Tuesday, 10 November 2009

Energy policy: Atomic dreams

The Guardian, Tuesday 10 November 2009

"No government has sought to influence me in any way whatever," declared Sir Frank Layfield before giving the go ahead for the last nuclear power station to be built in Britain. His Sizewell B inquiry, which occupied Aldeburgh's Snape Maltings for much of the early 1980s, was tortuous and expensive. Its successor, Ed Miliband confirmed yesterday, will be swift and restricted, its scope directed by government to an almost Napoleonic extent.
Mr Miliband is a convert to the nuclear cause, arguing that the price of not building a new generation of plants, in the form of higher carbon emissions, trumps the environmental and financial cost of going ahead. Yesterday he issued the new Infrastructure Planning Commission with its orders. There will be no drawn-out public inquiry into each new nuclear site, windfarm or power line. The IPC will review specific applications, and consult, but its remit will not allow it to question whether such things should be built, only where.
The new planning process is already controversial and will become more so once it swings into full operation next year. Decisions will be taken quickly and once made cannot be overturned by ministers (a point the Conservatives intend to change). There are promises of consultation, but no right of veto for local people on big projects. Applications for smaller wind farms below 50MW will continue to be decided by local government – which might throw the industry's focus behind bigger ones. But Mr Miliband is right to set out an energy policy, and right that planning policy had to change to accommodate it. "Saying no everywhere would not be in the national interest," he told the Commons. His aim is a near-zero level of carbon emissions from electricity production, but even if Britain faced no pressure to cut pollution, it would need to replace ageing power plants to keep the lights on and avoid a dangerous dependence on expensive imported gas.
Half the energy secretary's statement concentrated on clean coal technology, glossing over its erratic progress, and the reality that even if carbon capture and storage is made to work, it will only have a marginal impact on emissions by 2020. The big focus was on nuclear, the planning challenge underlined by confirmation that all 10 possible sites are next to existing nuclear plants. It is hard to dispute Mr Miliband's logic that, if Britain is to meet its carbon targets, extra nuclear power will be required – though some will ask why, ruling out Dungeness because of the risk of floods, he is happy to build at Sizewell, on an eroded coastline. Yesterday's statements also leave the issues of funding and waste management unresolved. Fast-track planning is only the start.

Barack Obama will go to Copenhagen if he can clinch climate deal

Daniel Nasaw in Washington
The Guardian, Tuesday 10 November 2009
President Barack Obama will travel to the climate summit in Copenhagen next month if the countries involved are on the verge of a deal and he thinks his presence will help to clinch agreement, he said in an interview last night.
It is Obama's strongest assertion yet that he will attend the meeting in Denmark to help secure a binding treaty in the fight against climate change, and comes after weeks of pessimism and a significant downgrading of the summit's goal.
"If I am confident that all the countries involved are bargaining in good faith and we are on the brink of a meaningful agreement and my presence in Copenhagen will make a difference in tipping us over edge, then certainly that's something that I will do," the US president told Reuters.
Obama made clear he considers his talks with Chinese leaders during an Asia tour later this month to be crucial in clearing remaining obstacles to an accord.
"The key now is for the United States and China, the two largest emitters, to come up with a framework that, along with other big emitters like the Europeans and those countries that are projected to be large emitters in the future, like India, can all buy into," he said. "I remain optimistic that between now and Copenhagen that we can arrive at that framework."
He spoke as progress on legislation in the US remains halting, and just days after the last formal international negotiations in Barcelona in the run up to the summit collapsed in acrimony. On Friday, developing countries threatened to walk out of the Copenhagen summit unless wealthier states commit to great cuts in their own emissions, and to more aid. Meanwhile, the UN, EU and some NGOs have accused the US of holding up the talks by refusing to show up at Copenhagen with firm emissions targets.
The US House of Representatives has passed a bill setting a 17% reduction in America's emissions from 2005 levels, and a version currently in the Senate aims for a 20% cut by 2020.
It became clear on Friday that the best hope for Copenhagen is a "politically binding" agreement, which rich countries hope will have all the key elements of the final deal, including specific targets and timetables for greenhouse gas emissions cuts and money for poor countries to cope with climate change.
A British government official said: "It would be substantive. It would set timelines, and provide the figures by which rich countries would reduce emissions, as well as the money that would be made available to developing countries to adapt to climate change." But, she said, a legally binding agreement "could take six months, up to a year, but we would want it to be [signed] as soon as possible."
If Obama shows up next month, he will join more than 40 heads of state, including prime minister Gordon Brown and others from Europe, Africa and South America who have said they will attend the talks.
In Washington, Republicans and some Democrats have resisted emissions legislation, saying it would hinder job growth as the country claws its way out of recession. The White House has said global climate negotiations should continue while the US domestic political debate plays out.
Republicans are little inclined to allow Obama a victory on climate change, which they see as a liberal issue in the US, and the entire Congress is embroiled in a bitter fight over his health care reform plans.
In a dramatic display of intransigence, Republicans on a Senate committee tasked with approving emissions control legislation boycotted a hearing last week on the bill. The bill passed and will now be further shaped by Senate Democratic leaders before a floor vote.
Complicating the situation are next year's congressional and Senate elections, when Democrats will be more concerned with voters' economic woes than with demands from Copenhagen participants.
On Monday, Obama said he was optimistic he could convince American businesses and the public of the "enormous amount of benefits" of emissions control.
"In meeting with world leaders, I've repeatedly explained that America is not a speedboat," he said. "We're a big ocean liner. And you can't reverse course overnight."

