Bentley will unveil an ethanol-powered car to outrun its fastest models
Mark Milner, industrial editor
The Guardian, Wednesday 25 February 2009
Bentley will unveil its fastest, most powerful production car ever at next month's Geneva motor show. It is tagging the Geneva debutante "the extreme Bentley", a two-seater that harks back to the 1920s and the glamorous, speed-struck "Bentley Boys".
While boasts of supercar performance may sound out of step with straitened times for the car industry and mounting concerns about climate change, Bentley is running the new car on green fuel E85 - containing 85% bioethanol. However, the extreme Bentley is still far more about performance and luxury than economy. It will, for example, accelerate from 0-60mph in 3.7 seconds and, though Bentley has not priced the new model, it will cost at least £140,000. Fuel consumption is 11.5 miles a gallon on an urban cycle and 24.4mpg travelling outside urban areas. Carbon dioxide emissions run at about 388 grammes/kilometre.
For all that, the new car does represent the first stage of Bentley's commitment to improving its environmental performance as well as maintaining "driveability".
Bentley is hardly alone in seeking to buff up its green credentials. At the opposite end of the market, Ford recently launched its Fiesta Econetic, the latest in a range of fuel-frugal cars which already includes the Mondeo and Focus, with a Ka version to come.
Using modifications including lowered suspension, aerodynamic body styling and a gear change alert, the £12,450 Fiesta Econetic's fuel consumption is 76.3mpg and its CO2 emissions are expelled at 98g/km.
Whether green is the new mean, as buyers chase thrifty fuel consumption and lower car taxes, or whether it is driven by genuine environmental concerns or a combination of the two, carmakers and governments know they have to act.
The ability to invest in technologies which cut fuel consumption and carbon emissions will be crucial to companies and countries competing in the global car market with a wider, economic knock-on effect. Much of the industry's research spending is directed towards reducing emissions or producing greener cars. Government bail-outs for the sector have also been linked to environmental targets in many countries.
The industry has spent a lot of time recently stressing the importance of its engineering expertise. As Jaguar Land Rover chief executive, David Smith, took care to point out in a speech in the presence of business and enterprise secretary, Lord Mandelson, JLR "is one of the country's biggest investors in R&D, ensuring our vehicles keep their technological edge on our competitors. In fact, we are one of the top 10 R&D investors in the UK and top 150 globally."
Jaguar Land Rover is not the only big spender on research and development. In 2007 Ford spent more than £400m on R&D in the UK - much of it going on power trains (engines and transmissions) - a vital area for reducing emissions. The UK is a key area for engine manufacture for Ford. Last year the company's Dagenham facility produced more than a million diesel engines, while the Brigend plant manufactured over 700,000 petrol engines. As a rough guide, one in four Ford engines is made in the UK.
And while Ford and Bentley may be at opposite ends of the spectrum in terms of target customers, there is a common thread - the UK's engineering resources. Graham Hoare, Ford's executive director for power train engineering who runs the company's Dunton Technical Centre in Essex, said one reason Ford has concentrated its European power train development in the UK is the pool of engineering skills available. It is not only the mass carmakers who use Britain as a base; Formula One and rally teams are also based in the UK.
"UK plc is home to many in the motor sport industry. We have a pool of UK engineers who are stretching the envelope, not just in terms of performance but also in terms of economy and emissions," Hoare said.
The message is not being lost in the corridors of power, not only in the UK but across the world. A substantial portion of the aid handed out to assorted national car industries has a green flavour - not least those offering incentives to buyers scrapping old gas guzzlers for new, lower emission models.
At the same CBI dinner when Smith spelled out JLR's importance to the UK's research and development efforts, Mandelson described the automotive sector as "vital", noting the government's role in helping to secure funds for the industry. His choice of comparison for the £2.3bn package which has government backing might be seen as telling. "That is effectively the same as underwriting the entire vehicle sector's research and development and capital expenditure for a year."
For Bentley the new model springs from a long tradition of speed and comfort, but the engineering capability which has made it possible is another, invaluable, UK tradition.
Wednesday, 25 February 2009
‘Green buildings’ will mean more savings
By Fiona Harvey, Environment Correspondent
Published: February 25 2009 02:27
Refurbishing office buildings to a higher environmental standard would create around 30,000 new jobs and save companies more than £700m ($1bn) a year, according to a study.
The construction industry is taking a renewed interest in “green building”, which could provide the sector with a much-needed boost as it struggles with the effects of the recession.
