ISSUE FIVE - OCTOBER 2016
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Technavio analysts forecast the global combined cycle gas turbine market to grow by 4% -page 28 DIESELGATE 1ST ANNIVERSARY: ALL DIESEL CAR BRANDS IN EUROPE ARE EVEN MORE POLLUTING THAN VOLKSWAGEN - Page 31 Scotland Gets Low-Carbon Cosy Page 16
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EDITOR'S NOTE Welcome to the fifth edition of Global Energy News, which sheds light on the latest deals, appointments, research and breaking news in the global energy sector. As Dieselgate turned one-year old recently, a new study by Transport & Environment (T&E) reveals that Volkswagen is currently selling the least polluting (Euro 6) diesel vehicles. Nonetheless, the marque caught cheating in the US also has the most grossly polluting Euro 5 vehicles on the road, which were sold between 2011 and 2015. The better performance of Volkswagen Euro 6 cars has nothing to do with the Dieselgate, but with better technology choices made before the scandal burst. The report Dieselgate: Who? What? How? also found that not one single brand complies with the latest air pollution limits (‘Euro 6’) for diesel cars and vans in real-world driving. In other news, cities have more power to secure their own cleaner energy supply than they realise a new study by Arup, released at the recent 23rd World Energy Congress, shows. Growing cities, already accounting for over 50% of global energy consumption, can no longer afford to rely on a centralised energy supply and will need to take greater control to meet growing demand. The European Bank for Reconstruction and Development (EBRD) and the European Union (EU) are stepping up their support to build a sustainable, green economy in the Kyrgyz Republic. The Bank is extending a loan equivalent to US$3 million in local currency to KICB, a leading bank in the country, to finance energy savings for businesses and residential homeowners under the Kyrgyz Sustainable Energy Financing Facility (KyrSEFF). I hope you enjoy reading this thoughtprovoking edition.
CONTENTS 4-11. NEWS
RENEWABLE ENERGY 12.
MERRILL FARMS PARTNERS WITH ALTA ENERGY TO HARVEST SOLAR
14.
NEW DATA SHOWS EXTENT OF EXISTING ENERGY STORAGE DEPLOYMENT AND PLANNED PROJECTS IN THE UK
16.
SCOTLAND GETS LOW-CARBON COSY
OIL & GAS 18.
REPORT HIGHLIGHTS IMPROVED COMPETITIVENESS OF UK OIL AND GAS INDUSTRY BUT FRESH INVESTMENT IS NOW VITAL
20-21. OIL: A NEW FRAMEWORK? 22.
UNDERGROUND COAL GASIFICATION BLOCKED
ENERGY EFFICIENCY 24-25. TOP FOUR DRIVERS PROMOTING GROWTH FOR THE COMBINED CYCLE GAS TURBINE MARKET UNTIL 2020, REPORTS TECHNAVIO 26.
EBRD AND EU BOOST FINANCE FOR ENERGY EFFICIENCY IN KYRGYZ REPUBLIC
28-29. GLOBAL UNMANNED AERIAL VEHICLE (UAV) BATTERY MARKET TO GROW AT A CAGR OF OVER 10% THROUGH 2020, REPORTS TECHNAVIO INFRASTRUCTURE & TECHNOLOGY 30.
ACTION ON FUEL POVERTY
31.
DIESELGATE 1ST ANNIVERSARY: ALL DIESEL CAR BRANDS IN EUROPE ARE EVEN MORE POLLUTING THAN VOLKSWAGEN – STUDY
32.
LITHUANIA'S IGNALINA NUCLEAR POWER PLANT PASSES DECOMMISSIONING MILESTON
NEWS
City Leaders Must Take Control of Own Energy Future Cities have more power to secure their own cleaner energy supply than they realise a new study by Arup, released at the recent 23rd World Energy Congress, shows. Growing cities, already accounting for over 50% of global energy consumption, can no longer afford to rely on a centralised energy supply and will need to take greater control to meet growing demand
The Arup ‘Innovating Urban Energy’ perspective paper provides insight for the World Energy Council Scenarios Report and shows that new technologies, innovative financing mechanisms and political changes are opening up opportunities for cities to secure their own energy. Technology drivers, such as advanced power electronics, smart metering and local generation, are allowing cities to diversify their energy portfolio.
contributors in the future. At the same time the study points to the growing role of civic leaders in climate change action, indicating that cities are increasingly willing to enter a sphere traditionally reserved for national governments. The report shows that civic leaders can succeed without national policies in place, highlighting that many will have the mandate to act even when central government does not.
Transactive energy is highlighted as an approach to change the way energy is bought and sold. This combines economic and control mechanisms to enable a dynamic balance of supply and demand using value created as a key operational parameter. It is allowing cities to develop lower cost, more stable networks capable of handling a much greater share of renewable sources.
A renewed interest in municipal energy companies in Germany, for example, is cited as evidence of the growing confidence of local authorities looking to secure their own cleaner energy supply. New financial products – such as green bonds and crowd funding – are also opening up new sources for cities to fund their own energy initiatives.
This particularly applies to electricity, but the report identifies that account needs to be taken of the other energy vectors. Many cities have existing energy and transport infrastructure that need integrated planning. Not all energy can sensibly arrive as electricity from renewable sources so other vectors such as district heating and hydrogen gas networks have a role to play in this integrated planning.
The report also highlights growing recognition of the relationship between urban planning and energy efficiency. Rapidly growing cities in Asia and Africa are urged to look to spatial planning to help reduce energy usage. “City leaders are increasingly understanding that if they are to continue to grow and to improve the lives of their citizens, they will need to play a more active role in securing their own stable and low emissions energy supply. It is an exciting time because there are big technological and political shifts that are giving cities the opportunity to take control. And, increasingly, for businesses there is an opportunity to become energy prosumers; producing their own energy and even supplying.
Crucially these technology developments are blurring the line between producers, distributers and consumers by allowing nontraditional energy players, such as technology companies, to enter the market. Corporates are increasingly looking for opportunities to become power producers in the new urban energy rush and could become significant
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NEWS
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NEWS
Lanes Proves It Has the Power to Support Energy Industry Drainage engineers from Lanes Group are proving they have the power to support one of the UK's fastest growing industrial sectors - renewable energy. The company's vacuumation and water jetting technology is proving to be suited for cleaning pipes and tanks in a range of different renewable energy plants in the industrial and farming sectors
Lanes drainage expertise has been used to support companies developing and running sustainable energy plants in Plymouth, Newcastle, Glasgow, Sheffield and North Wales. The Lanes Plymouth depot provides industry pipe cleaning services for MVV Environment Devonport Ltd, which operates one of the most advanced energy-from-waste plants in the UK.
energy plants to confirm cleaning has been thorough and the equipment is in good repair. Lanes Plymouth Depot area development manager Grant Cooper said: "The capabilities of our technology transfer very well from the water industry to renewable energy. "Also, our growing number of energy clients value the experience we already have of working in a regulated industry, and the very high priority we place on occupational health and safety."
