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Russia grants go- ahead to funding Finnish nuclear plant

January 20th, 2015

Russia's Cabinet of Ministers has approved up to $2.3bn in funding from the country's sovereign wealth fund for the Hanhikivi 1 nuclear power plant project in Finland.

Russian ministerial approval was published on 16th of January on the government's official website for legal notices. The project has been placed on the fund's list of "self-supporting infrastructure projects in terms of financial assets".
Hanhikivi 1
According to the document, the National Wealth Fund - as it is known is Russia - will allocate the Hanhikivi 1 project $549m in 2015, $792m in 2016 and $638 in 2017. There were no details of when the remaining $339m would be allocated.

To be built in in northern Finland, Hanhikivi 1 is scheduled to start generating electricity by 2024. The project is owned by Finland's Fennovoima.

Upgrades enable ten-year extension for Dungeness nuclear plant

January 20th, 2015

EDF Energy CEO, Vincent de Rivaz, has announced an extension to the life span of the Dungeness B nuclear power plant at an event in London for EDF Energy’s strategic supply partners.

The facility is set to continue producing electricity until 2028 following a decision to drive a £150m investment programme.
Many of these companies have worked with EDF Energy (Euronext: EDF) on the investment and technical innovation needed to safely extend the life of its nuclear power stations.
Dungeness
The life extension at Dungeness B is part of a wider EDF Energy programme to extend the lives of its eight nuclear power stations.

It comes after extensive reviews of the plant’s safety cases and work with the independent nuclear regulator, the Office for Nuclear Regulation (ONR). The station will also be subject to continuing independent safety reviews by the ONR.

Improvement projects at Dungeness B have already included a £75m upgrade to control room computer systems and £8m on enhanced flood defences.

Based on the expected life extensions, all seven AGR stations will be operating in 2023 when the new nuclear power station at Hinkley Point C is due to be commissioned, subject to a final investment decision.

The case for investment in Dungeness B and other nuclear power stations has been supported by the existence of the capacity market – one of the reforms of the electricity market which gives investors’ confidence in highly challenging conditions. EDF Energy is currently investing around £600m a year at its eight nuclear stations.

Today’s announcement also secures 550 jobs and work for 200 contractors at the site, as well as maintaining essential expertise in engineering and the UK nuclear industry.

During the conference, new supplier contracts will be signed including:
• £150m over five years with Cape plc for the supply of access, insulation and services in support all of EDF Energy’s nuclear power stations. Around 300 jobs will be safeguarded by this contract plus 200 during “outage” maintenance periods.
• A contract with Cavendish Nuclear, part of Babcock International, for carrying out inspections of graphite in the reactors, maintaining gas circulators and providing support at all the EDF Energy nuclear stations. The agreement is worth around £40 million every year.
• A strategic nuclear partnership between EDF Energy, Amec Foster Wheeler, Cavendish Nuclear, Atkins and Doosan Babcock to share knowledge and expertise in support of the nuclear stations.

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RWE could yet follow E.ON break-up example

January 20th, 2015

Germany’s second largest utility hasn’t ruled out going down the same path as its chief rival, E.ON, and splitting the company’s generation unit up to better cope with modern realities affecting the European power sector.

E.ON opted to split its operations last year in response to the demands of the government’s Energiewende policy, which promotes wind and solar power ahead of fossil fuel. The country’s top utility announced late last year that it will concentrate on renewables, distribution and marketing, while a spinoff will include conventional power generation, global energy trading and oil and gas and production.
RWE Chief Financial Officer Bernhard Guenther
RWE, which operates Germany’s largest fleet of coal-fired stations, is grappling with net debt of about $35bn as prices paid to power producers for electricity trade near a record low. RWE Chief Financial Officer Bernhard Guenther said in an interview that no decision is imminent, but splitting the power generation unit and the business that supplies customers hasn’t been ruled out.

“The reasons for not doing it are all of a nature that might change over time,” he said at the company’s headquarters in Essen last week.

Bloomberg reports that the company has been the worst performer in Germany’s benchmark DAX index since EON announced its decision to split up. The stock has dropped almost 20 percent, more than double the decline at EON over the same period.

EON’s move adds new momentum to the debate about how conventional power generation in Germany and continental Europe adjusts to the rise of renewable power, Guenther said.

Germany’s utilities have called for capacity markets that pay them for operating spare power capacity to guarantee security of supply.

There needs to be a discussion on “whether there is room for a solution where politics and business join forces to face the challenge of what happens to nuclear after the phase-out,” Guenther said.

RWE looked into the idea of a split some time ago, Hans Buenting, Chief Executive Officer of the Innogy renewables unit, told reporters last week, without giving details.

Top utilities pull out of EU CCS project

January 19th, 2015

Four of Europe’s largest utilities have cited expense in their decision to opt out of a decade long carbon capture and storage (CCS) project.