Gordon Brown, the prime minister, has leant his weight to efforts to raise the environmental standards of homes through a widespread programme of insulation, but this has focused on the domestic market.
Non-domestic buildings, including offices, public buildings such as hospitals and factories account for nearly a fifth of the UK’s emissions, according to a study from the consultancy Caleb Management Services, commissioned by Kingspan, the insulation manufacturer. About £27bn is spent a year on average in refurbishing such buildings, but many refurbishments devote little attention to improving the efficiency and environmental performance of the buildings.
The study concluded that spending 7 per cent more on refurbishment would cut carbon emissions by the equivalent of taking 5m cars off the road, and would lead to the creation of between 30,000 and 50,000 jobs.
Alan Whitehead, chair of the parliamentary renewable and sustainable energy group, said: “If the government’s emissions reduction targets are going to be met, then energy efficiency has to be the place to start. [There is] huge scope for emissions savings in buildings such as schools, hospitals, factories and warehouses.”
Buildings must now be rated for their energy efficiency, receiving an Energy Performance Certificate graded A to G according to their performance. But few buildings meet the higher standards, and the government’s own building stock are among the worst offenders: about three quarters of the UK’s public buildings were graded at D or below in a recent test.
The report found that many of the measures, such as enhanced capital allowances, put in place by government to help companies to cut emissions from their buildings were difficult for businesses to access.
In recent years, the construction industry has been reluctant to embrace “green buildings”, seeing them as an extra cost which would cut into their margins and discourage buyers. But the precipitous decline in the industry’s fortunes owing to the recession has encouraged companies to look to new areas of potential investment, such as low-emissions homes and offices, many of which qualify for some form of government support.
Copyright The Financial Times Limited 2009
Published: February 25 2009 02:27
Refurbishing office buildings to a higher environmental standard would create around 30,000 new jobs and save companies more than £700m ($1bn) a year, according to a study.
The construction industry is taking a renewed interest in “green building”, which could provide the sector with a much-needed boost as it struggles with the effects of the recession.
Gordon Brown, the prime minister, has leant his weight to efforts to raise the environmental standards of homes through a widespread programme of insulation, but this has focused on the domestic market.
Non-domestic buildings, including offices, public buildings such as hospitals and factories account for nearly a fifth of the UK’s emissions, according to a study from the consultancy Caleb Management Services, commissioned by Kingspan, the insulation manufacturer. About £27bn is spent a year on average in refurbishing such buildings, but many refurbishments devote little attention to improving the efficiency and environmental performance of the buildings.
The study concluded that spending 7 per cent more on refurbishment would cut carbon emissions by the equivalent of taking 5m cars off the road, and would lead to the creation of between 30,000 and 50,000 jobs.
Alan Whitehead, chair of the parliamentary renewable and sustainable energy group, said: “If the government’s emissions reduction targets are going to be met, then energy efficiency has to be the place to start. [There is] huge scope for emissions savings in buildings such as schools, hospitals, factories and warehouses.”
Buildings must now be rated for their energy efficiency, receiving an Energy Performance Certificate graded A to G according to their performance. But few buildings meet the higher standards, and the government’s own building stock are among the worst offenders: about three quarters of the UK’s public buildings were graded at D or below in a recent test.
The report found that many of the measures, such as enhanced capital allowances, put in place by government to help companies to cut emissions from their buildings were difficult for businesses to access.
In recent years, the construction industry has been reluctant to embrace “green buildings”, seeing them as an extra cost which would cut into their margins and discourage buyers. But the precipitous decline in the industry’s fortunes owing to the recession has encouraged companies to look to new areas of potential investment, such as low-emissions homes and offices, many of which qualify for some form of government support.
Copyright The Financial Times Limited 2009
Scottish & Southern in marine energy deal
By Andrew Bolger, Scotland Correspondent
Published: February 24 2009 10:53
Airtricity, the renewable energy arm of the Scottish and Southern Energy utility group, has signed an agreement aimed at developing sites capable of hosting 1,000MW of marine energy by 2020.
The agreement is with Aquamarine, the only UK marine energy company developing both wave and tidal power devices simultaneously, which has secured test berths for both technologies at the European Marine Energy Centre in Orkney.
Both companies will enter into a 50:50 joint venture to develop wave and tidal energy sites in the UK and Republic of Ireland. They aim to deploy Aquamarine’s Oyster wave energy converter and its Neptune tidal device.
Martin McAdam, chief executive of Aquamarine, said: “This contract is the biggest deal in the history of marine energy. Fully consented offshore wind farm sites are selling to owner operators at anywhere between £150,000 and £400,000 per MW consented, giving a strong indication of the large potential value of this deal if all 1,000MW of sites receive full consents and grid connection.”
