nuclear

Toshiba's share price (top) is hit after the company's announcement on nuclear on Wednesday

Toshiba's share price (top) is hit after the company's announcement on nuclear on Wednesday   © Getty Images

Toshiba is just one company in the global nuclear industry, but its current problems are symptomatic of the difficulties facing all the private enterprises in the sector. Civil nuclear power involves huge up-front capital costs, very long pay-back periods and high risks that are compounded by a lack of experience, especially in managing nuclear construction projects after a long period with few new plants. For all those reasons, private investors avoid the sector and prefer to put their money where they see faster and safer returns.

If the UK, Japan and other governments want nuclear power, state money will have to be involved. So, from where we stand now, what can be done? Read more

Opponents of the Keystone XL pipeline protest in Washington against Donald Trump's executive orders

Opponents of the Keystone XL pipeline protest in Washington against Donald Trump's executive orders  © Getty Images

The US energy sector, or to be precise that part of the sector working on hydrocarbons, is celebrating the arrival of Donald Trump as president. Mr Trump and the Republican congress have started a bonfire of regulations and the president has promised to do what it takes to increase supply from a sector he says is worth $50tn.

The number may be a little flaky (after all, US gross domestic product last year was only $18tn) but the direction of travel is not. After eight years of tightening regulation and restrictions, those who want to develop new sources of coal, gas and oil now have Washington’s full support. The new commitment to fossil fuel development has been welcomed by the industry and by countries such as Saudi Arabia. The question is whether they will all be cheering so loudly when they start to see the full consequences of the new policy. Read more

China is restructuring its domestic coal industry

China is restructuring its domestic coal industry  © Getty Images

What are the implications of China’s announcement last week that it will be spending $360m over the next four years to build up its renewable energy sector? There are many reasons behind the move, from Beijing’s growing concern about the impact of climate change to the political imperative of reducing low level pollution in the smog-ridden cities. The scale of the investment, however, suggests that two closely related policy objectives are driving energy strategy: an effort to create a modernised economy that can provide employment for the Chinese workforce and a determination to limit dependence on imported supplies.

Two weeks ago, in looking ahead to the potential stories of 2017, I suggested that Beijing might set a target of energy independence by 2025. This provoked a range of responses. Some people told me that such a policy was unnecessary since the country can afford to pay whatever is necessary. Others did not believe anything close to self-sufficiency was attainable. Read more

Saudi Deputy Crown Prince Mohammed bin Salman

Saudi Deputy Crown Prince Mohammed bin Salman  © Getty Images

The downbeat mood of the times was confirmed before Christmas by the publication of the Bloomberg Pessimist’s Guide to 2017. The guide lists some of the things that could go badly wrong across the world in 2017. Last year the Guide predicted both Brexit and Donald Trump’s election as US president. This year the possibilities range from the collapse of the Mexican economy after Mr Trump pulls the US out of Nafta to the election of Marine Le Pen as the next president of France. Some of the predictions, such as California’s decision to declare independence from the US (Calexit), to the forced departure of the Saudi Deputy Crown Prince Mohammed bin Salman could be seen as ambivalent outcomes that many would welcome. Pessimism, however, has its limits and so here, are a few notes of hope for the New Year. As ever, I have focused on the core issues of energy but politics are never far away. Some of the possibilities listed seem to me highly likely to occur to one degree or another. Others are long shots – but then Donald Trump was a long shot a year ago. Read more

 

For most of those involved in the energy sector 2016 has been a year to forget. Oil prices have risen a little but despite the Opec deal are still almost 50 per cent down on where they were 2 years ago. Gas and coal prices are also down. Some US coal companies are in a desperate financial position – as are some of the smaller oil and gas businesses who do not have the deep pockets necessary to survive a downturn which is both cyclical and structural. Read more

With the UK government's green light for the Hinkley Point nuclear power project came the announcement of a new national security test for would-be investors in infrastructure

With the UK government's green light for the Hinkley Point nuclear power project came the announcement of a new national security test for would-be investors in infrastructure  © Getty Images

For most of the last half century, energy security has been defined in terms of Opec boycotts, the risk of the Strait of Hormuz being closed to oil tankers and the dangers of Russia cutting off gas supplies through the European pipeline network. In the last few years, however, much has changed. Now, energy security concerns are focused internally and the risks are concentrated around the networks that sustain complex modern economies. The networks are physical but they are controlled by electronic systems. The greatest threat on this updated analysis is that hostile forces – whether terrorists or state-sponsored cyber specialists – could penetrate and disrupt or destroy those systems. These fears are beginning to reshape public policy and that will affect how the energy business develops across the world. Read more

  © Getty Images

The buzz word of the moment in the energy business is “transition”. It provided the theme for the ONS conference and exhibition in Stavanger in Norway two weeks ago as well as the title for several recent consultancy studies.

