Weekend press round-up: ‘Biggest ever’ CfD round opens

In our latest round-up of national newspaper coverage, the fourth round of the government's Contracts for Difference opens; the aftermath of Storm Arwen offers opportunities to bury power cables, and Electron has raised capital to expand amidst the energy crisis

Bids invited for next round of electricity links under the sea

The energy watchdog will today unveil plans to unlock billions of pounds of new investment in electricity links between Britain and its neighbours.

Ofgem will invite bids to build more interconnectors, which are the undersea cables that link the UK’s electricity network to continental Europe.

The plan would help the UK reach its climate goals, reinforce the country’s energy security and save households money, the regulator said. The government aims to at least double interconnector capacity by 2030, alongside quadrupling offshore wind capacity.

Akshay Kaul, Ofgem’s director of networks, said: “Greater interconnection of energy across borders is vital to ensure resilience, affordability and sustainability in the future as we transform our energy system.

“Our next investment round for interconnectors will bring forward the investment we need, creating green jobs and unleashing the full potential of the UK’s world leading offshore wind industry, while also protecting customers by capping costs.”

Ofgem said that it will invite bids for “multiple-purpose interconnectors”, which can link groups of offshore windfarms directly to cables, allowing surplus energy produced from wind farms in the North Sea to be transferred over to Europe, for example.

The UK, which is heavily dependent on gas, has seven subsea links, five of which go to the Continent: IFA, IFA2, Nemo Link, BritNed and the North Sea Link. The other two link with Ireland. The UK market has 7.4 gigawatts (GW) of electricity in interconnector capacity and last year the connectors provided 7 per cent of the country’s electricity.

Ofgem has approved seven more interconnectors, which are expected to be operational by 2025. Three of them will link to France and one each to Denmark, Ireland, Germany and Norway. The new round of investment will seek projects that are likely to be constructed by 2030.

The National Grid is also proposing two more interconnectors: Nautilus, a 1.4GW link with Belgium, and Eurolink, a 1400-megawatt transmission cable from the Netherlands to the UK.

See Utility Week‘s analysis of what to expect from the latest CfD auction

The Times

Storm Arwen: ‘Dozens’ of Northumberland homes still without power

Dozens of homes in Northumberland are still without power two weeks after Storm Arwen hit the North East.

Northern Powergrid said on Wednesday electricity had been restored to all 240,000 properties affected by the “worst storm in over 20 years”.

But it is thought around 30 homes in the Whitfield area, near Hexham, still do not have a full supply because of issues with temporary generators.

Residents have reported the power keeps cutting out.

Homes in County Durham and Cumbria are also still relying on generators.

A government review is already under way into how power companies responded to Storm Arwen.

Northern Powergrid has urged anyone still experiencing power outages to contact the company.

The energy distributor had already said it would take well into the new year to fix damage to overhead power lines before everyone was back on the main grid.

Jim Cardwell, from Northern Powergrid, told BBC Radio Newcastle the supplier had deployed more than 300 generators during the height of the restoration process.

“We are progressively taking them off the system and as soon as we can, we will do,” he said.

“Our work hasn’t stopped. There might be customers who are back on, but they are on temporary fixes.”

Mr Cardwell said the company was taking “proactive steps” to maintain supplies, with refuelling teams checking on generators and remote instrumentation to inform them when generators need attention.

He also said protections were in place for customers, regardless of whether they are back on the grid or on temporary fixes.

Those most affected for the longest periods will be due “well over £1,000” in compensation, he said, with the first payments being sent out next week.

People will also be able to claim welfare support costs, with details on how to claim to be published on Friday.

Scott Dickinson of Northumberland County Council said he believed Northern Powergrid was fighting to protect its reputation.

“It is a natural ambition of a private company to try to rebuild its reputation that has been damaged during this period, where they haven’t responded to the storm as effectively as they could have done in the first place,” he said.

“I guess it is now reputational damage limitation but that doesn’t help residents who are still without power.”

Storm Arwen caused major damage when it hit land on 26 November, with parts of Northumberland and County Durham worst affected.

Electricity North West said it had installed about 40 generators to households in Cumbria while repairs are ongoing.

BBC News

Government plans to bury power lines underground in wake of Storm Arwen

Power lines could be buried underground to preserve them from the effects of bad weather under plans being considered by the Government in the wake of Storm Arwen.

A review launched this week will examine ways to make the energy system more resilient after thousands of people in Scotland and the north of England were left without power for more than a week in the aftermath of the storm.

Ongoing National Grid projects are burying cables in National Parks and other areas valued for their natural beauty to remove the visual impact of pylons.

Campaigners called for more cables to be buried to protect them from the effects of storms.

Putting local lower-voltage cables underground can cost more than £150,000 per kilometre, with high-voltage pylon lines costing even more.

The Government said the measure would be considered as part of the review, set to report its findings in March next year.

The Telegraph

Energy tech firm scoops backing to exploit energy crisis

An energy trading platform backed by supplier Ovo has raised £1.4 million as it plots expansion on the back of Britain’s energy crisis.