In the same leaky boat on climate change

The Maldives and Britain are united in the face of environment crisis – and we take inspiration from underwater politics
Douglas Alexander and Mohamed Nasheed
guardian.co.uk, Monday 9 November 2009 21.00 GMT
Be in no doubt. Climate change is not tomorrow's future menace. It is today's growing catastrophe. In Copenhagen next month a meaningful deal must be secured if we are to have any hope of avoiding catastrophe.
This very human crisis is already being felt in parts of the world. This year, entire communities in Bangladesh are being forced to leave their homes due to rising sea levels; women in drought-ridden parts of Ethiopia have to walk five miles a day to collect water; and natural disasters are occurring with increasing frequency and ever more devastating results.
Climate change threatens us all. If we fail to bring it under control in the next decade we may move past the point of no return. This is a defining political test of our generation. Less than one degree of global warming since the industrial revolution has caused dangerous changes to our world.
Last month, the government of the Maldives held a cabinet meeting underwater to illustrate the stark reality facing the nation. The meeting caused a media sensation internationally. It was a lighthearted event with a deadly serious message: if climate change is not addressed, these beautiful islands will slowly slip into the Indian Ocean.
This week, the Maldives is hosting a conference of climate-vulnerable developing countries. The conference aims to thrash out a common position among the most vulnerable nations ahead of the Copenhagen meeting in December.
Britain stands shoulder to shoulder with the Maldives and all vulnerable countries. We are working to ensure the voices of the people who will be hit first and hardest by climate change are heard around the negotiating table. Copenhagen must secure a deal that sees rich countries shouldering their fair share of the burden of controlling climate change. This means tough targets on their own emissions but also an agreement on funding to help developing countries pursue green growth and cope with the impacts of climate change.
This will mean helping to end the deforestation that sees 8 million trees lost every day; governments working with the private sector to secure large investments in green industries; and a commitment to renewable energy, to make renewables cheaper than fossil fuel.
A fair deal at Copenhagen also means that climate change funding is not plundered from existing aid budgets but should be new, additional finance.
It is vital that the developing world has a strong, coherent voice at the table. The rich world must take the lead in cutting emissions and providing sufficient funds for developing countries. They, however, also have responsibilities. Developing nations need to grow, but their economic growth must be green.
To that end, the Maldives has signed an agreement to build a 75MW wind farm which will power the capital, Malé, the international airport, and 24 luxury tourist resorts. This project will cut CO2 emissions by 25%. It is due to be operational in 20 months. If a small developing country can make this rapid shift to renewables, there can be little excuse for richer nations to drag their feet.
Copenhagen is a moment of necessity. We must agree a credible, long-term deal that is fair and equitable. One that merely protects the interests of the rich will tell the world that the leaders of 2009 lacked the political will and moral conviction to help those whose lives will be blighted by climate change.
We need to use these last 28 days before Copenhagen to ensure that all parties are in a position to work towards a deal that will stand alongside the Geneva conventions and the UN charter as a defining document for humanity.

