and another two years to build a facility. Now they are scrambling,” said Dustan. “People are going to have a hard time meeting the targets.”
The Isle of Wight offers a glimpse of the future. In November, the waste company Biffa began diverting some of its lorries to a newly opened “gasification” plant, the first of its kind in Britain. With funding from a government technology demonstrator fund, the independent technology group Energos converted an old incinerator into a plant that heats waste to about 1,000C in an environment with minimal oxygen. The waste doesn’t burn; rather, it melts down, releasing a gas and leaving solid material. The gas is used as a fuel for a small power plant.
The plant would not have been possible without the Renewable Obligation Credit (ROC) scheme, a government subsidy programme that is one of the most generous in the world. Under the energy bill, which takes effect in April, companies like Energos will receive two ROCs for every megawatt of power produced using “advanced recovery technologies”, such as anaerobic digestion, gasification and pyrolysis.
These credits, which companies can sell to other power generators that exceed their pollution allocations, are worth about £50 per megawatt-hour (MWh). As advanced-technology firms get two ROCs per MWh, it roughly triples the income they can collect from electricity production — currently about £55 per MWh. It is the carrot to the landfill tax “stick”. Street said: “Between ROCs and the landfill tax, we’re rapidly reaching the point where it gets cheaper to do something different with waste.”
The ROC scheme was intended to get projects like the Energos one off the ground. Gasification is more efficient and cleaner than other options such as incineration, the preferred method of waste disposal in many continental countries, such as France. Grimshaw said: “If you imagine a bonfire, all the bits won’t burn. Some will be wet or too dense and they will be left over. That’s incineration. Gasification is like using a gas stove. The key is being able to control the reaction. There is no ash, no residue.”
Novera, the publicly quoted renewable-energy group, plans to build this year what would be the second such facility in Dagenham, Essex. It would gasify material provided by the Shanks waste company in east London to generate 13MW of electricity, which would be sold under contract to Ford to power its nearby engine plant.
Like Inetec, however, Novera has to find someone willing to bankroll the project. Gasification is a fairly new technology and its large-scale economics have yet to be tested. The worry is that despite the financial muscle the government has thrown behind the cause, the harsh reality of a recession has decreased the urgency, and the money, that such climate-driven initiatives attracted even a few months ago.
For every sceptic, however, there is an evangelist. Christiansen said: “We have been very slack for a long time, but that just means that now there is a huge opportunity. It’s like the Klondike out there at the moment.”
Even your loo could be used to generate electricity
IF it is up to Tony Wray, your loo waste will one day help to keep your lights on.
Yes, the chief executive of the water giant Severn Trent wants to convert Britain’s flushings — “sludge” in industry parlance — into a renewable-energy source.
“When it goes on to land now, sludge is 20% to 30% dry solids. If it is dried to about 80% solids, it becomes like a cake and has about half the calorific value of brown coal, even after we have taken the methane from it,” said Wray.
Making this a reality on a large scale is still some way off, but not for lack of trying. Wray has set up a research and development unit dedicated to advanced waste-to-energy technologies. However, his scientists have yet to perfect a method of drying the sludge that makes sense economically.
Wray has made some headway nonetheless. It takes a lot of power to pump water and waste through the company’s 32,000 miles of pipes. Electricity, already at record prices, is one of the group’s biggest expenses.
Yet last year, Severn Trent produced 17% of its own needs thanks to what Wray says is the largest fleet of anaerobic digestors in the country.
They break the solids sieved out of sewage into sludge and methane. The latter is used to fuel 34 combined heat and power plants.
And the former? Severn Trent uses the sludge as fertiliser on a 3,000-acre farm in Nottinghamshire where it will help to grow crops that will be used to supply energy rather than feed people.
Wray’s goal is to generate 30% of the company’s electricity needs within five years. Given that water companies will be among those that will be roped into the European Union’s carbon trading scheme, under which they will have to pay for emissions, it is more than a “nice to have”.
Wray said: “We’re going to get captured in the next phase of the carbon trading scheme, so the efficiency with which we can manage our energy consumption is very important.”