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Energy Prices

  • Littlebrook Power Station Closes Down

    The end of an era for Littlebrook Power station has been announced. The station was officially closed down on March 31st after being in service for decades, the station’s owners announced recently.

    The station, which is based in Kent, was not part of the Large Combustion Plant Directive, which meant that is was scheduled for closure either in 2015, or after it had been in service for more than 10,000 hours.

    German company RWE Generation, who own the Littlebrook Power Station, said they made the decision to close it down this year because of “current market conditions”.

    The plant was the last significant non-gas fired station in the Greater London area to be closed down; it has been operating since the 1980s and construction work began on it in the 1970s.

    RWE Generation says that during the stations life span, it provided 43475.699 GWh of power to fuel both homes and businesses in the local area. The owners of the station also pride themselves on the links they forged with the local community.

    Commenting on the announcement, Roger Miesen, Chief Technical Officer (CTO), RWE Generation, said:

    “Today is a sad but not unexpected day. I’d like to pay tribute to this station and the people that have worked here helping to keep the lights on across London for so many years.”

    While Keven Nix, Head of RWE Generation UK, said:

    “I would like to thank all of our staff past and present who have contributed to the success of the station, we are also grateful to the local community for their continuous support during the life of the plant.”

    Miners’ Strike

    During its lifetime, Littlebrook Power Station set some records for producing electricity. This was during the 1980s miners’ strike, when the power station was operating as a three unit station to keep the electric flowing to local residents and businesses.

    Peak Demands

    The Littlebrook Power Station has also proved crucial when it comes to meeting the growing demands for energy, providing power during peak times in the Greater London area.

    Cleaner energy supplies

    The decision to close Littlebrook Power Station is part of a drive towards finding greener energy alternatives for power generation. RWE has stated it has invested over £6 billion in a five year period into improving the efficiency of power generation by shutting down the older fossil fuel plants.

  • 30% take time off to deal with winter emergencies

    A new survey by British Gas has revealed that 30% of Britain’s have had to take time off sick, use holiday time, or have had to turn up to work late due to an  a home energy emergency such as a broken gas boiler or burst pipes.

    It is estimated that Britain’s take up to an average of 12 working days off to manage winter repairs to their gas heating system over a lifetime; 10% of those surveyed also stated they were concerned taking time off to deal with such problems could lead to them losing their job, missing out on a promotion or stop them from getting a pay rise.

    Moreover, the survey discovered it was residents in London that were more likely to take time off to deal with an emergency, with 44% stating  they had to take time off to cope with an unexpected emergency at home.

    The cost of emergencies

    In addition, electrical faults are another common reason for taking time off work with 21% of people forced to stay at home to deal with the problem, and it is estimated it costs £512 million a year in repairs.

    The survey also estimates UK workers can lose anything up to £100 in lost income and face average bills of £542 a time to repair winter damage.

    Commenting on the survey, Matthew Bateman, managing director at British Gas residential services, said:

     “The results of the research highlight that winter home emergencies can take a toll on people in terms of time and money, and worrying about how it impacts time away from their job. Every winter we increase the number of staff in our call centre teams so we have the resources ready to help customers who may be calling us with problems”.

    Prevent emergencies

    In order to help prevent household emergencies, British Gas advise householders to arrange regular checks of their boilers and bleeding the radiators. They also suggest insulating the gas pipes during the colder months and insulating the hot water tank.

    In addition, Chris Brain, a British Gas engineer from Canterbury, states:

    “This winter, frozen condensate pipes have been a big problem for customers with condensing boilers in colder areas of the country. Frozen pipes can result in damage to the boiler and even flooding, so people should ensure pipes on the outside of their home are wrapped with lagging, at the very least”.

  • 52 percent of Tory Voters in favour of Wind Farms

    A poll published in the Sunday Times shows more than half of Conservative voters think the government should do more to encourage onshore wind power.  52% of those surveyed said the building of wind farms should be encouraged, while 18% were against the building of more wind farms and thought they should be banned.

    The public in general are also in favour of the use of wind power according to the survey. 61% said that they would like to see more of the wind farms in the UK while 14% said that they would like to see a ban.

    Members of the public are also keen to see more offshore wind power, with 73% of people stating they would be in favour of more offshore wind power plants being built.

    When it came to other forms of energy production, there were mixed views on the extraction of shale gas with 43% against extracting shale and 32% in favour of it.

    Commenting in a press release, RenewableUK Chief Executive Maria McCaffery said:

    “Recent comments suggest that the Government is looking to restrict onshore wind as it’s concerned about the technology’s popularity. These poll results, and the many like them that have gone before, should provide reassurance that the majority of people, however they vote, want to see more onshore wind, and that any premature curtailment is not necessary.

    Indeed, as the Government has said it is committed to decarbonisation at the lowest cost, early curtailment would seem to directly contravene government objectives.”

