01 March 2010 00:00 [Source: ICB]
British energy regulator Ofgem may have jumped the gun on funding for new grid investment projects, a parliamentary committee has warned.
The 14-member energy and climate change committee said that funding may have been granted for specific projects "before the completion of a fundamental review of how better use can be made of the existing network."
The warning was contained in a report, The Future of Britain's Electricity Network, released last Tuesday.
The committee said that grid investment will be required to avoid delays in connecting new power stations, but it warned that the existing regulatory framework "may be driving the case for investment at the expense of other more cost-effective options, such as greater management of demand for energy."
However, a spokesman for Ofgem defended the regulator over the existing framework: "Ofgem agrees network-access reforms are needed," he said.
"We have sought to change the arrangements, but have met strong resistance from parts of the industry. This is why we referred the issue to government, so it can take legislative action."
The report also called for government to take a greater role in developing a smart grid.
Committee member and MP Paddy Tipping said this was necessary to "accommodate a far more diverse energy mix that includes a much higher proportion of renewables that cannot respond so easily to fluctuating demand."
UK generator Scottish Power has estimated that a £37bn ($57bn, €42bn) grid investment will be required between now and 2020.
"The scale of the challenge, combined with the time frame over which it is to be achieved, has led many within the industry to call on the government to provide more strategic direction on how it expects the networks to evolve over time," the report said.
Belgian regulator approves network balancing plan
Belgian electrictity regulator CREG has approved a proposal from grid operator Elia over the energy reserves it will buy from other producers to compensate for network imbalances during 2010. CREG confirmed that it had approved Elia's proposal, but has asked the grid operator for more transparency in future submissions. The decision to approve the energy reserves was taken back in December, but only published this week.
Goldman Sachs bullish on WTI oil; Commerzbank disagrees
US investment bank Goldman Sachs forecast that WTI oil prices will climb to $85-95/bbl in 2010, up from the $70-80/bbl range seen since October last year. Goldman cited positive year-on-year growth in US industrial production and expansion of Japan's economy at an annual rate of 4.6% in the fourth quarter of 2009. Germany-based Commerzbank, however, said the recent rally was due mainly to speculation and, given weak fundamentals, oil prices are unlikely to exceed $80/bbl for long.
US regulations equivalent to "economic suicide" - NPRA
Charles Drevna, president of the National Petrochemical & Refiners Association (NPRA) warned that the US would be committing "economic suicide" if it enacted proposed climate-change legislation, carbon dioxide regulation under the Clean Air Act, higher taxes on oil and gas, a Reach-like chemical management program and plant security measures with inherently safer technology (IST). "China and India are doing the exact opposite of what's being proposed in this country. They're talking a great game on climate change, but they sure aren't doing anything. They're waiting for us to jump off that cliff," he stated.
Is Europe's leading publisher of gas and power market information. A series of reports provides news, analysis, benchmark price assessments and indices. Find out more
For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.
Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.
Sample issue >>
My Account/Renew >>
Register for online access >>
|ICIS Top 100 Chemical Companies|
|Download the listing here >>|
Asian Chemical Connections