The combined heat and power plant, at North Yard, Devonport, burns 254,000 tonnes of residual household, commercial and industrial waste a year. Lanes' electro-mechanical pipe cleaning equipment has proved ideal for cleaning inert filtration media that builds up in pipework during the incineration process.
In recent months, Lanes drainage engineers have carried out work at biomass energy plants in Glasgow and Sheffield. Services delivered have included cleaning and patch lining of pipes. Patch lining is a no-dig technique that involves repairing cracked pipes or faulty pipe joints by inserting a resin-impregnated sleeve inside the pipe to create tough new pipe within a pipe.
The Plymouth depot is also regularly commissioned by industrial cleaning specialists New Wave Marine to use its jetting and vacuumation technology to clean pipes and tanks at a growing number of anaerobic digestion plants. These units use microorganisms to break down organic waste, including food and agricultural waste, generating bio-methane, which is very similar to natural gas, and carbon dioxide which can be used in industrial processes.
Grant Cooper said: "Energy production, like wastewater management, is very often a continuous process. So remote surveying and repair systems, like the ones developed by Lanes, are essential to ensure maintenance work can be done quickly and safely, while causing least disruption to the energy generation process."
Lanes jet vac tankers and van pack units, which have water jetting systems, are used to carry out the pipe and tank cleaning work. The company's CCTV drainage survey camera systems are also used to inspect pipework in
Web Address: lanesfordrains.co.uk
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NEWS
Innogy Renewables UK Ltd Has Chosen the Met Office's New VisualEyes™ Software Innogy Renewables UK Ltd has chosen the Met Office's new VisualEyes™ software to provide weather forecast information for multiple sites across the UK. Under the new contract the Met Office's recently-enhanced VisualEyes™ product will be used to provide one of the UK's leading renewable energy companies with forecasts which will help keep on-site personnel safe and plan the most cost-efficient maintenance schedules, eliminating avoidable weather delays
VisualEyes™ is an intuitive web-based weather monitoring and alerting system which will enable Innogy Renewables UK Ltd (formerly RWE Innogy) to monitor both current and forecast weather conditions across 36 of its sites across the UK including onshore wind and hydro sites and one offshore wind site. Innogy Renewables UK Ltd will use VisualEyes™ both in their Wind Control Centre in Swindon where it is displayed 24/7 to help with remote site monitoring and maintenance planning, and on-site, helping to protect engineering staff from potentially hazardous weather such as lightning strikes and wind gusts.
Patrick Sachon, Head of Energy at the Met Office added: "We are delighted Innogy Renewables UK Ltd has chosen our upgraded VisualEyes™ product. It has been developed in conjunction with customers in the energy industry such as Innogy Renewables UK Ltd, and gives safety-critical weather information, allowing engineering managers and site personnel to stay informed and make crucial on-the-ground decisions wherever they are." In addition, the Met Office is attending WindEnergy Hamburg later this month where there will be live demonstrations of the upgraded VisualEyes™ product.
VisualEyes™ is accessible on smartphones and tablets giving field-based personnel the latest guidance on impending weather conditions and advance warnings of any possible safety risks. Adam Oxley, UK wind control centre manager from Innogy Renewables UK Ltd commented: "We have worked really closely with the Met Office throughout the development of the upgraded VisualEyesTM system. The new design is impressive and some of the added features such as 'SmartWindows' and the improved map layer animations have become essential tools when planning our operations and maintenance. We look forward to continue working closely with the Met Office in the future".
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NEWS
Northern Ireland's Infrastructure Minister Announces Planning Review on Renewable Energy Northern Ireland’s Infrastructure Minister Chris Hazzard in late September announced a review of planning policies on renewable energy and countryside development
The review will be informed by external consultants who can provide specialist research and advice in relation to the rapidly changing technologies and types of renewable energy development and their impacts, including wind turbines and solar farms, and recommend the best policy approach going forward. It is expected to be completed in 2018. Speaking as he announced the review, Infrastructure Minister Chris Hazzard said: “As Minister with responsibility for planning I want to continue to improve our planning system and to make sure that it is effective and efficient and that it operates in the wider public interest. The Strategic Planning Policy Statement (SPPS) is a key component of the planning system and it is vital to ensure that current policy is sufficiently robust and appropriate for communities across the North. “The recent responses to the calls for evidence provided a useful insight into the operation and impact of the existing SPPS policies and endorsed the need for review. My officials are now progressing this work. “I am committed to ensuring that the SPPS delivers for local communities and the North as a whole and that the planning system addresses the present as well as the long term future needs of our society. There will be opportunities for stakeholder engagement and public consultation next year and I would encourage people to give their views. Any future changes to the policy would be subject to public consultation.”
The current policies are set out in the Strategic Planning Policy Statement available at: planningni.gov.uk/spps
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NEWS
Rainer Zietlow Smashes Another World Record in Exide-Powered Vehicle Exide-sponsored driver Rainer Zietlow has recorded a new Eurasian world record. The 15,145km journey started in Magadan in east Russia and ended in Lisbon on the western tip of continental Europe. Zietlow completed the journey in a time of 6 days, 9 hours and 38 minutes, smashing the previous record by more than 2 days. The Volkswagen Touareg V6 TDI was powered by an Exide Start-Stop AGM battery from Exide Technologies, a leading global provider of stored electrical energy solutions
The journey started on the Road of Bones, the bumpy gravelled terrain that runs through far east Russia. After six days on the road, the team entered Lisbon just before sunrise. They headed straight to the police station to have their official arrival document signed and stamped, certifying the world record.
Exide will show its latest innovations at Automechanika Frankfurt 2016, taking place on 13-17 September. Exide will be in Hall 4.1 Stand D47 and will present its full selection of batteries, including its latest motorbike range and new commercial vehicle battery. Zietlow will do a ‘meet and greet' with visitors every day, 2pm, at Exide's stand.
The Touareg was fitted with a highperformance Exide Start-Stop AGM battery, ideal for vehicles with power hungry electrical equipment. Exide is a pioneer in automotive start-stop AGM technology, and one of the few start-stop OE suppliers in Europe. As an original-equipment manufacturer, Exide's batteries are designed to meet the demanding requirements of carmakers. Its manufacturing facilities undergo regular audits to ensure they operate to the meticulous standards expected by its customers.
"Exide is an excellent partner, and has an unparalleled reputation for making highperformance, reliable batteries," said Rainer Zietlow. "Exide Start-Stop AGM was perfectly suited to such a demanding journey, with excellent charge acceptance, four times the cycle life and 20% more power than a standard battery."
Rainer Zietlow has completed some of the most ambitious journeys ever attempted, always with Exide on board. He has multiple long distance world records, including the ‘Panamericana’ from Argentina to Alaska, the ‘Russtralia’ from Melbourne to St. Petersburg, and the ‘Cape to Cap’" from Nordkapp in Norway to Cape Agulhas in South Africa. Zietlow is a strong supporter of the SOS Children's Villages organisation, which provides homes to orphaned and abandoned children.
