Daily Archives: October 20, 2010

Sheila McNulty

Six months after BP’s Macondo well disaster, the deepwater drilling industry is still finding its way forward. While no other countries followed the US and imposed moratoriums on drilling in the deepwater, many, like the European Commission, are reviewing the process in their patch and wondering if they should tighten regulations.

PFC Energy, the consultancy, describes how countries have reacted to the accident in a new report:

George Osborne has come up with a £1bn a year toll, mainly on businesses, which is so complicated that some may not spot it straight away.

There is an existing scheme called the “CRC Energy Efficiency Scheme” which applies to about 5,000 heavy users of energy (mostly companies but also councils and government departments). At the moment those who cut their carbon use receive net payments out of the programme paid for by those who are penalised for their heavy use.

That “revenue recycling” is going to end. Prepare for an extra £715m cost on business in 2011/12, rising to over a billion pounds in 2014/15.

Should we expect a letter to Osborne from large companies complaining about this new burden?

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Kiran Stacey

The chancellor has stopped speaking and the figures are in. But did the experts to whom this blog spoke earlier get what they wanted? Here are their responses.

Kiran Stacey

George Osborne did not spend much time talking about the energy industry today, but the spending review contained some important new figures and policies. Here, then is the spending review – as far as it effects the energy industry – in numbers.

£1bn

The amount to be spent on the UK’s CCS demonstration.

£200m

To be spent on developing new green technology, including offshore wind and developing port infrastructure.

£1bn

To be spent on funding the green investment bank.

5%

Average yearly fall in the DECC budget.

8%

Average yearly fall in the Defra budget.

£860m

The amount being spent on the renewable heat incentive over the next four years.

9%

The fall in feed-in tariffs planned for 2012 – the same as planned by the previous government.

Kiran Stacey

The green investment bank was never likely to be scrapped entirely in today’s CSR, but George Osborne’s announcement that it will receive only £1bn will dismay many environmentalists. As Greenpeace wrote for this blog, they wanted to see the bank receive at least £6bn.

Even yesterday, it was being reported that the bank would receive £2bn, so this will come as a major disappointment for green campaigners*.

You can follow live coverage of the spending review here.

* Although I am told that the extra money that will be raised for the GIB from government asset sales could reach £1bn, so that would explain the £2bn figure.

Kiran Stacey

Eon has confirmed it is shelving its delayed plans to build a new coal energy plant at Kingsnorth.

The announcement means there will be no new coal plant as part of the CCS competition, the details of which will be announced by the chancellor today.

Kiran Stacey

It’s the big day. Finally we see what the UK government’s spending plans are going to look like over the next four years. But what will George Osborne’s announcement mean for the energy industry? We asked a group of experts, industry insiders and campaigners to give us their view on the main things they want to hear from the chancellor. Here’s what they said:

FT Energy Source

- Occidental ahead 29% in quarter – FT

- Iran warns British oil groups in refuelling row – The Telegraph

- Zambia accused of ignoring mine abuse – FT

- Oil heats up as bulls target $100-a-barrel price – FT

- TNK-BP bids for Iraq oil – The Times

- Exxon, Chevron, Shell may bid for Iraqi gas – Bloomberg

- BP turns down legal right to cap Macondo liabilities at $75m – The Telegraph

- Indian Oil plans record $4.3bn IPO – FT

- India mulls shale upstream licensing round – Argus

- Spending review will test chancellor’s green promises – The Guardian

- A cheaper route to solar cells – NY Times Green blog

- France’s cooling nuclear ambitions – FT

- US ethanol producers seek renewed tax breaks – Reuters

Energy Source is no longer updated but it remains open as an archive.

Insight into the financial, economic and policy aspects of energy and the environment.

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