    Queen’s Speech and Onshore Windfarms

    In the Queen’s Speech it was announced the new energy bill would mean decisions over smaller onshore wind farms that have a capacity of 50 MW will be decided by local authorities in England as opposed to a ministerial level.

    At the moment it is unclear whether this will also affect wind farms in Wales as a decision has not yet been made.

    Renewable energy organisations have expressed concerns that this could cause a delay in renewable energy projects and RenewableUK are calling on the government to give local authorities the additional resources local councils will need to make quick decisions.

    Maria McCaffery, Chief Executive of RenewableUK said

    “Onshore wind is committed to being a good neighbour to the local communities in which it is hosted, providing substantial economic advantages to the region including the ground-breaking community benefits it pays, so we are confident that Local Authorities should recognise the value of these projects.” 

  • Amber Rudd announces changes to UK energy policy

    Energy and climate change Secretary Amber Rudd has detailed her plans for the UK’s energy policy in the coming years. The new policy is aimed at increasing competition, reducing energy bills for the consumer and securing adequate power generation for the country.

    With the policy, the government reaffirmed its commitment to low carbon, low-cost energy sources, and it also announced plans for a consultation regarding the abolition of unabated coal-fired stations by 2025.

    Moreover, during the speech at the Institute of Civil Engineers, Amber Rudd made the case for prioritising gas-fired stations in order to reduce emissions.

    Amber Rudd stated:

    “One of the greatest and most cost-effective contributions we can make to emission reductions in electricity is by replacing coal fired power stations with gas.

    “I am pleased to announce that we will be launching a consultation in the spring on when to close all unabated coal-fired power stations.

    “Our consultation will set out proposals to close coal by 2025 - and restrict its use from 2023. If we take this step, we will be one of the first developed countries to deliver on a commitment to take coal off the system.”

    The Energy and Climate Change Secretary also detailed plans for more nuclear power stations, and she committed funding for three further auctions of offshore wind power projects, however, she made it clear that the industry would have to reduce its costs as there would be “no more blank cheques”.

    Mixed response

    The changes have received a mixed response. Environmental campaigners Friends of the Earth described the decision to phase out coal as “historic”. However, it also feels that the government should be focusing on renewable energy and energy efficiency as “Gas is too high-carbon for a long-term future.”

    In addition, the Solar Trade Association was pleased at the decision to eliminate coal, stating:

     “Phasing out coal power electricity is of course good news and was expected – this is an essential move.”

    But it added:

    “However it makes little sense to replace fossil coal only with fossil gas.”

    Paul Barwell, CEO of the Solar Trade Association, went on to urge the government to support solar power as there was little commitment to it during the speech, and other groups were disappointed that there wasn’t greater provision for improved energy efficiency.

    Moreover, many analysts argued the reduction in funding for renewable forms of energy would have a negative impact on the government’s climate change targets and could increase costs for consumers.

  • Cardiff is one of the most energy efficient cities

    Householders in Cardiff are the most energy efficient in the UK according to a new survey by British Gas. More than 50% of the people surveyed said they are taking steps to save energy around the home while  87% said that they would change their habits if it meant saving money on their bills; 37% of householders stated they wanted to make energy efficiency a priority.

    The survey also showed that many people are completely unaware of just how much their energy bills cost them every day. Many householders estimated their energy spend cost them an average of £2 a day while others assumed the daily energy spend was anything from £3-£6.

    The survey was conducted as part of the British Gas Energy Saving Challenge, which sets out to help people save money on their energy bills.

    Lydia Campbell. Regional Director for British Gas in Wales, said:

    It’s great to see that so many people from Cardiff are looking to make changes to save energy and get their bills down.

    “The 60 Second Energy Challenge will help people living in Cardiff be more aware about how they use energy, it offers simple and practical tips to reduce their energy use."

    As part of the challenge, a survey was conducted and it revealed how little some householders understand about the simple measures they can take to save on energy around the home.

    Only 3% of the people interviewed were aware that by installing insulation they could make significant savings on their bills, and despite the fact smart meters are soon to be rolled out across the country, many consumers did not know that installing a smart meter could help them save money on their bills and gain a better understanding of which appliances were using the most power.

    Smart Meter Roll out

    While 500,000 smart meters have already been installed around the country, the full roll out will not begin until later in 2015.  The government is currently working with the energy industry to ensure that the roll-out goes ahead within the scheduled time frame.

    It is the gas and energy suppliers that will be held responsible for the planning and installation of smart meters; the roll-out will end in 2020. The method of installation will vary from company to company and the Department of Energy and Climate Change will oversee the management and implementation of the programme as well as carefully monitoring the roll-out.

  • China hosts annual valve exhibition

    An industry expo due to be held in Guangzhou, China from May 14th-16th is expected to attract 10,000 visitors from forty different countries. The expo is an annual event that has been hosted annually since 1997.