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NEWS
Vancouver Energy Is 'All in' on Public Safety – Proposes Performance-Based Throughput Vancouver Energy is offering significant changes including staking its proposed Port of Vancouver USA facility throughput growth on safety performance of the terminal and its rail and marine partners
“We heard the concerns about safety and environmental protection raised through the Energy Facility Site Evaluation Council (EFSEC) process. We are proposing being judged by our actual performance. We offered to begin operations at 50 percent of the optimal throughput, and significantly, only allowing this throughput to increase after demonstrating the facility operates safely,” said Vancouver energy general manager Jared Larrabee.
to the original proposed amount, subject to public safety or environmental performance. Vancouver Energy will bring North American crude oil to refineries in Washington and the West Coast, which is critical to American energy independence. The state’s manufacturing, consumer goods, trade, agriculture and aerospace industries will not be able to function without abundant petroleum fuels at a reasonable cost.
Vancouver Energy made a number of substantial commitments, above and beyond regulatory requirements, to help enhance safety and improve the performance of the crude-by-rail terminal. These commitments were included in an updated application submitted to EFSEC on October 6, 2016. Measures include a marine tug escort for all loaded vessels from the terminal, rail cars meeting or exceeding DOT-117 standards, commitments to supply Washington state refiners, supporting the Department of Ecology to apply the barrel tax to crudeby-rail terminals, financial assurances, and emergency response training exercises for area responders. A full list of the new safety measures announced by Vancouver Energy is provided on Vancouver Energy’s website.
Vancouver Energy is a joint venture between Tesoro Refining & Marketing Company LLC and Savage Companies. The proposed Vancouver Energy terminal will serve a basic and important function: the safe transfer of North American crude oil from rail to ship. The project has the potential to displace up to 30 percent of the crude oil currently imported from foreign countries for use on the West Coast and to further our efforts toward energy security and independence.
For more information, visit: vancouverenergyusa.com
“Our revised application and related mitigations demonstrate our commitment to safety and environmental performance, not only at the terminal, but also along the rail and marine routes to and from the facility,” said Larrabee. “We are confident we will operate the terminal safely and responsibly before moving to a higher throughput level to serve the energy needs of the state and region.” Under the revised application, the terminal’s throughput could increase over two periods
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NEWS
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RENEWABLE ENERGY
MERRILL FARMS PARTNERS WITH ALTA ENERGY TO HARVEST SOLAR
Alta Energy, a renewable energy solutions provider, announced on October 6th the deployment of solar energy for Merrill Farms, a fourth-generation Salinas, California vegetable and berry grower. The solar projects will generate approximately $60,000 per acre of revenue annually and gross energy savings of approximately $12 million over 25 years
In addition, 505 metric tons of carbon dioxide (CO2) will be eliminated each year – which is equivalent to the annual CO2 emissions of 53 homes or taking 8 diesel freight trucks off the road each year. Alta Energy worked with Merrill Farms to site the solar systems on mostly unproductive areas of two ranches in order to preserve as much fertile acreage for crop production as possible.
operational benefits and simultaneously become more sustainable. With the high electricity rates paid by California farmers, the lower cost of solar, incentives and favourable policies, solar is ripe for California agriculture.” These solar projects are among the first installations in the Salinas Valley region of California. The region is known as the “Salad Bowl of the World,” as it is one of the largest and most productive agricultural areas.
The combined size of the solar systems at Merrill Farms will be 1.6 megawatts and will offset nearly 80 percent of the electricity consumption on two large growing sites. The systems will utilise just six acres of farmland, most of which is unproductive, at these ranches.
“Given all of the business uncertainties our members face – especially concerning labour and water – solar energy can offer an opportunity to provide certainty and savings with respect to energy,” commented Jim Bogart, president of Grower-Shipper Association of Central California, one of the leading agricultural associations in the United States. “Considering the potential financial and marketing advantages, it makes sense for commercial farmers to explore adopting solar, as it may benefit their growing and processing operations.”
“My family has been stewards of the land since 1933,” said Ross Merrill, CEO of Merrill Farms. “We intend to continue this tradition using best practices and new technologies. When I sat down with the Alta Energy team, they analysed 13 of our growing operations and facilities, went through their financial analysis of our solar potential and identified the optimal sites. After this analysis, I saw clearly that solar was a ‘no brainer’ for our growing operations. Alta Energy cut through the complexity of all the variables in a solar project, showed us various trade-offs and options, explained ways to complete the projects efficiently and profitably, and expedited the deployment process.”
There is another major incentive for growers to go solar: their customers. “More and more of our customers expect us to incorporate sustainability into our operations,” Ross Merrill noted. “We believe supply chain transparency is a trend that will only accelerate and sustainability will likely become more important to both our customers and the produce consumer. As a grower, we are trying to do as much as we can. Solar works for us.”
Merrill Farms gained further financial benefits by utilising the 30 percent federal Income Tax Credit and accelerated depreciation, and choosing a financing structure that required virtually no money down and a loan that will be paid off by the energy savings.
Web Address: merrillfarms.com
“Solar is an economic and environmental boon for California agriculture,” said Alta Energy CEO Sam Lee. “Growers, processors and shippers can save money, utilise less-productive farmland, reap
Web Address: altaenergyinc.com
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RENEWABLE ENERGY
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RENEWABLE ENERGY
NEW DATA SHOWS EXTENT OF EXISTING ENERGY STORAGE DEPLOYMENT AND PLANNED PROJECTS IN THE UK
New data released by the renewable energy industry in a report on 4th October reveals the extent of energy storage deployment and the industry’s future growth in the United Kingdom. There are 35 standalone grid-connected projects operating as of August 2016, spanning technologies from lithiumion batteries (such as those used in mobile phones or electric vehicles) to pumped hydro systems (where water is stored in a reservoir and released through turbines when electricity demand peaks)
At least 1,500 smaller, residential-scale projects are also recorded. The cumulative electricity storage capacity operating in the UK as of August 2016 is 3.23 GW. At least 453 MW of energy storage capacity has been announced as under construction or being commissioned, in addition to the 200 MW of “enhanced frequency response” storage that was contracted by the National Grid in September.
that will have a significant role in the UK’s future energy system, allowing for an increased role for renewables, more flexibility, and greater decentralisation. James Court, head of policy & external affairs at the Renewable Energy Association said: “Storage is already a reality for the UK and right now there’s an opportunity to cement us as a global centre for investment, deployment, and research. Many technologies have advanced quickly and are now commercial, as such the storage industry is not seeking a direct subsidy.
Analysts who work in association with the industry point to the 1.2 GW of extra capacity that bid into the ‘Enhanced Frequency Response’ auction but did not win a contact as a clear indication that the storage industry has matured quickly and is ready to deliver. These extra projects will have demonstrated that they are ready to deploy and will have secured planning permission and grid connection capacity. Anecdotal reports also indicate that there has now been double-digit GW worth of applications for storage to the distribution network, but this will not all be built out and may not have planning and grid permission. To unlock this potential market improvement to the policy framework are required, which the REA highlight in their report. The Renewable Energy Association (REA)’s second edition of the report Energy Storage in the UK – An Overview is presently the authoritative database of energy storage projects in the UK. The REA’s energy storage sector group brings together over 100 companies operating in the UK’s energy storage supply chain.