Stephen Wheeler, Airtricity’s director responsible for marine development, said the agreement gave his group first option on sites Aquamarine developed, using its models of tidal and wave power and to identify and develop environmentally sensitive and profitable sites for the future.
“Aquamarine’s technologies also have similarities with our experience in hydro-electric and offshore wind development,” he said. “We see marine energy making an increasingly important contribution to our growing portfolio of renewable energy generation plants. ”
Airtricity was acquired by SSE last year for £1bn and the combined Airtricity/SSE team has developed 40 wind farms across Europe and North America, generating more than 1,500MW.
Edinburgh-based Aquamarine was founded in 2005, and is currently seeking to raise more than £50m of funding from investors. SSE currently has a 47 per cent stake in the company, but this is expected to be diluted by the fundraising.
Mr McAdam founded Airtricity’s US operations, which were recently sold for £750m, and it chief operating officer is Matthias Haag, former general manager at Shell WindEnergy.
Aitrtricity is currently developing two of the world’s largest windfarms, a 504 MW project at Greater Gabbard, off the Suffolk coast, and a 456MW onshore wind farm, located in the Upper Clyde Valley.
Copyright The Financial Times Limited 2009
Published: February 24 2009 10:53
Airtricity, the renewable energy arm of the Scottish and Southern Energy utility group, has signed an agreement aimed at developing sites capable of hosting 1,000MW of marine energy by 2020.
The agreement is with Aquamarine, the only UK marine energy company developing both wave and tidal power devices simultaneously, which has secured test berths for both technologies at the European Marine Energy Centre in Orkney.
Both companies will enter into a 50:50 joint venture to develop wave and tidal energy sites in the UK and Republic of Ireland. They aim to deploy Aquamarine’s Oyster wave energy converter and its Neptune tidal device.
Martin McAdam, chief executive of Aquamarine, said: “This contract is the biggest deal in the history of marine energy. Fully consented offshore wind farm sites are selling to owner operators at anywhere between £150,000 and £400,000 per MW consented, giving a strong indication of the large potential value of this deal if all 1,000MW of sites receive full consents and grid connection.”
Stephen Wheeler, Airtricity’s director responsible for marine development, said the agreement gave his group first option on sites Aquamarine developed, using its models of tidal and wave power and to identify and develop environmentally sensitive and profitable sites for the future.
“Aquamarine’s technologies also have similarities with our experience in hydro-electric and offshore wind development,” he said. “We see marine energy making an increasingly important contribution to our growing portfolio of renewable energy generation plants. ”
Airtricity was acquired by SSE last year for £1bn and the combined Airtricity/SSE team has developed 40 wind farms across Europe and North America, generating more than 1,500MW.
Edinburgh-based Aquamarine was founded in 2005, and is currently seeking to raise more than £50m of funding from investors. SSE currently has a 47 per cent stake in the company, but this is expected to be diluted by the fundraising.
Mr McAdam founded Airtricity’s US operations, which were recently sold for £750m, and it chief operating officer is Matthias Haag, former general manager at Shell WindEnergy.
Aitrtricity is currently developing two of the world’s largest windfarms, a 504 MW project at Greater Gabbard, off the Suffolk coast, and a 456MW onshore wind farm, located in the Upper Clyde Valley.
Copyright The Financial Times Limited 2009
Obama focuses on green economy in speech before Congress
• Barack Obama presses Capitol Hill on energy reforms• Budget will include $15bn a year for alternative fuels
Suzanne Goldenberg in Washington
guardian.co.uk, Wednesday 25 February 2009 03.54 GMT
Barack Obama raised the development of a green economy to the top of America's agenda tonight, calling on Congress to pass a law cutting the carbon emissions that cause global warming.
The president, in a rousing speech to both houses of Congress, tried to put to rest fears that the economic recession would force him to scale back ambitious plans for energy reforms.
Instead, he made it clear that he sees a direct link between America's long-term economic interests and the development of clean energy, budgeting additional funds for research into wind and solar power.
The president also pressed Congress to push ahead on a new law to cut greenhouse gas emissions, defying critics who say cap-and-trade measures could be a brake on economic recovery.
"To truly transform our economy, protect our security and save our planet from the ravages of climate change, we need to ultimately make clean, renewable energy the profitable kind of energy," the president said. "So I ask this Congress to send me legislation that places a market-based cap on carbon pollution and drives the production of more renewable energy in America."