    The fair will be held at the China Import and Export Complex, which is Asia’s biggest exhibition center; it was first opened in 2002.

    It is estimated there will be 300 exhibitors at this year’s event, with 8 per cent of them travelling from overseas to be there, and thousands of invitations for the exhibition have been sent out.

    Representatives from the food and beverage industry, environmental protection, petro-chemical, pharmaceutical, gas and electricity, water supply, and a vast range of other industries are also expected to attend.

    The exhibition has been designed to help manufacturers of valves, pipe fittings, castings and a range of other products to gain new customers for their products and make new connections with others in the same industry.

    It will also provide the opportunity to meet with new distributors and agencies to help increase distribution and forge new business relationships. In addition, it will give exhibitors the chance to reconnect with existing clients, increase import and export opportunities, mix with consumers and end users of the products, source new suppliers and even aid in the recruitment of key staff.

    Buyers from around the world have been invited to attend the exhibition and traders, wholesalers, importers and exporters, agents and distributors are all expected to be at the event.

    Exhibits

    There will be hundreds of different exhibits on display and numerous companies from China and the rest of the world are scheduled to be at the event when it gets underway in the middle of May.

    Future Trade Fairs

    Aside from the exhibition in China, there are a number of other trade fairs for the valve industry scheduled throughout the year. One of the most high profile events is due to be held in Rotterdam on the 30th September 2015 and it will run until 1st October.

    The trade show will highlight innovations and initiatives from the valve, pump and seal industries. The event is expected to attract buyers, process engineers and maintenance managers who are keen to demonstrate their solutions to new contacts in the industry.

    Exhibitors will also have the opportunity to demonstrate solutions that can make the valve industry safer and more efficient.

  • Combining resources necessary to improve offshore safety

    Offshore wind farms are becoming a greater part of the UK’s energy mix. However, the move toward renewables has also led to questions on how to improve health and safety for employees working in the industry.

    Recently, the Offshore Group of the Institution of Occupational Safety and Health (IOSH) recently held an event to discuss how the renewables, marine and oil and gas sectors could collaborate to address the health and safety challenges associated with the offshore sectors.

    The event, which was hosted at the Stadium of Light in Sheffield, was entitled Let's Talk: exploring the synergies and differences between the offshore oil and gas and offshore renewables sector. It examined the risks faced by these industries and how they could work together effectively to address them, such as conducting joint exercises and sharing resources.

    Simon Hatson, Chair of IOSH's Offshore Group, stated:

    “As the offshore windfarms are being built further offshore and the sectors are required to work even closer to each other, it is essential that we consider the safety and health implications of this.

    "As was recognised throughout the event, within our industry it is vital that, where we can, we seek to combine our knowledge and resources to put robust safety and health management systems in place. This way we can share our knowledge, efforts and provisions to continue to protect our workers from harm.”

    Hatson added that introducing these systems would also benefit the sector by enabling it to become more productive and efficient.

    Industry Concerns

    Industry representatives used the event as an opportunity to raise their specific concerns, such as the challenges posed due to the different regulatory regimes in place for each sector. However, Chris Streatfield of RenewableUK stressed that “this does not mean the sectors cannot combine to protect employees”.

    Peter Lowson of the Maritime and Coastguard Agency highlighted the possibility of vessels colliding or helicopter accidents. However, he felt the risk of such accidents could be reduced by sharing resources.

    Offshore wind farms

    The amount of electricity produced from offshore wind increased by more than 25 per cent in the first quarter of 2016, and given the growing role it is likely to play energy security, it is vital that the health and safety concerns are addressed.

    DONG Energy are currently leading the way in the offshore wind power sector, and it recently committed to building the world’s largest wind farm, Hornsea Project One, which will have the capacity to power more than one million homes. 

  • Competition to open up in the connections market

    Ofgem has announced a new code of practice aimed at regional electricity distribution networks. The announcement was made at the end of October with the purpose of increasing competition in the UK connections market.

    Ofgem say that the new code of practice should help to lower the cost of businesses connecting to the grid and add that the new measures should help to enhance the quality of service customers can expect.

    Statistics from Ofgem show that the electricity connections market is worth more than £500 million and thousands upon thousands of connections are made on an annual basis.

    Although many independent companies were already competing against the regional electricity distribution networks remained the only providers of a number of essential services that are required to make new connections. Due to the concerns that this was limiting competition in the field, Ofgem introduced its new code of practice at the end of October

    Under the new code of practice, electricity distribution networks ­- or DNOs as they are known - will have to abide by a new set of guidelines that have been set out by Ofgem.

    If the electricity distribution networks don’t abide by the new code of practice, then they could face action from Ofgem.

    Commenting on the announcement, Maxine Frerk, senior partner, electricity distribution, Ofgem, said:

    “We want to see competition in the electricity connections market thriving. While some DNOs are helping to achieve this, many independent companies still face unnecessary delays and needless complexity.”