“Storage is a critical technology for the decentralisation of the UK’s energy system and will support long-term renewables deployment. Policy is the single greatest barrier to the industry’s growth and reform is needed. We welcome the supportive comments made by Secretary of State Greg Clark at the Conservative Party Conference and look forward to seeing what actions he will take to support the industry’s growth.” Frank Gordon, senior policy analyst at the Renewable Energy Association added: “Energy storage has great potential in the UK, and can unlock billions worth of savings according to the Government’s advisers. Our research indicates that there are multiple gigawatts of capacity that are being proposed or are ready to be developed, but a joined-up and supportive policy structure is critically needed. “We need more action to unlock the opportunities and the Government’s awaited Call for Evidence should address crucial issues such as a definition for energy storage in legislation or the grid codes. We are also seeking an end to double charging of grid fees and
Energy storage is widely recognised as a technology
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consistent treatment when connecting to the grid, changes we have been calling for since our first Energy Storage Overview report in 2015.� Web Address: r-e-a.net
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RENEWABLE ENERGY
SCOTLAND GETS LOW-CARBON COSY
More Scottish homes and businesses are seeing the benefit of renewable heat, according to new figures. New figures published on 7th October by the Energy Saving Trust, on behalf of the Scottish Government, estimate that last year saw the largest annual increase in renewable heat output since measurement began in 2008 – up by over 1,100 GWh in a single year
In 2015, the proportion of non-electrical heat demand generated in Scotland from renewable sources is expected to be at least 5.3%, up from 3.8% in 2014 and a continuation of year-on-year increases since 2008/2009.The majority of the increase in output has come from large commercial sites installing biomass and combined heat and power systems and from installations supported by the non-domestic Renewable Heat Incentive.
output of renewable heat we need to do more. So, these figures also highlight there is much more work to do to reduce demand, supply heat more efficiently and increase the role renewable heat plays in Scotland’s energy mix. That’s why we continue to develop new and existing avenues of support in this important area and this will be reflected in our forthcoming Energy Strategy.”
However, renewable heat capacity in homes, including small-scale biomass as well as other increasingly popular technologies such as heat pumps, has also risen – with capacity growing by a very impressive 44% between 2014 and 2015.
The report by the Energy Saving Trust, “Renewable Heat in Scotland, 2015” was published on 7 October, and it is available at the following link http:// www.energysavingtrust.org.uk/sites/default/files/ reports/161006_Renewable%20Heat%20in%20 Scotland%202015_FINAL.pdf
Minister for Business, Innovation and Energy, Paul Wheelhouse, said: “With Autumn well underway, and the weather getting noticeably cooler, families and businesses across Scotland will, no doubt, be considering turning on their heating for the cooler weather ahead. “Heat makes up more than 50% of Scotland’s current energy consumption and approximately 47% of our emissions - the largest source for both.
Background
Key points on Renewable Heat for 2015 • •
“That is why these record-breaking figures are so encouraging. They show that programmes such as the District Heating Loan Scheme, the Low Carbon Infrastructure Transition Programme and the Home Energy Scotland renewables loans scheme are inspiring people to harness renewable energy to heat their homes and their businesses. These and our other programmes support the uptake of the GB wide Renewable Heat Incentive scheme, in which Scotland continues to punch above its weight.
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“That is not to say we should be in any way complacent. We have a target of 11% of non-electrical heat demand from renewable sources by 2020 and while these figures show we are making great progress in both reducing our demand for heat and increasing the
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2015 has seen the largest increase in renewable heat output since measurement began in 2008-09.
In 2015 Scotland generated an estimated 5.3 – 5.6% of its non-electrical heat demand from renewable sources. This is based on 3 possible heat demand scenarios, explained in more detail in Energy Saving Trust’s report.
In 2015 there was an estimated 1.504 GW of renewable heat capacity in operation in Scotland, (up 47% from 2014), producing an estimated 4,165 GWh of useful renewable heat in the 2015 calendar year, an increase of 37% from 2014. The majority of the increase came from large scale commercial sites supported by the RHI (total capacity of large installations increased by 45% between 2014 and 2015, while output increased by 27%). Scotland continues to do well from the RHI both for domestic and non-domestic installations, accounting for around 20% and 19% respectively of all accredited installations. Micro heat capacity also increased by 44% between 2014 and 2015.
Web Address: gov.scot
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RENEWABLE ENERGY
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OIL & GAS
REPORT HIGHLIGHTS IMPROVED COMPETITIVENESS OF UK OIL AND GAS INDUSTRY BUT FRESH INVESTMENT IS NOW VITAL
Oil & Gas UK’s Economic Report 2016 published on 27th September demonstrates the tenacity of the UK offshore oil and gas industry despite difficult market conditions
leading capability from front end exploration to late life operations.”
Few industries could have achieved the performance improvements the UK’s oil and gas industry has demonstrated over the last 18 months. Its determination has seen the cost of extracting a barrel of oil or gas from the UK Continental Shelf (UKCS) cut to nearly half its cost since 2014 and a 10 per cent increase in production.
Industry will continue to build on the achievements to date of cost reduction and efficiency improvement and will require the efforts of governments, HM Treasury, the Oil and Gas Authority and the Department of Business Energy and Industrial Strategy to continue. Oil & Gas UK is making three asks:
Despite this good news, major challenges remain. The supply chain has seen an average 30 per cent fall in revenues since 2014 and ongoing job losses – some 120,000 are expected to have been lost over the past two years – are the personal cost to individuals and families across the UK. Deirdre Michie, Oil & Gas UK’s chief executive, said: “The UKCS is in urgent need of fresh investment to boost exploration and drive activity, particularly for the supply chain. Exploration has fallen to record lows and little new investment has been approved in 2016 and 2017 looks no better. Increased asset trading is one area that could free up new investment by facilitating the trading of late-life assets. “In light of this I am calling on governments to vigorously champion the UK’s oil and gas industry, by providing certainty in our fiscal regime, encouraging new entrants to the market and recognising our supply chain as vitally important to the economy. “The evidence in the report demonstrates what our industry can achieve when the basin’s competitiveness is addressed and the tax regime reformed. Now it is time for the UK and Scottish Governments to reinforce their efforts to promote the UKCS, nationally and internationally, as an attractive investment with world
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The UK Government to re-affirm their continued commitment to the ‘Driving Investment’ fiscal strategy which recognises the need for a more competitive, simple and predictable fiscal regime as the basin continues to mature.
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HM Treasury to complete the constructive work on decommissioning tax relief over recent budgets by introducing measures to enable tax relief to be transferred upon an asset sale to facilitate the trading of assets, encouraging new entrants to the market and liberating new investment for buyers and sellers alike.
