Editorial -
MOX Battle Goes On and On
Following the legal challenge by Friends of the Earth’s to
the Sellafield MOX Plant, the Government decided to release the
analysis carried out for them by consultants, Arthur D Little,
and a 5th Public Consultation Exercise lasting four
weeks has already started (and right in the middle of the holiday
season).
Environment Minister Michael Meacher commissioned the new study
in April following the data falsification safety scandal last
year, which severely damaged customer confidence in BNFL.
The report was released on 27th July and is on the
Department of Environment, Food and Rural Affairs website – at
www.defra.gov.uk/corporate/consult/consultfrm.htm.
It will also be e-mailed or posted to all the 1,500+ people who
responded to the 28 March consultation.
The report estimates that the 'net present value' of the plant
only amounts to around £200 million. However, the plant's owner
British Nuclear Fuels plc (BNFL) has already spent £460M on construction
and other costs, therefore giving an effective loss of around
£260M. The plant was built by BNFL four years ago. But its operating
licence has been withheld because of the significant lack of orders.
BNFL has asked the Government to ignore construction costs when
considering if the plant is justified under radiological protection
law.
Under these circumstances, Friends of the Earth “consider it would
be unlawful for the Government to give the plant the go-ahead
… There must also be a full debate about how to manage the legacy
of long-lived radioactive wastes and in particular plutonium.
It would be premature for the Government to authorise a dangerous
and expensive process for plutonium waste management when other
safer and less expensive options have not been explored."
ADL appears to have failed to take any account of responses
to the previous consultation. Nor does it appear to have looked
into the very real possibility that BNFL may fail to get Japanese
contracts.
The ADL report reveals for the first time that, following
the MOX falsification episode, Japanese customers have set "Five
Conditions" on future business with BNFL (Fig11, p15 and
Appendix A5, ADL Report). According to the ADL report, none of
these conditions have yet been met.
Authorisation of the SMP is only one of these 5 conditions and
in itself is not sufficient to guarantee future Japanese business.
It is irrational to ignore the option of deferring an authorisation
decision in order to first determine whether or not these other
4 Japanese conditions will be satisfied.
The likelihood of Japanese contracts and the use of MOX in Japan
has been thrown into disarray by the referendum in the village
of Kariwa which voted against MOX use in their local reactor.
So if you didn’t get around to responding
to the last consultation, please send comments to
Adam Smith at Zone 4/F6, Ashdown House, 123 Victoria Street, London
SW1E 6DE or you can E-mail them to adlconsultation@defra.gsi.gov.uk
to arrive no later than midnight on 24 August 2001.
Tell
DEFRA that they must take into account the sunk costs, and refuse
to give authorisation to SMP while the situation in Japan remains
unclear.
Mothballed plutonium plant faces £250m loss by Paul Brown Guardian
July 28, 2001
The controversial plutonium fuel plant built at Sellafield
by British Nuclear Fuels but mothballed for four years while the
government decides whether to grant it a licence will cost the
taxpayer £250m even if it is allowed to open, according to independent
analysts.
Yesterday the government released the report of consultants
Arthur D Little, showing that their best estimate is that the
plant would do around £216m worth of business
in 10 years, compared with a construction cost of more than £460m.
The government agreed to publish the report after facing a high
court challenge by Friends of the Earth. The plant turns plutonium
and uranium which has been through the reprocessing works in Sellafield
back into reactor fuel.
The government told the consultants to disregard the fact it has
cost £460m to build and to evaluate only whether the profit it
made would exceed operating costs. On this basis Arthur D Little
consider the plant would make around £216m "profit"
but opponents of
the plant believe this is "voodoo economics". BNFL,
on the other hand, claims it proves the plant is viable.
The plant's operating licence has been withheld so far because
of a significant lack of orders. This was compounded by a scandal
and diplomatic row involving fuel sent to Japan from a demonstration
plant designed to show how the fuel would work.
Eventually BNFL, at the government's insistence, agreed to pay
for the fuel to be brought back to the UK. The company hoped that
the Japanese would subsequently order more plutonium fuel but
this now seems unlikely. However, the company has had more interest
from Europe and claims firm orders from Sweden and Germany. Mark
Johnston, nuclear campaigner for Friends of the Earth, claimed
the report "confirms the plutonium plant will lose hundreds
of millions of pounds. "We consider it would be unlawful
for the government to give the plant the go-ahead, and it is a
scandal it was ever built in the first place. "Ministers
must dismiss BNFL's application or risk further legal challenge.
There needs to be an independent inquiry into why the government's
supervision of BNFL has failed so badly. There must also be a
full debate about how to manage the legacy of long-lived radioactive
wastes and in particular plutonium." Mr Johnston said it
would be premature for the government to authorise "a dangerous
and expensive process for plutonium waste management when other
safer and less expensive options have not been explored".
BNFL argued the report concluded that there was "a robust
economic case" for proceeding with the plant and that it
would make a net contribution of £216m.
"This clear, independent evidence supports what we have been
saying for some time, that the plant has a strong economic justification,
there is customer commitment and it is vitally important to both
employment and the economy in west Cumbria. The environment agency
has already said that the environmental impact of the plant is
'negligible'." The company claims the plant has 40% of the
firm orders it needs for the first 10 years of operation.
Report on Sellafield
costs fails to satisfy critics by Matthew Jones Financial Times
27th July, 2001
It would be cheaper to open British Nuclear Fuels' controversial
Sellafield nuclear fuel recycling plant than to mothball it, even
though the project will still cost the Treasury hundreds of millions
of pounds, an independent report published on Friday reveals.
The study, commissioned by the government and prepared by consultants
Arthur D Little, says the plant would have a net economic benefit
of more than GBP200m ($286m) in today's money if allowed to open
compared with a loss of GBP58m if cancelled.
But environmentalists pushing for the plant to remain closed
pointed out that this analysis did not take into account the GBP470m
spent so far on building, which ministers had asked to be treated
as a sunk cost.
Mark Johnston, a campaigner at Friends of the Earth, the environmental
campaign group, said the report exposed the "folly"
of building the plant, which was completed four years ago but
cannot open under European law until it has passed a test of economic
justification.
"We consider it would be unlawful for the government to give
the plant the go-ahead and it is a scandal it was ever built in
the first place," he added. The plant is designed to combine
plutonium from spent fuel reprocessed at Sellafiled's Thorp facility
with uranium to produce recycled mixed-oxide (Mox) fuel for burning
in reactors. Critics claim this process is more expensive than
storing spent fuel and presents the additional risk of plutonium
falling into terrorist hands and being used to make atomic weapons.
The decision by the government to publish the report follows a
High Court challenge by FoE last month. The campaign group and
members of the public will now have a month to scrutinise the
study before the final decision on the plant is taken by the environment
and health ministers.
An official from the Department of the Environment, Food and Rural
Affairs said no decision had been taken on whether to treat the
value of the plant as a sunk cost. "We welcome Friends of
the Earth's views. The ball is still in the air and the ministers
will take all relevant factors into account when making their
decision," she added.
The ADL assessment of the plant's economic benefits was almost
GBP100m lower than BNFL's own economic analysis and GBP30m lower
than a previous study prepared for the government by PA Consulting
in 1997. BNFL said the ADL report confirmed the "robust economic
case" for opening the plant, despite orders from important
Japanese customers being hit by a Mox data falsification scandal
in 1999. An official said: "We are where we are with the
build costs and the important thing is that Britain would benefit
from the plant starting operations."
2. Environment Agency Review of Sellafield Discharges
The
Environment Agency published its long-awaited proposals for the
future regulation of radioactive waste disposal from the BNFL
site at Sellafield on 30th July. These are now
up on their web-site - www.environment-agency.gov.uk.
The proposals are contained in an Explanatory Document (ED).
A summary document of the proposals is also available. These
can be downloaded from the website or hard copy can be requested
by phoning 01768-866666 or e.mail to project.sellafield@environment-agency.gov.uk
or fax request to 01768 892456.
A
collection of Supporting Information (correspondence with BNFL,
Govt etc) has been compiled as part of the consultation package
- and is available on CD ROM from the above contacts.