    Frerk added that the new code of practice would enable independent companies to compete fairly throughout the UK, and it will mean businesses and other organisations will now have a choice as to who delivers its connections.

    Ofgem decided to implement the Code of Practice after carrying out a review of the connections sector. It found that while some companies were making an effort to improve competition in the connections market, to further improve competition it was going to be necessary to introduce a formal, binding code in order to ensure fairness to independent companies.

    Home Builders Federation welcome announcement

    The decision was welcomed by Dave Mitchell of the Home Builders Federation. Mitchell explained that as home builders are increasing the number of homes built to help address U.K.’s housing crisis, it was important these new changes had been introduced to improve the speed at which new homes are connected to the grid.

  • Contracts for World’s biggest interconnector awarded

    Contracts worth €1.5 billion have been awarded to build an electricity link between England and Norway. When it is complete, the interconnector will be the longest in the world; NSN Link Limited gave the contracts to Nexans and Prysmian, who will be responsible for constructing the 740 km route.

    The England and Norway link will be the first time that two countries have shared a direct energy system; the project is a collaboration between the National Grid and Norwegian company Statnett SF.

    The cables will run from Blyth in Northumberland to Kvilldal in Norway. It will require almost 1500 km of cable to complete the project and there will also be a 10 km offshore route.

    Prysmian will be providing 950 km of the submarine and land cables; they will also be responsible for installing them. Prysmian will manufacture the cables in a factory in Naples and they will use a specially designed cable laying vessel, which is called the “Giulio Verne”.

    Nexans will be providing cabling for the Norwegian side of the connection; they will manufacture the cables in their Halden-based factory.

    Commenting on the project, Alan Foster, National Grid’s director of European Business Development, said

    “There is a huge programme of work for us to undertake over the next five years to deliver what will be the world’s longest interconnector.  Our contractors will have a big part to play in that successful delivery. But the benefits to both UK and Norway are also huge and when completed the link will deliver low carbon electricity for the UK and also add to security of supply for Norwegian consumers.”

    Håkon Borgen, Executive Vice President of Statnett, added that the project was vital for the future of the energy system in Europe.

    The licence that will allow the project to go ahead was first granted in 2013 when the Norwegian Ministry of Petroleum and Energy gave permission for the interconnector to be built. Preparation work at the site will begin in 2016 and will continue into 2017 when construction will get underway

    The link between the two countries will have numerous benefits including helping to provide a more secure power supply for both the UK and Norway, and the construction work will help to provide jobs. When the link has been finished it will have the capacity to produce 1400 MW of power.

    It is expected that the work would be completed in 2019 and the interconnector will be operational by 2020.

  • Energy price rigging could lead to two year jail term

    New proposals put forward by Energy and Climate Change Secretary Ed Davey could lead to anyone found guilty of rigging energy prices facing a jail term of up to two years, it has been announced.

    If the new laws are introduced it could mean that energy regulators will be given new powers to prosecute if it is suspected that someone has rigged gas and electricity prices. Moreover, if the laws were brought into force it would mean that if anyone was to make misleading claims about wholesale energy prices in a bid to manipulate the market, they could be charged with an offence.

    Commenting on the proposed new laws, Ed Davey said:

    “Manipulating the energy market is absolutely unacceptable, and these proposals provide a much stronger deterrent – more in line with the approach taken in the financial markets.

    “The government is doing everything it can to help consumers by increasing market competition to drive prices down. We have also set up the first ever annual competition assessment, which has led to the first ever referral of the sector to the competition authorities.”

    Current regulations mean that energy regulators have the power to investigate anyone that is suspected of breaching the rules and they can impose fines. However, a change in the law would mean much harsher punishments and could lead to a prison term of up to two years.

    The government has announced the proposals as part of its attempts to reform the energy market so that consumers’ rights are put first. The announcement is part of the government’s attempts to loosen the stranglehold that the big six energy companies have on the energy market. The government also hopes that its actions will lead to greater competition in the energy sector

    It has also been announced that there is to be an investigation into competition and transparency in the retail energy market. The investigation is considered necessary to restore the confidence that has been lost in the power industry in recent years.

    Commenting on the new proposals, Rachel Fletcher, senior partner, markets, Ofgem, said:

    “Ofgem has a track record for taking strong action against companies that break the rules. And we want the strongest possible deterrents in place to guard against market manipulation and insider trading. We put forward the case to government for greater powers to take action if needed, and we welcome this consultation.”

  • Fortunes improve for small and medium-sized businesses

    Small and medium-sized manufacturing businesses in the UK are continuing to see their fortunes improve, according to the latest survey from the CBI. The survey, which reflects the last three months of trade, shows that the output in growth and the increase in orders have continued.

    For the fourth consecutive quarter, domestic orders and output both showed vigorous growth and it is expected that the upward trend will continue throughout the next quarter.