Germany's RWE, France's Electricite de France , Sweden's Vattenfall AB and Spain's Gas Natural Fenosa have announced their withdrawal from the Zero Emission Platform (ZEP), which advises the European Commission about CCS technologies.

They say the technology behind the project, aimed at tackling global warming, is too expensive, according to a letter obtained by Reuters.
CCS
"The utility group has decided to stop its engagement in the ZEP," according to the letter dated Jan. 12 to Graeme Sweeney, chair of the ZEP advisory council.

The ZEP is a coalition of companies, scientists and environmental groups seeking ways to capture and bury heat-trapping carbon emissions mainly from the exhausts of coal, oil and gas-fired power plants.

While Saskatchewan Power opened the world's first coal-fired power plant retrofitted with CCS in October, the European body has largely failed to enable a proliferation of the technology.

"We currently do not have the necessary economic framework conditions in Europe to make CCS an attractive technology to invest in," the letter also stated. It added that CCS would play an important role cutting greenhouse gas emissions in future.

"It's a matter of regret ... but it also presents us with an opportunity to reinforce our membership," Sweeney, a former advisor to Shell, told Reuters. New members could include companies from energy intensive industries.

The letter said that the utilities had "restricted time and budget" and that ZEP had focused more and more on lobbying.

Reflections from breakthrough marine energy trials

January 19th, 2015

Last year, marine energy technology company Minesto announced that it had successfully managed to produce electricity from low velocity currents off Northern Ireland, the first in the marine energy era. The marine power plant Deep Green has now been producing electricity for more than a year, and Minesto’s founder and CEO Anders Jansson shares his experiences from the trials in this article.

The lush hills of Strangford Lough are truly a place of magic scenery. Portaferry, a small fishing village, is located one hour’s drive from Belfast in Northern Ireland, and is today perhaps most famous for being close to the location where blockbuster Games of Thrones is filmed. In this idyllic fishing village, struggling with a high unemployment rate and a diminishing population, something new and prosperous is growing. Looking out over the calm waters of Strangford Lough, one could hardly believe that under the ocean surface – that electricity can be produced.


Minesto marine power
In fact, as the sun starts to rise and another spring tide starts to take off, pushing massive amounts of water through the narrows, the ‘underwater kite’ called Deep Green initiates its electricity production. Strangford Lough has, due to its sheltered waters and good tidal conditions, become a popular area for the testing of tidal power plants; Siemens, Schottel, and Queens University of Belfast are all conducting their tests there.

Deep Green is a tidal and ocean current power plant, which actually looks like an underwater kite. It's there that the similarity ends. Deep Green can produce electricity from low velocity currents at a cost lower than fossil fuels and nuclear power. As such, Minesto's Deep Green kite has the potential to change the world.

The Deep Green technology was invented by the inquisitive engineer – Magnus Landberg, in 2001. Magnus was project manager for a wind turbine project at Swedish aircraft manufacturer Saab. The outcome was a compact, efficient, tidal power plant able to sweep large areas, much more efficient than rotors on static structures. The design offered a decrease in electricity generating cost. The company Minesto was spun-off from Saab, and has since then pushed Deep Green towards commercialisation with great focus on prototype testing in combination with business development on literally all continents. Today, large public and private investors, including the British Department of Energy and Climate Change, the Swedish Energy Agency and the EU, are all backing the development of Deep Green.

The autumn of 2013 was the first time ever a marine power plant designed for low velocity currents were targeted to produce electricity at sea. It was a hectic time for the Minesto team, and also an important and critical step for the Deep Green technology. Even though there were big challenges and valuable insights before Deep Green was installed in the water and started to produce electricity, the ocean trials provided the Minesto team with even greater challenges, and in addition invaluable insights.

As expected, deployment of the power plant turned out to be a great challenge. From the desk top, it is almost impossible to foresee how the power plant could be handled in the unpredictable offshore environment with winds, waves and tidal currents causing forces and havoc in all directions. Initially, months were spent on constantly changing under-dimensioned mechanical components and searching for electrical insulation faults without gaining any useful test results. The cold, windy and always wet working environment fatigued the Minesto team, and the situation urged for alternative solutions.

The team took time out and gathered to develop a plan. This all resulted in a test set-up physically being turned upside down - with the power plant attached to a floating platform instead of to the seabed. The new set-up gave more control, and it was easier to access all subsystems. In addition to that, all mechanical and electrical components were thoroughly examined with great care. When the kite was re-launched and submerged in Strangford Lough, the pulse was high on all 25 Minesto employees watching as it disappeared beneath the surface. As soon as the kite started to make its first figure 8 – steered by a person in the offshore control room– they all knew that a successful launch was in hand.