In
contrast to the 5th MOX consultation the Agency has
decided to add an extra month to the usual 12 week consultation
period, because of the holiday season. It wants your views by
3rd December 2001.
There is a huge amount of information contained in the EA Consultation
documents. Lots of issues are bound to emerge over the next few
months as people plough though the information. For example in Appendix 6 (which is 568 paragraphs
long) there is the following news.
"A6.564 The second potential alternative to
the continued use of the Magnox Reprocessing Plant involves the
reprocessing of spent Magnox fuel in THORP. This would require
major modifications to THORP including the construction of
a new fuel dissolution facility. BNFL has decided to undertake
development for a small capacity route i.e. of the order of 20-30%
of the current full Magnox requirement. BNFL has stated that it
is to carry out sufficient development work on the option to enable
a decision to be taken in 3-4 years time.”
The fact that this
development work is already taking place has previously not been
in the public domain. Clearly BNFL is trying to come up with a
way to extend the lives of its Oldbury and Wylfa Magnox stations,
now that it has abandoned the idea of using an oxide fuel in these
reactors to keep them open beyond the 2012 closure date for the
Magnox reprocessing plant.
3. More MOX News
The Financial Times on 28th May reported BNFL’s claim
that the referendum vote in the Japanese village of Kariwa against
Mox is not a 'setback'. Almost 54 per cent of the residents voted
against plans by Tokyo Electric Power Company to load Mox fuel
into reactors at its Kashiwazaki-Kariwa plant. Although the vote
is not legally binding, local opposition to Mox threatens to derail
Japan's nuclear fuel recycling programme, which BNFL had hoped
would form the mainstay of its orders for the SMP. A BNFL official
acknowledged that Japan was the group's most important Mox customer
but said the Kariwa vote should not endanger the SMP.
"We
don't believe this is a setback. Both the Japanese government
and the federation of electricity companies have said they intend
to continue with the Mox programme," he added.
The
Department of the Environment Transport and the Regions confirmed
it would take the Kariwa vote into consideration when deciding
on whether to open the SMP. But an official said it was still
"too early to comment" on the likely impact of the vote
until more details were known.
[Environmental
News Service adds] The Kashiwazaki-Kariwa fuel is the third batch
of MOX fuel to be shipped to Japan and then rejected for use.
The 28 assemblies of MOX, containing around 220 kilograms of plutonium,
arrived on the British Nuclear Fuels vessel Pacific Pintail in
March after a 30,000 kilometre voyage protested by environmental
groups and many countries en route.
In 1999, a shipment
of MOX fuel from British Nuclear Fuels arrived in September under
suspicion that BNFL workers had falsified quality control data.
In February 2000, it was proved that fuel production standards
had been violated by BNFL, and the eight assemblies of MOX fuel,
intended for the Takahama-4 reactor operated by Kansai Electric,
will now be returned to the UK at a cost of billions of yen.
A second cargo
of MOX fuel, produced by a French Belgian consortium led by Cogema,
also arrived in 1999 for use in the Tokyo Electric reactor, Fukushima-1-3.
It came under suspicion of quality control violations and was
the focus of a legal battle to prove falsification.
In March, the
regional governor of Fukushima Prefecture decided to conduct a
one year review of MOX fuel use, citing loss of public confidence
as one reason for the review. The 32 assemblies of plutonium MOX
fuel at issue remain stored at the Fukushima-1-3, nearly two years
after delivery.
The Financial
Times reported on 1st June that
Tokyo Electric Power agreed to postpone the loading of MOX at
the Kashiwazaki-Kariwa reactor after meeting with local government officials, following
the Kariwa referendum. Ikuo Hirayama, governor of Niigata prefecture,
called on Tepco to delay the use of Mox after an earlier meeting
with the mayors of Kariwa and Kashiwazaki City.
Nobuya
Minami, Tepco's president, said the group would respect the request.
"The time has come for us to pause," he said. "The
opposition [to Mox] is also a criticism of Tepco's everyday activities."
He added, however, that the company should strive to improve residents'
understanding and win their support in order to begin the Mox
fuel programme in Japan as soon as possible.
Japan
Economic Newswire on 15th June reported that the Niigata
governor went even further and asked the Japanese industry Minister
to reconsider the nation's entire plan for using MOX fuel. Economy,
Trade and Industry Minister Takeo Hiranuma replied that he would
seriously consider proposals made by Hirayama, who visited the
ministry. Ministry officials quoted Hirayama as saying that a
plan to have MOX fuel generated in 16 to 18 nuclear plants by
2010 in Japan has been apparently delayed, and so the government
will have to make clear how it will deal with the situation. Citing
the fact that his prefecture is the third to delay the debut in
Japan of the so-called pluthermal process, Hirayama told reporters
after meeting Hiranuma, 'It is not easy to proceed with pluthermal
plans.' The process entails the use of MOX fuel in regular nuclear
power plants. 'Given that demand for electricity is sluggish,
there is an opinion there is no need to rush the plan,' he said.
Hiranuma later said at a regular press conference that power demand
is on the rise and so the government will continue sticking to
the promotion of nuclear power generation as a core of the national
energy policy. The proposals also call on the central government
to reconsider how to form a national consensus on the use of nuclear
energy, to take steps to let the country as a whole share more
of the burden placed on local communities hosting nuclear power
plants, and to clearly show how the government intends to promote
its pluthermal plan.
The
Economist on 2nd June added that Japan has 30 tonnes of separated
plutonium now awaiting shipment back home. Meanwhile, Japan has
started building its own reprocessing plant, at a cost of Y2.14
trillion ($18 billion). This plant will produce an extra five
tonnes of plutonium a year when it opens in 2005. By that time,
thanks to the European contracts, Japan will be sitting on more
than 50 tonnes of plutonium, if its MOX programme remains stalled.
That seems more and more likely because, along with the safety
and proliferation worries, comes plutonium's appalling economics.
Reprocessed plutonium is up to 312 times as expensive as conventional
uranium fuel.
This did not matter so long as Japan's ten regional power companies
enjoyed local monopolies: customers would have had to foot the
bill. But deregulation has already brought competition to the
wholesale electricity market, and the retail market may follow.
So the power companies have privately welcomed the public hostility
to MOX fuel, promising not to introduce it against the wishes
of local residents. Yet if they do abandon MOX, Japan will be
left sitting on enough plutonium to make several hundred nuclear
warheads. Partly for this reason, goes the government's curious
logic, the use of MOX must proceed.
Ireland
to seek arbitration over new Sellafield plant by Tania Branigan Guardian June 14,
2001
Ireland
is to take the British government to arbitration over proposals
to open a new plant at the nuclear reprocessing centre at Sellafield,
it emerged last night.
The action,
which is thought to be the first case of one state taking another
to an international tribunal for violating freedom of information
rules, is likely to exacerbate tensions with London following
years of arguments over the Cumbrian complex.
It was prompted
by Britain's refusal to release details of the controversial development
of a £300m mixed oxide fuel (Mox) plant which would reprocess
nuclear rods from Germany, Switzerland and elsewhere.
The UK has yet
to give the plant the go-ahead but is expected make a decision
following a recent public consultation.
Announcing the
action yesterday, Joe Jacob, minister with special responsibility
for nuclear safety, said the British government had withheld information
needed to assess the justification for opening the plant on the
grounds of commercial confidentiality. He said Dublin believes
the development is neither economically nor socially justified.
The case will
centre on what is covered by commercial exemptions to the right
to access information in a convention covering pollution in the
north-east Atlantic. The Ospar (Oslo-Paris) convention was opened
for signature in Paris in 1992 and has been signed or ratified
by 15 European nations.
Dublin is thought
to believe that the extent of the information withheld - which
may even include how much fuel would be reprocessed at the Mox
plant - makes it impossible to assess the risks.
Mr Jacob told
the Irish Times that the Irish government was taking the action
under the Ospar convention because it had exhausted all other
avenues for opposition.
Sellafield has
long been a source of contention between Britain and Ireland and
has been the subject of several high-level talks between Irish
prime minister Bertie Ahern and Tony Blair.
