Weekend press: Hunt to offer residents near new power projects money off their bills

Utility Week's latest roundup of sector coverage from the national press includes the chancellor's proposal to halve the delivery time for electricity projects, a pullback on heat pump promises and a legal case being launched against the government over the use of sewage sludge.

Hunt to offer residents near new power projects money off their bills

Jeremy Hunt plans to speed up the roll out of new electricity networks in Britain by offering people living close to pylons and substations up to £10,000 off their bills over 10 years.

In the Autumn Statement, which is due to be announced in the coming week, the chancellor will claim that the compensation package, alongside planning reforms, would halve the delivery time for new electricity projects from 14 years to seven.

The slow delivery of new pylons, power lines and substations is seen by the Treasury as a big drag on Britain’s transition to a low-carbon economy. Hunt will also claim that by removing blockages in the planning system, he could bring forward £90bn of global investment over the next decade, as he tries to boost growth by pulling in more overseas cash.

The chancellor repeated on Saturday that the Statement’s principal focus would be measures to boost Britain’s sluggish growth rate. The economy is expected to barely grow over the next two years. Planning reforms will include a new “premium planning service” — with a fee attached — and the prioritisation of the rollout of electric vehicle charging points.

Britain needs to rapidly build more electricity cables to move power from new and planned wind and solar farms to where it is needed, as part of the shift away from fossil fuels.  However, planned pylons and cables are facing opposition in several parts of the country from people living nearby, who have raised concerns about the impact on the environment and views.

In August the government’s electricity networks commissioner Nick Winser recommended households living near new transmission lines should be given lump sum compensation payments.

One Treasury figure familiar with the Chancellor’s thinking said: “Expanding the grid will unlock global investment for Britain and bring improvements for people across the country, with energy security that will keep energy costs down.

“By speeding up the planning system, including the rollout of EV charge points, we will be tackling one of the most common issues raised by businesses who are keen to invest in the UK.”

The slow pace at which new wind and solar farms are able to connect to the electricity network has emerged as a big problem in Britain in recent years. Some renewable energy projects have been given connection dates in the 2030s.

National Grid, which owns and runs the main transmission network, said this month that the queue to connect to the transmission network comprise projects with a combined capacity of 400GW, several times more than the total capacity currently connected.

Financial Times

Labour turns up pressure on green investment

Britain is failing to compete in the global race to develop green technologies, Labour has claimed.

James Murray, the shadow financial secretary to the Treasury, has called on the chancellor to respond to ambitious American subsidies in the autumn statement this week.

He said the government’s response to President Biden’s Inflation Reduction Act, under which $669 billion of taxpayers’ money in the United States will be used to fund tax credits for electric vehicles and the building of green supply chains, was inadequate.

“If you look at what Jeremy Hunt has said about the approach taken by the Inflation Reduction Act, he’s called it distortive and that the UK will essentially use the same tools they have used over the last years,” Murray said. “There is a race for investment and the UK is not in it. The US has the Inflation Reduction Act and the EU has its response. There are companies looking to invest and build supply chains and we need to be in that race, too.”

Jeremy Hunt has said that he will lay out Britain’s initial answer to the subsidies race ignited by Washington during his statement on Wednesday. The government is hemmed in by a tight set of public finances, however.

This year Labour said it would set up a national investment fund worth an initial £26 billion to boost the development of renewable technologies, but since then it has stepped back somewhat, saying that money will be spent only if the party’s fiscal rules are met.

“The fiscal rules will always come first in any decisions we take,” Murray said, noting that Labour had promised not to borrow money for day-to-day government spending and to get the debt ratio falling within five years.

He said that while Britain was not able to go “toe-to-toe” with America, it should boost investment in sectors that had a strong footprint in the country, such as “life sciences, creative industries and the financial services sector”.

Labour has said that it will not seek to raise new taxes on working people and instead will plan to liberalise planning laws to make it easier for companies to set up projects such as offshore wind turbines. Murray said the party also would set up GB Energy, a nationally owned green energy business, to fund greater investments into low-carbon energy.

The Times

Buzz grows over northwest power grab by Iberdrola

A Spanish energy group has emerged as a frontrunner to take control of electricity power lines in the northwest of England.

Best known in Britain as the owner of ScottishPower, Iberdrola is said to be close to making an offer of up to £3.5 billion to take control of Electricity North West, the power network operator that delivers electricity to five million customers from Manchester, Lancashire and Cumbria.