The team now knew that they had taken a giant step closer to unlock the low velocity tidal and ocean currents as a source for renewable energy production. In October 2013, just a few weeks after the successful first flight, the initial use of an automatic control system took place. Since then, the quarter scale Deep Green has been operational and has produced electricity. The Minesto Deep Green power plant has now achieved performance comparable to producing electricity at the same cost as offshore wind. Furthermore, multiple improvements are targeted, without any significant design changes, with the power output expected to be doubled.

All of the power plant’s functions have been verified, including the full control in all tidal velocities. An important milestone was reached the first time the power plant was automatically controlled and positioned in the middle of the water column during slack water and the turning of the tide. The quarter scale test platform has many times proven to be a cost efficient development environment. For example, when testing a new turbine design, 3D printing was used to produce a polymeric prototype at 1/5th of the cost and 1/10th of the time for an aluminium turbine.

Now the kite is mostly operated from the seabed foundation, and the possibility to connect it to the floating platform is still used when deploying new upgraded sub-systems. In the end, the challenges Minesto faces surprisingly continue to unlock opportunities. The solution of an upside down anchoring to a platform has doubled the market potential since it has turned out to enable full scale installations at larger depths than originally thought, such as in ocean currents. It is in fact ocean currents, which enable constant renewable electricity production, can be used as base load on the grid.

The next step for Deep Green is the installation of the first commercial scale, 0.5MW power plant off the coast of Wales in 2017. The installation in Wales will be successively extended to a 10MW array, which will have the potential to deliver power to over 8,000 Welsh households. The installation site is located off the Holyhead Island in Anglesey, Wales. For this, Minesto has been awarded an ‘Agreement for Lease’ by the Crown Estate, manager of the UK seabed, for the site and environmental investigations and detailed resource studies are far progressed. This on-going project to commercialise Deep Green in Wales underpins Minesto’s position as the global leadership in renewable energy production from low flow tidal and ocean currents. For Wales, this project will lead to job creation, increased income and a more sustainable and diverse energy supply.

Development of new energy technologies require long-term political strategies and capital. However, the payback from a success story is significant for financial investors, and also in terms of societal benefits. If we want to enable our children to live as great lives as we have experienced (or better!), renewable and reliable energy is a must.

Scepticism has been expressed against marine energy for its long and costly development, but that should be set in relation to other technologies that we today depend on. Offshore wind hadn’t been heard of in the mid 1990’s whereas the growth during the 20th century has been phenomenal. Between 2010 and 2014, the market grew with 600% and is expected to grow with 2,300% until 2020. Today we depend on wind power which supplied electricity to more than 25% of the UK’s households in 2014. The next industry to experience the same breakthrough is tidal and ocean current energy. Thanks to many enabling technologies, like sensors, materials and computer simulations, tidal energy technologies have made great advancements in few years’ time. The tidal energy industry has done its homework to pass the early stages of technology development, and now it’s time for politicians and investors to act to ensure the future European backbone industry to grow.

Anders Jansson is co-founder and CEO of Minesto, an energy technology company in the field of marine energy, with a patented and proven technology (Deep Green) to harvest energy from low velocity tidal and ocean currents. He has eight years of experience from developing and commercialising marine energy technology, both as an entrepreneur and business leader with a background from Chalmers University of Technology. See http://www.minesto.com/

Last call for expert power speakers at POWER-GEN Middle East

January 19th, 2015

Global experts in the power sector now have until January 30 to submit abstracts of papers for the 13th annual POWER-GEN Middle East Conference and Exhibition. The event is set to take place at the Abu Dhabi National Exhibition Centre (ADNEC) from 4-6 October, 2015, alongside WaterWorld Middle East.

International leaders in the industry are invited to share their expert knowledge at the event, which has become the definitive platform for discussing issues of economic development in relation to power generation in the Middle East.
PGME 

Under the theme titled ‘Sharing Technology Innovation’, the Advisory Board invites authors to provide their insights on a theme from one of the strategic conference tracks, which include market structure & regulation; strategic planning; market trends; project issues and renewable energy, with the technical tracks tackling fossil fired technology; renewable energy technology; nuclear power and operation & maintenance.

Event Director Nigel Blackaby said: “Every year we receive submissions of papers that present expert knowledge that reflects impactful analysis of energy trends. Hosting global dialogue on the evolving energy system and on sustainable power production and utilization, POWER-GEN Middle East is the definitive platform discussing critical issues that surround economic development in relation to power generation.

“The sessions will be headlined by powerful list of speakers, each a thought-leader in his own right. Such conversation is the need of the hour as electricity demand is expected to surge, resulting in a 45-50 per cent increase in power generation capacity over the period 2015 – 2020, requiring investments in the Middle East & North Africa (MENA) region to the tune of over $200 billion.”