    Job Creation

    There was also good news on the job creation front. In the last quarter small and medium- sized manufacturing companies have seen a dramatic increase in the number of people employed in this sector; last quarter’s figures for employment showed the strongest growth since records began in 1988. However, while firm's optimism was up in the latest survey, it wasn’t as high when compared with the last quarter.

    Investment

    Smaller manufacturers also stated that they plan to invest in machinery in the next twelve months; however, many of the manufacturers don’t intend to invest in new buildings in the near future.

    Export Orders

    The one weak point for small and medium-sized manufactures continues to be exports. Exports remained flat in the last quarter. However, many were optimistic that export orders would begin to improve again in the next few months,

    Commenting in a press release, Katja Hall, CBI Deputy Director-General, said:

    "Smaller manufacturers are settling into a regular growth pattern, with their order books and output growing for the fourth consecutive quarter.

    "Firms remain upbeat about their business situation and they are hiring at their fastest rate since 1988.

    "But export orders have underperformed this quarter, which may in part be because of the strength of Sterling.

    "We need the Government to get behind our small and medium-sized manufacturers to help them to sell their products and services to new markets around the world, giving a sustainable boost to long-term growth."

    Key Findings

    Key Findings from the latest CBI survey showed that 36% of small and medium-sized businesses experienced a growth in orders in the last quarter.

    31% of companies said that their order output was on the increase and 16% experienced a decrease.

    36% of firms had an increase in domestic orders, but 19% of companies said that their orders fell.

    And 34% of companies announced an increase in employment, but 9% said that there had been a fall.

  • Government announces licenses for 27 onshore blocks

    The Oil and Gas Authority has announced that 27 onshore areas of land or blocks, are to be offered to businesses as part of the 14th Onshore Oil and Gas Licensing Round. The announcement of the fresh licensing round was first made in 2014.

    Other blocks of land that were applied for are to undergo further assessments to establish the environmental impact of the applications, and when this has been completed licenses will then be offered to the companies. The announcement regarding the remaining companies that have been awarded licenses is due to be made later in 2015.

    Commenting on the new licences, Lord Bourne, the Energy Minister for the UK, stated:

    “Keeping the lights on and powering the economy is not negotiable, and these industries will play a key part in providing secure and reliable energy to UK homes and businesses for decades to come.

    “It’s important we press on and get shale moving, while maintaining strong environmental controls

    The Government said that close to one hundred companies had applied for the initial licenses for shale gas exploration, and chemical company INEOS has revealed that it is one of the successful applicants.

    With three licenses granted for shale gas exploration in the East Midlands, this opens up brand new opportunities for INEOS Shale, who pledged a £640 million investment into shale gas exploration last year.

    Gary Heywood, CEO for INEOS Shale said:

    "We are keen to move quickly to evaluate the potential of this resource, and determine if we can economically produce gas from our licenses.  This will depend on the pace of planning approval. If we can, it will provide a local source of competitive energy and raw materials to support manufacturing jobs in the UK.”

    Ministers say that the new rounds of blocks are essential to secure UK energy supplies into the future, and that they will also be a vital part of the continued UK economic recovery by creating new jobs.

    Controversy

    Shale gas has its opponents and there has been controversy caused by plans to allow shale gas exploration in the UK. However, others argue that it is important for finding fresh sources of energy and it is vital for job creation, and for ensuring energy production into the future. The Government predicts that investment in shale gas could be worth as much as £33 billion, and it could assist in the creation of more than 60,000 jobs.

  • Government signs historic agreement with EDF

    The UK Government has signed an historic agreement with the French-owned energy firm EDF, which paves the way for a new generation of nuclear power. After an unexpected delay to further review the Hinkley Point C proposals the government finally gave the go ahead for the two new nuclear reactors in mid-September 2016.

    The Current secretary of State for Business, Energy and Industrial Strategy Greg Clark, Jean Bernard Levy, CEO of EDF and He Yu, chairman of the China General Nuclear Power Group (CGN) came together to sign the Contract for Difference and Secretary of State Investor agreement in late September.

    Commenting on the development, Greg Clark stated:

    “Signing the Contract for Difference for Hinkley Point C is a crucial moment in the UK’s first new nuclear power station for a generation and follows new measures put in place by Government to strengthen security and ownership.

    Britain needs to upgrade its supplies of energy, and we have always been clear that nuclear power stations like Hinkley play an important part in ensuring our future low-carbon energy security.”

    Building and Funding of Hinkley Point C

    The £18 billion plant is being partly funded by the CGN group, who have invested £6 billion; the government has also pledged funding towards the new plant.

    Hinkley Point C will be the UK’s first nuclear power plant for twenty years and Vincent de Rivaz, CEO of EDF Energy in the UK, said it will “kick start Britain’s nuclear revival”.

    Once built, the Somerset-based plant will produce 7 per cent of the UK’s fuel needs, and the signing of the agreement will also allow the development of Sizewell C and Bradwell B.

