COMPANIES

UK watchdog probes RWE Npower over mis-selling claims

UK energy watchdog Ofgem has launched a formal investigation into RWE npower and the methods the UK’s fourth-biggest gas and electricity group uses to sign up customers.

The regulator announced the investigation after The Sunday Times exposed questionable sales techniques of npower employees. Ofgem will examine potential breaches of licence obligations by npower, which is owned by RWE of Germany.

Ofgem said: “The decision to investigate follows recent allegations that npower sales representatives have been mis-selling energy contracts to customers.”

Meanwhile, Ofgem has also launched an investigation into Scottish & Southern Energy and Iberdrola-owned Scottish Power based on a formal complaint, said the regulator, “alleging abuse of a dominant position in the electricity generation sector arising from constrained capacity on the transmission network, as well as informal inquiries.”

The two companies export electricity to England and Wales, a process that was opened up following the launch four years ago of UK-wide power-trading scheme Betta. But capacity constraints on the interconnector have been an issue among power traders, according to the Financial Times.

UK’s Centrica to buy Strategic Energy

Centrica is to pay $300m cash to buy US electricity supplier Strategic Energy as part of the group’s strategy to expand in North America.

British Gas’s owner said it would merge Strategic Energy and Direct Energy, its North American subsidiary, to form “a top-three supplier of energy to the commercial and industrial market in North America”.

Centrica generated about 25 per cent of its sales in North America last year. Strategic Energy, a subsidiary of Kansas-based Great Plains Energy, supplies power across 11 US states. It sells 21 TWh of power a year, generating revenues of $2bn.

The combined business would supply almost 55 TWh of electricity and gas a year, said Centrica.

E.ON to speed power plant sales while slowing acquisitions

E.ON aims to sell 5 GW of German power generation capacity either this year or next, board member Johannes Teyssen said.

He added that the German utility’s aims to sell the plants in “the adequately near future”. Teyssen declined to comment on possible negotiations with would-be buyers of the plants or E.ON’s high-voltage power network, which the company has also said is up for sale to appease the European Union.

E.ON said it would tread cautiously with new acquisitions after recently buying generating capacity in Russia, gas fields in Norway, and parts of Spanish utility Endesa. It is also committed to a €60bn ($93bn) investment programme up to 2010.

Areva and Mitsubishi nuclear cooperation to widen to fuel

Areva and Mitsubishi Heavy Industries are to enlarge the scope of their nuclear cooperation to include the new area of fuel business.

The companies are contemplating the establishment of a joint business for the supply of PWR, BWR, MOX and gas reactor fuels, focusing on the Japanese market.

According to the agreement, both parties will discuss MHI’s potential investment in Areva’s US nuclear fuel fabrication facility.

They also noted that joint development work on their new reactor, ATMEA 1, has made good progress and have targeted the end of 2009 as the completion of its basic design.

Areva and MHI have also decided to work jointly on the South African tender for which Areva proposed two EPRs, extending the manufacturing cooperation initiated for Finland’s Olkiluoto 3 EPR.

Terna CEO balks at Enel asking price for power assets

Terna SpA CEO Flavio Cattaneo said that the price that Enel SpA is asking for the sale of its high-voltage power line assets is too high.

Cattaneo noted that the power lines are distribution assets but have the same kind of returns as transmission grid assets, reported Thomson Financial.

Enel CEO Fulvio Conti recently said talks other bids for the assets will not be examined unless the talks with the national power grid operator Terna falter. A Milan-based analyst said the power lines to Terna would raise €1.2bn-€1.3bn ($1.9bn-2bn) but €1.3bn-€1.5bn after a tender bid.z

Utility M&A set record in 2007

Global electricity and gas utility mergers and acquisitions hit a new record of $372.5bn in 2007, 25 per cent above the $298.8bn worth of deals completed in 2006, according to a report by PricewaterhouseCoopers.

