John Hutton on Nuclear Power and Coal-Fired Power Stations

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In a March 2008 speech to the free-market think tank the Adam Smith Institute, the British Secretary of State for Business, Enterprise & Regulatory Reform, John Hutton, signaled his view of the government's policy direction on new nuclear power and coal-fired power stations.

Backing Big Power Plants

After outlining that the government had introduced an Energy Bill into parliament to promote renewable energy, Hutton turned his attention to the prospect of new centralised power stations. "The end game is to largely decarbonise our electricity mix by the middle of this century," he said.[1]

First he endorsed the need for new nuclear power stations, claiming that "we cannot afford to rule out options which have the potential to make a substantial contribution to meeting Britain’s energy needs" and that they "should play a role in this country’s future energy mix. Why, indeed, I believe they have the potential to play a significantly expanded role in helping to make our electricity production both more secure and cleaner."[1]

Hutton then focused on coal, offering in-principle support for new coal-fired power stations. (The only new coal-fired power station under active consideration at the time was E.ON UK's proposed Kingsnorth Power Station.) "For critics, there’s a belief that coal fired power stations undermine the UK’s leadership position on climate change. In fact the opposite is true ... Our leadership role is best served by the actions we take on capping emissions, carbon pricing and supporting the development of new CCS technology. Not by a gesture of politics."

Hutton argued that the continued fossil fuels would "continue to play an important role in ensuring the flexibility of the electricity generation system" and that winter peaking capacity rely on gas and coal-fired power stations. "We therefore will continue to need this back up from fossil fuels, with coal a key source of that flexibility, as we increase the proportion of renewable energy in our country," he said.

While conceding that "gas is cleaner than coal" he echoed the coal industry's argument that the UK should avoid being reliant on the international gas market. Without specifically stating it, Hutton was referring to wariness in government circles about reliance on gas from Russia or the Middle East.

Hutton's speech was met with dismay by environmentalists, world development campaigns and other political parties. the climate change analyst for Christian Aid, Andrew Pendleton, told the Telegraph that "Gordon Brown says he is committed to helping the developing world. This flies in the face of such sentiments." The executive director of Greenpeace, John Sauven, argued that "when it comes to climate change, Gordon Brown's Government is behaving like Jekyll and Hyde. On the one hand, the Prime Minister accepts we can generate 40 per cent of our electricity from renewables by 2020, plugging the energy gap and slashing emissions, then weeks later his Business Secretary sings the praises of coal, the most climate-wrecking form of power generation known to man."[2]

Speech Extract

The section of his speech, subtitled "Continued need for fossil fuels", was as follows[1].

"But over this period, as we develop low-carbon technologies, we should be under no illusion: generation from fossil fuels will continue to play a leading role."
"Consider some basic arithmetic for electricity generation. Nuclear and renewables jointly account currently for just over 20% of UK electricity generation. By 2020 we may need around 15% renewable energy in order to meet our EU 2020 targets. This could mean a substantial amount of renewable electricity. And a new generation of nuclear plants might maintain or increase the nuclear contribution."
"But that still leaves a significant proportion of electricity, and the majority of overall energy, coming from fossil fuels. I believe very strongly that our job as Government is not to try and dictate the exact mix. A market based approach to allocating scarce resource remains our most effective tool in the fight against climate change – provided we can secure a robust price for carbon."
"As a country we have to accept the reality that, even in meeting our EU 2020 renewables target, fossil fuels will still play a major part for the next couple of decades at the very least. And there is nothing wrong with that – provided we are meeting our international obligations to reduce our carbon emissions."
"For critics, there’s a belief that coal fired power stations undermine the UK’s leadership position on climate change. In fact the opposite is true. Developing economies need to be able to see by the actions that we are taking that it is possible to use indigenous energy reserves as you decarbonise your economy."
"Leadership isn’t about forcing people into making binary choices. Low carbon energy production or fossil fuels. Particularly when the primary goal – substantial emission reductions – can be achieved without having to make binary choices in the short term. The world will use a mix of energy sources for the foreseeable future. Our leadership role is best served by the actions we take on capping emissions, carbon pricing and supporting the development of new CCS technology. Not by a gesture of politics."
"Fossil fuels will continue to play an important role in ensuring the flexibility of the electricity generation system as well. Electricity demand fluctuates continually, but the fluctuations can be very pronounced during winter, requiring rapid short-term increases in production. Neither wind nor nuclear can fulfil that role. We therefore will continue to need this back up from fossil fuels, with coal a key source of that flexibility, as we increase the proportion of renewable energy in our country."
"Gas is cleaner than coal, but an over-reliance on gas would leave us more exposed to the international gas market as our own resources decline. In winter 05/06, with pressures in gas markets, it was coal fired generation that took up the slack, consistently generating about half of our country’s electricity needs throughout the winter."
"It was for these reasons that in our Energy White Paper last year we said that “coal fired generation makes an important contribution to the UK’s energy security and the flexibility of the UK’s energy system, while acknowledging that in order to have a long term future its environmental impact must be managed effectively.” I believe it can."
"That’s why we are taking a global lead on clean coal power generation."
"Within 7 years one of the world’s first commercial scale demonstrator plants will be up and running here in the UK, generating electricity from coal with up to 90% less carbon emitted. Through our competition, the Government is intervening in the right way to help develop this breakthrough technology."
"And we’re already preparing for the technology’s rapid deployment. A Bill is before Parliament now on the regulatory regime, and we are in discussions with our EU partners. And shortly we’ll set out proposals for making carbon capture readiness a mandatory requirement for all future fossil fuel power stations."
"The EU ETS places a firm cap on emissions from the power sector and I believe the energy industry is fast adapting to the emissions trading world. Any decision to invest in fossil fuel generation will be taken in full knowledge that it pays them to deliver low emissions."[1]

Articles and Resources

Sources

  1. 1.0 1.1 1.2 1.3 John Hutton, Secretary of State for Business, Enterprise & Regulatory Reform, "The Future of Utilities", Speech to the Adam Smith Institute, Marriott Hotel, Grosvenor Square, London, March 10, 2008.
  2. Charles Clover, "Government to approve new coal power station", Telegraph (UK), March 10, 2008.

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