UK carbon capture competition 'dead on its feet' says expert

Professor Stuart Hazeldine warns only Scottish Power can deliver carbon capture and storage within the government's timetable.
From BusinessGreen.com, part of the Guardian Environment Network
guardian.co.uk, Monday 9 November 2009 11.10 GMT
The UK's carbon capture and storage (CCS) competition is "dead on its feet" with only one of the three projects in the running capable of delivering a full scale working demonstration plant by the 2014 deadline, a leading expert has warned.
Speaking to BusinessGreen.com, Professor Stuart Hazeldine, a geologist at the University of Edinburgh and leading expert in CCS technologies, said that the Department of Energy and Climate Change (DECC) should close the competition and award the funding to Scottish Power to develop CCS at its Longannet plant in Fife in order to prevent any more time being wasted.
"Scottish Power are the only people who can deliver by 2014 now," he said. " The competition timescale has already slipped and to get it back on track the award needs to be made soon."
Back in 2007 the government said it would award the winner of its CCS competition around £1 billion to help fund a commercial scale carbon capture demonstration project.
The government has said it plans to announce the winner some point next year with three proposals in the running: Longannet, RWE npower's station at Tilbury in Essex, and E.ON's plans for a new coal plant at Kingsnorth in Kent.
"RWE npower are showing a manifest lack of movement on their CCS offerings and E.ON have delayed Kingsnorth plans," said Hazeldine. "That leaves one obvious winner."
He added that the long-running competition had discouraged other firms from coming forward with project proposals. "The UK has such a slow track record on developing CCS that anyone who is able to has gone elsewhere," he said. "We need to get on with it."
The government has now committed to helping fund "up to four" CCS plants in the UK. The first – the competition winner - will be funded by the Treasury, but any further plants will be funded primarily from a levy on energy bills.
As well as awarding the competition to Scottish power, the government should announce a "feed study" – a detailed engineering evaluation – for CCS at Kingsnorth so that E.ON can install the technology when it likely revives the plant in the second half of this decade, Hazeldine advised.
Hazeldine first made his controversial recommendations at a Westminster energy forum last month, where Martin Deutz, director of the cleaner fossil fuels unit at DECC, defended the department's position.
"It is an active commercial negotiation and I'm not going to say anything about the commercial position of each of the companies," he said. "But I would say that the negotiations that we have been having with the bidders have thrown up a number of extremely interesting and important issues… they are important issues which have to be dealt with financially, operationally and in regulatory terms."

Government impose ‘carbon capture levy’ to fund coal-fired power plants

Ben Webster, Environment Editor

Families will pay a new levy on electricity bills for at least the next 20 years to fund technology designed to capture the carbon from coal-fired power stations.
The Government is planning to raise £9.5 billion from the levy to subsidise up to four carbon capture and storage (CCS) demonstration plants. Details of the first plant will be announced early next year. The Department for Energy and Climate Change said yesterday that uncertainty over the commercial viability of CCS meant that public support might have to continue beyond 2030.
The Government is promoting CCS to justify approving new coal plants to replace the eight due to close by 2015 under European rules on air pollution.
Burning coal produces far more carbon than burning gas for the same amount of electricity but ministers want to build new coal plants to reduce Britain’s dependence on imported gas.