PWC said the recent credit crunch has had little impact on such deals as 57 per cent of them were in the second half of the year, when the crisis had only begun to hit. The report said that the crisis and the US presidential election are not expected to deter global investment in the US power sector in 2008.

New Zealand’s Vector sells Wellington grid to Chinese firm

New Zealand’s biggest power and gas distributor Vector has agreed to sell its Wellington power network to Hong Kong-based Cheung Kong Infrastructure for NZ$785m ($614m).

The sale is subject to shareholder approval and a clearance from the Overseas Investment Office, Auckland-based Vector said today in a statement to the New Zealand stock exchange. The deal will settle on 1 July and represents a profit of about NZ$195m, the company said.

Vector’s biggest assets are its power and gas networks in Auckland, the country’s largest city, and pipelines delivering natural gas around the nation’s North Island.

Vector said that the proceeds from the sale of its Wellington assets will be used to reduce debt, positioning the company to buy other assets in New Zealand should they become available.

Westinghouse to build first US nuclear power plants for 31 years

Westinghouse Electric, a unit of Japan’s Toshiba, will build two nuclear power plants in southern United States for Georgia Power, the first such projects in the country in 30 years.

The plants will be at the existing Vogtle Electric Generating Plant site near Augusta, Georgia, which already has two reactors, and will be of Westinghouse’s AP1000 design. Shaw Group and Westinghouse won the EPC contract to build the reactors, which will have an 1000 MW capacity. Westinghouse’s new nuclear reactors in the US are expected to be built by 2016 and 2017.

Mott MacDonald strengthens presence in UK nuclear sector with acquisition

Mott MacDonald has strengthened its position as a provider of services to the nuclear sector following the acquisition of UK consultancy Multi Design and an exclusive agreement it has signed with American nuclear specialist Excel Services Corporation.

Multi Design brings world-class skills in architecture and civil, mechanical and electrical engineering in a nuclear environment. Formed in 1984 and based in Stockport, Multi Design has over 100 staff and a turnover of $12m. Mott MacDonald’s acquisition has been heavily involved in commissioning developments at Sellafield and elsewhere.

To further strengthen its position in the sector, Mott MacDonald has entered into an exclusive agreement with American nuclear specialist Excel Services Corporation to bring comprehensive expertise in nuclear reactor technology and licensing to projects outside the USA.

Excel’s focus is the resolution of technical, safety and regulatory issues to help clients achieve the highest level of safety and performance in nuclear facility operations.

E.ON invests €6m in nanotechnology developments

German utility E.ON is to give €6m ($9.3m) to its International Research Initiative to explore the potential of nanotechnology in energy supply.

Teams and researchers from the world over can apply to E.ON to obtain support for projects dealing with the use of nanotechnology in fields such as energy storage, electricity transmission, carbon capture and storage or energy saving.

One application expected to feature heavily in the initiative is nano-LEDs.

The invitation for applications is part of the International Research Initiative successfully launched in 2007 under which E.ON will make €60m available by 2016 for research projects with different lines of emphasis. Teams and researchers at universities or research institutes are eligible for the grants.

Iberdrola Renovables and Cajalon to form clean energy venture

Clean energy firm Iberdrola Renovables and savings bank Caja Rural de Aragon have agreed to form a joint venture to develop clean energy installations in the Aragon region of northeastern Spain.

The new company, in which Iberdrola Renovables holds an 80 per cent share to Caja Rural de Aragon’s (Cajalon) 20 per cent, plans to develop clean energy installations with a total capacity of around 650 MW, including a number of wind farms and a solar thermal plant.

The thermal solar plant is expected to be the region’s largest, with a 50 MW capacity, and taking up a 245-hectare site in the municipalities of Azaila y La Puebla de Hijar in the province of Teruel.

Endesa signs innovation agreement with European utilities

Spanish utility Endesa has signed a deal with fellow European counterparts EDF, EDP and RWE to develop energy efficiency initiatives and electricity networks for the future.