Successive Irish
governments have campaigned for the closure of the plant and have
pressed BNFL to stop discharging radioactive waste, including
plutonium, into the Irish sea. They made some progress in 1998,
when Britain signed up to an international agreement to cut discharges
to almost nothing by 2020.
Last night,
the London-based Ospar commission said it had not yet received
formal notification of the action.
Under Ospar
rules, the two countries must undergo an attempt at conciliation
before proceeding to a tribunal. Ireland and the UK would each
be able to appoint one arbitrator and the two people selected
would then choose a third. Should they fail to agree, the International
Court of Justice in The Hague would choose the final arbitrator.
Worst
nightmare: Terrorists could easily make an atomic bomb from MOX
fuel, says a confidential report Exclusive from New Scientist
magazine (2nd June 2001) by Rob Edwards.
Terrorists could easily make a crude atomic bomb from MOX fuel
produced at British Nuclear Fuels' new plant in north-west England,
according to a confidential report submitted to the British government
and seen by New Scientist.
The report comes as the state-owned company is trying to get the
government's go-ahead to make MOX, a mixture of plutonium and
uranium oxide, for reactor operators in Europe and Japan.
Although the MOX plant, at Sellafield in Cumbria, was completed
in 1996, the government has postponed authorising its start-up
because of doubts over its economic viability. Last week, as a
fourth consultation exercise on the MOX plant ended, Friends of
the Earth lodged papers at the High Court in London calling for
a judicial review of the consultation, accusing the British government
of skewing the process in favour of British Nuclear Fuels (BNFL).
The environmental group alleges that the £462 million invested
in the plant so far has been disregarded in calculating its financial
prospects, and that the results of an independent audit have been
withheld from the public.
But now the confidential report submitted to the government highlights
another potential problem for the plant. Written by Frank Barnaby,
a physicist who worked at the nuclear weapons laboratory at Aldermaston,
Berkshire, in the 1950s and later headed the Stockholm International
Peace Research Institute, it spells out exactly how easy it is
to make MOX fuel into a bomb.
Barnaby says that terrorists intent on mass destruction would
need no more technical know-how than that used to make the Lockerbie
bomb. The expertise required is less than the equivalent skill
used in 1995 by the Japanese cult, Aum Shinrikyo, to prepare sarin
nerve gas for release into the Tokyo subway, he says.
It would be "sheer irresponsibility" for the government
to allow the new plant to open, Barnaby warns, as the theft of
MOX fuel pellets would then become a "terrifying possibility".
His report, which was commissioned by the Oxford Research Group,
an independent body of scientists studying nuclear issues, comes
in the wake of mounting concern about the poor security arrangements
for radioactive materials worldwide (New Scientist, 26 May, p
10).
Barnaby reveals three ways of chemically separating the plutonium
dioxide from the uranium dioxide in MOX fuel. One, involving lanthanum
nitrate as a carrier, was used in 1941 by the atomic pioneer Glenn
Seaborg at the University of Chicago.
The other two methods - one of which is currently used at the
University of Kiev in Ukraine - depend on reactions with resins.
The chemistry is less sophisticated than that required for the
illegal manufacture of designer drugs, he says. All the details
terrorists need are in the published literature or on the Internet,
says Barnaby.
A primitive bomb could be made with 35 kilograms of plutonium
dioxide, or terrorists could use hydrofluoric acid to precipitate
out the pure metal, Barnaby says. Only 13 kilograms of pure metal
would be needed to create an explosion with a yield of 100 tonnes
of TNT - 50 times the size of the largest terrorist bomb to date,
in Oklahoma City six years ago.
BNFL points out, however, that MOX fuel would be difficult to
steal because it travels under armed guard. The security arrangements
"are mature, comprehensive and robust", says a company
spokeswoman. "We are 100 per cent confident in the physical
protection measures we have."
The company points out that turning plutonium into MOX fuel and
burning it in reactors could reduce the threat of nuclear weapons
proliferation by cutting plutonium stockpiles. Some plutonium
also has to be returned to foreign customers because they own
it. The risk of MOX fuel falling into the hands of terrorists
is "minimal", BNFL insists.
An atomic explosion in a city centre is "everyone's worst
nightmare", says Frans Berkhout, a nuclear expert from SPRU
(formerly the Science Policy Research Unit) at the University
of Sussex, Brighton. But although turning fresh MOX fuel into
a bomb is "theoretically possible", he thinks that in
practice terrorists might find cheaper and easier ways of causing
mass destruction.
4. Other Sellafield News.
THE
GREENS/EUROPEAN FREE ALLIANCE IN THE EUROPEAN PARLIAMENT
PRESS RELEASE Brussels, 29 May, 2001
Calls for a moratorium on reprocessing nuclear fuel
The Greens/EFA Group in the European Parliament is calling for
an immediate suspension of reprocessing activities at the Sellafield
site in the UK and the La Hague plant in France, following the
results of two reports that have brought to light key new facts
about the environmental and social costs of reprocessing. The
first study, carried out by the German Government, concludes that
licensed and real discharges at Sellafield and La Hague are often
much greater than that authorised for similar plants in Germany.
The analysis also shows that the calculated effect of annual discharges
of liquid nuclear waste from the Sellafield plant would result
in doses up to 25 times the permitted levels in Germany.
The second report, an interim analysis undertaken for the Scientific
and Technological Option Assessment (STOA) Program of the European
Parliament, gives details of current and past discharges from
Europe's reprocessing plants and puts forward a number of policy
options. The report states that the discharges from the
French reprocessing plant are approximately 35 000 times higher
for gaseous discharges and a 1000 times higher for liquid discharges
than a modern French reactor. The report also mentions the
economic impact of reprocessing and states that readily available
alternative methods of managing spent nuclear fuel (dry storage)
can be up to 20 times cheaper than the reprocessing option.
Claude Turmes MEP (Greens/Luxembourg) member of the Industry,
Trade, Research and Energy Committee of the European Parliament
said:
"Dry storage of the spent nuclear fuel at or near to the
point of production is the best waste management option as it
reduces the discharge of radioactive waste into the environment
and the risk of accidents during transport. This option
has also been shown to be the most economic.
Furthermore, the allegations in the German Government report raise
sufficient serious concerns, especially given the EU requirement
of the precautionary principle, that a suspension of activities
must be introduced immediately".
Caroline Lucas MEP (Greens/UK), also a member of the Industry,
Trade, Research and Energy Committee stated:
"The uncertainties in calculating the impact of radioactive
waste discharges into the environment are so large that one cannot
guarantee public safety. However, what is certain is that practices
in France and the UK are undermining the EU's efforts to protect
the public from man-made radiation. These discharges must stop
immediately".
Profit meltdown at BNFL by Oliver Morgan, Observer 24th
June 2001.
British
Nuclear Fuels will this week report a series of severe operational
problems which left it with an operating loss of nearly £200 million
last year. Disruptions in reprocessing activities at its Sellafield
site in Cumbria, as well as serious difficulties with its first-generation
Magnox nuclear power stations, will be blamed for the performance,
which is worse than previous estimates.
Last year BNFL made an operating profit of £65m, which converted
into a £242m loss after exceptionals. This year's underlying operating
performance is worse, but is likely to be improved by some exceptional
items. However, the total figure will still be in the red.
The key problem at Sellafield has been the Thorp reprocessing
plant, which had to shut down in April, October and February.
Its Wylfa Magnox plant - which generates nearly 40 per cent of
BNFL's power - was closed all year.
BNFL executives, headed by chairman Hugh Collum, are anxious
to meet Energy Minister Brian Wilson to discuss the prospects
of a partial privatisation initially scheduled for the end of
next year. However, sources close to the BNFL board say it accepts
that such a move is a long way off, given the operational problems
and uncertainties over BNFL's nuclear liabilities, which could
total £34 billion.
The news comes as CORE, a Cumbrian-based group campaigning
for the closure of Sellafield, circulates research to BNFL's customers
indicating that it is unlikely to meet deadlines for reprocessing
their waste. BNFL has already angered customers from Germany,
Japan and elsewhere by pushing back by one year to 2005 the first
10-year tranche of contracts. However, Core argues that bottlenecks
at BNFL vitrification facilities, which package highly radioactive
liquids, mean that this date could be pushed back to 2012 or 2015.