Barely a week after the passage of his $787bn economic rescue plan, Obama came back to Congress with plans for further green investment.
The recovery plan devoted more than $100bn to making private homes and government buildings more efficient, developing wind and solar power and spending money on public transport.
But the president promised even more tonight, saying his budget, which will be announced on Thursday, would allocate $15bn a year to develop wind and solar power and more fuel-efficient cars.
"We are committed to the goal of a re-tooled, re-imagined auto industry," he said. "The nation that invented the automobile cannot walk away from it."
Obama also set out a plan to modernise the electric grid.
He said America needed to re-establish its leading role in the development of solar and other renewable energy technologies, after losing ground to China, Germany and Japan.
"I do not accept a future where the jobs and industries of tomorrow take root beyond our borders – and I know you don't either. It is time for America to lead again,"
The direct appeal for climate change legislation could re-energise efforts to produce legislation before global climate change talks get underway in Copenhagen next December.
White House officials admitted on Monday it was increasingly uncertain such legislation could pass in time, and that the deadline might slip to 2010.
Suzanne Goldenberg in Washington
guardian.co.uk, Wednesday 25 February 2009 03.54 GMT
Barack Obama raised the development of a green economy to the top of America's agenda tonight, calling on Congress to pass a law cutting the carbon emissions that cause global warming.
The president, in a rousing speech to both houses of Congress, tried to put to rest fears that the economic recession would force him to scale back ambitious plans for energy reforms.
Instead, he made it clear that he sees a direct link between America's long-term economic interests and the development of clean energy, budgeting additional funds for research into wind and solar power.
The president also pressed Congress to push ahead on a new law to cut greenhouse gas emissions, defying critics who say cap-and-trade measures could be a brake on economic recovery.
"To truly transform our economy, protect our security and save our planet from the ravages of climate change, we need to ultimately make clean, renewable energy the profitable kind of energy," the president said. "So I ask this Congress to send me legislation that places a market-based cap on carbon pollution and drives the production of more renewable energy in America."
Barely a week after the passage of his $787bn economic rescue plan, Obama came back to Congress with plans for further green investment.
The recovery plan devoted more than $100bn to making private homes and government buildings more efficient, developing wind and solar power and spending money on public transport.
But the president promised even more tonight, saying his budget, which will be announced on Thursday, would allocate $15bn a year to develop wind and solar power and more fuel-efficient cars.
"We are committed to the goal of a re-tooled, re-imagined auto industry," he said. "The nation that invented the automobile cannot walk away from it."
Obama also set out a plan to modernise the electric grid.
He said America needed to re-establish its leading role in the development of solar and other renewable energy technologies, after losing ground to China, Germany and Japan.
"I do not accept a future where the jobs and industries of tomorrow take root beyond our borders – and I know you don't either. It is time for America to lead again,"
The direct appeal for climate change legislation could re-energise efforts to produce legislation before global climate change talks get underway in Copenhagen next December.
White House officials admitted on Monday it was increasingly uncertain such legislation could pass in time, and that the deadline might slip to 2010.
Ministers considering stringent measures to clean up coal power
Juliette Jowit and Tim Webb
The Guardian, Wednesday 25 February 2009
Radical plans to clean up pollution from the UK's coal plants have been drawn up by the government amid growing international pressure to curb emissions that cause climate change.
The climate secretary, Ed Miliband, is understood to have asked for a thorough review of existing plans for up to eight new coal plants - described by leading US climate scientist James Hansen as "factories of death".
Options under consideration include forcing power companies to fit carbon capture and storage (CCS) equipment - which buries the greenhouse gases - and a big increase in funding for more "demonstration plants", which would be the first to fit the technology. Such a policy would be in line with Conservative proposals to impose CCS via a cap on emissions and to fund three or more plants to be fitted with the equipment.
Miliband has asked the Treasury for billions of pounds for the new policy because energy companies have warned they cannot afford to fund the expensive, unproven technology themselves. However the Treasury is understood to be reticent about the investment, which could run to £250m-£1bn for each power plant.
Energy companies have also warned Miliband and the Department for Business, Enterprise and Regulatory Reform (DBERR) that government dithering over new coal power is putting the UK's security of energy supply at risk, as ageing stations are closed down.
Miliband has asked officials at the Department for Energy and Climate Change for a further review in an attempt to head off the funding row, said people familiar with the discussion. Until now, the government has refused to impose any deadline for CCS, and only offered to fund one demonstration plant.