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The UK and Scottish Governments to promote the increasing competitiveness of the basin as well as the capability of the UK’s oil and gas supply chain, both nationally and internationally, as part of the UK’s new industrial strategy, recognising the sector as a key element of the economy.
Web Address: oilandgasuk.co.uk
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OIL & GAS
OIL: A NEW FRAMEWORK?
The recent unexpected announcement by OPEC on a framework designed to limit crude output has substantially changed the market dynamics in the short term for the price of oil. What was previously an uncertain environment, with no OPEC guidance, has now changed to offering a glimpse of price stability amidst a more orderly background. Ultimately the recent commitment will be put to the test when it comes to defining a binding agreement ahead of the next official meeting at the end of November
This move by OPEC represents a change in the approach that previously favoured targeting market share at the expense of the oil price and total revenue. A combination of factors, including the prolonged rebound from January low for WTI futures of $26.55, has led to greater confidence by OPEC in its ability to manage the oil price. However, there remain a number of challenges to making the recent intentions produce credible results.
the direction and intention that has been signalled to the market. This places even more emphasis on the conclusion of a firm agreement at the next scheduled OPEC meeting in Vienna on the 30 November, which will therefore set the scene for OPEC’s supply schedule for the winter.
As recently as August, OPEC had been producing at 33.69 mb/d, which represents record rates compared to the past five years.). In this context it is easy to see how
In the meantime, the oil price has reacted positively to the news with front month WTI futures recently trading at $48.24, and increase of 7.9% for the month. Brent has also risen to $49.06, a rise of 4.3% on the month. (Source: Bloomberg). Over the past three months, oil has been relatively flat with WTI declining by 0.2% and
Source: Bloomberg, OPEC OPEC is positioning the new proposal of a reduction to between 32.5mb/d to 33mb/d as a strategic shift. At the lower bound this would represent a modest decrease of 3.5% in OPEC’s supply of crude, but it is not the magnitude of the decrease that is important, more
Brent by 1.2%. Although, realised sixty-day volatility has remained high at close to 40%. This is relatively subdued compared to the particularly elevated levels of around 70% in March. Whilst news of the shift in OPEC’s stance has laid the foundation for potentially
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OIL & GAS
greater price stability compared to the market turmoil when oil was trading below $30 per barrel in January, there remains a lot of uncertainty. Specifically, nonOPEC producers such as Russia may have less of a desire to manage output given domestic economic and budgetary constraints. As prices rise there is also the potential for increased US shale production that may also impact the supply equation. In addition, there is a significant risk, that even after two years of talks, the cartel may yet fail to reach a definitive agreement. Over the past two years Boost Oil ETCs covering European trading in short and leveraged products have risen dramatically to reach a market leading position. Whilst in 2015, Boost short and leveraged Oil ETCs had a market share in Europe of 54%, the current year has seen this increase to close to 66%. In fact, during the period of highest traded volumes, which was May and June, Boost’s market share was above 70%. So far, on a year to date basis Boost Oil ETCs, have traded over $6.5bn on exchange and have also seen primary market activity of $2.3bn. These high traded volumes, on both secondary and primary market show the efficiency of the short and leveraged products and helps explain the efficiency that they offer when tactical positions with respect to the oil price. The lower volatility in oil may well be beneficial in the context of broader commodities, where in some indices, such as the Bloomberg Commodity Index, energy represents close to 33% of the index. A more stable commodity pricing environment, led by oil, is likely to encourage investors to consider an increased allocation to broad commodities. In this
instance investors are likely to want to gain exposure in an efficient manner and using a strategy that has enhanced and optimised roll yields is likely to prove beneficial for longer-term holders. OPEC’s announcement is a first step towards a more stable pricing environment for oil, with the commodity remaining an important part of investor sentiment to commodity investing. There is a long way to go until true price stability and supply normalisation has been reached but in the short term investors can Boost short and leverage Oil ETCs to focus on opportunities as they arise. For those investors looking to gain exposure to commodities whilst reducing portfolio volatility may wish to consider the WisdomTree Enhanced Commodity UCITS ETF (WCOA) Investors looking to take advantage of the expected volatility in the oil price may wish to consider Boost ETCs that cover both long and short exposures to WTI and Brent with a range of leverage factors (1x to 3x). Key products include: + Boost WTI Oil 3x Short Daily ETP (3OIS) + Boost WTI Oil 3x Leverage Daily ETP (3OIL) + Boost Brent Oil 3x Leverage Daily ETP (3BRL) + Boost Brent Oil 3x Short Daily ETP (3BRS) + Boost WTI Oil 2x Short Daily ETP (2OIS) + Boost WTI Oil 2x Leverage Daily ETP (2OIL) + Boost WTI Oil 1x Short Daily ETP (OILZ) + Boost Brent Oil ETC (BRND) + Boost WTI Oil ETC (WTID)
Source: Bloomberg, OPEC Web Address: wisdomtree.eu
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OIL & GAS
UNDERGROUND COAL GASIFICATION BLOCKED
The Scottish Government will not support underground coal gasification (UCG) developments in Scotland following the publication of an independent report that highlights serious environmental concerns
UCG should not be confused with hydraulic fracturing, also known as fracking, or coal-bed methane both of which are Unconventional Oil and Gas (UOG) technologies. The announcement has no bearing on the policy on either of these technologies, which remain covered by the Scottish Government’s moratorium on UOG technologies.
still be there. As a result of the announcement, our Energy Strategy for Scotland will set out an energy mix for the future that does not include UCG. The position I have announced on UCG is a clear validation of the evidence-based approach this government is taking and I thank Professor Gemmell for his work in preparing the report.”
The Scottish Government put in place a moratorium on UCG in October last year so that evidence on the practice could be gathered and considered. Professor Campbell Gemmell of University of Glasgow was tasked to undertake an independent examination of UCG. Having received his report, Minister for Business, Innovation and Energy Paul Wheelhouse on October 6th, he updated Parliament on the Scottish Government’s response to the findings.
Mr Wheelhouse has written to the UK Government, requesting that it issues no further UCG licences in Scotland and that existing licences are revoked. The Scottish Government will continue to use planning powers available to it to ensure UCG applications do not receive planning or environmental permission. Professor Campbell Gemmell, professor of environment research, policy, regulation and governance at the University of Glasgow, said: “I have consulted widely, including with industry, communities, regulators, academic specialists and NGOs, and studied the available evidence on the technologies and impacts involved in Underground Coal Gasification, including the variety of international experience. It is extremely difficult to conceive of UCG progressing into use at this time. Despite there being few longer-term operations at scale to consider, and no directly comparable operations in siting, regulatory and policy terms, there is both a history of incidents of pollution and losses of containment.
The report finds that it would appear logical “to progress toward a ban” of UCG, based on a variety of reasons, including: •
the UCG industry having a history of incidents of pollution and losses of containment and;
•
UCG presenting a serious issue to face in reducing Scotland’s carbon/greenhouse gas emissions without an operational storage method, such as carbon capture.