CORE says that BNFL must continue to vitrify waste from its
Magnox reprocessing plant, which holds up work on Thorp waste.
It says it has checked its calculations with the safety regulator,
the Nuclear Installations Inspectorate, where sources have suggested
they are broadly correct.
A BNFL spokesman said he was unable to comment on the figures.
Greenpeace
International Press Release 24th June 2001
BNFL'S
CLIENTS KEPT IN THE DARK OVER DELAYS AND HIGHER COSTS FOR
REPROCESSING OF SPENT NUCLEAR FUEL REPORT
Overseas clients of British Nuclear Fuels Ltd (BNFL) will
face delays of between 18 months to ten years and large
cost increases for the reprocessing of spent nuclear fuel, in
violation of BNFL's contractual commitments, according to a new
report.
"BNFL and Plutonium: The Deception of Customers Continues",
written by Martin Forwood of Cumbrians Opposed to a Radioactive Environment
(CORE), outlines how BNFL will not be able to meet even its
new deadline of March 2005 for the reprocessing of spent nuclear fuel.
The company is currently negotiating the terms of the one-year extension
with overseas clients. However these clients have not yet been told
by BNFL that there will be further delays and cost increases.
BNFL customers, including electrical utilities from Germany, Switzerland, Holland
and Japan, have already been highly critical of BNFL's poor operating
performance at the Thermal Oxide Reprocessing Plant (THORP).
They have also threatened legal action over possible breach of
contract. According to leaked internal documents, the overseas
clients told BNFL last September:
" ... the next business plan will result in another
increase of more than 10% in operating costs, mainly due
to the projected 11th year of operation of THORP... such cost
increases and uncertainties are commercially highly unsatisfactory
and make it impossible to manage our own fuel cycle business
economically, given the cost pressures we are under” [Overseas
Baseload Customers Statement 18th September 2000. Paras 5/6.2.]
Martin Forwood of CORE said: "Already under financial pressure
due to the high cost of reprocessing, and the increasingly
deregulated electricity market, utilities will be shocked to learn
that BNFL is continuing to deceive them on the reality of the
situation at Sellafield."
Due to a combination of factors, including BNFL's technical incompetence
and mismanagement, contracts that were supposed to be completed
after ten year in 2004, could be as much as ten years behind schedule,
according the report.
"BNFL from the start has failed to operate their so-called
flagship THORP facility as planned. This report exposes facts
that BNFL would rather not tell their customers or the UK government,"
said Shaun Burnie of Greenpeace International. "BNFL's deception
of their Japanese, German and Swiss clients over MOX falsification
revealed in 1999-2000, is continuing, this time with all
of their reprocessing clients."
The new details about BNFL's problems at the THORP plant come
at a highly sensitive time when another controversial facility,
the Sellafield MOX Plant (SMP), is awaiting license approval
from the UK government to start producing plutonium fuel, known
as MOX. The SMP has few secure contracts with customers in
Germany, Switzerland and Sweden, and none with BNFL's largest
reprocessing client, Japan. The Irish government has launched
an arbitration process with the UK government on the grounds
that it has not been provided sufficient information about
the plant.
"The Blair government will be making a huge mistake if BNFL's
deceptions persuade them to grant a license to the SMP -
a plant, like THORP, with inherent technical failures that BNFL
will not be able to overcome. There is an alternative - stop reprocessing
and abandon the Sellafield MOX plant," said Burnie.
The report, "BNFL and Plutonium: The Deception of Customers
Continues" is available at http://www.britishnuclearfuels.com
a Greenpeace established website.
Sellafield
emissions predicted to rise By Charles Clover The Telegraph Tuesday
26 June 2001
RADIOACTIVE emissions from Sellafield will rise over the next three years,
despite a treaty signed by John Prescott, the Deputy Prime Minister,
three years ago to reduce them steadily, according to a leaked
report. It is predicted that emissions to the sea of carcinogenic
substances such as plutonium and tritium will peak in 2003 and
remain above 1998 levels until 2008. Several plutonium isotopes
are among the likely discharges, according to the predictions,
confirmed yesterday by the Environment Agency.
Plutonium is a substance with no safe level of exposure and even
a speck, if it found its way into food for human consumption,
would be enough to cause cancer. One of the British Nuclear Fuels
documents leaked to Greenpeace and Cumbrians Opposed to the Nuclear
Environment says that, in the worst case, discharges could be
above legal limits. The predictions were published by Greenpeace
on the eve of this week's meeting of signatories to the Ospar
treaty, which governs sea pollution in the north-east Atlantic.
At a meeting in Sintra,
Portugal, in 1998, Mr Prescott, then Environment Secretary, signed
up to the "progressive and substantial reductions" of
Sellafield discharges, with the aim of concentrations of artificial
radioactive substances in the environment being "close to
zero" by 2020. Coincidentally, emissions, which are currently
all within discharge limits set by the Environment Agency, are
predicted to peak by the time of the next meeting of ministers
from Ospar countries in 2003.
Dr Helen Wallace, Greenpeace nuclear campaigner, said: "Emissions
going up is clearly not what most Ospar governments understand
by Britain's commitments under the treaty which says that emissions
should progressively be going down. The Government should stand
up to BNF and make sure they keep their promise. These discharges
are polluting countries from Ireland to the Arctic with dangerous
radioactivity.
A
Spokesman for BNF said “We're committed to help the Government
reach its commitments under Ospar. These emissions are partly
from processing historic arisings from the nuclear industry over
the past 50 years that we are committed to the Nuclear Installations
Inspectorate to work off. The figures compiled by Greenpeace conveniently
do not show that Magnox reprocessing will end in 2012, well within
Ospar's commitment period."
Greenpeace UK Press Release Tuesday 26th June SELLAFIELD PLANS
MASSIVE INCREASES IN DISCHARGES OF NUCLEAR WASTE TO SEA
Leaked documents published in the UK Telegraph newspaper today
show that massive increases in nuclear discharges into the Irish
Sea from the notorious Sellafield nuclear plant in Cumbria are
planned.
The documents (1) show that Sellafield's operator, BNFL, plans
to breach international commitments to reduce the discharges,
made by Deputy Prime Minister John Prescott in 1998. Prescott
stated "This is the day the UK finally throws off the mantle
of Dirty Man of Europe" when he made the commitment to the
1998 ministerial meeting of the OSPAR Commission in Sintra, Portugal
(2).
"Sellafield's nuclear pollution contaminates the shores of
Ireland and our Nordic neighbours, as far north as the Arctic,"
said Dr Helen Wallace of Greenpeace, "The Government promised
not to be a dirty neighbour, but Sellafield has secret plans to
pour yet more deadly radioactivity into the sea."
Greenpeace is providing the leaked documents to the annual meeting
of the OSPAR Commission meeting in Valencia, Spain this week.
Sellafield discharges some 8 million litres of nuclear waste into
the sea each day. The radioactivity contaminates sea water, sediments
and marine life such as winkles and lobsters. Nuclear reprocessing
at Sellafield, and at La Hague in France, is the major source
of radioactive discharges in the OSPAR region.
"If the UK is to meet its international commitments, it must
stop nuclear reprocessing today," said Dr Wallace, "There
is no safe dose of radiation and these massive discharges threaten
the environment and health of future generations."
Last year in Copenhagen, OSPAR adopted a decision to review reprocessing
"as a matter of priority" and implement dry storage
of existing nuclear waste fuel as an alternative. However, the
UK and France refused to accept the decision, which was supported
by the 13 other OSPAR member countries.
Notes for editors:
(1) The documents, available from Greenpeace on request, show
predicted discharges from Sellafield from 2000 to 2008. The predictions
appear to have been made by BNFL for the UK Environment Agency,
for its forthcoming review of Sellafield's discharges. Discharges
of many radioactive substances are predicted to double, and some
to increase four-fold by the next OSPAR ministerial meeting in
2003.
