Utility Week

UTILITY Week 17th February 2017

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8 | 17TH - 23RD FEBRUARY 2017 | UTILITY WEEK Policy & Regulation This week UK's nuclear fuel supplies in jeopardy Davey warns Euratom withdrawal could leave UK without raw materials for nuclear plants Former energy minister Sir Ed Davey has warned that the UK could find itself barred from importing fuel for its nuclear power stations following its withdrawal from Euratom. It was revealed in January that the UK will leave Euratom (a European nuclear market governed by EU institutions) as it exits the EU. However, Euratom membership is necessary for nuclear fuels to be legally traded. "As soon as you come out of Euratom it would be illegal for the French to export fuel for the plants that EDF own and run [in the UK] – ie all of our nuclear plants at the moment," Davey told Utility Week. Due to constraints on the storage of nuclear fuel and the long lead time required to order fuel (around 36 months) Davey added: "If we are out of Euratom, there is going to be a period – possibly two years – when we run out of fuel for our nuclear power stations, which in the early or mid-2020s is going to be about 20 per cent of our power supply." Davey described the UK decision to withdraw from Euratom as "extraordinarily stupid" and an "own goal" that will "imperil" the UK's nuclear industry, "threaten to turn the lights out" and undermine the UK's negotiating position during Brexit negotiations. The government has argued that membership of Euratom is incompatible with Brexit. Davey dimissed this as "simply untrue", and said legal experts had assured him it would be "perfectly possible" for a non-EU member state to remain within Euratom. JG ENERGY Labour threatens market shakeup The Competition and Markets Authority (CMA) may have to revisit its two-year-long probe into the energy market if other suppliers follow Npower and Scottish Power's lead on fuel prices, Labour's Alan Whitehead has warned. Speaking to Utility Week, the shadow energy minister said: "We may have to revisit the CMA remedies because we have got to hold the energy companies much more to account." On 3 February Npower raised its standard dual fuel tariff by 9.8 per cent. Scottish Power followed suit with a 7.8 per cent hike on 10 February. Whitehead said the justification for price rises was difficult to assess given the lack of transparency surrounding suppliers' costs. He described the CMA investigation as a "missed opportunity" to secure "proper and transparent relationships". ENERGY Ombudsman wants broker regulation Energy ombudsman Debra Vaughan has called for utility brokers to be regulated in order to increase consumer confidence in utility markets and in brokers themselves. Speaking to Utility Week, Vaughan said that complaints about suppliers of energy to microbusinesses oen related to the sales behaviour of brokers. "Because there is no regulation or redress in place for complaints about brokers, we take the complaint about the supplier, which may not have done anything wrong. "Separating out the two parts of the energy market which are otherwise linked, and putting a clear responsibility on each area of the market should help improve customer awareness and confidence in the companies they use." (See analysis, p28) ENERGY Yeo backs call for CCS obligation The creation of a carbon capture and storage obligation scheme is "absolutely vital", according to Tim Yeo, former chair of parliament's energy and climate change committee. A similar mechanism to the renewables obligation for low-carbon generation would be the "simplest and most rational policy available" to support the delivery of carbon capture and storage (CCS) in the UK, Yeo told delegates at an event in London. Fossil fuel suppliers would have to store a percentage of the carbon content of their fuels, or buy enough CCS certificates from others to make up any shortfall. The UK's nuclear fuel supplies could be cut off Political Agenda David Blackman "Ministers ducked questions on the Euratom exit fallout" The recent announcement that the UK will pull out of the Euratom treaty has le many wondering whether the government's Brexit le hand knows what its energy policy right hand is doing. The Euratom exit, outlined in the recent white paper on exiting the EU, was a bombshell for the nuclear industry. It is driven by the UK government's determination to escape the jurisdiction of the European Court of Justice, which handed of questions ducked on the issue in the House of Commons The upcoming Brexit negotiations will be a fiendishly complicated and fraught process that will involve balancing a host of competing interests. In the late night horse trading, it is all too easy to see how the nuclear sector's interests could drop down a packed agenda. With the UK facing an energy crunch, it seems a bad time to demolish the regulatory bedrock underpinning the nuclear sector. out some bruising treatment to Theresa May when she was home secretary. The move may please the Eurosceptic diehards in the Conservative Party, but it is fraught with risk for Britain's drive to achieve energy security. Former energy and climate change secretary Sir Ed Davey issued a dire warning that Euratom withdrawal imperils the transfer of nuclear materials from EU member states to the UK. It also ends UK participation in cutting edge research such as Euratom's fusion project. Ministers have few answers about the implications of exiting Euratom, judging by the number

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