Britain Delays Outlining of Minimum Energy Prices
In a move that is increasing uncertainty among investors, even as it provokes anger among climate change activists, Britain is set to unveil the minimum prices that utilities will charge for electricity generated from both nuclear and renewable sources, beginning in mid-2013.
The highly anticipated Electricity Market Reform bill will be introduced into British parliament next week, stipulating the nation’s plans for improved infrastructure in its energy industry, while luring those who would like to be included in the $525 billion of investment that the sector is expected to require through 2030. (Read More: World Energy Consumption Facts, Figures, and Shockers)
Those potential investors were disappointed yesterday when Secretary of State for Energy and Climate Change Edward Davey told a parliamentary committee that the minimum rates for new nuclear and wind-powered electricity plants that sell into the public grid would be released in June 2013; previous rhetoric had indicated that the rates could be determined as early as this month.
Davy stated that the government wants to set minimum prices that are based solely “on the evidence of the costs,” requiring further study by the committee in question before rates can be agreed upon. Analysts are already at work predicting those minimums, with consensus resting at about $223 per megawatt hour (MWh) for new-to-market nuclear power plants, a level very similar to the current rate for offshore wind farms.
Environmental groups, in the meantime, are panning the government for not staying firm enough on original plans to decarbonize Britain’s energy sector — plans that many groups had hoped would eliminate nuclear power generation in the region within 20 years. (Read More: In the American West, Coal Power Being Dropped in Favor of Natural Gas and Renewables)
“My personal view is that there are attractions to decarbonization by 2030. I am not going to prejudge (the) outcome of discussions, but a lot of people in industry think this is a good idea,” Davey said in response to questions from committee members regarding that commitment yesterday, leaving his view on the matter open to interpretation.
The June 2013 release of minimum rates should be the last step in finalizing plans for the near-future of electricity generation in Britain.