Chris Smith, chairman of the Environment Agency and a former cabinet minister, said: "There is a battle going on between the Department of Energy and Climate Change and the Treasury to secure the necessary funds for as wide a range of demonstration projects as possible."
A DECC spokesman said: "We do not recognise this description of our discussions [with the Treasury]. We're determined to meet the needs of security of supply and climate change."
Miliband is said to have first acted after the watchdog Climate Change Committee called in December for all coal plants to have the technology fitted by 2025 to ensure the UK can meet its pledge to cut emissions by 80% by 2050.
Miliband asked officials to draw up policies that would deliver the committee's recommendation, the Guardian has learned. As well as suggestions for limiting emissions and backing more demonstration plants, financing options have been discussed, including UK government guarantees for loans, a levy on customer energy bills and a carbon tax. Some money is also available from the European Commission. The Conservatives have said they would fund CCS demonstrations using money raised by auctioning carbon allowances under the European Emissions Trading System.
Miliband's department will make the decision, putting him under intense personal pressure, particularly after widespread anger among environmental campaigners over January's decision to expand Heathrow airport.
The Institute for Public Policy Research thinktank said yesterday the government must ban new coal-fired power plants which have not been fitted with CCS equipment. "CCS could be a crucial technology for tackling climate change,'" it said. "It could also create new jobs supplying markets at home and abroad, which will be especially valuable during a recession."
The Environment Agency is also calling on the government not to give the go-ahead to new coal plants which are not fitted with CCS equipment. Smith, who is in contact with DECC officials about the policy discussions, said Miliband was unlikely to go this far . "The indication I get is that DECC and Ed Miliband in particular are keen to take CCS forward in a serious way," he said. "But the devil is in the detail. I would certainly want to give every encouragement to DECC to go as far as possible."
Details of the new proposals emerged as anger over new coal plants continues to generate protests against Miliband and the utility company E.ON, which has made the first application for a new plant, at Kingsnorth in Kent. International campaign groups from more than 50 developing countries this week accused the UK of being a "climate criminal" over the existing plans for unabated coal plants.
Campaigners said they would welcome a firm deadline for CCS by the early 2020s, however a more flexible life-time emissions cap for plants was rejected as "fudge".
The Guardian, Wednesday 25 February 2009
Radical plans to clean up pollution from the UK's coal plants have been drawn up by the government amid growing international pressure to curb emissions that cause climate change.
The climate secretary, Ed Miliband, is understood to have asked for a thorough review of existing plans for up to eight new coal plants - described by leading US climate scientist James Hansen as "factories of death".
Options under consideration include forcing power companies to fit carbon capture and storage (CCS) equipment - which buries the greenhouse gases - and a big increase in funding for more "demonstration plants", which would be the first to fit the technology. Such a policy would be in line with Conservative proposals to impose CCS via a cap on emissions and to fund three or more plants to be fitted with the equipment.
Miliband has asked the Treasury for billions of pounds for the new policy because energy companies have warned they cannot afford to fund the expensive, unproven technology themselves. However the Treasury is understood to be reticent about the investment, which could run to £250m-£1bn for each power plant.
Energy companies have also warned Miliband and the Department for Business, Enterprise and Regulatory Reform (DBERR) that government dithering over new coal power is putting the UK's security of energy supply at risk, as ageing stations are closed down.
Miliband has asked officials at the Department for Energy and Climate Change for a further review in an attempt to head off the funding row, said people familiar with the discussion. Until now, the government has refused to impose any deadline for CCS, and only offered to fund one demonstration plant.
Chris Smith, chairman of the Environment Agency and a former cabinet minister, said: "There is a battle going on between the Department of Energy and Climate Change and the Treasury to secure the necessary funds for as wide a range of demonstration projects as possible."
A DECC spokesman said: "We do not recognise this description of our discussions [with the Treasury]. We're determined to meet the needs of security of supply and climate change."
Miliband is said to have first acted after the watchdog Climate Change Committee called in December for all coal plants to have the technology fitted by 2025 to ensure the UK can meet its pledge to cut emissions by 80% by 2050.
Miliband asked officials to draw up policies that would deliver the committee's recommendation, the Guardian has learned. As well as suggestions for limiting emissions and backing more demonstration plants, financing options have been discussed, including UK government guarantees for loans, a levy on customer energy bills and a carbon tax. Some money is also available from the European Commission. The Conservatives have said they would fund CCS demonstrations using money raised by auctioning carbon allowances under the European Emissions Trading System.
Miliband's department will make the decision, putting him under intense personal pressure, particularly after widespread anger among environmental campaigners over January's decision to expand Heathrow airport.