E.On announced last month that it was delaying its plan for a new coal station with CCS at Kingsnorth, Kent, for at least three years. However, the Kingsnorth plant may yet go ahead and, along with a proposed plant at Longannet in Scotland, is competing to be the first subsidised CCS demonstration project.
The department said the CCS levy, likely to start in 2011, would be about £17 a year per household. It said that the cost could be higher if its assumptions about the cost of CCS proved too optimistic.
The initial levy, which will be imposed on electricity suppliers but passed on to consumers, will run for 15 years. This will pay for the first phase of CCS, under which new coal plants will have to capture the carbon from only about a quarter of their generating capacity.
Ed Miliband, the Energy and Climate Change Secretary, said that the levy could be continued beyond the 15-year period to subsidise CCS for the entire output of the four plants.
An official from the department said it was possible that the levy could remain in place for an additional 15 years, but this would depend on the price of permits to emit carbon. If the price remained at the present low level, CCS would continue to need huge subsidies because it would be cheaper for generators to buy permits for their carbon emissions than to invest in technology to reduce them.
Mr Miliband admitted that further regulations or financial incentives might be needed to encourage the development of CCS. He ordered a “rolling review” of progress on CCS and said it would report by 2018 on whether it was “technically or economically viable”.
The department said its ambition was for any coal plant opening after 2020 to have CCS covering its full capacity from the outset.
Its draft policy on “clean coal” said it hoped that the four demonstration projects would allow CCS to be applied to existing coal plants from 2020. “Our ambition is for CCS to be ready for widespread deployment from 2020.”
It admitted that there was a risk that CCS, which has yet to be shown to work commercially anywhere in the world, might prove unviable.
“In the event that CCS is not on track to become technically or commercially viable, preventing retrofit, an appropriate regulatory approach for managing emissions will be needed.”
Keith Allott, head of climate change at the environmental group WWF-UK, said: “The acknowledgement that we need a safety net in place, in case carbon capture and storage technology doesn’t work or costs too much, is a sensible step forward. However, waiting until the 2020s to put such a plan into action is foolhardy.
“It gives us no guarantee that the advice of the Committee on Climate Change, which urges the UK to decarbonise the power sector by 2030, will be met.
“It would also do nothing to stop the building of largely unabated coal power stations in the interim.”

Boost to Scots CCS bid for £1bn emissions cash as rival quits race

Published Date: 10 November 2009
By Jenny Fyall
SCOTLAND'S chances of winning at least £1 billion in funding to capture emissions from power stations have been boosted after a key competitor pulled out of the contest.
ScottishPower has ambitions to win the huge sum of government funding to install carbon capture and storage (CCS) technology at Longannet Power Station in Fife.The firm had been competing against E.ON, which hopes to win the money to install CCS at a new power station at Kingsnorth in Kent, as well as RWE npower, for its power station in Tilbury, Essex.However, RWE npower yesterday confirmed it had decided withdraw from the competition, blaming the current economic situation.It has been highlighted that E.ON has admitted it is unable to meet the competition deadline – which has demanded a full-scale working demonstration plant built by 2014. This is due to a decision earlier this year that it would be postponing plans for a new coal-fired power station at Kingsnorth – which was to have been its host site for the CCS project if it won the technology.Although E.ON has been allowed to remain in the competition, some experts say this makes ScottishPower the front-runner for the cash.Professor Stuart Haszeldine, an expert in CCS at Edinburgh University, said there was now just "one obvious winner".If ScottishPower won the money to retrofit Longannet Power Station, it could pave the way for Scotland to lead the way globally in developing a technology considered crucial for the fight against climate change.If CCS is developed successfully, it will be able to capture about 90 per cent of the emissions produced by coal-fired power stations – meaning the plants could continue operating without hampering efforts to tackle global warming.Energy and Climate Change Secretary Ed Miliband said: "The government has received two bids – from E.ON and Scottish Power – to proceed to the next stage of the current CCS demonstration competition."It is expected contracts for the detailed design stage will be concluded early next year." Nick Horler, ScottishPower's chief executive, said: "The ScottishPower consortium is ready to demonstrate CCS at a commercial scale at Longannet from 2014 and help the UK realise the massive economic and environmental potential of this revolutionary technology."Meanwhile, the Scottish Government and UK government both announced yesterday they would no longer allow any new coal power stations without CCS technology. Previously, the SNP had only insisted on new power stations being "ready" to use the technology, once it was invented.Environmental campaigners welcomed the move, but argued deadlines for installing CCS technology at existing power stations were not ambitious enough.