Jefferies, the investment bank, is working with Electricity North West’s present owners and could start a sale process shortly. Iberdrola is a leading contender likely to make a bid, but Macquarie, the Australian finance house that has wide interests across British utilities, also could be among those to make an offer, as could KKR, the huge American investment firm.

Buying Electricity North West could help Iberdrola to connect areas that it already serves via its ScottishPower business. This provides power to 3.6 million customers in Merseyside, Cheshire, north Wales and north Shropshire in England, and in central and southern Scotland, its latest annual report shows.

The Spanish group previously considered making an offer for the company in 2019, when JP Morgan and Colonial First State, its owners at that time, launched a sale that eventually was won by Kansai Electric of Japan and Equitix, the City-based asset investor, which are its present owners. Macquarie, KKR, Equitix and Kansai Electric declined to comment.

The Times

Ministers set to push back heat-pump target

Scottish ministers look set to delay plans requiring homeowners to switch from fossil fuel boilers to heat pumps or other green energy schemes.

The SNP-Green administration had aimed to begin phasing out oil, gas and coal heating systems as early as 2025.

The governing parties, as part of their 2021 power-sharing Bute House agreement, said they were going to rule out new or replacement fossil fuel boilers for 170,000 off-grid properties by then.

Householders would be expected to install heat pumps or other sustainable technology.

The government had also committed itself to banning new gas-fired boilers in properties on the grid from 2030.

Patrick Harvie, the Green co-leader and minister for zero carbon buildings, previously confirmed the government’s “commitment to phasing out the need to install new or replacement fossil fuel boilers in off gas properties from 2025, and in on gas areas from 2030”.

The plans caused uproar, with critics questioning how families could afford the switch amid the cost of living crisis.

However, the government is now poised to shelve this commitment, according to insiders.

An unnamed source told The Herald on Sunday the previous timescale was “unlikely to be in the consultation in this form”.

“The strategy explored 2025 and 2030 as the starting points for phasing in compliance with the zero emissions heat standard in off-grid and on-grid areas, with the backstop date of 2045 applying to all,” they added.”

New gas boilers will be banned in new buildings from next April after regulations were passed at Holyrood this year.

The delay to gas boiler ban in off-grid homes is the latest policy under Nicola Sturgeon’s government to be abandoned or changed since Humza Yousaf took over in March.

The Times

Tide turns against Thérèse Coffey over sewage ‘inaction’

“We have seen some difficult situations with water companies,” Thérèse Coffey told the House of Commons when she started her job as environment secretary. Yet sewage spills and water firms were not her priority, she said, because other ministers were working on them.

This week, one year on from those words, Coffey was deposed as environment secretary with public anger over river pollution at a high-water mark despite the MP hailing her “plan for water” as one of her big achievements.

Her Suffolk Coastal constituency, which she has held since 2010 and retained with a 20,533 majority in 2019, appears a safe Tory seat. But local people and opposition politicians think her handling of water pollution issues in the county could be her undoing at the next election.

“She’ll be remembered with disappointment,” said Ruth Leach, of Save the Deben, a campaign to make a tidal river snaking through the constituency safe to swim in.

“When we needed her help and support she was unable to give us any conversation, any time, any advice, any support because of her role as minister. She said that there was a conflict between the ministerial and constituency duties. There was no leadership. I felt very much alone.” Leach emailed Coffey when she resigned on Monday, to see if she could now help, but has not yet heard back.

Eamonn O’Nolan, the mayor of Woodbridge, who has supported efforts to have stretches of the Deben designated as bathing waters, also said Coffey had been unhelpful. In March, when she was still secretary of state, a section of the Deben was rejected by her department for bathing water status on the ground that the applicants could not show it had enough swimmers. When Coffey posed to celebrate another part of the Deben being designated, she was mocked by the Labour MP Angela Rayner and social media users.

Julia Ewart, the Lib Dem candidate for Suffolk Coastal who lost to Coffey in 2019, believes that local outrage over water pollution will help her win next time. “It’s not as if Thérèse has been the minister for sport. Given she’s MP for a coastal constituency with numerous rivers and waterways, how come she’s allowed her own region to be so impacted by filthy wastewater? Who wants to go open water swimming in E.coli?”

The vocal water company, Anglian Water, was responsible for 16,000 sewage spills across its region last year. Hundreds of residents have protested against pollution at the river Waveney and river Blyth as well as the Deben.

Toby Hammond, a Green on East Suffolk district council, said: “Thérèse Coffey seemed to specialise in both saying and doing the wrong thing. When visiting Martlesham Creek, she blamed seabirds rather than sewage companies for the polluted water, after the site failed its bathing water status, and high levels of E. coli were found in the water.”