The Institute for Public Policy Research thinktank said yesterday the government must ban new coal-fired power plants which have not been fitted with CCS equipment. "CCS could be a crucial technology for tackling climate change,'" it said. "It could also create new jobs supplying markets at home and abroad, which will be especially valuable during a recession."
The Environment Agency is also calling on the government not to give the go-ahead to new coal plants which are not fitted with CCS equipment. Smith, who is in contact with DECC officials about the policy discussions, said Miliband was unlikely to go this far . "The indication I get is that DECC and Ed Miliband in particular are keen to take CCS forward in a serious way," he said. "But the devil is in the detail. I would certainly want to give every encouragement to DECC to go as far as possible."
Details of the new proposals emerged as anger over new coal plants continues to generate protests against Miliband and the utility company E.ON, which has made the first application for a new plant, at Kingsnorth in Kent. International campaign groups from more than 50 developing countries this week accused the UK of being a "climate criminal" over the existing plans for unabated coal plants.
Campaigners said they would welcome a firm deadline for CCS by the early 2020s, however a more flexible life-time emissions cap for plants was rejected as "fudge".
Warning over delays to ‘clean coal’ scheme
By Ed Crooks and Fiona Harvey
Published: February 25 2009 02:47
Companies competing to build Britain’s first “clean coal” power station have warned that the project risks missing its target start date because of government delays.
Ministers have promised to back a large-scale demonstration of a coal-fired power plant that captures and stores its carbon dioxide emissions, and in 2007 launched a competition for companies to bid for funding. The government wants the plant to be operational by 2014, and says it is committed to developing a commercial-scale clean coal plant as quickly as possible.
Companies that have entered the competition, however, told the Financial Times they were worried the timetable had slipped. Some fear the Department for Energy and Climate Change is arguing with the Treasury over the project’s funding.
Ed Miliband, the energy secretary, will on Wednesday face questions on the issue from MPs on the Commons energy committee.
The industry expects the government to set out a new strategy for coal, which could include rules limiting the emissions from coal-fired power stations.
It could also make the carbon capture competition more generous, so that more than one project could be funded, and change the rules so that a proposal from Richard Budge’s Powerfuel in Hatfield, South Yorkshire, would be eligible.
A government official said on Tuesday: “We are determined to demonstrate carbon capture and storage technology and we will be making an announcement in the coming weeks about the next stages of that process.”
Industry executives fear a new strategy risks further delaying the carbon capture project in a fresh round of consultations.
Three groups are left in the competition: one led by Eon, looking at fitting carbon capture to part of its controversial new plant at Kingsnorth in Kent; one led by RWE Npower, for a new plant at Tilbury in Essex; and one led by Scottish Power, for its existing plant at Longannet in Fife.
All three say they are committed to their plans, and none is prepared to raise its concerns in public for fear of jeopardising its chances in the competition. Off the record, though, executives have expressed deep anxiety.
One said: “This competition is utterly imperative for delivering industrial-scale carbon capture and storage by 2020.
“For that there needs to be a large-scale demonstration project by 2014. We need the full resources of the government to deliver that, and there is a very real risk that a new coal strategy will stretch the project out or confuse it.”
Another said: “We are very anxious for clarity on a project that requires a huge amount of capital investment.”
Jeff Chapman, chief executive of the Carbon Capture and Storage Association, said companies were “frustrated by the slow rate of progress”.
Industry was “keen to get on with it”, he added.
Copyright The Financial Times Limited 2009
Published: February 25 2009 02:47
Companies competing to build Britain’s first “clean coal” power station have warned that the project risks missing its target start date because of government delays.
Ministers have promised to back a large-scale demonstration of a coal-fired power plant that captures and stores its carbon dioxide emissions, and in 2007 launched a competition for companies to bid for funding. The government wants the plant to be operational by 2014, and says it is committed to developing a commercial-scale clean coal plant as quickly as possible.
Companies that have entered the competition, however, told the Financial Times they were worried the timetable had slipped. Some fear the Department for Energy and Climate Change is arguing with the Treasury over the project’s funding.
Ed Miliband, the energy secretary, will on Wednesday face questions on the issue from MPs on the Commons energy committee.
The industry expects the government to set out a new strategy for coal, which could include rules limiting the emissions from coal-fired power stations.
It could also make the carbon capture competition more generous, so that more than one project could be funded, and change the rules so that a proposal from Richard Budge’s Powerfuel in Hatfield, South Yorkshire, would be eligible.