    Hinkley Point C Plans

    Hinkley Point C is due to start producing electricity in 2025 and it will provide power for 6 million homes. 

    Decommissioning of the plant will begin in 2083 and will cost more than £7 billion; the operators of the Hinkley Point C have been made responsible for the decommissioning and site clearance costs under new measures brought in by the government.

    Importance of nuclear energy to UK

    Nuclear power is part of the government’s plans to provide energy security for the UK and to help fill the need for low carbon energy sources. There are eight potential sites that could be commissioned by 2025, and Horizon Ltd and NuGeneration are just two companies who plan to build nuclear reactors in the UK.

  • Government urged to do more to improve manufacturing productivity

    Manufacturing has continued to perform well in the face of uncertainty following the Brexit vote, exports are on the increase and economic growth in general is picking up. However, the EEF has taken the opportunity ahead of the spring budget to urge Chancellor Philip Hammond to do more to aid productivity in the manufacturing sector.

    Ms Lee Hopley, Chief Economist for the EEF, said:

    “This Budget must drive ahead with the productivity-focused commitments that we saw in both the Autumn statement and the government’s recent industrial strategy green paper. Action that enables more innovation, more investment and supports better skills and infrastructure in the economy are not optional if the UK is to be ready to make the most of post-Brexit opportunities.

    The EEF is also calling on the government to encourage innovation by improving the current research and development tax credit scheme. Other reforms the EEF are keen to see include further investment into digital infrastructure, and improved training. Similar calls have been made from business organisations like the CBI, who feel that more should be done to improve technical training and apprenticeships in the UK.

    Government efforts to improve business productivity

    The chancellor’s autumn budget had already allocated significant funding for productivity, with the announcement of a $23 billion National Investment Productivity Fund; the fund aims to improve infrastructure, research and development and assist in the building of faster internet connections.

    The government has also announced an industrial strategy. The strategy, which was recently outlined in a green paper, has increasing economic growth and making companies more productive at its core. However, it has come under criticism from various quarters for lacking details and targets.

    Lack of productivity in manufacturing

    Throughout the past year there has been several reports regarding the fall in productivity in the manufacturing sector. Some of this has been attributed to poor internet connectivity among some manufacturers, while the EEF has highlighted how productivity in some industries has come under strain due to the reduction in crude oil prices. In addition, the financial crisis took its toll on manufacturing productivity, which had previously been gaining strength.

    There has been calls for government action to improve productivity, some of which were addressed by the announcement of the industrial strategy. However, the government is still be urged to adopt policies that will further encourage innovation and investment into new technology to boost productivity among the manufacturing sector.

  • Hinkley Point C gets final funding approval

    After months of delay, EDF has made the final funding decision over Hinkley Point C.  The decision was confirmed on July 28, following a meeting of the board of directors. The meeting approved the £18 billion of funding needed for the project, which will open up a new generation of nuclear energy for the UK.

    Following the announcement, EDF stated it would be signing contracts with its overseas partner, China General Nuclear Power Generation, which has a 33.5 per cent share in the project, and with its main suppliers.

    Speaking about the agreement between EDF and China General Nuclear Power Generation in 2015, the then Energy Secretary Amber Rudd, said:

    “The Government will support new nuclear power stations as we move to a low-carbon future. Hinkley Point C will kick start this and is expected to be followed by more nuclear power stations, including Sizewell in Suffolk and Bradwell in Essex. This will provide essential financial and energy security for generations to come.”

    Government Review

    EDF was also expecting to sign contracts with the UK government. However, the government made the surprise announcement that it will be delaying the decision on whether to give the plant the go ahead.

    The government will review the plans for Hinkley Point C and make the decision in the Autumn. Despite the delay, EDF has indicated that it’s confident the government will give the nuclear plans its approval.

    In the meanwhile, Friends of the Earth has urged ministers to use the review as “an opportunity to do the right and popular thing and end support for Hinkley”.  The environmental organisation also argues that renewables and energy storage offer a better deal.

    Concerns over Hinkley Point C

    Environmentalists have raised concerns over the amount of nuclear waste that might be generated, and there has been some discussion over the costs to the consumer. However, the plans for the plant have been welcomed by Unite and several nuclear industry experts.

    Energy security, carbon emissions and job creation

    Alternative forms of producing energy are necessary if the government is to reduce carbon emissions and secure future power supply. Once it is up and running, the Somerset-based plant will have the capacity to power 6 million homes.

    The project itself will create an estimated 25,000 jobs, as well as providing apprenticeship opportunities and boosting local business through supply contracts. When Hinkley Point C has been built, it is estimated there will be 900 ongoing jobs at the site.

    https://www.markiteconomics.com

  • Lynemouth biomass plant given EU state approval

    Plans to convert a coal fuelled plant in Lynemouth to biomass have been granted state aid approval, the EC has announced. Owners RWE now intends to press ahead with the plans for conversion.