Unsurprisingly, transition is the main concept in many of the corporate strategy reviews now being undertaken by some of the leading energy producers and utilities. The meaning of the word, however, is loose and variable. It is not even clear whether some of the big operators in the market understand the breadth of the transition that is already taking place and the extent to which it could reshape the prospects for their businesses.

The transition is normally discussed in terms of the move from hydrocarbons to lower or zero-carbon sources of energy supply. Driven by the fear of climate change and by the adoption of various public policies, the shift has been under way for two decades and more. The Paris conference at the end of last year provided new impetus, even if the end product fell somewhat short of a global deal backed by law and a carbon price. Different countries are moving at different speeds, and the result is a gradual shift in the energy mix, which now promises to be accelerated by advances in technology. Low carbon sources of supply are falling in price and some are within reach of the point where they can be competitive without subsidy. Read more

The French economy minister Emmanuel Macron visits the Civaux nuclear power plant operated by EDF, which is 85% owned by the state

The French economy minister Emmanuel Macron visits the Civaux nuclear power plant operated by EDF, which is 85 per cent owned by the state  © Getty Images

The saga of Hinkley Point goes on. The UK government is right to delay approval of a project in which it has lost confidence. The EDF board may have approved the deal to build a new nuclear power plant in Somerset, southwest England, but the obvious risks were such that the only prudent response is to pause and to reconsider all the options. The government must be right in wanting to avoid locking the UK into an expensive source of supply at a time when the costs of every alternative — including natural gas, solar and wind — are falling. In the post-Brexit world competitiveness is critical.

Theresa May, the prime minister, has also appreciated that approval of the project is now a UK bargaining chip in Britain’s relationship with the French. Cancelling the Hinkley project would destroy the thousands of jobs promised along the supply chain – most of which is located in France. The pressure is now on President François Hollande, who faces a very difficult re-election campaign next year, to force EDF to come up with a much better offer. Read more

The board of EDF meets in Paris on Thursday morning to discuss its long-planned investment in a new nuclear power station at Hinkley Point in Somerset, southwest England. There is speculation that the meeting will come to a definitive decision after years of delay. If the outcome is to go ahead, the French company has work to do in rebuilding trust. So what should investors and consumers be looking for ?

To begin with, it is important to put aside the fanciful idea that the announcement is simply a matter of French politics. Most of the jobs created by Hinkley will be in the supply chain in France and the argument is that President François Hollande needs to ensure that they are not put at risk before the presidential election next year. Read more

George Osborne visiting the Montrose Platform in the North Sea

George Osborne visiting the Montrose Platform in the North Sea  © Getty Images

At one level, the UK’s exit from the EU should have very little impact on the energy business. The price of oil, gas and coal is set by international markets not by the institutions in Brussels. The EU has never had the authority to determine the energy mix of individual member states and even under the latest plans for an “energy union” different countries would retain in full the ability to choose whether they want to develop shale gas or to eliminate nuclear power. Read more

George Osborne Visits North Sea oil in Scotland

George Osborne on the Montrose Platform in the North Sea  © Getty Images

On Wednesday, George Osborne will present the UK budget to the House of Commons. At a moment of deep uncertainty for the country’s energy industry — which is discouraging investment and creating quite unnecessary risks for the future. From the North Sea to Hinkley Point and shale there is confusion and doubt. Mr Osborne should come forward with a package of messages to restore confidence. Here are four obvious steps the chancellor should take.

First, the North Sea is now on the verge of a serious cutback in activity that will reduce energy supply and lead to lost jobs as well as much lower tax revenues. The hopes expressed in Sir Ian Wood’s report two years ago for an renaissance in the North Sea and the development of the billions of barrels of remaining resources will be lost. Read more

Executive Vice President in charge of fi

Thomas Piquemal  © Getty Images

Thomas Piquemal, the finance director of EDF has performed a significant public service by resigning and focusing attention on the continuing problems around the UK’s Hinkley Point nuclear project in Somerset.

