THE ENERGY INDUSTRY TIMES - SEPTEMBER 2017
Europe News 7
Fossil fuel funding
jeopardising UK climate goals
The Catholic Agency for Overseas Development
(Cafod) says that the UK’s
government’s ability to deliver on its
climate change goals is in jeopardy
because of its funding of overseas fossil
fuel-based projects.
The aid agency believes that the UK
spent more than double the amount on
fossil fuels as it did on renewable energy
overseas over the five years to
2014. It also says that there is a large
variance in spending between different
government departments, indicating a
lack of policy consistency.
“The Conservatives made manifesto
commitments they would continue to
lead international action against climate
change and extreme poverty, but
supporting fossil fuels overseas puts
that leadership at risk at a time when
international leadership is needed now
more than ever on the Paris Agreement,”
said Dr Sarah Wykes, lead analyst
on climate change and energy at
Cafod. “We'd like some clarity from
the government on how it plans to make
its energy spending consistent with its
promises to tackle climate change and
help the world's poorest people access
modern energy services.”
According to Cafod, more than 46
per cent of UK spending on energy in
developing countries went on fossil
fuels, compared to 22 per cent on renewable
energy from 2010-2014. In
total, the UK spent $9.73 billion supporting
energy overseas over that
period.
Cafod also says that over 99 per cent
of spending via UK export finance
went on fossil fuels. This compares
with the Department for International
Development, which spent more aid
money on supporting renewable energy
(32 per cent) than it did on fossil
fuels (22 per cent).
Cafod, which campaigns for politicians
and decision-makers to tackle
climate change because of its impact
on poor communities, has urged the
government to clarify how it will overhaul
spending on overseas energy projects.
Its analysis of UK government
spending, carried out in conjunction
with the Overseas Development Institute
(ODI), also shows that of the
money spent on energy in developing
countries, only eight per cent went towards
improving people’s access to
energy.
“To tackle climate change we have
to leave fossil fuels in the ground and
switch rapidly to renewable sources
of energy,” said Dr. Wykes. “Yet the
UK carrying on a business as usual
spending pattern overseas in recent
years suggests a huge inconsistency
in policy and a missed opportunity to
promote greater investment in renewable
technologies.”
n London Mayor Sadiq Khan has
published a draft London Environment
Strategy that includes plans for
the city to reach an installed solar energy
capacity of 2 GW by 2050. The
Mayor’s proposals include implementing
incentives for domestic and
community solar power schemes and
adding solar capacity to local authority
buildings.
UK Power Networks says new flexibility services contracts will help it operate its distribution
network and is a key step forward for a traditional DNO keen to modernise its business.
Siân Crampsie
The UK’s distribution network operators
(DNOs) are planning a major transition
that will enable them to take on
new, active roles in managing smart,
flexible grids.
UK Power Networks (UKPN), the
country’s largest DNO, has invited
operators of distributed energy resources
to submit expressions of interest
for new flexibility services
contracts.
The company has also joined other
DNOs, industry bodies, academics
and government departments to
launch a consultation regarding the
creation of a smart electricity grid and
the use of flexible, distributed energy
technologies.
The consultation is part of the Energy
Networks Association’s (ENA)
Open Networks project and will look
at how the UK’s electricity grid can
maximise the use of distributed assets,
deliver access to markets, encourage
new business models, and maximise
the benefits of competition and thirdparty
involvement.
The initiatives are a major step forward
for network operators, which are
currently bound by strict regulations
governing their activities as network
asset managers.
The drive to create a more smart,
flexible grid capable of managing intermittent
renewable and distributed
generation resources will require
changes in regulations that allow
DNOs to become more active ‘distribution
system operators’ (DSOs),
UKPN says.
UKPN has identified ten locations
across its network where the installation
of distributed generation resources,
including batteries, fast-response
generators, or demand-side aggregators,
will help it to improve network
management. It plans to run a tender
to contract for flexibility services to
start as early as January 2018.
UKPN says that its new flexibility
services contracts have rarely been
used on local distribution networks
before and will benefit both the grid
and the owners of the distributed resources.
Follow-on tenders for the
contracts will be run on a regular basis,
it said.
UKPN’s Sotiris Georgiopoulos said:
“This is a hugely important time for
the energy industry as we transition
towards a more low-carbon economy,
which is why it is vital that we commit
to working together and listening to
everyone involved.
“Our objective is to enable flexible
energy systems and new technologies,
while continuing to deliver the secure,
stable and cost-effective electricity
network our customers expect. The
work we are doing to open up our
network presents a wealth of new
opportunities for flexible energy
resources.”
“The smart grid transition has the
potential to create a whole new range
of market opportunities for new technology
and service providers, many
of whom will be participating in the
UK market place for the first time,”
said David Smith, CEO of ENA.
“Our energy networks increasingly
need to access the latest technologies
and services in order to ensure continued
reliable and cost-effective
electricity supply as part of a decarbonised
system.”
Polish energy firms Energa and Enea
may seek a third partner for the construction
of a new coal-fired power
plant, they say.
The two companies have confirmed
plans to invest in the 1000 MW Ostroleka
C project and plan to select a
construction contractor in early 2018.
The PLN6 billion ($1.68 billion)
project is a key element of the Polish
government’s energy security plans.
State-owned Energa abandoned
plans for the Ostroleka C plant in 2012
because of difficulties with finance. It
is now hoping that a proposed capacity
market scheme in Poland will help
to support the plant.
The financing model for Ostroleka
C should be ready by the end of 2017,
and Energa and Enea hope to have the
plant operational by mid-2023.
It will be built at the site of two existing
Ostroleka units in Ostroleka,
Masovian.
Energa invited bids for the construction
of the new unit at the end of
2016.
Plans for the construction of Estonia’s
first offshore wind farm are taking
shape.
Developer Nelja Energia and its subsidiary,
Hiiumaa Offshore Tuulepark,
have signed a cooperation agreement
with Hiiu municipality that seals a letter
of intent signed three years ago.
The agreement commits the developers
of the proposed Loode-Eesti offshore
wind project in the Baltic Sea to
make a contribution to the development
of Hiiumaa Island on completion
of the wind farm. It also states that wind
turbines will not be installed less than
12 km from the shores of the island.
The Loode-Eesti offshore wind
farm will consist of 100-160 wind
turbines installed in the sea to the
north of Hiiumaa with a capacity of
700-1100 MW.
Nelja Energia is also developing a
400 MW wind farm off the coast of
Lithuania.
Bulgaria is to sell its troubled nuclear
power project in Belene to private investors.
The government says it will
launch a tender in early 2018 for the
2000 MW project, which was cancelled
in 2012 because of financing
constraints.
The government is aiming to sell up
to 90 per cent of the project to private
investors willing to complete construction
of the power plant without
state guarantees or long term power
purchase agreements.
The move follows a 2016 ruling by
an international arbitration court that
Sofia should pay more than €550 million
($623 million) in compensation
to Russian nuclear giant Rosatom for
two nuclear reactors it ordered for
Belene in 2006.
Construction of Belene was initially
started in 1987 but was stopped in 1991
due to pressure from Bulgaria’s neighbours
and concerns over safety and the
environment.
The project was revived in 2002 and
Bulgaria selected Atomstroyexport in
2006 to build two 1000 MW VVER-
1000 reactors at the site.
Polish energy firms seek
partner for Ostroleka
Giant Estonian offshore
wind farm takes shape
Flexibility contracts will help
distribution network, says
UKPN
Government
plans to sell
Belene to
private sector
n Export finance is fossil fuel focused n Cafod calls for policy clarity