Utility Week

Utility Week 12 12 2014

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18 | 12th - 18th December 2014 | UtILItY WeeK Finance & Investment This week Shale plans progress at Scottish Power site 'encouraging' results from exploration near gas storage site mean work will continue Plans to extract shale gas from near Scottish Power's Hatfield gas storage site will move ahead aer project partner Egdon Resources reported encouraging reserve findings at the Doncaster licence area. Egdon is one of the largest players in the UK's burgeon- ing shale development sector and last year approached Scottish Power with plans to undertake exploration work in the licence area, which is owned by the big six utility. During the option period Egdon said it undertook a full evaluation of the site's potential and is "very encouraged" by the results. In return for a share of the licence interest, Egdon will cover all associated costs of the exploration which will take place away from the storage facility. At the end of the exploration phase, Scottish Power will have the option to remain in the project or to pass the remaining licence interests to Egdon Resources. Scottish Power said it is too soon to say whether it will secure gas supplies from the project, but the com- pany could take up to 50 per cent of the extracted gas to supply its customers. Scottish Power is the second of the big six to take steps towards shale development. Centrica holds a 25 per cent stake in Cuadrilla's project in Lancashire. Also, SSE Energy has a five-year oake agreement with the Dart Energy-operated licence near Stirling in Scotland. Other energy players leading the development of shale include French companies GDF Suez and Total. JA eLectrIcItY Nuclear firm signs up to finance scheme NuGeneration (NuGen) and the Treasury have signed a co- operation agreement that starts the process of allowing NuGen access to the UK Guarantee Scheme to promote financing for a new nuclear power station at Moorside. NuGen and HM Treasury will work together to see how the scheme can support an arrange- ment of external project finance for Moorside, the nuclear con- sortium said. NuGen is a UK nuclear company owned by Toshiba and GDF Suez that plans to build a nuclear power plant next to the Sellafield nuclear complex in West Cumbria. The UK Generation Scheme was introduced in 2012 to help companies finance power plants and other infrastructure projects. The government acts as guaran- tor to encourage further invest- ment by outside companies. energY SSEPD opens talks on Shetland energy Scottish and Southern Energy Power Distribution (SSEPD) has said it is seeking views from market participants on the most economic and efficient way to meet the energy needs of the Shetland Islands. The SSE-owned networks company will open a tender for services to secure supply to the Shetland Islands in spring next year, but has asked the market to respond to an initial consulta- tion by 19 December. The Shetland Islands are 200km off the northeast coast of Scotland and offer strong poten- tial for renewable energy devel- opment, but the islands are not connected to the UK electricity system. The Lerwick and Sullom Voe power plants are expected to close in the next few years. The consultation document is available on the SSEPD website. eLectrIcItY Foresight buys UK's largest solar farm Foresight Solar Fund has signed a contract to acquire the 46MWp Landmead solar farm in Oxford- shire, the largest in the UK. The farm is being built by Belectric UK and is expected to be connected to the grid later this month. It will therefore be eligible for the 1.4 ROC rate. The acquisition is subject to the plant being built to the required standard and its suc- cessful connection to the grid. Foresight manages a portfolio of 185MW of UK solar plant. Landmead will increase capacity to 231MWp. Foresight agreed this year to acquire the Kencot and Bournemouth solar farms when they have been connected. Hatfield site is being tested by Egdon Stock watch 1,000 900 2,200 800 2,000 700 1,800 600 1,600 Pennon and United Utilities share Price, JanUary-december 2014 severn trent share Price, JanUary-december 2014 Jan Jan Mar Mar May May Jul Jul Sept Sept Nov Nov The final determinations (made today) have provided certainty for the three publicly listed water companies – Severn Trent, United Utilities, and South West Water's parent company Pennon. Pennon was last week boosted to an eight-year high of 910 pence per share by its enhanced status and Ofwat's "do no harm" principle. Severn Trent and UU are not protected from negative FDs rulings, but possible M+A has maintained steady prices. United Utilities Pennon

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