The Times

A cocktail of toxins is poisoning our fields. Its effect on humans? Nobody can tell us

It’s an experiment with 8 billion test subjects, no controls and no endpoint. What happens when you release thousands of novel chemicals, most of which have not been tested for their impacts on human health or ecosystems, into a living planet? What are the effects on the development of foetuses, on human brains, other organs, immune systems, cancer rates, fertility? What are they doing to other species and to Earth systems? We seem determined to find out the hard way.

The gap between our actions and our knowledge is astounding. Of the 350,000 registered synthetic chemicals, about a third are impossible to assess, as their composition is either “confidential” or “ambiguously described”. For most of the rest, deployment comes first, testing later. For instance, the health and environmental impacts of 80% of the chemicals registered in the European Union have yet to be assessed. And the EU is as good as it gets. Our own government, as one of the benefits of Brexit, has just decided to downgrade the safety information chemical companies have to provide to an “irreducible minimum”.

Far from shielding us from this chemical load, the government is knowingly and actively exposing us. In 2017, the Environment Agency produced a startling report on the contamination of the sewage sludge being sold or given to farmers as fertiliser by water companies. It revealed that there has been a radical change in the disposal of many industrial wastes. Instead of taking their liquid waste to dedicated disposal facilities, chemical and cosmetics manufacturers now pay water companies for the right to dump their loads into sewage treatment works.

In other words, two completely different waste streams – human excrement and industrial effluent – are being deliberately and irremediably mixed. This filthy cocktail is augmented by runoff and drainage from roads, building sites, businesses and homes, laced with everything from tyre crumb to PFAS (“forever chemicals”). When this chemical shitstorm hits the sewage system, it’s either pumped directly into rivers through illegal discharges by the water companies or held back as sewage sludge, now a toxic and highly complex mess.

What then happens to it? Well, the next steps are as clear as sewage. There are, the report says, “a number of gaps in the Environment Agency’s understanding of what water companies are doing with tankered industrial wastes, how they handle them and … the destinations of sludge generated”. A proliferation of “waste brokers, contractors and subcontractors” ensures that the tracking of waste from source to sink is almost impossible. Transfer and consignment notes fail to list the industrial effluents the sludge contains or to explain where it is going. It is often “miscoded”, creating a false impression that it’s safe.

But from what the agency can tell, “much of the mixed sludge was destined for farmland”. That’s not surprising: about 87% of sewage sludge ends up as fertiliser. The manufacturers get cheap disposal for hazardous waste, the water companies get paid for accepting it, and farmers get cheap or free manure. But they are not informed about the added extras.

Read the full article at The Guardian 

Union strikes deal to give workers more say on future of North Sea

Union bosses and energy firms have struck a unique accord as they battle to ensure that workers have a larger say in shaping the future of the North Sea.

GMB and the Association of British Independent Exploration Companies (Brindex) have agreed a memorandum of understanding that will result in their collaborating to plot a sustainable path to a lower carbon economy.

Traditionally, union organisers and corporate bosses were more likely to be found on opposite sides of a negotiating table.

However, both the GMB and Brindex believe improved co-operation is required to help get policymakers to listen more closely to the needs of industry. In time, this will include union reps visiting various offshore platforms to gather thoughts from workers.

The organisations want to highlight how the skills in the UK’s offshore oil and gas workforce are going to be required for decades to come as well as being key to building nascent areas such as carbon capture and hydrogen.

The Conservative party is trying to encourage greater exploitation of domestic oil and gas and are pushing a desire for greater energy security as the reasoning behind a move to annual offshore licensing rounds.

Yet the Treasury has not repealed its energy profit levy, which takes up to 75 per cent of UK profit in tax, which has constrained investment, delayed projects and affected confidence across the sector.

Sir Keir Starmer, who was in Aberdeen last week talking up renewable energy, has indicated Labour would end new exploration drilling in the basin if it wins power at the next general election.

The SNP has also been supportive of an end to new exploration drilling although wants to see a managed transition to lower carbon alternatives to retain jobs in Scotland.

GMB and Brindex plan to work together on shaping “pro-jobs policies” in the domestic oil and gas sector as well as the low carbon industries.

They also highlighted a need for a secure North Sea supply to reduce reliance on oil and gas imports, as well as supporting other domestic sectors, including steel and brick making, which require large amounts of energy.

The Times

Utility Week’s weekend press round-up is a curation of articles in the national newspapers relating to the energy and water sector. The views expressed are not those of Utility Week or Faversham House.