A government official said on Tuesday: “We are determined to demonstrate carbon capture and storage technology and we will be making an announcement in the coming weeks about the next stages of that process.”
Industry executives fear a new strategy risks further delaying the carbon capture project in a fresh round of consultations.
Three groups are left in the competition: one led by Eon, looking at fitting carbon capture to part of its controversial new plant at Kingsnorth in Kent; one led by RWE Npower, for a new plant at Tilbury in Essex; and one led by Scottish Power, for its existing plant at Longannet in Fife.
All three say they are committed to their plans, and none is prepared to raise its concerns in public for fear of jeopardising its chances in the competition. Off the record, though, executives have expressed deep anxiety.
One said: “This competition is utterly imperative for delivering industrial-scale carbon capture and storage by 2020.
“For that there needs to be a large-scale demonstration project by 2014. We need the full resources of the government to deliver that, and there is a very real risk that a new coal strategy will stretch the project out or confuse it.”
Another said: “We are very anxious for clarity on a project that requires a huge amount of capital investment.”
Jeff Chapman, chief executive of the Carbon Capture and Storage Association, said companies were “frustrated by the slow rate of progress”.
Industry was “keen to get on with it”, he added.
Copyright The Financial Times Limited 2009
Ill and Fair Winds for U.K. Power
Government Plans for Renewable Energy Face Hefty Obstacles
By SELINA WILLIAMS
LONDON -- The U.K.'s ambition to be a leader in offshore wind power got a boost last week with the award of 10 new sites to companies to develop more than six gigawatts of electricity in waters off Scotland.
But analysts and utility executives said attaining such a position will depend on whether the government can ensure the planning and consent process runs smoothly for the construction of the wind farms and the grid infrastructure that is needed to carry the power to consumers.
"The U.K. is a great opportunity because of the wind conditions, but they have to act quickly to get the utilities to commit once the licenses are granted," said Dean Cooper, head of clean technology at stock brokerage and consultancy Ambrian Partners Ltd.
Although the U.K., with its strong financial incentives for investors, is currently the biggest producer of offshore wind power, it faces stiff competition from continental European countries such as Germany and the Netherlands, where the grid-connection process is more straightforward.
Reuters
Wind turbines stand in the Irish Sea at the North Hoyle offshore wind farm near Prestatyn, North Wales in 2006. The U.K. government last week awarded 10 new sites to companies to develop electricity in waters off Scotland.
Under German law, grid companies are obliged to ensure that the onshore and offshore grid connections are in place in time for the commissioning of wind farms. In the U.K., the construction of new grid links to offshore farms in Scotland has to go out to tender.
New grid connections and upgrades are crucial because the offshore wind farms in Scotland are in northern areas that are far from the U.K.'s main power-consuming regions in the south. Currently, the grid links in Scotland aren't sufficient to cope with the expected output from planned wind farms.
Meanwhile, a proposed upgrade of the main Beauly-Denny power-transmission line in Scotland has been mired in planning since 2005.
"The Beauly-Denny line is critical, and more upgrades of a similar size and scale will also be needed," said Alan Mortimer, head of policy at ScottishPower Renewables, a U.K. subsidiary of Spain's Iberdrola SA and one of the companies to win a site in the Scottish licensing round.
The U.K. government's new planning bill intends to speed up the approval process for new grids and offshore wind farms through an Infrastructure Planning Commission. Yet the process has come under some criticism because the National Policy Statements that the IPC will rely on to make its decisions about the construction of renewable-energy projects are still more than a year away from being approved.
And with the wind farms from the Scottish licensing round due to be commissioned starting in 2015, the timing is tight.
Gordon Edge, director of economics and markets at the British Wind Energy Association, said more financial incentives are necessary to keep the momentum going on projects that are coming up now, so the supply chain and expertise is there for the longer-term wind projects.
The investments needed for offshore wind projects range between £2.5 million and £2.8 million ($3.6 million and $4 million) per megawatt hour, or double that of onshore wind projects.
Investors in the Scottish round are likely to be partly shielded from the current credit crisis because they probably won't seek project financing before 2012.
Companies that are developing offshore projects for commissioning over the next two to three years are finding it tougher and more expensive to get project financing in an environment where U.K. power prices have more than halved in recent months and component costs are still high.
Last month, E.ON U.K. Chief Executive Paul Golby told the Financial Times that the economics of the U.K.'s flagship 1,000-megawatt London Array offshore wind farm were "on a knife edge." London Array suffered a blow last year when Royal Dutch Shell PLC pulled out of the project because of rising costs. Shell instead chose to focus on onshore wind power in the U.S.