(2) The OSPAR Commission is charged with reducing and eliminating
marine pollution in the North-East Atlantic region. Members are
Belgium, Denmark, Finland, France, Germany, Iceland, Ireland,
Luxembourg, the Netherlands, Norway, Portugal, Spain, Sweden,
Switzerland, the UK and the EU. The Objective agreed by ministers
in 1998 was "...to prevent pollution of the maritime area
from ionising radiation through progressive and substantial reductions
of discharges, emissions and losses of radioactive substances,
with the ultimate aim of concentrations in the environment near
background values for naturally occurring radioactive substances
and close to zero for artificial radioactive substances"[emphasis
added]. The timeframe included commitments for the years 2000
and 2020.
BNFL's
200 million pound losses prompt audit call. Reuters 28th
June 2001.
State-owned
British Nuclear Fuels has posted pre-tax losses of over 200 million
pounds because of poor performances at the Magnox power stations
and its showcase THORP reprocessing plant. The results prompted
environmental group Friends of the Earth to call for the National
Audit Office (NAO) to investigate the running of the nuclear group.
"BNFL
is losing money like a Soviet steel works", said Mark Johnston
in a statement criticising the government for failing to supervise
BNFL on behalf of taxpayers.
The
audit office last investigated government supervision of BNFL
in 1989. For the year ended March 31, BNFL reported a pre-tax
loss before exceptionals of 210 million pounds against a profit
of 74 million pounds for 1999/2000.
Exceptional
gains shaved the 2000/2001 pre-tax loss to 66 million pounds from
337 million in 1999/2000 when the company was hit by exceptional
charges of 411 million.
BNFL
Chief Executive Norman Askew said the results reflected the closure
of the Wylfa power station for most of the year and difficulties
at a downstream treatment plant at its Sellafield site which hurt
operations at the THORP reprocessing plant.
"The
loss from the Magnox power stations (of which Wylfa represents
40 percent) accounted for a loss of nearly 200 million pounds.
If this loss were stripped out it would give a clearer picture",
he said.
Askew
added that although THORP had been out of commission for about
six months it returned to service in April while the 980 megawatt
Wylfa power station was expected to start producing electricity
again sometime this summer.
"We
are in a better position for this year", he said.
Turnover
rose slightly to 2.146 billion pounds from 2.064 billion pounds.
Askew
said he was encouraged that nuclear power might see something
of a revival.
In
May U.S. President George Bush announced plans to increase nuclear
power production and this week Britain declared it was undertaking
a review of the country's energy policy including looking at nuclear
power.
"We
have got the best portfolio of new reactor designs (via subsidiary
Westinghouse) anywhere in the world. If demand for new nuclear
build comes, we are ready to go."
Askew
added the group was eagerly awaiting a government decision on
whether it could start up its 482 million pound Sellafield MOX
Plant (SMP) built four years ago to make reactor fuel from combination
of uranium and plutonium oxides.
The
government is set to make a decision sometime this summer after
it considers a report by independent consultants on MOX's economic
viability.
5. Nuclear Waste Management Consultation
THE TIMES TUESDAY MAY 29 2001
Burial of nuclear waste back on political agenda
BY CARL MORTISHED, INTERNATIONAL BUSINESS EDITOR NUCLEAR WASTE will return to the Government’s
political agenda in the autumn, when a controversial proposal
to seek a permanent burial site for waste from Britain’s nuclear
industry is placed in the in-tray of a new Environment Minister.
A consultation paper on disposal of nuclear waste has been in preparation
in the Department of the Environment, Transport and the Regions
for more than a year. The Government has been loath to reopen
the highly sensitive subject of nuclear power before an election,
but growing anxiety over energy security will push the nuclear
issue up the agenda Sources within the DETR suggest that publication
of the consultation document could quickly follow the widely expected
formation of a new Labour administration. “Nothing will be published
before the general election, but work has been going on,’’ one
source said. “A consultation paper could come out later this year.’’
Signs that the Government is willing to grasp the nettle will
arouse fierce opposition from environmental groups, such as Friends
of the Earth, which are opposed to permanent burial. However,
the political climate on nuclear power is beginning to shift.
The US Administration is backing further research into waste disposal
at its Yucca Mountain site in Nevada and, earlier this month,
the Finnish Parliament approved by a big majority a scheme to
bury spent nuclear fuel from Finland’s nuclear stations in an
underground depository at Olkiluoto.
Political fright over nuclear waste scuppered an attempt by the former
Conservative Government to conduct research into underground disposal
of intermediate-level waste at Sellafield in Cumbria. On the day
John Major called the general election, John Gummer, then Environment
Secretary, scrapped proposals by Nirex, a nuclear industry-owned
body, to do a “rock-characterisation study” at Sellafield to determine
its suitability for a permanent depository A parliamentary select
committee in March 1999 argued that phased disposal in a deep
depository “is feasible and desirable”. The committee recommended
widespread public consultation and delivered an implicit rebuke
to the procrastination of successive governments. It said: “The
problem exists and has to be solved. It could not be avoided by
a decision today to discontinue nuclear power production.” Currently,
intermediate-level waste is encased in concrete and stored at
Sellafield, while high-level waste, mainly residual fuel, is encased
in glass blocks, also stored at Sellafield. British Nuclear Fuels
insists that there is no problem with the storage, but is pressing
for a solution. It said: “The Government needs to address this
so people know there is an end-game.’’
6. Energy Review
Below
is an action briefing sent by the Socialist Environment Resources
Association to its members about the Energy Review. SERA is the
"green wing" of the Labour Party. The Safe Energy Journal
supports what SERA is proposing. Please try to carry out at least
some of the actons which SERA is suggesting to its members. If
you are interested in joining SERA e-mail Vicky Cann at SERAoffice@aol.com and ask for details".
Dear
SERA member,
The government has launched a review (by the Performance and Innovation
Unit in the Cabinet Office) into the future of UK energy supply.
The preamble to the review notes that the government is concerned
about a number of areas in relation to future energy supply: ensuring
diversity of supply so the UK is not dependent on one source;
ensuring security of supply - much of the world's oil and gas
are in areas of political turbulence; meeting its environmental
obligations to reduce carbon dioxide (CO2) by 20% on 1990 levels
by 2010 and by up to 60% by 2050; the social consequences of high
energy prices.
This review represents the opportunity to campaign for a full
and comprehensive investment programme into renewable energy,
combined heat and power, and energy efficiency. We advocate the
following:
Renewable Energy - The review must set out a strategy for a major
expansion of renewable energy and a clear objective for renewables
to make the dominant long-term contribution to energy supply.
Onshore wind, offshore wind, wave, solar and energy crops represent
diverse resources with the potential to supply all the UK's power
- Greenpeace believes that the UK could have up to 100% electricity
from renewables within 40 years. A major expansion of renewable
energy will lead to the creation of new jobs and new export markets.
But this will require the government to put in place the right
fiscal and investment support structures, a more positive planning
regime, plus reform of the electricity markets and network, now.
Combined Heat and Power - CHP provides one of the most cost-effective
methods for reducing CO2 emissions and the UK's potential is barely
a quarter of what the Government have identified as being economically
realisable. The current market for CHP stands at 6% of UK generating
capacity, comparing poorly with several European countries with
levels of over 30%. The review must link together with the Government's
long-awaited CHP Strategy, anticipated to be released later this
year, to establish a short and longer plan for delivering CHP's
full potential to the UK's environment and economy. This includes
full exemption for CHP projects from the climate change levy.
Energy Efficiency - The growing threats posed by climate change
will require massive reductions in fossil fuel use making energy
efficiency an environmental (and social) imperative. Improvements
of more than 20% are possible with technologies that are already
cost effective. But with commitment, innovation will deliver far
more - halving energy use by 2050 is possible without affecting
economic growth. This requires, amongst other measures, building
regulations improved progressively towards 'zero heating' houses;
government, local authority and energy supplier programmes expanded
to eliminate fuel poverty by 2010; boost for energy efficiency
R&D, focussing on key technologies such as fuel cells; more
ambitious efficiency standards for appliances; extension of the
emissions trading scheme to cover all major business polluters.
