News digest

Europe: A report from Prospex Research has found that European electricity trading volumes increased in 2003, with the largest volumes seen in Germany. Excluding the Nordic region, total power trading volumes in Western Europe in the over-the-counter and exchange-traded markets grew by 32 per cent in 2003.

Finland: Teollisuuden Voima Oy (TVO) has signed a contract with Areva for the supply of uranium and transformation services required to manufacture nuclear fuel for the Olkiluoto 3 reactor. The g100m ($121m) contract covers the supply of uranium concentrates, conversion and enrichment services for the first reactor core and the following two reloads.

Germany: German investigators have searched several Siemens AG offices in Germany in connection with a bribery probe in Italy involving former managers of the company. The Italian investigation is trying to determine whether three former Siemens managers paid bribes to former employees of Enel to secure gas turbine contracts.

Ireland: ESB Ireland is planning to construct a £275m ($500m), 400 MW combined cycle gas turbine plant at the existing Aghada site. Siemens, Alstom and a partnership of Mitsubishi Heavy Industries and NEL Power are expected to place bids for the project.

Italy: Foster Wheeler Italiana has been awarded two contracts by ERG Raffinerie Mediterranee for the expansion of an existing power station and construction of a new ultra-desulphurization unit at the ISAB refinery at Priolo Gargallo, Italy. Foster Wheeler will add a 72 MW gas turbine and heat recovery boiler to the existing power plant, bringing its capacity to 99 MW.

Italy: Rolls-Royce and the University of Genoa in Italy have formally inaugurated a university technology centre (UTC) to conduct research into fuel cell systems. Rolls-Royce recently formed a new company – Rolls-Royce Fuel Cell Systems Limited – dedicated to the exploitation of predominantly solid oxide fuel cells.

Sweden: Swedish and Norwegian power grid operators Svenska Kraftnät and Statnett plan to construct an 850 MW high voltage interconnector between Sweden and Norway. The line would replace an existing 550 MW line, and would be completed by 2009.

UK: Cleanaway Ltd is planning to develop a £12m ($22m) landfill gas power plant at the Pitsea landfill site near Basildon, Essex. The initial plant will be 8 MW, with an option to increase it to 14 MW depending on gas availability.

Eurelectric calls for coherent framework

Hans Haider, president of the Union of the Electricity Industry (Eurelectric), has called for a more coherent energy regulatory framework in Europe to help meet the goals of economic development, energy security and environmental sustainability.

Speaking at Eurelectric’s annual conference in France, Haider outlined a number of recommendations to help promote effective competition.

A key theme of the conference was that in order to maintain security and quality of supply, the market will need to be attractive and profitable enough to drive investment in power generation. Haider underlined that this can only be achieved if the regulatory framework can provide sufficient stability, reliability and competitiveness.

Haider called on policy makers and regulators to commit to allowing the market to work by confining intervention to only what is strictly needed, and avoiding the use of measures such as price caps. He stressed the need to encourage the development of a wholesale market with liquidity and depth.

Speaking at the Eurelectric conference, Christopher Jones of the European Commission’s DG Transport and Energy said that the Commission will start “necessary procedures” against EU member states which fail to meet the July 1 deadline for liberalization of the electricity sector.

Renewables 2004 sets targets

The International Conference for Renewable Energies was last month declared a success by its German hosts when its aim of establishing an International Action Plan on renewable energy was achieved. It also succeeded in agreement on a shared Political Declaration of Intent to supply one billion people with energy from renewable sources by 2015.

Held in Bonn in early June, the conference was attended by over 100 governments, many of which submitted an action plan outlining their commitments to renewable energy. Incorporated into an International Action Plan, these targets are expected to mobilize billions in investments in wind, solar, biomass and geothermal energy, according to Jürgen Trittin, Germany’s federal environment minister.

Particularly ambitious commitments were submitted by China and the Philippines. The World Bank also announced that it will increase funding in the renewable energy and

energy efficiency sectors by 20 per cent per year for the next five years.

China announced that by 2010 it plans to have increased the share of renewables in its total installed capacity to ten per cent. This is equivalent to 60 GW, and is expected to be made up from 50 GW of small hydro installations, 4 GW of wind capacity, 6 GW of biomass and 450 MW of solar power.

Capgemini surveys utilities

Capgemini’s third annual Global Utilities Survey has highlighted a number of issues faced by the European and global electricity markets as they grow increasingly competitive. The report flagged particular concerns over the customer switching process and the challenge of customer data quality.

Security of supply was shown by the survey’s respondents to be an increasing concern for electricity and gas companies, although a lack of clarity exists over who should be responsible for securing electricity supply. Further findings of the report show that environmental issues are becoming increasingly important, and that electricity and gas utility markets remain the domain of incumbents.

Scotland rewires

UK utility ScottishPower has announced a £400m ($732m) project to upgrade high voltage power lines in Scotland in order to meet the demands of an increased level of renewable energy in the system. The new lines will bring the biggest improvement to the country’s electricity grid in more than 40 years, says ScottishPower.

The plan forms part of proposals outlined in the Renewable Energy Transmission Study (RETS), which ScottishPower, Scottish & Southern Energy and National Grid Company undertook on behalf of the UK’s Department of Trade and Industry. The objective of RETS is to increase the capability of the UK’s electricity network to accommodate renewable generation in two 2000 MW stages.

Eclipse starts offshore hybrid plant

Eclipse Energy has started the engineering design and consultation phase of its innovative ‘wind and gas to wire’ project in the east Irish Sea. The Ormonde project will be centered on two undeveloped natural gas fields and an offshore wind farm, and will have a capacity of up to 200 MW.

The successful deployment of this hybrid concept will be a global first, and will demonstrate the viability of using hydrocarbon reserves as a catalyst to develop offshore wind farms.

The project will involve the construction of wind turbines and gas turbines fuelled by the natural gas fields.