Electron was co-founded and run by Jo-Jo Hubbard, who received the funds from investors three weeks after giving birth to her first child.

Hubbard, 33, founded the company in 2016. She previously worked in banking, arranging financing for wind and solar farms.

Electron has a trading platform that allows electricity network operators and energy suppliers to more evenly distribute renewable energy through the grid.

New investors in Electron include former Sage chief executive Stephen Kelly and Steve Garnett, who was a software executive at Oracle.

Hubbard, who did not disclose the valuation, said the recent crisis and focus on Cop26 meant the company “had finally got some rocket fuel behind us”. She plans to raise more next year.

Ofgem, the under-pressure energy regulator, is poised to unveil an action plan to tackle the crisis that has claimed 25 energy suppliers since August. The largest to collapse has been Bulb, which received a £1.7 billion bailout from taxpayers to help its 1.7 million customers find a new supplier.

The Times

UK universities took £89m from oil firms in last four years

Some of Britain’s most prestigious universities are among those to have shared in funds totalling at least £89m from major oil companies in the last four years, an investigation has found.

Oxford, Cambridge and Imperial College London are among the universities to have been given funding from some of the world’s biggest companies, according to new research by openDemocracy.

In recent months there has been increasing pressure on institutions to break links with fossil fuel companies. Last month, more than 40 senior academics and scientists signed an open letter vowing not to work with the Science Museum over its financial ties to major oil corporations. The museum faced several resignations over ties with Shell and a newly announced deal with the renewables company Adani Green Energy, part of the Adani Group, which has major holdings in coal.

The new research found that Imperial College London had accepted £54m since 2017 – by far the most of any institution surveyed. It included £39m from Shell, with which the college has said it has a “longstanding and fruitful partnership”. Imperial said the confidentiality of private contracts meant it could not reveal exactly what the money was used for, stating that it funded research into “energy transition, lowering carbon emissions in extraction and in carbon mitigation measures”.

Cambridge University received more than £14m from oil giants, while Oxford got almost £8m. These include large donations to Oxford’s Said Business School Centre for Corporate Reputation.

OpenDemocracy used the Freedom of Information Act to ask universities for details of any funding they had accepted since 2017 from eight of the biggest oil firms: BP, Shell, Total, Equinor, Eni, Chevron, Exxon or ConocoPhillip. The figures include donations, gifts, grants and research funding.

In total, 36 universities said they had received funding from eight oil giants, with others refusing to disclose whether they had received similar funding. Southampton, Aberdeen, Edinburgh and Bath universities also took more than £1m each from the oil firms. In total, universities said they had received £89m – but the true figure could be far higher, because many failed to provide details.

“By accepting millions of pounds in grants and sponsorship from the fossil fuel industry, UK universities are complicit in propping up and legitimising the existence and operations of some of the most harmful companies on the planet,” said Rianna Gargiulo, divestment campaigner at Friends of the Earth. “The revelation of these sponsorship deals tarnishes the reputations of the UK’s leading academic institutions, including those like the University of Cambridge that have committed to divesting from fossil fuels.”

Caroline Lucas, the MP for Brighton Pavilion, said: “Let’s be clear – there is no justification for taking money from oil and gas firms and no justification for being complicit in greenwashing of these big corporations.”

The Guardian

Scottish Nationalists hopes for windpower economy slammed

Keen to lift the spirits, Nicola Sturgeon stepped up to the podium in Aberdeen for a morale-boosting speech.

It was June 2017 and her audience of North Sea oil executives at a conference organised by the trade body Oil & Gas UK had suffered years of low prices. Scotland’s first minister, and leader of the Scottish National Party, was keen to show drillers that they had her full support.

Hailing the start of BP’s Quad 204 field, Maersk Oil’s Flyndre field beginning to flow with crude, and a breakthrough for the Aim-listed UK company Hurricane Energy, Sturgeon told delegates: “All of this provides fairly compelling evidence that … the oil and gas sector is going to continue to be crucially important to Scotland for decades.”

How times change. Last month, she said that development of the new Cambo oilfield in the North Sea should not go ahead on environmental grounds.

While oil was the bedrock of the SNP’s referendum campaign in 2014, Sturgeon’s economic argument for Scottish independence has shifted from oil to another abundant source of energy north of the border: wind.

Her new focus is set to stir up tension between Holyrood and Westminster as both talk up their green credentials. Boris Johnson has pledged to turn the UK into the Saudi Arabia of wind power and slash carbon emissions to net zero by 2050. Sturgeon is likely to argue that Britain will struggle to hit those ambitious targets without Scotland’s green energy.

Despite having only 8 per cent of the UK’s population, Scotland generated 25 per cent of the entire country’s renewable electricity in 2019. Renewable projects produced the equivalent of 97 per cent of Scotland’s electricity consumption in 2020 — mostly from wind.
“I would be very surprised if I didn’t see net-zero targets, environmental concerns and therefore renewable energy being a critical part of the [Indyref2] conversation,” said Melanie Onn, a former Labour MP who is now deputy chief executive of trade body RenewableUK.

