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News digest

Belgium: C-Power has been granted planning permission to build a g475m ($572m), 300 MW offshore wind farm comprising up to 60 turbine units at Thornton Bank. Construction of an initial demonstration phase of six turbines will start in late summer 2004. A further 18 turbine units will be erected in 2006 and the remainder in 2007.

France: The European Commission has indicated that it has approved the acquisition of a controlling stake by Spain’s Endesa in France’s SNET group through an increase in its stake from 30 to 65 per cent.

France: Electricité de France (EDF) is planning to launch an appeal against the European Commission’s December 2003 decision compelling it to reimburse the French state for a financial ‘gift’ of g889m ($1070m) plus interest. EDF has already repaid g1.2bn.

Germany: Siemens Power Generation has shipped the 2000th steam turbine from its industrial steam turbine facility in Goerlitz, Germany. The unit is one of two destined to supply power for a new sugar factory in Cumra, Turkey. The first commercial steam turbine to be manufactured at Goerlitz was delivered in 1906 and was installed at a power plant in Lignica, Poland.

Italy: Abruzzo Energia has been granted planning permission for a g425m ($511m), 800 MW gas fired combined cycle power plant at Gissi in the Chieti province of the Abruzzo region. Site work is expected to start in late summer 2004, with start up scheduled for the end of 2006.

Italy: Italian electricity market operator Gestore Mercato Elettrico (GME) has officially opened the Italian wholesale electricity market. On the first day of trading, market participants traded 286 GWh of electricity, equivalent to 32 per cent of Italian consumption. The market uses Excelergy’s MarketRunner software platform.

Portugal: The Portuguese economy minister has announced that the country’s transmission networks for gas (Transgas) and electricity (REN), which are to be merged, may be privatized in the second half of 2004.

Sweden: Fortum Generation AB of Sweden has awarded GE Energy two contracts worth a total of $3.5m for major turbine refurbishment work at two hydroelectric projects in Sweden. The work will increase the output of the Forshult power plant in Klaràƒ¤lven and the Làƒ¥ngstràƒ¶mmen plant in Ljusnan.

UK: Banham Power, a wholly-owned subsidiary of Banham Poultry, is planning to build a à‚£10m ($18m), 5.5 MW power plant based on pyrolysis and gasification of dried poultry products. The plant will be located near Attleborough in Norfolk and start up is scheduled for 2006.

More ETS NAPs submitted

The UK, Sweden and Italy became the latest countries to submit their emissions trading National Allocation Plans (NAPs) to the European Commission in May. Sweden, like the UK, has set a cap which is more stringent than its Kyoto target, while Italy’s plan appears to be relatively unambitious.

Under the EU Emission Trading Scheme (ETS), due to start in 2005, Sweden has allocated carbon dioxide (CO2) emissions of 22.9m t per annum. This equates to a four per cent reduction in emissions against a Kyoto target of 104 per cent of the 1990 reference level for 2008-12.

The UK NAP sets a 15.2 per cent reduction in carbon emissions, compared to a Kyoto commitment of 12.5 per cent. The UK’s NAP target has, however, been revised downwards from 16.3 per cent following pressure from the business and industrial sector in the country.

Italy’s NAP has received a mixed reaction, with power utilities reported to be generally happy. Under the Italian proposal, a total of 837.4m t of CO2 has been allocated for the first phase of the ETS, which more than adequately compensates for forecast emissions, according to analysts. The rationale behind the plan is that Italy needs to raise generating capacity to overcome security of supply issues.

The UK was the first to publish its NAP in January 2004. The stringent cap set under this original plan was applauded by environmentalists but was expected to be weakened after heavy criticism from the industrial sector and after several other countries submitted relatively weak NAPs. The new NAP represents a 21.5m t CO2 increase on the original draft plan.

Energy suppliers can tap g5bn DSM market

Datamonitor has published research indicating that Western Europe’s major energy users are increasingly keen to limit their energy consumption and are willing to spend g5bn ($6bn) per year on products and services to achieve this. However, most of the region’s utilities are not well positioned to take full advantage of this market.

According to its research, Datamonitor says that increases in wholesale energy prices ” as a result of higher taxes or renewable obligation schemes, for example ” means that Europe’s major energy users are now turning to demand management solutions to control their energy costs. The energy services market in the EU15 is worth g1.3bn per annum, says Datamonitor, and is forecast to reach g5bn per annum by 2010.

The majority of utilities are poorly positioned to access the energy services market directly as they cannot successfully combine their energy supply and energy service operations. Some would be better off exiting the energy supply market and repositioning themselves as service providers, says Datamonitor.

Cogeneration provides boost to services market

The European Union’s directive to promote combined heat and power (CHP) plants is expected to provide the power plant services market in the region with a boost, according to recent analysis by Frost & Sullivan. By 2010, the European power plant services market will generate approximately $4.33bn in annual revenues, says the consultancy firm.

Strong support from governments for CHP and distributed generation is expected to be a key driver for the power plant servicing market. Increasing competition and cross border trade is also expected to boost the market as plant operators seek to enhance cost efficiency.

Small gas fired power plants owned by private investors, rather than large utilities, are likely to present service providers with the best opportunities. Spain is likely to be the fastest growing market due to the addition of large amounts of gas fired generating capacity.

Fuel cell funding

The UK’s Department of Trade and Industry has approved a à‚£3.2m ($5.7m) funding package for the development of fuel cell technology. The funding has been awarded as part of the government’s Climate Change Programme and will be used to make fuel cell technology more efficient and economically viable.

The funding has been awarded to Johnson Matthey, which develops membrane electrode assemblies, fuel processors and catalysed components for low temperature fuel cells.

UCTE publishes final report

The Union for the Coordination of Transmission of Electricity (UCTE) has published its final report into the transmission system failure which caused the loss of power to the whole of mainland Italy in 2003.

The sequence of events leading up to the blackout was triggered by a trip of the 380 kV Mettlen-Lavorgo line in Switzerland caused by a tree flashover. This resulted in line overloads and ultimately the isolation of the Italian grid from the rest of the European network. Up until this initial incident, the system was in a state compliant with necessary security criteria, according to UCTE’s report.

Although countermeasures for returning the system to a secure state were in theory available, a combination of technical, human and organizational factors prevented this from being achieved. The UCTE also found that although the restoration of the Italian system was performed successfully, its duration could have been reduced

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