£300m biomass fund promises nine steps towards green targets

Published Date: 10 November 2009
By Rosemary Gallagher
A £300 million fund being launched to build nine biomass heat and power plants across Scotland will help the country reach its ambitious renewable energy targets, it has been claimed.
The Scottish Government has set a target of 50 per cent of electricity to be generated from renewable sources, such as wind, wave, hydro, biomass and solar, by 2020. It also wants 11 per cent of heat to come from renewables by that point. Scottish Renewables, a trade body, said biomass was vital to meeting the second target in particular. The biomass fund, which is thought to be the first of its kind in the UK, is being launched by Invicta Capital, a private client investment firm. Invicta has already gained planning permission for two biomass combined heat and power (CHP) plants to be built in Caithness. It has outline planning permission for a further seven plants across Scotland.Niall Bamford, managing director of Invicta, said it had to raise a minimum of £35m by February to enable it to start building the first plant at Georgemass in Caithness. Construction will start in the first quarter of next year and the aim is to have all nine sites up and running within three years.Bamford said: "Biomass is part of our energy solution. It will never provide for all of our needs." The fund's launch yesterday came on the same day as the UK government approved ten sites in England and Wales for new nuclear power stations, most of them on the sites of existing plants. Energy Secretary Ed Miliband said nuclear was "proven and reliable".However, the Scottish Government remains opposed to building nuclear plants and can effectively veto them through planning powers held at Holyrood. David Hunter, international business manager for electricity at consultancy firm McKinnon & Clarke, said: "Biomass is only one of many energy sources – it's never likely to be a leading technology. But it is good to look into such areas and invest in them."He added that existing biomass plants in Scotland tended to be relatively small scale.Hunter warned that the SNP would come under pressure to explain what viable alternatives it had to nuclear. He said renewables were unlikely to meet more than about 30 per cent of the country's energy needs.For the launch of its biomass fund, Invicta has brought together a consortium including New Park Management, a private sector developer of science and technology parks. New Park will provide access to a number of development sites, planning advice and building management services. New Park is part of the Scottish Enterprise Energy Technology Centre consortium.An electricity purchase agreement is currently being negotiated by Invicta with a UK utility. Bamford said he was in discussion with at number of utility firms, including Scottish ones.The nine plants will be located on existing industrial and business development parks or brown field sites in Scotland, with a total generating capacity of up to 90MW of electricity, enough to supply 140,000 homes. The plants will be powered by wood.Niall Stuart, chief executive of Scottish Renewables, said: "The industry has the potential to create jobs and investment in rural areas of Scotland, as that is where the fuel source is."