Mr. Edge said the need to get projects such as London Array up and running is likely to prompt the industry to seek additional help in the short term, possibly in the form of tax breaks. Another option would be a fixed price or floor for Renewable Obligation Certificates, the support mechanism to reward a company for each megawatt hour of electricity it produces from a so-called green energy source, he added.
The U.K. is counting on offshore wind to help it meet a binding European Union target on cutting greenhouse-gas emissions and boosting renewable-energy use by 2020. The proportion of renewable energy in the total mix needs to rise to 15% from about 2% now.
Write to Selina Williams at selina.williams@dowjones.com
By SELINA WILLIAMS
LONDON -- The U.K.'s ambition to be a leader in offshore wind power got a boost last week with the award of 10 new sites to companies to develop more than six gigawatts of electricity in waters off Scotland.
But analysts and utility executives said attaining such a position will depend on whether the government can ensure the planning and consent process runs smoothly for the construction of the wind farms and the grid infrastructure that is needed to carry the power to consumers.
"The U.K. is a great opportunity because of the wind conditions, but they have to act quickly to get the utilities to commit once the licenses are granted," said Dean Cooper, head of clean technology at stock brokerage and consultancy Ambrian Partners Ltd.
Although the U.K., with its strong financial incentives for investors, is currently the biggest producer of offshore wind power, it faces stiff competition from continental European countries such as Germany and the Netherlands, where the grid-connection process is more straightforward.
Reuters
Wind turbines stand in the Irish Sea at the North Hoyle offshore wind farm near Prestatyn, North Wales in 2006. The U.K. government last week awarded 10 new sites to companies to develop electricity in waters off Scotland.
Under German law, grid companies are obliged to ensure that the onshore and offshore grid connections are in place in time for the commissioning of wind farms. In the U.K., the construction of new grid links to offshore farms in Scotland has to go out to tender.
New grid connections and upgrades are crucial because the offshore wind farms in Scotland are in northern areas that are far from the U.K.'s main power-consuming regions in the south. Currently, the grid links in Scotland aren't sufficient to cope with the expected output from planned wind farms.
Meanwhile, a proposed upgrade of the main Beauly-Denny power-transmission line in Scotland has been mired in planning since 2005.
"The Beauly-Denny line is critical, and more upgrades of a similar size and scale will also be needed," said Alan Mortimer, head of policy at ScottishPower Renewables, a U.K. subsidiary of Spain's Iberdrola SA and one of the companies to win a site in the Scottish licensing round.
The U.K. government's new planning bill intends to speed up the approval process for new grids and offshore wind farms through an Infrastructure Planning Commission. Yet the process has come under some criticism because the National Policy Statements that the IPC will rely on to make its decisions about the construction of renewable-energy projects are still more than a year away from being approved.
And with the wind farms from the Scottish licensing round due to be commissioned starting in 2015, the timing is tight.
Gordon Edge, director of economics and markets at the British Wind Energy Association, said more financial incentives are necessary to keep the momentum going on projects that are coming up now, so the supply chain and expertise is there for the longer-term wind projects.
The investments needed for offshore wind projects range between £2.5 million and £2.8 million ($3.6 million and $4 million) per megawatt hour, or double that of onshore wind projects.
Investors in the Scottish round are likely to be partly shielded from the current credit crisis because they probably won't seek project financing before 2012.
Companies that are developing offshore projects for commissioning over the next two to three years are finding it tougher and more expensive to get project financing in an environment where U.K. power prices have more than halved in recent months and component costs are still high.
Last month, E.ON U.K. Chief Executive Paul Golby told the Financial Times that the economics of the U.K.'s flagship 1,000-megawatt London Array offshore wind farm were "on a knife edge." London Array suffered a blow last year when Royal Dutch Shell PLC pulled out of the project because of rising costs. Shell instead chose to focus on onshore wind power in the U.S.
Mr. Edge said the need to get projects such as London Array up and running is likely to prompt the industry to seek additional help in the short term, possibly in the form of tax breaks. Another option would be a fixed price or floor for Renewable Obligation Certificates, the support mechanism to reward a company for each megawatt hour of electricity it produces from a so-called green energy source, he added.
The U.K. is counting on offshore wind to help it meet a binding European Union target on cutting greenhouse-gas emissions and boosting renewable-energy use by 2020. The proportion of renewable energy in the total mix needs to rise to 15% from about 2% now.
Write to Selina Williams at selina.williams@dowjones.com
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