    The European Commission opened its investigation early in the year and made its ruling on December 1, 2015. It announced that the UK government support for the project was in compliance with EU state aid rules and said the conversion would help the UK to reach the environmental and energy targets set out by the European Union without “unduly distorting competition”.

    Plans to convert the station were first announced in 2014, and the government is supporting the project by paying a premium in addition to the market price. The project will continue to receive aid until 2027.

    Commenting on the announcement, Andree Stracke, Chief Commercial Officer of RWE Supply and Trading GmbH said:

    "We welcome this confirmation of the government support for biomass power generation, which provides a reliable base load to complement other renewables such as wind and solar.”

    Stracke added that the company hope to have converted the plant within the next 18 months and he said it would allow the export of 390 MW of low carbon electricity to the National Grid, thus aiding the government’s climate change aims

    The government has set itself a target of reducing carbon emissions by 80% by 2050. One of the ways the government intends to reach its aim is by switching to low carbon alternatives and becoming less dependent on fossil fuels.

    When the conversion goes ahead, Lynemouth power station intends to use renewable wood pellets, which will be exported from the United States, Europe and Canada. In addition, a sustainability management system will be put in place to ensure that the biomass fuel produced by the plant will meet the minimum sustainability standards that have been set out.

    The plant, which is based in the Northumberland in the UK, has the capacity to make enough electricity to power more than 450,000 homes. In addition, converting the Lynemouth plant from coal power will have a positive impact on the environment and on the economy in the north east.

    Moreover, it will burn 1.5 million tonnes of wood pellets annually, and produce an estimated 2.3 TWh of power.

    The Lynemouth power station has been powered by coal since the early 1970s and was previously owned by Alcan. In 2012, RWE took over the running of the plant and as a result the Lynemouth Power Company was established.

  • Manufacturing close to stagnation rates

    Manufacturing has hit a 34-month low, according to figures from the Purchasing Managers Index (PMI), which takes its data from more than 600 manufacturing companies.

    The UK manufacturing PMI now stands at 50.8, which is only just above the stagnation mark and output has experienced a sharp decrease. The fall comes just a month after an increase of the January manufacturing PMI to 52.9, which was due to a surge in domestic orders.

    The slump is attributed to a slowdown in the consumer and investment goods market, and capital and consumer goods are also in decline.

    Commenting on the new figures, Rob Dobson, a Senior Economist at Markit, said:

    “The near-stagnation of manufacturing highlights the ongoing fragility of the economic recovery at the start of the year and provides further cover for the Bank of England's increasingly dovish stance.

    "The breadth of the slowdown is especially worrisome. The domestic market is showing signs of weakening while export business continued to fall."

    “Price pressures also remained firmly on the downside, with the survey signalling input costs falling at a double-digit annual pace and average factory gate selling prices showing a further decline. A lot of this is driven by the ongoing weakness of global commodity prices. However, there are also signs that weaker growth is driving up competition between manufacturers to secure new business and among their suppliers too.”

    Nevertheless, despite the decline in February’s results, the PMI still remains in positive figures and previous industry surveys show that manufacturers are positive about the future prospects.

    Employment slump and Exports

    Employment in the manufacturing sector also fell, with the figures for February showing a reduction for the second successive month, however, the fall was not significant

    Exports were on the decline with manufacturers stating there is a slowdown in orders from key locations such as Russia, Brazil and mainland Europe, and there was low demand from the domestic market also.

    Exchange rates, Brexit and the manufacturing sector

    Many manufacturing firms have expressed concerns over the volatility of exchange rates and the impact these will continue to have on the sector. Moreover, with an EU referendum set for June, this will lead to more uncertainty over the future of exports.

    The future of the UK export market will remain unclear while the outcome of the Brexit vote is unknown. In the meanwhile, analysts state that if the UK public does vote to exit the EU, this will have a significant impact on many UK manufacturing sectors, including the chemical, food and beverages industry.

  • New figures show surge in renewable power

    New figures from the Department of Energy and Climate Change show an increase in the role that renewable energy is playing in powering homes and commercial premises in the United Kingdom.

    The latest figures from the DECC cover the April to June 2015 period and show that during this time, renewable power was used to produce 25.3% of electricity in the United Kingdom; the majority of this was produced from offshore and onshore wind power. This increase represents an 8.6% surge on the figures for the previous year.

    This means that renewable power is now more popular than coal and nuclear as a means of fuel, and the Department of Energy and Climate Change say this upsurge is down to “favourable weather conditions” such as increased wind speeds and sunshine, and a greater capacity for producing wind power.

    Commenting on the increase, Maria McCaffery, Chief Executive of Energy UK, said:

    “Renewables have now become Britain’s second largest source of electricity, generating more than a quarter of our needs. The new statistics show that Britain is relying increasingly on dependable renewable sources to keep the country powered up, with onshore and offshore wind playing the leading roles in our clean energy mix.”