Windfarm opponents must decide whether they want electricity or not

Objections to wind turbines, speciously citing 'democratic reasons', have a historical precedent – and they were wrong then, too
Adam Bruce
guardian.co.uk, Monday 9 November 2009 12.49 GMT
In January 1831 a Yorkshire merchant wrote to the Leeds Intelligencer to protest at the planned construction of a new railway:
On the very line of this railway, I have built a comfortable house; it enjoys a pleasing view of the country. Now judge, my friend, of my mortification, whilst I am sitting comfortably at breakfast with my family, enjoying the purity of the summer air, in moment my dwelling, once consecrated to peace and retirement, is filled with dense smoke of foetid gas; my homely, though cleanly, table covered with dirt; and the features of my wife and family almost obscured by a polluted atmosphere. Nothing is heard but the clanking iron, the blasphemous song, or the appalling curses of the directors of these infernal machines.
Remove the Victorian prose, replace railways with wind turbines and you have a typical letter from a modern windfarm to their local newspaper. The renewable energy industry is no stranger to the debate between amenity and development. Our challenge, as we build out a new energy infrastructure for the UK, is where to find the balance.
Yesterday Adrian Snook used a comment piece in the Guardian to follow in the footsteps of the opponents of 19th-century railway development and the 20th-century "hydro-isation" of highland Scotland. The "democratic reasons" that he cites in support of his arguments against wind power descend directly from those advanced by objectors to Scottish Hydro's Tummel-Garry hydro scheme in 1945, who claimed that building a dam at Pitlochry would end tourism in the Highlands forever. Today, over 400,000 people a year visit the site at Loch Faskally.
Snook may be unwilling to recognise the local economic benefits, including tourism, brought by wind and other clean energy developments, but they are real. To the many thousands who visit Scotland's existing hydro schemes, can now be added the growing number of windfarm visitors. One of the strengths of the renewables sector is its willingness to engage with the public.
Uniquely in the power sector, windfarm developers have always sought to create long-term relationships with communities through community benefit funds, and in some cases, direct local ownership of part of a windfarm. For those communities, and for the local trustees of windfarm community benefit schemes, Snook's assertions that wind energy brings no neighbourhood benefits will simply ring hollow. For people in the independent power sector, his other assertion that windfarm development is a scam perpetrated by large power companies will be even more galling.
As the UK restructures its electricity sector in the drive to meet the twin imperatives of climate change and security of energy supply, it is clear that the wind industry will become increasingly visible across the country. The electricity sector will no longer be confined to anonymous grey boxes but will be part of the landscape from Cornwall to Cape Wrath. Thousands of people will be able to point to "their" windfarm, and in many cases they will have a tangible stake in the success of that farm.
There will always be reasons for objecting to clean energy development, wherever it is located. The simple truth is that the long-term consequences of not undertaking that development will be far worse than the consequences of undertaking it. Whether it was building dams to bring clean water to 19th-century cities or to bring light to 20th-century highland homes, or as now to cut out carbon emissions from our power sector, "we are", as someone once said, "all in it together".
Or, as the chairman of the Scottish Hydro-Electric Board put it in his evidence to the Tummel-Garry inquiry:
We have come … to the point of decision. Do the people of this country want electricity or do they not? We have come to the point … where the interests of amenity and fishing have perhaps to give way to the larger issues.
• Adam Bruce is the chairman of the British Wind Energy Association (BWEA)

Spain's windfarms set new national record for electricity generation

High winds over the weekend supplied 53% of Spain's electricity – equivalent to the power output of 11 nuclear plants
Giles Tremlett
guardian.co.uk, Monday 9 November 2009 16.27 GMT

Wind energy provided more than half of Spain's total electricity needs for several hours over the weekend as the country set a new national record for wind-generated power.
With high winds gusting across much of the country, Spain's huge network of windfarms jointly poured the equivalent of 11 nuclear power stations' worth of electricity into the national grid.
At one stage on Sunday morning, the country's wind farms were able to cover 53% of total electricity demand – a new record in a country that boasts the world's third largest array of wind turbines, after the United States and Germany.
For more than five hours on Sunday morning output from wind power was providing more than half of the electricity being used. At their peak, wind farms were generating 11.5 gigawatts, or two-thirds of their theoretical maximum capacity of almost 18GW.
The new record, which beat a 44 % level set earlier last week, came as strong winds battered the Iberian peninsula.
The massive output of wind turbines meant the Spanish grid had more electricity than was needed over the weekend. In previous years similar weather has forced windfarms to turn turbines off but now the spare electricity is exported or used by hydroelectric plants to pump water back into their dams — effectively storing the electricity for future use.
José Donoso, head of the Spanish Wind Energy Association, recalled that just five years ago critics had claimed the grid could never cope with more than 14% of its supply from wind.
"We think that we can keep growing and go from the present 17GW megawatts to reach 40GW in 2020," he told El País newspaper.
Windfarms have this month outperformed other forms of electricity generation in Spain, beating gas into second place and producing 80% more than the country's nuclear plants.
Experts estimate that by the end of the year, Spain will have provided a quarter of its energy needs with renewables, with wind leading the way, followed by hydroelectric power and solar energy.

