Renew On Line (UK) 48
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12. Nuclear News
De-nuke the EU - a way to go still
Not content with adopting a national
nuclear phase out programme (the first plant
closed recently), the German red-green government has decreed
’s White paper on Energy last year, this stressed renewables and CHP, but it also suggested that new nuclear plants should not be ruled out. See www.debat-energie.gouv.fr
In the event neither of these things happened. As noted in Renew 147, BE’s financial crisis was at least temporarily postponed by getting creditors and investors to accept some losses, and by the governments agreement to provide £3.9bn to help with clean-up costs. However the deal will leave equity shareholders with only 2.5% of the new company. Even Railtrack’s investors did better than that. Basically, under the new deal, they have been abandoned. For their part, the major creditors have agreed to swap most of their debts, of over £1bn, for new bonds- and 97.5% of the equity, while the government will take on £3.9bn of BE’s nuclear liabilities, in return for 65% of the companies cashflow.
Although the deal had not been agreed by the EU under the state aid rules, British Energy’s shares edged up slightly to 5.38p- but that has to be compared to their peak value of 730p in 1999. The current value of the company is put at £33 m, compared to £5 bn at its peak. It remains hopeful that things may improve. They could hardly get worse. It reported unaudited operating losses of £40m between April and the end of August 2003, but said that this was because its precarious financial position had forced it to sell 90% of its electricity at uncompetitive prices, with average price of £15.50 per megawatt hour, compared with the market rate of £19.70 per MWh. Part of the problem is that electricity prices have been pushed down by NETA. But whatever the reason, BE can hardly expect to carry on for long losing over £4 on each megawatt it sells and relying on government support- the direct cost of which will, according to the DTI, be £150- £200 m p.a. for the next 10 years,‘falling thereafter’. In the event, with further losses due to problems with Sizewell and Heysham, the government has actually expanded the £200m loan it had agreed to provide for the current year to £275m.
Longer term, even more desperate measures may be needed to keep the company afloat. For example, at one stage, there were evidently plans (FT 22/9/03) to seek to extend the allowed operational life of the companies 8 plants by at least five years, thus providing continued income and deferring the cost of decomissioning. Otherwise the closure programme was set to start in 2008, with all but one (the Sizewell B PWR) due to shut by 2023. Mike Alexander, BE chief executive, told the FT ‘if we achieve all the things we want to, and can make the safety case, we will be able to put forward a case to extend the lives of the plants.’
Time was when the
4S Micro Nuclear
The nuclear industry may be facing difficulties in Europe (see above) but around the world it is still looking for market niches. Japanese corporation Toshiba is developing a very small 10MW liquid sodium cooled nuclear plant design which it wants to test in Alaska in the community of Galena on the Yukon River. According to the Anchorage Daily News (Oct 21, 2003) the developers claim that the technology is ‘safe, simple and cheap enough to replace diesel-fired generators as the primary energy source for villages across rural Alaska’. They add it would also have enough excess power to create hydrogen gas, and envision Galena as a demonstration center for a local hydrogen economy, to power cars and trucks. However, a working reactor is still 6-8 years away and development costs are put at $600m, although, once mass produced individual plants might cost $20m.
Toshiba calls its reactor the 4S
system: super-safe, small and simple. The core would be built and sealed
in a factory and transported by barge, truck or helicopter. It would
then run for 30 years, without the need for an operator, and then be
disposed off (but where?). However, as the Anchorage Daily News noted
‘a reactor of this type and size has never been built anywhere in
the world, much less tested and licensed for use in the
So could public opposition- it would be the first commercial use of nuclear power in Alaska. While some environmental groups are keen to replace expensive diesel fuel (Galena uses 700,000 gallons annually to generate electricity) others worry about accidents and leaks. But a US Federal study, published in May 2001, found that micro nukes could be inherently safe and easy to operate, resistant to sabotage or theft, cost effective and transportable.
For more new nuclear ideas, see the Technology section in Renew 148.