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Will the U.S. Follow the U.K. Into Power Shortages?


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Will the U.S. Follow the U.K. Into Power Shortages?

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 kbit 
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As Britain endeavors to build new nuclear power plants to avert an electric crisis in 20 years -- with the retirement of nearly all the nation's installed capacity, as it falls prey to age -- the question arises whether the United States is destined for the same crisis.

Britain commissioned its first nuclear power plant back in 1954. For decades, Britain was at the forefront of the development of nuclear energy.

Then came natural gas. Discoveries in the North Sea coupled with improvements in gas turbine technology caused a boom in gas-powered electricity generation. At one point, it looked as though 50 percent more gas-fired electricity generation would be installed than needed.

The next surge of generating enthusiasm was for wind. Under the Labor government of Tony Blair, Britain planned to lead the world in wind generation, both on shore and off. Wind, as elsewhere, was subsidized because it was politically lovable. What better source of energy for a windswept island with a stormy coastline than wind, wind and more wind?

But the high cost of wind-generated electricity, coupled with intermittent availability, began to turn the country off wind. While the Conservative government of David Cameron is still pushing wind through subsidies, it has been forced into a painful re-think to avoid catastrophe.

Coal mines -- the engine of the Industrial Revolution -- began to be phased out under Margaret Thatcher's Conservative government partly because of continuing labor problems, but primarily because its cost was rising as mines became less productive. Britain became an importer of coal.

Nuclear just languished; the fabrication capacity declined, the design shops closed up, and the universities turned out fewer graduates in the nuclear sciences.

Then came the gas boom of the 1980s and '90s. The North Sea was full of it, the plants were cheap to build and operate, and the emissions were half those of coal.

But gas began to peak in Britain's North Sea fields in 2000, and gas imports began to rise. The jig was up for cheap, non-controversial energy.

Cameron's government, looking toward the day when the lights will fail, has supported an aggressive nuclear building program -- none of it designed or built by British companies. The French government-owned utility, Electricite de France (EDF), will build the Britain's first new reactors; the technology will come from Areva, the French nuclear plant builder, and some of the construction funding will come from China.

But to lure EDF, a mechanism called the “strike price” had to be negotiated. Under this deal, the British government guarantees a floor price for the electricity generated at the new nuclear plants. The strike price for the EDF deal is $154 per megawatt hour, or about twice the current wholesale price of electricity in Britain.

British industry is screaming that it will be driven offshore, particularly chemicals. The European Union is screaming that this is a subsidy by another name. And British consumer groups are screaming that it will kill off old people, who will not be able to afford the Gallic electrons.

The Cameron government has its fingers in its ears, because it knows the screaming will be far worse if the lights do go out.

Across the Atlantic, a sequel to the year the lights will go out in Britain may be in production. We are already shuttering nuclear plants; the total down from 104 to 99 with many more endangered as the plants either become uneconomic, as a result of competition from our gas boom, or too old. Four big new nuclear plants are under construction in Georgia and South Carolina, but they are all that are likely to be built in the foreseeable future.

Currently, nuclear plants contribute 19 percent of our electricity, about the same percentage they contributed in Britain in the 1990s before plant retirements began. The numbers are being kept up by extraordinary operating efficiency gains and by upgrading-- called “uprating” in the industry -- the plants.

How long the gas boom will last is a matter of conjecture. The lifespan of the new hydraulically fractured fields is not known, but it is expected to be about one-third that of conventional fields. The full environmental consequence is not known either. Yet the euphoria of gas abundance is boosted by multi-million-dollar campaigns from the oil and gas industries, led by the giant American Petroleum Institute.

These advertisements give the impression that gas is forever in America. The way it was in the North Sea?

Will the U.S. Follow the U.K. Into Power Shortages?

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Last Updated on February 19, 2014


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