Discussing Energy Economics on the Internet

On Retail Competition

Posted in Retail,Texas,UK by Cheryl Morgan on the March 3rd, 2009

Over at Knowledge Problem, Michael Giberson reports that a shake-out is occurring in the Texas retail market and asks whether vertical integration might have been a better option for Texas.

I don’t have Sally Hunt’s book to hand, and I know that there are complex issues involved in this case, but here are some quick thoughts.

1. The end result of vertical integration is a situation like we have in the UK where there is no serious wholesale market in electricity, and consequently much less transparency in the market. Transparency, in general, is a good thing, and I don’t like doing without it.

2. Texas is experiencing a shake-out of retailers because it, like California, made the foolish assumption that the retail market would see enthusiastic and successful new entry. All of the experience around the world suggests that this does not happen. Energy retailing is a business in which economies of scale are everything, and new entry is practically impossible. The Texas market will eventually settle down to a small number of very large companies all of which, I suspect, will also have retail businesses in other states.

March EEnergy Informer

Posted in EEnergy Informer by Cheryl Morgan on the February 27th, 2009

The March 2009 issue of EEnergy Informer is now available. Here is the contents list:

  • Renewable Stimulus Creating Jobs Overseas?
  • Sweden to Reverse Nuclear Ban
  • IRENA: Do We Need Yet Another Energy Agency?
  • Will A LNG Flood Lead To The Collapse Of Natural Gas Prices?
  • Grid Operators Envision Windy Future
  • A National Renewable Portfolio Standard: What Is There Not To Like?
  • PJM Puts Price Tag On Climate Change Proposals
  • Renewables Now Come In GW Size
  • Southern Company Unit Applies For IGCC
  • A Better Shade Of Green

The article on LNG is available for free. All other articles currently require a subscription to the paper edition of the magazine. To subscribe to EEnergy Informer click here.

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Italy Joins New Nuke Club

Posted in France,Italy,Nuclear by Cheryl Morgan on the February 25th, 2009

Prime Minister Berlusconi and President Sarkozy have signed an agreement that will see EdF and Enel collaborate on the construction of at least four new nuclear power stations in Italy. The first plant is expected to be online in 2020. This is despite a referendum in 1987 that saw Italy close all operational nuclear plants in the country. EurActive has more details.

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Piebalgs Speaks

Posted in Europe,Renewables by Cheryl Morgan on the February 11th, 2009

The latest post on EU Energy Policy is by none other than Andris Piebalgs, Europe’s Commissioner for Energy. In it he makes a confident plea for a revolution in energy technology:

It is clear that we are at the beginning of what has correctly been called the “third industrial revolution” – the rapid development of an entirely new energy system. We can expect a massive shift towards a carbon-free electricity system, huge pressure to reduce energy consumption and transport on the basis of renewable electricity. To make this shift in a manner that maintains, and in fact increases the EU’s competitiveness, means that stimulating rapid technological development in these areas has to be a central part of the EU’s energy policy. Indeed, this is at the heart of the question: how can the EU turn the challenges of climate change and energy security into an opportunity?

Read the whole article here.

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No Aliens After All

Posted in UK,Wind by Cheryl Morgan on the February 11th, 2009

A while back I linked to a story about a catastrophic failure of a UK wind turbine that people were speculating might have been caused by a passing UFO. Sadly the real explanation is much more prosaic. As this Guardian report reveals, the actual explanation was metal fatigue in some of the bolts holding the turbine together. Enercon, who made the turbine, is embarrassed; Ecotricity, who own the site, are disappointed that their time in the limelight appears to be over; and the British newspapers are off looking for the next promising alien invasion story.

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Germans Take Over French Power Trading

Posted in Europe,Trading by Cheryl Morgan on the February 6th, 2009

Consolidation of energy trading markets continues with Germany’s EEX announcing that they will take over the operation of France’s Powernext. Platts has the full details.

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Poland Too

Posted in Nuclear,Poland by Cheryl Morgan on the February 6th, 2009

The rush to nuclear in Europe is gathering pace. Poland has announced that it plans to build two new nukes.

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Sweden Re-Thinks Nuclear

Posted in Nordic,Nuclear by Cheryl Morgan on the February 5th, 2009

In 1980 Sweden held a referendum on the use of nuclear power, and the people voted to phase it out. Now, however, the current government is having a re-think. Just like the UK, Sweden has a fleet of aging nuclear plants that need to be replaced with something. As coal and gas are now considered as dangerous, if nor more so, than nuclear, building new nukes is back on the agenda. The Guardian has more details.

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GdF Joins SSE/Iberdrola Group

Posted in Nuclear,UK by Cheryl Morgan on the February 4th, 2009

The consortium formed by Scottish & Southern (SSE) and Iberdrola, with the purpose of building new nuclear plants in the UK, has a new member. The BBC reports that Gaz de France (GdF) has joined the group. The article also mentions a rival consortium comprised of RWE and E.ON. It is getting crowded in that market.

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FERC Goes Green?

Posted in Regulation,USA Federal by Cheryl Morgan on the February 3rd, 2009

Energy Legal Blog has an interesting post up about Commissioner Jon Wellinghoff, the new acting FERC Chairman.

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