Investors' Electric Dreams For BYD

Chinese automaker BYD couldn't have found a better advertiser than Warren Buffett.
The company, best known for a plan to develop a mass market electric car, has instead seen sales of its gasoline powered cars surge. For that, Buffett gets much credit. The buzz in the Chinese press, surrounding Berkshire Hathaway's September 2008 investment in BYD, boosted the company's brand recognition, just as auto sales in China were taking off.
BYD's F3 model is now China's leading compact car model by sales, after ranking fourth in 2008. Another model, the F0, is the second biggest seller in the mini car category. By the year's end, BYD's unit sales will be up 137%, JD Power & Associates projects, and the company's profits are benefiting accordingly: these rose 72% on-year in the first half of 2009.
The problem is that stock investors have been even more enthusiastic about BYD than car buyers -- driving the shares up sevenfold since Buffett bought into the company. The rise has propelled BYD's founder Wang Chuanfu to the top of China's richest list, according to Forbes magazine. He's now worth a cool $5.8 billion.
Great for Wang, and Buffett, but such a share move makes it difficult for others to back BYD now, no matter what the hope for the company is. BYD's lithium-ion battery technology, critical to its plan to sell electric cars to the mass market, faces far more uncertainty than a valuation of 60 times earnings suggests.
It's not yet clear whether the Chinese government will provide the subsidies that will be critical to promote electric car sales in China; their current price is far beyond most Chinese households.
Moreover, BYD's prototype electric car has left some critics disappointed, and with competition heating up, it's far from a given that BYD's lithium-ion batteries will become a market leader. The company faces no fewer than a dozen competitors, many of them joint ventures with global automakers, in the battery race.
Certainly, sales of gasoline powered cars are buying the company some time while such questions are ironed out, and they offer BYD a robust fallback if it does stumble on the electric car front.
They won't, though, be enough to sustain the stock price at this kind of valuation.
Write to Andrew Peaple at andrew.peaple@dowjones.com

Japan eyes solar station in space as new energy source

Relax News
Monday, 9 November 2009
It may sound like a sci-fi vision, but Japan's space agency is dead serious: by 2030 it wants to collect solar power in space and zap it down to Earth, using laser beams or microwaves.
The government has just picked a group of companies and a team of researchers tasked with turning the ambitious, multi-billion-dollar dream of unlimited clean energy into reality in coming decades.
With few energy resources of its own and heavily reliant on oil imports, Japan has long been a leader in solar and other renewable energies and this year set ambitious greenhouse gas reduction targets.
But Japan's boldest plan to date is the Space Solar Power System (SSPS), in which arrays of photovoltaic dishes several square kilometres (square miles) in size would hover in geostationary orbit outside the Earth's atmosphere.
"Since solar power is a clean and inexhaustible energy source, we believe that this system will be able to help solve the problems of energy shortage and global warming," researchers at Mitsubishi Heavy Industries, one of the project participants, wrote in a report.
"The sun's rays abound in space."
The solar cells would capture the solar energy, which is at least five times stronger in space than on Earth, and beam it down to the ground through clusters of lasers or microwaves.
These would be collected by gigantic parabolic antennae, likely to be located in restricted areas at sea or on dam reservoirs, said Tadashige Takiya, a spokesman at the Japan Aerospace Exploration Agency (JAXA).
The researchers are targeting a one gigawatt system, equivalent to a medium-sized atomic power plant, that would produce electricity at eight yen (cents) per kilowatt-hour, six times cheaper than its current cost in Japan.
The challenge -- including transporting the components to space -- may appear gigantic, but Japan has been pursuing the project since 1998, with some 130 researchers studying it under JAXA's oversight.
Last month Japan's Economy and Trade Ministry and the Science Ministry took another step toward making the project a reality, by selecting several Japanese high-tech giants as participants in the project.
The consortium, named the Institute for Unmanned Space Experiment Free Flyer, also includes Mitsubishi Electric, NEC, Fujitsu and Sharp.
The project's roadmap outlined several steps that would need to be taken before a full-blown launch in 2030.
Within several years, "a satellite designed to test the transmission by microwave should be put into low orbit with a Japanese rocket," said Tatsuhito Fujita, one of the JAXA researchers heading the project.
The next step, expected around 2020, would be to launch and test a large flexible photovoltaic structure with 10 megawatt power capacity, to be followed by a 250 megawatt prototype.
This would help evaluate the project's financial viability, say officials. The final aim is to produce electricity cheap enough to compete with other alternative energy sources.
JAXA says the transmission technology would be safe but concedes it would have to convince the public, which may harbour images of laser beams shooting down from the sky, roasting birds or slicing up aircraft in mid-air.
According to a 2004 study by JAXA, the words 'laser' and 'microwave' caused the most concern among the 1,000 people questioned.