All abstracts must be submitted in English by Friday, January 30th, along with speaker and author details, using the on-line form found on the POWER-GEN Middle East website available at www.power-gen-middleeast.com. The lineup of speakers will have complimentary delegate status at POWER-GEN Middle East. Further details on the subject tracks and full list of topics are available at the POWER-GEN website www.power-gen-middleeast.com.

Saudi Arabia hires DNV to launch energy efficiency study

January 19th, 2015

DNV GL has been taken on by the government of the Kingdom of Saudi Arabia to undertake analysis of the country’s capacity for energy efficiency.

With Saudi anticipating increased demand for electricity, the government sees energy efficiency as having significant potential in cost effectively offsetting demand growth.

DNV GL will develop a study to assess electricity end-use efficiency which will enable the forecast of future electricity consumption trends and the development of appropriate planning methodologies.
DNV GL
Electricity demand in the kingdom has more than doubled since 2000 and is anticipated to continue increasing rapidly, at an average rate of more than 8 per cent per year for the next ten years.

The Saudi Electricity Co-Generation Regulatory Authority (ECRA) and the Saudi Electric Company (SEC) have engaged DNV GL to develop a programme to understand and classify how electricity is consumed within the Kingdom.

The $2.5m project that will be executed over the next 20 months, and the research team will collect data on the stock of appliances and end uses within each customer sector, including hourly data on customers’ demand for energy both at the customer whole-facility level and most importantly, at the end-use level.

This information will be used by ECRA, SEC and other Saudi government agencies to forecast future trends and develop appropriate planning methodologies.

Nordic fund manager ends payments to coal

January 19th, 2015

Fund manager, Nordsea, has decided to end funding coal-fired power plants.

The company is the latest such body to cut their exposure to fossil-fuel assets, and is in the process of identifying companies for exclusion that have a “large and sustained exposure to thermal coal mining”, according to Sasja Beslik, head of corporate governance at the group.

KLP, Norway’s largest pension fund, decided in November to blacklist companies that derive more than 50 per cent of their revenues from coal-based activities. The 27 companies affected included Peabody Energy, the world’s largest coal company, and India’s Tata Power.

These investors join a list of more than 800 institutions that have committed to reducing their exposure to coal and other fossil fuel-driven companies over concerns that governmental action to combat climate change has made these investments more risky.

There is resistance to fossil-fuel divestment in the US, where legislation is under way that could force Calpers and Calstrs, two of the biggest US public pension funds, to divest completely from coal.

Commission paper advocates export credits for coal power

January 16th, 2015

An unpublished European Commission paper, which proposes export credits for European coal-fired power plant equipment manufacturers has been disclosed by Reuters.

The news agency reports that it has seen the paper drawn up by officials from the European Commission's trade department. The document proposes that export credits, or preferential loans, continue for more-efficient coal-fired power plant, or clean coal technology.

Ahead of UN talks on a possible climate change global agreement in Paris later in 2015, the EU and other global governments are keen to phase out subsidies for domestic coal plants by 2018 and the European Investment Bank has set an emissions limit for the energy for which it provides preferential loans, meaning coal is excluded.
EU Commission
The paper’s authors are putting forward the elimination of finance for coal-fired plants that use the least energy-efficient technologies , as a potential compromise.

For those efficiency-compliant plant makers it proposes reducing the maximum length for repaying loans to eight or 10 years, down from 12.

In a briefing paper on coal finance, the WWF said countries around the world provided $7 billion over the period 2007-2013 for developing coal overseas.

However the figure is well behind subsidies for other fossil fuel- powered facilities. According to a recent IMF report, gas power accounted for $112bn in 2013, with oil-fired power accounting for $212bn in subsidies in the same year.

Of this, export credit preferential loans accounted for some $5 billion, with Germany, followed by France, being the biggest provider in Europe.

France's Alstom previously said the risk of removing subsidies is that countries with no limits on coal plant financing would step in and could use less-sophisticated technology.

EDF and China Nuclear move closer to Hinkley Point agreement

January 16th, 2015

An EDF executive has confirmed that the company is confident of an investment deal on the Hinkley Point project in England by the end of March.

“In principle, everyone’s on board,” Song Xudan, chief executive for EDF (Euronext: EDF) in China told the Financial Times. “But these are huge contracts and we have to go through them line by line.”

The £24.5bn nuclear power project represents the first overseas venture for China General Nuclear Power Corp, which has negotiated for Chinese companies to get a share in supplying components to the project. Previously EDF and the British government had envisaged the Chinese partners would primarily help with providing financing.
Hinkley Point
The FT said there is speculation that the Chinese companies have also been pushing for a substantial share of the supply contracts, a demand that has complicated the negotiations. They also want ownership of another nuclear site, at Bradwell in Essex, with the aim of building their own nuclear reactor. Discussions over that has been a stumbling block in the Hinkley Point negotiations.

EDF is keen to tie up agreement before the end of Q1 as delays could take hold due to the looming general election.

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