Mr Wheelhouse said: “Having considered the report in detail, it is the Scottish Government’s view that UCG poses numerous and serious environmental risks and, on that basis, the Scottish Government cannot support this technology. Accordingly, UCG will have no place in Scotland’s energy mix at this time.
“In my view, the Scottish Government has responded appropriately to the available evidence on this technology. “Should industry wish to progress this technology at scale here or overseas at some future date, several key factors would need to be addressed, including managing the potential impact of the greenhouse gases produced. The onus would also clearly be with the industry to demonstrate and provide evidence that it can operate to the high environmental standards that the government and public should expect.”
“In Professor Gemmell’s report he recommends it would be wise to consider an approach to UCG based upon a precautionary presumption against the technology, and that it would appear logical to progress toward a ban. “I cannot predict what kind of clean energy technologies may be available in the decades to come, but what is certain is that this this resource will
Web Address: gov.scot
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OIL & GAS
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ENERGY EFFICIENCY
TOP FOUR DRIVERS PROMOTING GROWTH FOR THE COMBINED CYCLE GAS TURBINE MARKET UNTIL 2020, REPORTS TECHNAVIO
Technavio analysts forecast the global combined cycle gas turbine (CCGT) market to grow at a CAGR of more than 4% during the forecast period, according to October report
The research study covers the present scenario and growth prospects of the global CCGT market for 20162020. The capacity additions of new CCGT as well as aftermarket CCGT, and the average price of various types of CCGTs have been considered in determining the market size.
drive their adoption in power generation applications. Factors such as stringent carbon emission regulations worldwide, focus on high performance and lower power generating cost, and volatility in fuel costs are driving demand for highly efficient gas turbines.
CCGT is a power generation technology that incorporates a gas turbine in conjunction with a steam turbine. A steam turbine is used to supplement the electricity generated from a gas turbine, which is driven by the steam generated from waste heat recovered from the gas turbine exhaust.
Anju Ajaykumar, a lead tools and components analyst at Technavio, says, “Major manufacturers such as GE and Siemens are investing heavily in the development of high-efficiency gas turbines. The 9HA/7HA-series CCGTs developed by GE's Power and Water division and the SGT5-8000H developed by Siemens offer more than 60% efficiency levels in a combined cycle configuration.”
In the last decade, new market conditions and vital changes have been brought about by liberalisation and deregulation accompanied by competitive forces as well as with manufacturers' R&D spending. These changes are determining the technological innovations in CCGT power generation systems. Owing to these innovations, CCGT power plants have evolved from the early CCGT power plants like BBC, ABB, GE, KWUSiemens, WEC, and MHI through the “B,” “C,” “D,” “E,” “F,” “G” and “H” technology in the 21st century.
Regulations on carbon emissions Government bodies worldwide are working toward reducing GHG emissions. International agreements such as the Kyoto Protocol have reduced the future outlook for coal-fired generation of energy. Agencies and regulations such as the EPA, the Intergovernmental Panel on Climate Change, and the Climate Change Act, 2008, have laid down certain targets for reducing emissions.
Technavio heavy industry analysts highlight the following four factors that are contributing to the growth of the global CCGT market: • Increasing efficiency and durability of gas turbines • Regulations on carbon emissions • Consolidation of market vendors • Lower initial cost than other low-carbon emission substitutes
“These regulations provide an impetus to the ongoing shift toward gas-fired, gas turbine-driven power plants and CCGTs. The regulations will also drive long-term growth as they are bound to becoming increasingly stringent with regard to carbon-intensive technologies in the coming years. Therefore, vendors are increasingly focusing on gas turbine technologies and processes to reduce harmful emissions,” adds Anju.
Technavio’s sample reports are free of charge and contain multiple sections of the report including the market size and forecast, drivers, challenges, trends, and more.
Consolidation of market vendors In the last decade, the global CCGT market has undergone considerable changes. Mergers have played a crucial role in this transformation, with many large players acquiring gas turbine contracting companies. This has led to the expansion of operations of major
Increasing efficiency and durability of gas turbines The increasing efficiency of gas turbines is projected to
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ENERGY EFFICIENCY
manufacturers on the global scale. This transformation has had its impact on equipment and components manufacturers, which need to be effective globally in terms of their product offerings and support services. Therefore, these manufacturers are increasingly offering global products and services based on international guidelines. Expansion of product portfolios and increasing prominence in various end-user segments have been the top priorities for manufacturers in the market that is characterized by a small number of players. Lower initial cost than other low-carbon emission substitutes One of the major challenges to the growth of the global CCGT market is the high threat of substitution from low-carbon emission alternatives such as renewable and nuclear energy. With the increasing focus on carbon emissions, the world is shifting toward renewable energy to meet the growing energy demand. However, in the current scenario, renewable energy's high initial cost hinders its adoption on a significant scale. This challenge for renewable energy is proving to be a major driver for the global CCGT market that offers a lower cost of power installation than renewable and nuclear energy. Request a sample report: technavio.com/request-asample?report=53080
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ENERGY EFFICIENCY
EBRD AND EU BOOST FINANCE FOR ENERGY EFFICIENCY IN KYRGYZ REPUBLIC
The European Bank for Reconstruction and Development (EBRD) and the European Union (EU) are stepping up their support to build a sustainable, green economy in the Kyrgyz Republic. The Bank is extending a loan equivalent to US$3 million in local currency to KICB, a leading bank in the country, to finance energy savings for businesses and residential homeowners under the Kyrgyz Sustainable Energy Financing Facility (KyrSEFF)
On average, the Kyrgyz Republic is about ten times more energy and carbon intensive than the EU. The use of energy- and resource-efficient technologies will help the country tackle some of its most pressing challenges, including increased energy needs and energy security.
the EU to support the Kyrgyz Republic’s transition to a greener economy,” said Neil McKain, EBRD director for Central Asia. “The available finance and advice on energy efficiency measures will help to minimise energy costs, make firms more competitive and build a sustainable future for the country.”
The country’s energy supply currently depends to a large extent on imports of fossil fuels and on domestic hydropower, but hydropower resources do not offer a long-term solution as they face depletion due to melting glaciers.
To date, the EBRD has invested over €630 million in the Kyrgyz Republic, focusing on the development of the private sector as well as a programme to improve vital public services such as water and wastewater, electricity and transport.
KyrSEFF is a flagship project in the country. It consists of credit lines totalling US$55 million that the EBRD extends to local partner banks. These credit lines are supported with US$18 million of technical cooperation and grant funding from the EU to provide incentives for highly energy-efficient investments. The funds also support technical assistance for the assessment of optimal energy use and for new equipment or facilities.