Opposition to Nuclear Power - There has been much media speculation
that the energy review will signal a renaissance of nuclear power
through either building brand new stations or upgrading existing
ones. SERA has always been opposed to nuclear power - on economic
and environmental grounds. In May 2001, The Economist published
a damning report into nuclear power and the billions of hidden
subsidies it receives, concluding that it was an economically
unviable industry. In recent years, Labour Party policy as stated
in In Trust for Tomorrow (1994), the 1997 manifesto and the 2000
National Policy Forum Report, was that new nuclear power stations
were uneconomic. A continuation of the present phasing-out policy
would see nuclear power contributing only 3% of our total energy
consumption by 2020. SERA believes the nuclear power phase-out
policy should be upheld.
Nuclear energy production creates an enormous amount of waste,
much of which will still be dangerously radioactive in 100,000
years time. There is no safe way to manage this waste and SERA
advocates its storage (with proper monitoring and the option of
full retrieval) until the technology exists to deal with it sustainably.
Certainly, the reprocessing of nuclear waste is not
the answer - nuclear reprocessing leaks radioactive emissions
into the environment, in contravention of international agreements.
Labour Party policy, as agreed at the 1997 conference, is for
the government to implement a full review of nuclear reprocessing.
After four years, this review has yet to be carried out. SERA
believes that BNFL should seek to become a world leader in the
field of decommissioning nuclear facilities (rather then reprocessing),
thereby guaranteeing domestic and overseas contracts (and employment)
at BNFL for years to come.
There are a number of actions which SERA would like you to undertake
to make your views known to the government and other decision-makers
about the future of UK energy supply:
1. SERA supports the Early Day Motion copied below. Please write
to your MP at House of Commons, London SW1A 0AA or email using
this formula < surnameinitial@parliament.uk> e.g. SmithF@parliament.uk,
asking them to sign this. The site www.faxyourmp.com will let
you send a fax to your MP on-line, free of charge. In your
letter/fax, please set out your views on the future
of energy (using the information supplied in this paper) and ask
the MP to write to Brian Wilson MP, the minister responsible for
conducting the review.
2. Please write direct to Brian Wilson MP, DTI, 1 Victoria Street,
London SW1H 0ET to let him know your views on the issues being
discussed by the energy review.
3. Write to national/ regional / local newspapers - either responding
to articles on the review or perhaps in response to a local energy
issue. It is important that we communicate our views to as wide
an audience as possible.
4. Write to the Prime Minister, Rt Hon Tony Blair MP, 10 Downing
Street, London SW1A 2AA specifically asking him when the Labour
Party policy of a review into nuclear reprocessing will take place.
5. If you live in an area with an existing nuclear power station
please contact the office direct for more information about local
campaigning. The following have all been suggested as possible
sites for an upgrading/ replacement programme:- Chapel Cross (Dumfries
and Galloway); Wylfa
(Anglesey); Berkeley (Glos.); Oldbury (Glos.); Hinkley Point (Somerset);
Hunterstown (Ayrshire); Calder Hall (Cumbria); Trawsfynydd (Gwynedd);
Sizewell (Suffolk); Bradwell (Essex); Dungeness (Kent).
6. Why not write to the leader of your local council or the chief
executive of your regional development agency - put forward your
views on energy policy and ask what efforts are being made locally
and regionally to develop renewable energy and promote energy
efficiency.
7. If you are a member of a CLP, try to raise this matter urgently
with colleagues. Copies of SERA briefing materials are available
to any CLP - including a draft motion.
More detailed briefings are available from seraoffice@aol.com
or http://users.aol.com/seraoffice, www.greenpeace.org.uk, www.foe.co.uk,
www.forumforthefuture.org.uk
-------------------------------------------
(cut and paste or print out this EDM and send to your MP)
EDM 57 - Energy Review
This House welcomes the recently announced Energy Review to analyse
security of supply for the UK's future energy needs; recognises
that changes to the earth's climate require us to take urgent
action to substantially reduce our carbon dioxide emissions; notes
that renewable energy sources - wind, solar, wave, energy crops
- which do not produce carbon dioxide, have the potential to become
a secure source of up to 100% of UK energy needs by 2040; expresses
concern at recent press reports that the government is considering
developing new nuclear power plants instead of continuing with
the current policy to phase out nuclear power; agrees with The
Economist which in May 2001 stated that "nuclear plants continue
to depend on vast (and largely hidden) subsidies"; recognises
that no adequate management mechanism yet exists for the huge
quantities of dangerous radioactive waste produced via nuclear
energy creation, posing a potential environmental risk for generations
to come; and urges the government to reject, for once and for
all, the nuclear energy option and to put in place a fiscal and
regulatory framework to enable the development of a fully renewable
energy system.
------------------------------------------------------------------------------
CABINET
OFFICE NEWS RELEASE 25 June 2001
The Prime Minister, Tony Blair, today announced that he has asked
the Performance and Innovation Unit (PIU) to carry out a review
of the strategic issues surrounding energy policy for Great Britain.
The review will be set within the context of meeting the challenge
of global warming, while ensuring secure, diverse and reliable
energy supplies at a competitive price. Announcing the review
in response to a parliamentary question from Stephen Pound MP,
the Prime Minister said:
"The aim of the review will be to set out the objectives
of energy policy and to develop a strategy that ensures current
policy commitments are consistent with longer-term goals. The
findings will
also inform the Government's response to last year's report from
the Royal Commission on Environmental Pollution Energy - the changing
climate.
"The work the PIU has already started, on resource productivity
and renewable energy, will be an important input into this project.
This review will work closely with the resource productivity team
and the main Whitehall departments, as well as business, international
institutions, other governments and non-governmental organisations."
The Minister for Industry and Energy, Brian Wilson, will chair
the Advisory Group for the project, which will report by the end
of the year. Other Ministers on the Advisory Group include the
Minister for the Environment, Michael Meacher, and Chief Secretary
to the Treasury, Andrew Smith.
PROJECT
SCOPING NOTE Energy Policy
June 2001
1.This
paper provides background for the PIU project on energy policy.
It will involve close working with other Whitehall departments,
devolved administrations, industry, international institutions,
other governments and non-government organisations.
Summary
2. Current patterns and future projections of global and UK energy
consumption raise three key challenges:
Managing potential conflict with environmental objectives. - meeting
the long term targets for emissions reductions, whilst ensuring
future projections for energy demand are met, will require fundamental
changes in energy and fuel markets, the management of energy demand,
the development of new technologies, and infrastructure and policy;
Ensuring continued security and diversity of energy supplies over
the long term including ensuring appropriate investment incentives
to maintain sufficient spare capacity to be able to cope with
supply shocks, especially within the regulatory regimes for the
energy utilities; and
managing potentially conflicting policy goals for energy prices.
Higher energy prices could be a potent instrument for advancing
environmental objectives but they are in potential conflict with
fuel poverty and industrial competitiveness objectives.
3. Competitive markets will continue to be central to energy policy.
The main aim of the project will be to set out the objectives
of energy policy and to develop a strategy that ensures current
policy commitments are consistent with longer-term goals.
4. The project's outputs will be a key input to the Government's
future policy on security and diversity of energy supply and on
climate change including its response to the Royal Commission
on Environmental Pollution (RCEP) report on Energy.
Why
is a PIU project needed? – The problem.
5. Current patterns and future projections of global and UK energy
consumption are likely to give rise to the following policy challenges:
(i) The potential for increased conflict with environmental objectives
6. C02 emissions pose a global challenge. Recent work by the Intergovernmental
Panel on Climate Change (IPCC) suggests they are likely to rise
by between 1-3% per annum globally to 2050 [1]. On unchanged policies
(including the expected progressive decommissioning of nuclear
power stations), CO2 emissions from UK energy consumption are
likely to rise by between 0.01-0.3% per annum to 2050 [2].
7. There is scientific agreement that very substantial reductions
in global CO2 emissions will be required to stabilise the climate.