Paul Butcher, director of public policy at law firm Herbert Smith Freehills, said the debate had moved on by “a very, very large extent in a very short time,” adding: “With energy, it’s an important issue politically from the SNP’s perspective to try to show how they can be greener, more progressive.”

The Times

Boss of collapsed supplier Extra Energy faces disqualification

A tech entrepreneur faces being barred from running a company in the UK for at least two years after his energy firm collapsed.

Kwasi Kwarteng, the Business Secretary, has applied to the High Court to disqualify Mordechay Maurice Ben-Moshe as a company director in the UK, court filings show.

Mr Ben-Moshe ran Birmingham-based Extra Energy which collapsed in November 2018 with about 130,000 household and business customers.

The company struggled amid poor debt collection and cold weather in 2018 which drove up energy prices, administrators have previously said.

The disqualification action, filed on Dec 1 and due to be heard in March, relates to alleged breaches of energy industry regulations.

Extra Energy was among a string of suppliers to have entered the UK market over the past decade. Its collapse fuelled concerns that many new entrants did not have the financial backing or expertise to survive fierce competition and market volatility.

Those warnings have been vindicated in recent months with more than 20 suppliers collapsing since the start of September amid soaring wholesale gas prices.

Ofgem, the regulator, is facing claims it has not policed the market rigorously enough with Citizens Advice accusing it of “failing to act against unfit energy suppliers for nearly a decade”.

Citizens Advice estimates the latest spate of collapses will add £94 to the typical household energy bill.

Customers ultimately have to pay for costs left behind by failed companies, under the industry safety net.

Following Extra Energy’s collapse in 2018, its customers were taken on by ScottishPower.

An Insolvency Service spokesperson said: “We cannot comment due to ongoing legal proceedings”. Mr Ben-Moshe could not be reached for comment.

The Telegraph

Fracking companies threaten to sue the Government over ban

Fracking companies are threatening to sue the Government over its ban on the practice amid complaints they have been left out of the country’s energy revolution.

The onshore shale gas industry has exchanged “pre-action correspondence” with Whitehall after it was barred from drilling following concern over earthquakes in 2019, before any gas was produced.

It raises the prospect that taxpayers could be forced to shell out compensation to an industry which came under sustained attack from campaigners over environmental concerns.

The potential legal action also raises questions for Cornwall’s clean energy revival.

Fracking companies were riled after testing to extract heat, power and lithium from deep geothermal waters in the county last year triggered mini-earthquakes similar to those caused by fracking, but different regulations meant the work did not have to regularly pause as a result.

The billionaire industrialist Sir Jim Ratcliffe was among those who spent millions of pounds on fracking projects that had to be ditched following the ban. His company Ineos wrote off £63m in 2019.

It comes as the Government faces questions over whether its policies are deterring investment in energy that would help Britain secure independence from Russia and producers in the Middle East.

Charles McAllister, policy manager at UK Onshore Oil and Gas, the trade body, said: “We support the continued development of geothermal energy in the UK, however we would ask the Government to look again at lifting the moratorium on hydraulic fracturing for shale gas in light of its approach to the regulation of seismicity from deep geothermal projects.

“Whether our members will legally pursue compensation for the £500m they have invested in the Midlands and the North of England is a question for each company.

“We would of course prefer the Government to look at the science, apply regulation fairly and allow our members to proceed in producing a much-needed source of domestic natural gas.”

The Telegraph

What is nuclear fusion and can it really happen?

About half an hour into explaining how fusion energy might just change the world, Scott Krisiloff, business chief at Helion Energy, held up his water bottle to the camera. “A bottle of heavy water this size,” he said, “could power your home for 860 years.” Message received.

Nuclear fusion has, for decades, been the ultimate “jam tomorrow” story — a fantastical technology that could solve many of the world’s most urgent problems, from energy poverty to climate change. The process is the same that powers the sun — forcing atoms to bind under immense pressures and temperatures. The ideal temperature for a fusion reaction is 200 million degrees centigrade. The resulting fused atom is lighter than the two that made it, and the excess mass is released as energy.

Crucially, it does not generate radioactive waste, like the fission reactors that have left us with stockpiles of toxic waste. Fusion may turn the reactor materials radioactive, but the half-life is 12 years; fissile material will take hundreds of thousands of years to decay.

Within the past month, three start-ups have together raised more than $4 billion (£3 billion) from top venture capital investors and billionaires betting on a technology that, if cracked, would indeed change the world. Commonwealth Fusion, a three-year-old spinout from the Massachusetts Institute of Technology, raised $1.8 billion from Bill Gates, George Soros and others this month.

General Fusion, a Canadian start-up backed by Jeff Bezos that recently announced plans to build its first pilot plant in Culham, Oxfordshire, attracted $130 million in fresh funding in November. And Helion Energy, an eight-year-old firm in Washington, nabbed $500 million, plus another $1.7 billion contingent on hitting development milestones. Investors include LinkedIn founder Reid Hoffman and Sam Altman, the billionaire boss of OpenAI, the artificial intelligence organisation.

Altman put $375 million of his personal cash into the deal. He told CNBC: “I think it is our best shot to get out of the climate crisis.”

Read the full story at 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.