Web Address: ebrd.com
Since 2013, the programme has helped more than 600 households and more than 50 businesses to save energy and financial expense. This has reduced harmful CO2 emissions by more than 30,000 tonnes per year – the equivalent of taking almost 25,000 passenger cars off the road. To support the Kyrgyz Republic’s transition to a green economy, KyrSEFF has also started to offer finance for projects that use water and other resources efficiently and sustainably. KICB will be the first local bank to extend this opportunity to its clients on a pilot basis. “We are delighted to work with our partners KICB and
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ENERGY EFFICIENCY
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ENERGY EFFICIENCY
GLOBAL UNMANNED AERIAL VEHICLE (UAV) BATTERY MARKET TO GROW AT A CAGR OF OVER 10% THROUGH 2020, REPORTS TECHNAVIO
Technavio analysts forecast the global UAV battery market to grow at a CAGR of more than 10% during the forecast period, according to their latest report
The research study covers the growth prospects of the global UAV battery market for 2016-2020. The report presents the market landscape and a corresponding detailed analysis of the five major vendors operating in the market. In addition, the report discusses the major drivers influencing market growth and the challenges faced by vendors and the market as a whole. It also examines key emerging trends and their influence on current and future market scenarios.
reconnaissance (ISR) operations. Technavio expects that the growing investments in UAVs will raise the number of UAVs from 6,316 to 8,300 during 2012-2017, which augurs well for the growth of the global UAV market.
“Demand for UAVs is rapidly increasing from developing nations, such as India, China, and Brazil for command, control, communications, computers, intelligence, surveillance and reconnaissance operations,” says Arushi Thakur, an industry expert for aerospace components research at Technavio. Technavio aerospace and defence analysts highlight the following three factors that are contributing to the growth of the global UAV battery market: • • •
Growing demand for UAVs Improved endurance with enhanced flight range Reduction in Li-ion battery costs
Growing demand for UAVs The UAVs are smaller in size and cost-effective, compared to their manned counterparts. They provide reliable, secure, and modernized digital communication through various systems that are equipped with them. These systems include navigation systems, sensors, engines, autopilots, and communication links. In addition, they feature on-board sensors like synthetic aperture radar (SAR), LASER light, inertial measurement unit (IMU), and GPS. Currently, UAVs are being increasingly used for suppression of enemy air defence (SEAD), communication transfer, combat, search, and rescue (CSAR), electronic attack (EA), destruction of enemy air defence (DEAD), and intelligence, surveillance, and
Improved endurance with enhanced flight range The adoption of UAVs in commercial and civil applications has increased their utility and has led to an upgradation of existing technologies. Since 2013, major companies such as Facebook and Google have been investing in numerous UAV technologies that can offer internet access in rural areas. Owing to the inability to perform on an autonomous power source, the endurance capability of the conventional UAVs remains the prime concern for commercial UAV operators. Similarly, the employment of UAVs (small electricpowered UAVs) for ISR applications in the defence domain has been greatly augmented in the last couple of years. However, the limited flight endurance of small UAVs is one of the significant challenges that defence organizations have to deal with. Typically, a small fixed-wing UAV has a flight time of an hour, whereas a small rotary-wing UAV typically has a flight time of half an hour, after which the UAV must be retrieved to recharge or be replaced with a charged battery. Therefore, the flight endurance of these UAVs is directly affected by the limited on-board power capacity. “Selecting solar technology as the primary source of power is a major driver propelling vendors to develop and offer solar-powered UAVs. A fixed-wing UAV on its large horizontal wing surfaces can accommodate substantially higher units of solar cells, which deliver almost quadruple units of power compared to a battery-powered UAV,” says Arushi. Reduction in Li-ion battery costs Li-ion batteries are gaining momentum for their use in UAVs as a result of which the demand for Nickel-
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Cadmium (Ni-Cd) and Nickel-Metal-Hydride (Ni-MH) is decreasing by significant margins. Another factor which distinguishes the Li-ion batteries from other batteries is their low price. Companies are enhancing these batteries in every possible way, which leads to a reduction in their cost year-over-year. Their costs have dropped at an average of 23% annually, since 2010. During the same period, the energy storage system cost has also dropped at an average of 14%, annually. This has led to a total installation cost reduction of approximately 17%, from USD 3,400/ kWh to USD 1,600/kWh, during 2010-2014. In addition, according to the US Department of Energy (DOE), battery costs are likely to decrease further to USD 300/ kWh by 2020. Thus, the reduction in cost of batteries will lead to an overall increase in demand for these batteries. Web Address: technavio.com
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INFRASTRUCTURE & TECHNOLOGY
ACTION ON FUEL POVERTY
Homes and businesses across 11 local authority areas will be warmer and cheaper to heat thanks to over £9 million of Scottish Government funding. Councils have been awarded the funding to pilot new and innovative approaches to drive down energy bills and tackle climate change
Scotland’s Energy Efficiency Programme (SEEP) Pathfinder Fund is being directed at businesses, community groups and individuals working and living in areas with particularly high levels of fuel poverty. These pilots will help shape the wider work that will be delivered when SEEP is rolled out further from 2018.
ambitious climate change targets. “This is part of our overall investment of over £1 billion by 2021 in energy efficiency which aims to make homes and buildings warmer, improve health outcomes and create a supply chain across all of Scotland which will support around 4,000 jobs a year once the programme is fully operational.”
Cabinet Secretary for Communities, Social Security and Equalities Angela Constance announced the funding on a visit to meet Margaret Wilson, a West Lothian householder who has already seen her fuel bills reduced thanks to the installation of Scottish Government-funded energy efficiency measures. Ms Constance also visited Lanthorn Community Centre and met with a local mum and toddler group to talk to them about what measures they can take to help make their homes easier to heat this winter. Ms Constance said: “Since 2008 over one million energy efficiency measures have been installed in almost one million households across Scotland which has helped make homes warmer and easier to heat. The Scottish Government will continue to prioritise tackling fuel poverty and remains committed to helping those most in need. These SEEP pilot projects will build on our existing support for households and also improve the energy efficiency of community centres, charities, businesses and commercial properties. “Tackling fuel poverty is a priority for us, but we need to be creative if we want to make a real lasting difference. I look forward to seeing how councils can bring their innovative ideas to life to reduce energy bills and tackle fuel poverty in their communities.”
Margaret Wilson, from Livingston, West Lothian, has already benefitted from Scottish Government funded fuel efficiency measures. She said: “We are delighted with the work carried out and we’re already feeling the benefits of having a warmer home. With winter not far off, it will make a huge difference to us to have the peace of mind that our home is more energy efficient and we can afford to have the heating on a bit longer without worrying as much about when the bill comes in. “Everyone we dealt with was so helpful and everything went smoothly – we’d definitely recommend that other people apply and have the same experience that we did.” Web Address: gov.scot
Minister for Business, Innovation and Energy Paul Wheelhouse said: “By taking a coordinated approach to improving buildings across the commercial, public and industrial sectors we are not only boosting the economy but will be able to substantially reduce greenhouse gas emissions which will help us meet our
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INFRASTRUCTURE & TECHNOLOGY
DIESELGATE 1ST ANNIVERSARY: ALL DIESEL CAR BRANDS IN EUROPE ARE EVEN MORE POLLUTING THAN VOLKSWAGEN – STUDY The better performance of Volkswagen Euro 6 cars has nothing to do with the Dieselgate, but with better technology choices made before the scandal burst. The report Dieselgate: Who? What? How? also found that not one single brand complies with the latest air pollution limits (‘Euro 6’) for diesel cars and vans in real-world driving. T&E analysed emissions test data from around 230 diesel car models. Data were taken from the investigations conducted by the British, French and German governments, as well as a large public database. The carmakers’ ranking was built with on-road performance figures mostly measured in real world driving. The key findings per car brand are: Fiat and Suzuki diesel cars on average pollute 15 times more than the legal NOx limit; Renault-Nissan vehicles exceed the limit more than 14 times; General Motors’ brands Opel/Vauxhall pollute 10 times more while Volkswagen diesel cars pollute twice as much as the Euro 6 standard. Greg Archer, clean vehicles director at T&E, said: “One year after the US caught Volkswagen cheating, all carmakers keep selling grossly polluting diesel cars with the connivance of European governments. The automotive industry has captured its regulators, and European countries must now stand up for their citizens and stop this scandalous cover up. Only a recall of all harmful diesel cars will clean up our air and restore credibility in Europe’s legal system.”
