Utility Week

UTILITY WEEK | 30TH NOVEMBER - 6TH DECEMBER 2018 | 11 Policy & Regulation pence while its domestic counterpart at Flaman- ville is also way behind its due completion date – and its costs are still soaring. Of course, UK interest will focus most on Hinkley Point C and its infamous 35-year £92.50 per megawatt-hour contract for differ- ence strike price. The latter should, though, underwrite EDF's investment in the project. Looking forward, EDF has two obvi- ous priorities – neither of which envisages acquisitions. First, it must take a firm grip of its nuclear new-build programme. Second, it needs to turn round its very stretched finances – and cut its net debt. Of the big six, it is Spain's Iberdrola, which can report the best share price perfor- mance – up by c15 per cent over the past dec- ade. Given that Spain was especially hard hit by the credit crisis, this is impressive. In the UK, following its Scottish Power acquisition, Iberdrola's operations are pre- dominantly north of the border. But, unlike SSE, its vista is expansive – and well beyond its core Spanish business. Iberdrola has various renewable power operations in the US. Furthermore, it is involved in several major projects includ- ing the 1,158 MW Tamega hydro-power com- plex in Portugal, the 800MW Vineyard Wind scheme some 14 miles off the US East Coast and the 714MW East Anglia One offshore wind project in the UK. With these – and many other projects on the go – Iberdrola seems unlikely to pursue radical changes to its very successful strat- egy. Aer all, the company vigorously backed wind power – and especially solar power – far earlier than most. Its current share price rating underlines how these technologies have come of age. More generally, its profitable interna- tional operations – short of any major fail- ings – provide a template as to how large EU energy companies should have developed over the past two decades. While the big six may become the "big five", the surprising acquisition of energy supply minnow First Utility by Shell warrants comment. Of course, for Shell, this acquisi- tion barely features in its vast cash flow. However, the deal seems to be about positioning as electric vehicles become more widespread. In time, millions of motorists will be using more power to charge their electric cars. It will certainly be interesting to see whether Shell – and BP – become more closely involved in the UK energy supply market. The momentum for change is certainly there. Nigel Hawkins, director, Nigel Hawkins Associates CENTRICA (BRITISH GAS) EDF EON RWE (INNOGY/NPOWER) SSE IBERDROLA (SCOTTISH POWER) BIG SIX SHARE PRICES, FIVE YEARS 350 300 250 200 150 100 pence 2014 2015 2016 2017 2018 30 25 20 15 10 5 16.0 14.0 12.0 10.0 8.0 6.0 8.0 7.0 6.0 5.0 4.0 40 30 20 10 0 1,800 1,600 1,400 1,200 1,000 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 € € € €

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