Work by the IPCC suggests that deep cuts in greenhouse gas emissions
- of the order of 60-80% worldwide - will be needed over the coming
decades if the risks of global warming and associated severe impacts
are to be avoided. The UK Climate Change Programme [3] recognised
the challenge this poses for the UK. The RCEP has suggested that
this translates into a 60% reduction in UK emissions by 2050 [4].
But this needs to be put in a global context: in total, the UK
accounts for about 2% of global climate change emissions.
8. The UK's target under the Kyoto Protocol is to reduce a basket
of six greenhouse gases including methane, nitrous oxide, sulphur
hexafluoride, perfluorocarbons and hydrofluorocarbons as well
as CO2 to 12.5% below 1990 levels over the period 2008 - 2012.
The Government also has a domestic goal of reducing carbon dioxide
emissions to 20% below 1990 levels by 2010.
9. To reduce CO2 and other emissions at the same time as meeting
future energy demand will require action in the UK as in the rest
of the world, including:
Achievement of the full potential for energy efficiency and clean
fuel technology;
continuing technological innovation in the development of energy
efficient clean fuels (zero and low carbon energy etc) and new
vehicle technologies (hydrogen fuel cells etc), with implications
for science policy and support for innovation;
the transformation of the national infrastructure for producing
and distributing energy, including electric power; and major behavioural
changes by consumers, businesses and others.
(ii) Questions about the security and diversity of energy supplies
10.
On most projections the world will become - on present policies
- increasingly dependent on oil and gas supplies from a limited
number of producers. There are risks, which need to be explored,
both to the physical security of supply and to energy prices.
11.
In the UK, nuclear power stations (which currently account for
25% of UK electricity generation) will (on unchanged policies)
be progressively decommissioned.
12.
With the UK's nuclear power stations decommissioned and coal generation
likely to have only a limited role, UK energy consumption is likely
to be increasingly dependent on oil and, in particular, gas.
13.
With the decline of projected North Sea oil and gas production
from 2004, oil and gas will be increasingly imported. By 2006,
the UK is expected to be importing up to 15% of its gas compared
with 2% currently [5]. The UK currently exports far more oil than
it imports. The trend, however, is to produce less, export less
and import more. By 2006/07, the UK is likely to be a net oil
importer.
14.
On current policies, initiatives to promote domestic renewable
energy sources and reduce demand will be insufficient to reduce
dependence on imported oil and gas. And UK energy security will
be increasingly tied up with that of Europe as a whole.
15.
The regulatory regime for the privatised energy utilities has,
to date, focused on a price control regime that seeks to promote
cost efficiency and to reduce or contain real energy prices. Such
a regime has the potential to conflict with the government's environmental
objectives.
16.
The UK has not experienced the same problems as California with
its electricity supply. Nevertheless, the problems experienced
by the Californian system raise the question whether the UK regulatory
regime provides utilities with appropriate incentives for investment
in generating or other capacity to minimise the risk that energy
supply shocks will lead to interruptions in supply.
(iii) There are potentially conflicting policy goals for energy
prices
17.
Environmental policy objectives point strongly to internalising
the environmental costs of fossil fuel consumption through higher
energy prices. This would provide price signals that encouraged
economy in fossil fuel consumption and the switch to alternative,
cleaner fuels etc.
18.
The consideration of measures (taxes, quotas etc) which would
increase energy prices needs, however, also to take account of
fuel poverty and industrial competitiveness objectives, particularly
where, as in the case of petrol used by motorists, the consumption
of energy is relatively insensitive to price.
What
are the existing activities by Government and others?
19.
The UK government's current activity can be split into two main
areas:
i. Policies to lessen the environmental impacts of energy
consumption:
the UK Climate Change Programme to meet the UK's Kyoto target
and move towards the domestic carbon dioxide goal. Some of the
key measures include:
implementation of the Kyoto Protocol of the UN Framework Convention
on Climate Change;
a target for renewable energy;
the renewables R & D programme;
a target for Combined Heat and Power (CHP) use;
support for the Energy Saving Trust and the establishment of the
Energy Efficiency Commitment, and other measures to improve energy
efficiency and tackle fuel poverty in the domestic sector
the Climate Change Levy (CCL) and associated agreements to improve
energy efficiency in energy intensive sectors;
establishment of a UK emissions trading scheme;
the new Carbon Trust;
enhanced capital allowances for energy saving products; and
the 10 Year Transport Plan, and promotion of alternative fuelled
vehicles.
ii. Policies to improve the security and diversity of energy
supplies:
measures to promote energy efficiency and renewable;
clean coal technology initiatives;
reform of the operation of the electricity market to remove distortions
which encouraged investment in gas-fired power generation at the
expense of existing coal fired plant;
a temporary policy of stricter consents for new gas-fired power
stations from end 1998 to end 2000, followed by a short term subsidy
for the UK coal industry, 2000/01-2001/02;
the energy regulatory framework and its role in promoting competitive
markets.; and a joint government/industry efforts through PILOT
to increase UK oil and gas production.
promotion of greener transport fuels, including renewable biofuels.
Project Scope
20. The project will look at energy policy for Great Britain to
2050. The main aim of the project will be to set out the objectives
of energy policy and to develop a strategy that ensures current
policy
commitments are consistent with longer-term goals.
21.
Although the challenges explored by the project will be largely
placed in a UK context, they are global challenges to which global
solutions will be required: UK policy will have to evolve in step
with other countries' policies. Furthermore, new policies to meet
these challenges will have to be sufficiently flexible to cope
with large economic, technological and scientific uncertainties
in the transport, domestic, and industrial and commercial sectors.
22. The project will also analyse the implications for fuel poverty
of possible policy changes, however this will not be the main
focus of the report. Fuel poverty has recently been addressed
by The UK Fuel Poverty Strategy Consultation Paper.
23. The team will work closely with other departments. In particular,
it will draw on ongoing work in the: Department of Trade and Industry; Department for the Environment, Food and Rural
Affairs; Department of
Transport, Local Government and the Regions;
The Foreign and Commonwealth Office; and HM Treasury; and
ofgem
24. The team will work closely with the PIU resource productivity
and renewable energy team to ensure that current policy commitments
are consistent with long term objectives. The project will be
overseen by an Advisory Group chaired by Brian Wilson, Minister
for Energy. Other Ministers on the Advisory Group include Michael
Meacher, Minister for the Environment and Andrew Smith, Chief
Secretary to the Treasury.
Project Output
25. There are two main options:
(a) an "of the Government" PIU report which would be
a collectively agreed statement of future Government policy. The
majority of PIU reports to date have taken this form; or (b) a
"to the Government" PIU report which would be consultative
rather than a statement of collectively agreed policy.
26. However, the output of the project does not have to be firmly
decided now but can be considered as the project proceeds and
as conclusions begin to emerge.
27. The project's conclusions will be a key input to the Government's
future policy on security and diversity of energy supply and on
climate change including its response to the RCEP report on Energy.
Timing
28. The PIU will prepare a report for the Prime Minister by the
end of the year.
Comments
29. Comments on this note or enquiries about the project should
be sent to Allan Brereton at: energyteam@cabinet-office.x.gsi.gov.uk
June
2001
References:
[1] Emission Scenarios, Intergovernmental Panel on Climate Change,
2000;
[2] Preliminary report on work in progress by the Inter-Departmental
Analysts Group on long term greenhouse gas emission reductions,
March 2001;
[3] Climate Change - The UK Programme, CM 4913, November 2000.
[4] Energy - The Changing Climate, Royal Commission on Environmental
Pollution, Cm 4749, June 2000;
[5] Energy Trends, March 2001;
Friends
of the Earth Release: Monday 25 June 2001GOVERNMENT'S ENERGY REVIEW - Nuclear power is not the answer says FOE
The Government must not build more nuclear reactors to combat
climate change, Friends of the Earth commented after today's announcement
of a comprehensive energy review.
Friends of the Earth is concerned that more nuclear power stations
will be 'justified' as part of the battle against climate change.
However, FOE says that nuclear power can never be part of a green
energy solution, since:
. it has intrinsic accident and radiation risks,
. it produces highly dangerous nuclear waste which we don't know
what to do with;
. It is totally uneconomic - relying on vast public subsidies.