The Innovation Utilities Alliance (IUA) agreement, promoted and co-ordinated by Endesa, aims to facilitate closer links and the open exchange of opinions between members, the companies determined at a round table.

The utilities analyzed what future innovations Endesa expects to make and contrasted them with their own business visions. They then jointly identified lines of action.

Finland: Power company TVO has applied for permission to build the country’s sixth nuclear power plant at Olkiluoto. It will be a 1600 MW facility that will go on-line in in 2011. The site is near two existing reactors and one that is under construction.

India: Engineering company Thermax has signed a contract for the use of Babcock & Wilson’s Radiant sub-critical pressure boiler technology.

Japan: Wind turbine maker Komai Tekko is launching overseas sales, aimed mainly at developing regions. The first shipment of 300 kW turbines will be delivered to the southern Mexican state of Oaxaca.

Portugal: Horizon Wind Energy, owned by Energias de Portugal, has ordered 95 units of the S88-2.1 MW wind turbine from Suzlon and 190 units in 2009.

Scotland: The government has received a an application from ScottishPower to extend its Whitelee wind farm by 36 turbines. This would raise the project’s capacity to 425 MW.

UK: Tidal company Lunar Energy has signed a $1bn deal with Korean Midland Power to create a giant 300-turbine, 300 MW wind farm off the coast of South Korea.

UK: More than 5m people switched energy supplier in the UK in 2007, according to energy regulator Ofgem. The number has risen from 4.8m in 2006.

UK: Services company Pyeroy Group has appointed Malcolm Hood to spearhead its growth in the nuclear decommissioning sector.

USA: Lansdale, Pennsylvania based Neptune Chemical Pump Company has been acquired by the Dover Corporation’s newly formed Pump Solutions Group. The terms of the transaction were not released.

USA: JPMorgan Chase has agreed to invest $150m in AIM quoted wind turbine specialist Clipper Windpower. The investment will help with the manufacturing, delivery and commissioning of Clipper’s 2.5 MW Liberty Turbine into the US market.

USA: American Superconductor has licensed its proprietary Windtec WT1650 wind turbine design and manufacturing expertise exclusively to Ghodawat Industries of India for the Middle East, Southern Asia and Africa.

The Commission investigates: The EC is examining whether the new joint venture created by the Hungarian gas and oil concern MOL and the Czech utility CEZ will restrict the competition in Central Europe.

Russian sell-off: Russia’s former electricity monopoly Unified Energy Systems has auctioned off 49 per cent of UlyanovskEnergo to investment firm MSK Securities for 120m roubles ($5.1m).

Spanish omelette: E.ON is to merge its assets in Spain into a subsidiary called E.ON Iberia Energia. Spanish utility Viesgo, which E.ON is buying from Enel, will be linked to the subsidiary but will retain its name.

Greasing the axel: Addleshaw Goddard has advised French energy company Areva on the acquisition by Axilya, an Areva subsidiary, of RM Consultants. RM is a British company that specializes in nuclear safety assessment.

Termotec goes west: Clyde Bergemann Power Group has acquired Termotec, a German engineering firm that specializes in solutions for thermal process technologies, in particular where gases are applied in industrial heat exchanging procedures.

Iberdrola strikes a blow: Iberdrola Renovables has acquired a 49 per cent interest in wind power firm Eolica 2000, which is developing a 32.3 MW wind farm in Spain’s northern coastal region of Cantabria.

Chinese dreams: Suntech Power Holdings, China’s largest maker of solar-power modules, intends to seek investment opportunities in Australia, New Zealand and the Pacific Islands after opening a regional office in Sydney.

Changing names: Trithor, the leading supplier of high temperature superconductors technology in Europe, has changed its name to Zenergy Power. The group’s American and Australian subsidiaries à‚— formerly known as SC Power Systems and Australian Superconductors à‚— will also be known as Zenergy Power.

Well connected: AB Connectors, a market leader is the design and manufacture of connectors, harnesses and box build systems for harsh environments, has rebranded its US operations to AB Interconnect, Inc.

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