As Dieselgate turned one-year old recently, a new study by Transport & Environment (T&E) reveals that Volkswagen is currently selling the least polluting (Euro 6) diesel vehicles. Nonetheless, the marque caught cheating in the US also has the most grossly polluting Euro 5 vehicles on the road, which were sold between 2011 and 2015
sale by national type approval authorities, mainly in Germany, France, the UK, Spain, Italy, Luxembourg and the Netherlands. The largest number of ‘dirty’ diesels is found on French roads (5.5 million), followed by Germany (5.3 million), the UK (4.3 million), Italy (3.1 million), Spain (1.9 million) and Belgium (1.4 million). "The true scandal of Dieselgate in Europe is national regulators turning a blind eye to the glaring evidence of test cheating with the sole purpose of protecting their national carmakers or their own business. This is killing tens of thousands of people annually. We need a European watchdog to stop EU member states protecting their national champions and to ensure the single market for vehicles operates in the interests of all citizens,” Greg Archer said. Cheating on environmental regulation is not a victimless crime. This causes premature deaths. The World Health Organisation has described worsening air pollution levels as a “public health emergency”. Last year, the European Environment Agency said that NO2, mainly created by diesel engines in urban areas, is responsible for an estimated 72,000 premature deaths in Europe. The majority of NO2-related premature deaths occur in Italy (21,600); 14, 100 in the UK; Germany (10,400); 7,700 in France; Spain (5,900) and 2,300 in Belgium. Web Address: transportenvironment.org
29 million 'dirty' diesel cars and vans driving on Europe's roads today T&E’s calculations also show that today 29 million diesel cars and vans are driving on Europe’s roads that we classify as ‘dirty’, meaning that, for Euro 5 cars, they are at least 3 times over the relevant NOx limit. Only one in four diesel vehicles registered since 2011 achieve these modest thresholds. These vehicles were approved for
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INFRASTRUCTURE & TECHNOLOGY
LITHUANIA'S IGNALINA NUCLEAR POWER PLANT PASSES DECOMMISSIONING MILESTON
The decommissioning of Lithuania’s Ignalina nuclear power plant has passed a key milestone with the award of an operating licence for a new interim storage facility for spent fuel from the plant’s two RBMK-1500 reactors
The licence permits the start of hot trials during which casks will be loaded with spent nuclear fuel and transported to the storage facility. All the plant’s used fuel is to be moved to the facility by the end of 2022. About 190 specially designed containers with about 16,000 used fuel rods will be stored at the facility. Lithuania closed unit 1 of the Ignalina nuclear power plant in 2004 and unit 2 in 2009. The decommissioning is financed by an international donor fund managed by the EBRD.
wide first decommissioning of RBMK-1500 reactors. This was achieved as a result of the great efforts and close cooperation of all the project parties. We are particularly grateful to the European Commission and the European Bank for Reconstruction and Development which, through their support, have enabled us to overcome project challenges and to achieve this excellent result." In addition to financing the decommissioning of the Ignalina nuclear power plant the international donor fund has also financially supported energy sector projects in Lithuania in line with the country’s energy strategy. These include updates to Lithuania’s power and gas sectors strategies, the flue-gas desulphurisation facilities for environmental upgrade of the Lithuanian power plant, the construction of a new state of the art 455MW combined cycle gas turbine power plant, and the development of the power interconnection project between Lithuania and Poland.
Vince Novak, EBRD director, nuclear safety, said: “We have seen outstanding progress in the implementation of the project in recent years. The operation licence marks a milestone achievement and will allow us to proceed on time and on budget. We are grateful to the Ignalina team, the contractors, the government of Lithuania, the European Commission and the donor community.” The International Ignalina Decommissioning Support Fund, established in 2001, is funded by the European Commission as well as Austria, Belgium, Denmark, Finland, France, Germany, Ireland, Luxembourg, the Netherlands, Poland, Spain, Sweden, the United Kingdom, Norway and Switzerland. To date, the fund has received more than €750 million.
Web Address: ebrd.com
The hot trials will initially commence with 10 casks which will be moved to the storage “in real conditions”. Each stage of the hot trials – from loading used nuclear fuel into the casks, to their transportation to the new facility – "will be tested to demonstrate that all design and safety requirements are fully met," the Ignalina nuclear power plant said. The defuelling will then continue and the formal start of the industrial operation of the storage is scheduled after approval of the final safety analysis report by Lithuania’s nuclear regulator in October 2017. Darius Janulevicius, General Director of the Ignalina nuclear power plant, said: “We are very proud to have achieved this important milestone in the world-
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DEALS
HINKLEY POINT C CONTRACT SIGNED
This follows the Government’s decision to proceed with the project following a comprehensive review and revised agreement with EDF. The signing of the Contract for Difference and Secretary of State Investor Agreement for Hinkley Point C marks a significant step forward for a new era of nuclear power in the UK. Greg Clark, Secretary of State for Business, Energy and Industrial Strategy, said: “Signing the Contract for Difference for Hinkley Point C is a crucial moment in the UK’s first new nuclear power station for a generation and follows new measures put in place by Government to strengthen security and ownership.
The Government and EDF in late September signed a historic agreement for the UK’s first new nuclear power station for a generation. During a signing ceremony in London, the Secretary of State for Business, Energy and Industrial Strategy, Greg Clark, the Chairman and CEO of EDF, JeanBernard Levy and the Chairman of CGN, He Yu signed the final documentation to enable Hinkley Point C to go-ahead
Britain needs to upgrade its supplies of energy, and we have always been clear that nuclear power stations like Hinkley play an important part in ensuring our future low-carbon energy security.” The event was also attended by Jean-Marc Ayrault, the French Minister of Foreign Affairs and International Development and Minister Nur Bekri, the Administrator of the National Energy Administration of China. Hinkley will provide seven per cent of Britain’s electricity needs for sixty years. UK-based businesses will benefit from more than 60% of the £18 billion value of the project and 26,000 jobs and apprenticeships will be created.
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