    McCaffery added that “we’d welcome clearer signals from Government that it’s backing the installation of vital new projects”.

    New Campaign

    The release of the figures came shortly before a new campaign got underway in opposition to the Government’s plans to cut support for some smaller renewable energy projects such as investment in solar panels and wind turbines.

    The new campaign has been named People Power and hopes to persuade the Government to think again before reducing funding.

    Renewable energy investment cuts

    In recent years there has been a steady increase in renewable energy investment in the UK as the government looks for more sustainable ways to power the country. However, there have been some concerns about continued investment after it was announced earlier in the year that funding for renewable energy subsidies was to be cut.

    In September, the BBC reported the CBI has expressed concerns that the reduction in these energy subsidies could be off-putting to investors, and there are also worries the reduction in funding could lead to job losses in the renewable energy sector.

    Renewable Energy UK says that Government cuts to funding for smaller renewable energy projects would mean it won’t be possible for such schemes to advance.

  • New solar power farm opens in Vale of Glamorgan

    A new solar far has been opened on a former brownfield site in the Vale of Glamorgan. The 20 acre solar farm was launched by the local MP Alun Cairns and it was built by British Gas for use by Associated British Ports.

    Work began on the site in March 2015; the installation of 15,000 solar panels were completed shortly afterwards.

    Commenting on the opening of the new site, MP Alun Cairns said:

    "The new solar farm on Barry Docks is a fantastic example of maximising the use of industrial space, in a very impressive scheme. The energy partnership between ABP and British Gas will allow Barry Dock to become more competitive in the industry, and the project in the Vale of Glamorgan could become an exciting model for other docks and ports around Great Britain.”

    The opening of the new farm is predicted to produce approximately 4.5 megawatts of green power annually for use by ABP’s port operations. The energy that is produced will also be used by 75 tenants of ABP, and surplus energy is to be sold back to the National Grid.

    The new solar farm is set to lead to a significant reduction in the CO2 emissions, reducing them by 2,000 tonnes annually.

    Representatives from both ABP and British Gas were at the site for the opening, and it has recently been announced that the site has already been nominated for the Wales Green Energy award.

    At the launch, Chris Morrison of British Gas reaffirmed the company’s commitment to greener energy and reducing the impact of carbon stating: stating:

    “This solar farm will generate a significant contribution towards that goal.”

    Solar power in the UK

    The drive towards green power has been welcomed by environmental campaign charities. There are now more than 400 wind farms in the UK and the growth has increased rapidly in recent years. A Press Association report featured in the Guardian shows that there are now 650,000 solar installations being used in the UK.

    However, there has been some concern over the government’s on-going commitment to green energy after it was announced by the Secretary of State for the Environment, Amber Rudd, in July that the Government was to reduce its renewable energy subsidies. The decision to cut green energy subsidies was made amid concerns that they were on course to be higher than had been previously predicted.

  • New survey reveals why businesses are reluctant to invest in new energy sources

    Businesses of all sizes are often accused of not doing enough to invest in energy efficiency, however, a new survey from British Gas Energy reveals some of the reasons behind this. Among the biggest concerns were political and regulatory uncertainty surrounding Brexit, the recent election and the potential implications for energy technology investment.

    The opinions were gathered at the Energy Live Future conference in the first week of June. The large organizations present commented on the need to reduce energy costs, but also stressed the problems of convincing company bosses/team leaders to make the necessary investments.

    However, despite these challenges, Gab Barbaro, Managing Director of British Gas Business, has urged business owners to be more proactive when it comes to energy use, saying:

    “My challenge to business leaders is to get smart and be more proactive about their energy use. Businesses must think long-term rather than be swayed by current political or economic uncertainty - there are countless opportunities for organisations to save money on their bills today, by getting to grips with how it’s being used and acting where it’s being wasted.”

    Other barriers to energy efficiency

    Another barrier to the adoption of the latest energy technologies, like smart meters, is that business owners often lack a basic understanding of them, and their advantages.

    And another issue is worries over cyberattacks. Two thirds of companies interviewed by PWC are concerned that the data stored by utility companies from smart meters could be compromised, and these reservations are costing businesses money.

    The increasing cost of energy

    Rising energy bills means companies can spend twice as much on their energy bills, according to the Carbon Trust.

    Although the Carbon Trust’s figures were taken from 2014, spiralling energy costs continue to put a strain on businesses’ finances, and analysts are warning that the UK industry could suffer as a result.

    Cost savings from energy efficiency

    Although there is some resistance to introducing new energy technologies and trends into the workplace, UK-based businesses are being urged to embrace them due to the advantages they offer, such as cost savings.

    It’s estimated that companies that introduce energy saving measures could save up to 20 per cent on their energy costs. And specialist manufacturers who use the most energy, such as the petrochemical, food and beverages and industrial gases sectors, potentially have the most to save by adopting efficiency measures.

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