No excuse for muddled thinking which could lead to energy shortfalls

John Westwood

Peak UK electricity demand could exceed available capacity as early as 2017 owing to the planned closure of current nuclear and coal power stations and a short-term lack of replacement options.
Much of this capacity will have to be met by gas-powered plants — running on imported fuel — until the next generation of power stations and renewable energy options can be brought online.
We predict that over the period 2010 to 2017 more than 50 per cent of all capacity additions will have to come from gas-power plants, while a further 44 per cent will come from wind power.
The prospect of reliance on foreign gas to produce our electricity until new capacity is added to the national grid is obviously worrying the Government and is undoubtedly the driving factor behind today’s announcement.

However, successive governments have had 30 years’ notice of the present serious decline of UK oil and gas supplies and full knowledge of generation plant lifetimes.
There is really no excuse, therefore, for reaching the situation we are in today where the lights could literally go out in less than a decade.
Although time is of the essence, the Government has done itself no favours by trying to rush though measures without proper explanation to the general public or a full debate before the house.
Once again, it gives the impression, whether accurately or not, that there is no joined-up energy policy in the UK. This may make the public, as well as the international energy industry, rather nervous.
We’ve no doubt that, in the longer-term the decommissioned capacity will ultimately be replaced largely by new nuclear plants and wind power and some clean coal power.
However, given much of the sensitivity and innate public scepticism surrounding nuclear power, today’s approach may seem to some as heavy-handed.
Worse still, it could create further confusion about Government energy policy and, far from stimulating investment and new-builds, may actually delay the process of investment and widen the energy capacity gap.
This could, in turn, force further reliance on gas powered stations and raise significant questions about the country’s energy security.
As such, the UK power generation sector is at a critical crossroads and what’s called for today is a clear and consistent message to the energy market, its supply chain and the general public.
The Government needs a high-level private sector investment to meet capacity demands. Our research suggests the required levels of capital investment needed to meet demand increases could be as high as £162 billion between 2010 and 2030.
The money is available but only if the Government makes its energy policies clear to the industry so that investments are made in time to meet potential shortfalls and balance the need to enhance energy security, maintain public support and adhere to international environmental targets.
John Westwood is chairman of Douglas Westwood, the energy consultant

Carbon Trust's 'scrappage' bid

British businesses are being urged to scrap their old inefficient machinery and other equipment and replace it with more efficient models. The scheme has been launched by the Carbon Trust, an independent company backed by the Government that aims to help businesses to reduce carbon emissions, as a sort of equivalent of the motor industry's scrappage scheme.
Under The Big Business Refit, which runs until March 2010, businesses can use interest-free funding to obtain new equipment that can produce energy savings of 15 per cent. The trust estimates that British businesses are wasting £3.3bn a year in unnecessary energy costs through holding on to old equipment.
More than half of small and medium-sized businesses wait until their equipment breaks down before replacing it, the organisation's research suggests.