Friends of the Earth has also described the Government's review
as giving an opportunity for a massive investment in energy efficiency
and renewable energy.
Mark Johnson, energy campaigner at Friends of the Earth said:
"This energy review, and the fight against climate change,
must not be used as an excuse to build a new generation of nuclear
reactors. That would be economic and environmental madness.
They're dangerous, they're uneconomic and they produce dangerous
waste that we have to keep safe for thousands of years.
If the Government can be persuaded to say no to the nuclear lobbyists,
then this energy review could be a wonderful opportunity to draw
up an sustainable energy strategy for the 21st century. The Government
should be investing in energy efficiency and increasing our use
of renewable
energy ".
Nuclear
and solar fans square up over energy as the government reconsiders
nuclear
By Nolan Fell Electronics Times (02/07/01 09:45 AM GMT)
The government's energy review, announced last week, could spark a political
battle between supporters of renewable energy, including solar
power, and the nuclear industry.
Jeremy Leggett, CEO of Solar Century, described as "tragic"
the government's intention to reconsider the nuclear option. "Money
put into nuclear is money taken away from technologies ready to
go that really don't produce greenhouse gases," he said.
"Given the potential power of microtechnologies, I think
it's mad to give money to a dangerous old dinosaur. The nuclear
industry is a great theocracy of largely old folk who cling to
the idea and are un-willing to embrace new technology." Solar
Century is a small company set up to install solar panels as roofing
material. It recently tiled the roof of the Big Brother house.
Brian Wilson, the new energy minister, whose constituency includes
the Hunterston nuclear power station, is considered pro-nuclear,
particularly in comparison with his predecessor, Peter Hain, who
actively supported solar power. In announcing the review, which
the minister will chair, Wilson said: "The review will consider
the role of coal, gas, oil and renewables in our future energy
balance, as well as combined heat and power and the enhancement
of energy efficiency. The review will also need to consider what
role the nuclear industry should play in meeting the environmental
and security aspects of supply objectives."
As
part of its commitment to the Kyoto treaty, the government has
a target of producing 10% of the UK's electricity from renewable
sources by 2010. In a speech in March, Prime Minster Tony Blair
committed to a £100m funding package for renewables. The first
tranche of this investment will be announced in September. Silicon-based
solar panels use the material's semiconducting properties to convert
photons to electric charge. Germany and Japan both have large
development programmes and companies such as Sharp, Siemens, Sanyo,
BP and Shell are investing in the technology. They believe that
solar power's potential for energy generation, even in northern
countries such as the UK, is immense.
"The
money Tony Blair has announced is a good start," said Leggitt.
"But to rival Germany and Japan and to get companies to manufacture
here, there needs to be continuity of support."
Martin Garside, a spokesman for the British Nuclear Industry Forum,
dismisses the argument that the nuclear industry resists the development
of renewables: "I don't think the review will be a Trojan
horse for new nuclear plant. We don't, as an industry, have a
prejudice against renewables, but we do think the UK needs diversity."
Financing
the nuclear revival By Matthew Jones and David Buchan in London
FT on Line July 2 2001
The UK appears to be edging towards a revival of the nuclear industry but
the now privatised atomic plant owner, British Energy, faces significant
problems in funding a rebuild programme.
City financiers remain highly sceptical about lending to the industry
and the group does not have a strong enough balance sheet to build
new plants on its own, following an expansion in North America
and falling power prices in Britain. Unless this point is addressed,
a rebuild programme will be dead in the water even before the
energy debate has properly begun. The UK government last week
launched a wide-ranging energy review, led by new energy minister
Brian Wilson, which will include an examination of the future
role of nuclear power. Prime minister, Tony Blair, has ruled out
an expansion of nuclear energy but industry analysts have interpreted
this as meaning that a replacement programme, maintaining the
proportion of nuclear power at the current 25 per cent of total
generation capacity, would be acceptable. Robin Jeffrey, British
Energy's chairman, will tell Mr Blair that the group wants to
build seven new nuclear power stations to replace its ageing advanced
gas-cooled reactors, the first of which is due to be closed down
in around 2011 and the last in 2025. However, bankers say there
is little prospect of the market financing a rebuild programme
without substantial support from the government in the form of
subsidies or taxes on other energy sources. One financier accepts
there is a need for nuclear power if the UK is to meet its greenhouse
gas reduction targets under the Kyoto climate change treaty, but
says the economics do not stack up. "It is very difficult
to justify new nuclear reactors compared to gas-fired turbines.
It would be dependent on some kind of third party support, otherwise
the economics don't work."
Another banker who worked with the old Central Electricity Generating
Board monopoly before privatisation 10 years ago says the key
problem is the lack of certainty on wholesale power prices in
the liberalised UK market. "I would not lend much money to
a nuclear power station unless someone was foolish enough to sign
a long term contract with it", he says. "The only sure
loan would be to a vertically integrated nuclear utility with
a regulated rate of return, allowing costs to be passed on to
customers". The nuclear industry is trying to reduce the
capital costs of a nuclear plant to about $1,000 a kilowatt compared
with $400/kW for gas-fired generators, by developing more standardised
technologies such as British Nuclear Fuels' AP1,000 water-cooled
reactor or modular pebble-bed reactor. But replacement nuclear
plants are still expected to cost in excess of £1bn each. The
City is concerned that even if new technologies reduce costs and
the industry wins government support, the construction and technology
risks remain high.
"The
gap between developing a new technology and making it work can
be extensive and the track record of building new nuclear plants
on time and within budget is appalling," says one senior
banker. British Energy has warned that government support for
new nuclear power stations would be needed as early as next year
if Britain is to maintain its nuclear capacity because the planning
approval and licensing process would take between eight and 12
years.
Mr Jeffrey admits that financing new projects will be difficult
and that no single company would be able to do so on its own.
He believes the industry will form consortia of energy companies,
contractors and equipment suppliers that could either work in
a direct partnership with government or benefit from subsidies.
Mr Jeffrey will submit evidence to the energy review, which is
due to conclude by Christmas, suggesting that new nuclear plants
could be built alongside old ones at its existing sites. The group
believes this would save money and make it easier to gain planning
permission. "We will be able to reuse some of the existing
infrastructure and will have access to a highly-skilled workforce
in areas that are used to and understand nuclear power,"
says a British Energy official. A further eight existing sites
are potentially available from British Nuclear Fuels' older Magnox
power stations, which account for 5 per cent of UK generation
and are due to close by 2010. But British Nuclear Fuels, the state-owned
atomic services group, has made it clear that it does not want
to operate new nuclear power stations and British Energy says
it has no plans to consider BNFL sites at the moment. Mr Jeffrey
believes the government will also have to make a definitive decision
on the long-term storage of nuclear waste if the industry is to
minimise criticism on environmental and health grounds.
Nirex,
the body responsible for long-term storage in the UK, is still
traumatised by the decision by John Gummer, former environment
minister, to axe its underground storage laboratory in Cumbria
in the dying hours of the last Conservative government. With one
third of the staff it had in 1997, Nirex have limped on, providing
advice on the short-term packaging of power station waste but
doing little else. A Nirex official said: "Essentially we
do not believe the problem [of storage] to be a scientific and
technical problem, but rather a social and political problem.
The government needs to set up an open and transparent process
for deciding on a site". However, BNFL believes it may be
easier to allay health and safety concerns, and more economic
to store waste in controlled conditions above ground. Norman Askew,
BNFL chief executive, says the group is hoping to adopt this approach
and is in talks with the UK's environmental and safety regulators.
"By storing waste in an inert condition above ground now
we can keep it safe for one or two hundred years until a more
permanent solution is found," he adds.
MP's warning on nuclear plans BBC on Line, 1 July 2001Report
claims children at higher risk of developing cancer
Parts of rural Wales could be prime targets for new nuclear
power station developments, a politician has warned. Plaid Cymru's
environment spokesman Simon Thomas expressed his concern following
the announcement that British Nuclear Fuels Limited is to put
forward a plan for six new nuclear power stations in the UK. "Sparsely-populated |