I cannot remember the last occasion when the CFO of a major company resigned over an issue of policy. The event is certainly rare and can only increase the pressure on the French company’s chairman, Jean-Bernard Lévy.

There are multiple questions behind the resignation. Read more

The UK plan is uneconomic for owners and consumers, writes Nick Butler Read more

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Protests against the reopening of the Sendai nuclear plant  © Getty Images

Within the next few weeks the Japanese utility Kyushu Electric Power will restart its two nuclear power reactors at Sandei in the Kagoshima prefecture in the far south of the country. Fuel loading is set to begin July and the plants should be onstream again in August. After four years of crisis and much legal and political debate, the Japanese nuclear industry is finally on the way back. The implications for the rest of the energy sector in Asia and across the world are significant.

The two reactors at Sandei have been closed since 2011. From a nuclear fleet of 50 reactors capable of producing some 47 GW of electricity and supplying over 30 per cent of Japan’s daily electricity needs at the beginning of 2011, the sector’s output shrank to zero in the months following the Fukushima disaster. At Fukushima itself six reactors have been closed and are being decommissioned. The rest of Japan’s nuclear fleet stands cold and unused. Gradually, however, the negative mood of 2011 has abated. Now the operators of 24 different reactors across the country have applied for permission to reopen with the full and very active co-operation of the Japanese state and the powerful industrial lobbies such as the Kaidanren and the Keizai DoyukaiRead more

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  © Getty Images

“I am convinced that the nuclear industry has a future, that it is a strength of our country.” The fact that Manuel Valls, the prime minister, had to make such a statement in the National Assembly in Paris two weeks ago is a dramatic indication of the depths of the problems the nuclear sector in France is facing. Read more

  © Getty Images

The conflict at the heart of Germany’s energy policy is finally coming to a head. Can Germany claim to be an environmental leader while continuing to burn more coal than any other developed country apart from the US?

The issue is easier to describe than to resolve. Germany has led the EU in adopting “green” policies, including the promotion and subsidy of renewables. Energy consumers, including industry, have tolerated ever-rising energy costs. Electricity in Germany costs over 90 per cent more than in the US. The country has begun the process of closing its nuclear power stations — the last will be closed in 2022, although a vexed question remains over how the decommissioning will be paid for. Energy policy enjoys support across the political spectrum. The Green party won just 7.3 per cent of the vote in the last federal election but green ideas permeate the thinking of all the other parties. The grand coalition between the Christian Democrats and the Social Democrats is committed to reducing emissions by 40 per cent by 2020, 70 per cent by 2040 and 80 to 95 per cent by 2050. The whole plan is explained in a post by Mat Hope on the CarbonBrief website. The German approach is now being exported to Brussels with a determined effort under the new European Commission to shape an EU energy policy along the same lines. Read more

Saudi Arabia's newly appointed King Salman meets with US President Barack Obama

Saudi Arabia's newly appointed King Salman meets with US President Barack Obama  © SAUL LOEB/AFP/Getty Images

Having talked vaguely for many years about the possibility of developing nuclear power as an alternative source of energy, it seems that Saudi Arabia under its new leadership may finally be taking steps towards what would be one of the world’s largest nuclear building programmes over the next decade. Read more

A number of well-sourced reports over the past two days suggest that, as predicted, we are on the edge of a deal for the construction of new nuclear power stations in the UK.

The champagne corks however are not quite popping either in Whitehall or in Paris. Read more

For some years I used to bet on the end year oil price with Ed Crooks. He usually won.

I thought for 2013 a wider challenge would be a better test for FT readers.

So here are six questions: Read more

Government plays at panto with energy policy. Getty Images

And so the UK energy policy saga continues. Recently it was all wind and decarbonisation. Now it is about gas and shale.

Each step is presented as the answer – definitive and final – but behind that rhetoric is the slippery suggestion of another review of the policy in 2016, which makes everything decidedly temporary.

In the Department of Energy and Climate Change itself, pantomime season has come early this year. Jack and the Wind Turbines will be performed by an all-star cast. Young Greg, played by Kenneth Williams, and followed everywhere by a small dog, goes around planting windmills – “look behind you, there’s another”. He is followed around by the Rev. John, played by Ronnie Barker, proclaiming wind to be wicked, contrary to the word of the Lord and trying to pull them down. Led, if that is the word, by Mr Davey, an eternally optimistic but increasingly emotional character, caught beautifully by Tony Hancock, our heroes wander around looking for an energy policy on which they can agree. Read more